By Leslie D. Venzon
MANILA, May 12 (PNA) — D&L Industries, a listed food and plastic input manufacturer, is increasing its capital expenditures (capex) this year by 20 percent to Php340 million to meet strong domestic demand driven by higher economic growth.
“We normally see a bump in spending whenever there is an election, especially presidential elections…We expect that to happen that this year until the beginning of next year. Bigger sales are coming from election-related spending,” said D&L chief finance officer Alvin Lao.
Lao is optimistic about the outlook of its businesses –oleochemicals and other specialty chemicals, aerosols and food ingredients– this year on the back of robust consumer spending.
He expects the recovery of its specialty plastic business in the next quarters as the port congestion in Manila is addressed.
Net income of specialty plastics went up two percent in 2014 though sales were down 14 percent as the congestion at the ports created a challenging operating environment for the business. Half of its output is exported.
D&L Industries posted a 16-percent surge in profit in the first quarter of 2015 at Php512 million.
First-quarter revenues rose 15 percent, driven by volume growth in food ingredients and oleochemicals.
High margin specialties, which accounted for 59 percent of revenues, improved margins during the period.
Specialty ingredients grew considerably, supported by new product developments mostly in the food service industry.
Oleochemicals continue to drive volume and margin growth in the business.
Biodiesel still performed strongly, supported by significant and steady progress in oleochemicalspecialties as emphasis on sustainability in home care and personal care industries, as well as health and wellness, gained greater momentum globally.
Aerosols delivered outstanding results year-on-year, with revenues and net income went 42 percent and 38 percent, respectively. (PNA)