By James A. Loyola
Universal Robina Corporation (URC), the food and beverage arm of the Gokongwei group, has upgraded its sales growth target for the year due to the recovery of its coffee business as well as the strong performance of its other products.
In an interview after the firm’s annual stockholders’ meeting, URC President Irwin Lee said “we earlier said we want to make sure of organic growth in themid single digits.”
However, Lee noted that, “it looks like we can make the high single digits. You saw the first quarter results. We are going to push 7 to 9 percent growth.”
Meanwhile, Lee said “bottom-line is looking good. Our commitment is to hold margins. That means whatever is the topline growth, that will also be the bottom-line growth.”
URC has managed to recover market share for its coffee product which accounts for the bulk of its revenues. Lee said they dropped to 20 percent share in coffee mixes, which accounts for 95 percent of the market, but has regained market share to around 25 percent.
Aside from strong growth in coffee due to a relaunch of existing brands, Lee said URC’s other products also performed well such as chips, biscuits, and chocolates.
“Our Nissin noodles are also growing, C2 bottled tea and water. Almost all of our businesses are contributing to growth,” he noted.
Because of the growth in sales, URC is planning to expand existing production capacity, particularly for its branded snack foods.
URC earmarked up to P9 billion in capital expenditures (capex), to be spent equally on capacity expansion and regulatory requirements as well as working capital.