Gokongweis’ food arm struggles with soaring costs as earnings drop

Universal Robina Corp. of the bilyonaryo Gokongwei family took a hit from higher costs despite brisk sales.

URC said its net income tumbled by 23 percent to P6.2 billion, weighed down by material cost increases.

Higher costs offset the 23 percent jump in sales to P71.1 billion with all business units posting double-digit growth. Operating income inched up by two percent to P7.4 billion.

Total sales of the group’s branded consumer foods, excluding packaging, grew 27 percent to P50.7 billion on record sales from the Philippine business which jumped 20 percent to P35.1 billion and strong overseas operations.

Revenues from the International business surged 43 percent to P15.6 billion in revenues as the strong sales momentum from key markets continued into the second quarter.

Agro-industrial and commodities saw a 15 percent rise in revenues to P19.4 billion on higher selling prices and a robust pet foods business.

Sugar and renewables also posted strong growth despite lower output caused by tighter cane supply in the country.

URC president and CEO Irwin Lee expects the company to sustain its sales momentum as consumer demand continues to be resilient across the region.

“As we continue to navigate global headwinds, we remain confident that we will be able to continue increasing our absolute profits as we couple strong topline growth with our reinforced cost savings initiatives,” Lee said.

URC said its financial position remains healthy, with a cash balance of P13.3 billion. The company paid out Php 7.6 billion in dividends last April 29, an increase of almost five percent versus 2021.

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