San Miguel Pure Foods, Inc. (SMPFI), the food arm of conglomerate San Miguel Corp., reported a 19% increase in operating income for the first nine months of 2014 to P4.3 billion despite the negative effect of the Manila port congestion and typhoon Glenda on its operations.
In a statement, SMPFI said growth was driven by favorable selling prices, lower wheat costs and improved availability of key raw materials that resulted in bigger margins for its agro, flour milling, and dairy services, “tempering the adverse impact of the Manila port congestion and typhoon Glenda on operations.”
Typhoon Glenda (international name Rammasun), which passed over landmass in the Philippines in July, is the second strongest typhoon to hit the country after deadly super typhoon Yolanda in November last year.
The Manila port congestion, which was triggered by the implementation of the Manila daytime truck ban in February this year, caused disruptions to the country’s supply chain and logistics.
Food and beverage company RFM Corp. recently said its sales in the first nine months of this year could have been higher “if not for the bottlenecks in operations caused by the Manila port congestion, aggravated by the delivery trucks shortage due to the poorly timed implementation of rules on franchised trucking services.”
SMPFI said its revenue in the first nine months went up 4% to P74.4 billion, while net income registered at P2 billion.
Its agro and milling businesses—composed of BMEG Feeds, Magnolia Chicken, Monterey meats, and Baron and King flours—delivered a combined revenue growth of 7% on higher volumes and better selling prices. However, SMPFI noted that the sales volume of Magnolia chicken “would have been much higher had it not been for typhoon Glenda” which affected its broiler supply in the third quarter.
Its branded value-added business, on the other hand, posted a combined revenue growth of 2%, although its processed meat business “took a hit” from the Manila port congestion.
Despite the challenges, SMPFI said it is positive that holiday spending will boost volumes and revenues in the fourth quarter to enable the company to breach the P100-billion revenue mark in 2014.
