Poultry and feeds firm Vitarich Corporation reported a net income of P89.4 million last year, nearly 10 times the P9.3 million earned in 2020, on the back of record revenues.

In a disclosure to the Philippine Stock Exchange, the firm said revenues hit an all-time high of P9.7 billion, up 23% year-on-year driven by growth in all three business segments.

Vitarich President and CEO Rocco Sarmiento said “2021 not only delivered new revenue records across segments, but also pointed to higher long-term volume growth.”

He added that, “Our strategy to expand our capabilities has been validated by market trends toward rising consumption of meat products and convenience food. This formed the basis of our recent capital investments in the business, and as a result, we have good revenue visibility going into 2022.”

Cost of goods increased 21 percent to P8.9 billion in relation to higher sales volume and prices of raw materials such as wheat, soybean, and corn which rose by an average of 12 percent compared to the prior year.

The cost inflation was due to several factors, including logistics challenges due to COVID-19, reimposed series of quarantine measures in the third quarter, as well as supply disruptions for soybeans in the fourth quarter due to high demand from China, increasing domestic use in the U.S., and lower output from Brazil and Argentina.

Revenues from the Feeds segment, which accounted for 48 percent of total sales, were up 14 percent to P4.7 billion with volumes reaching the highest levels ever for tie-up and commercial customers, such as distributors and direct farms.

Sales volume climbed 12 percent while average selling prices inched up modestly by 3 percent.

Revenues from the Foods segment, which accounted for 44 percent of revenues, accelerated by 36 percent to P4.2 billion due to a 21 percent increase in sales volume and 12 percent increase in average selling prices.

Meanwhile, revenues from the Farms segment, which accounted for the remaining 8 percent, registered a 19 percent increase to P778.0 million. Fair value adjustments on biological assets amounting to P55.1 million was recognized as part of revenues and P78.0 million as part of cost of goods. The Farms segment is involved in the production of day-old chicks and pullets.

“We continue to execute on the factors we can control, including new products, improved customer satisfaction scores, enhanced processes, and engaged stakeholder relationships, said Sarmiento. 


He added that, “Looking ahead, we expect revenues to stay robust, but the ongoing challenges will temper the full impact of sales growth on our earnings. Supply chain headwinds will persist and pressure our costs in raw materials and transportation.”

“In view of these elevated input costs, we will continuously reconfigure our purchasing approach and explore new grain and protein sources to reduce dependency on corn, wheat, and soybean meal. We are positive that higher volumes, cost efficiency, and responsible price increases will help us meet our performance objectives while ensuring that our products remain affordable,” Sarmiento noted.