The Po family’s Century Pacific Food Inc. (CNPF), one of the country’s leading food and beverage companies, reported a 10 percent year-on-year improvement in net income to P4.6 billion in the first nine months of 2023.

In a disclosure to the Philippine Stock Exchange (PSE), the firm said it delivered consistent growth performance in the third quarter of 2023. Profits began to gain momentum during the three-month period, up by 13 percent year-on-year on the back of favorable commodities and a sustained topline.

Consolidated revenues for the first nine months of the year amounted to P50.5 billion, registering a growth of seven percent compared to the same period last year. 

This was primarily driven by the Branded sales, which saw a 12 percent year-on-year growth rate as domestic demand for consumer staples and value for money goods remained resilient. 

Third quarter sales were up by seven percent versus the comparable period in 2022, buoyed by Branded segment’s 14 percent growth for the period.

CNPF’s Branded business is composed of the Marine, Meat, Milk, and other emerging segments. Comprising the majority of the Company’s topline, it is the strategic growth driver of CNPF catering predominantly to the domestic market. 

For the nine-month period in particular, Milk and other emerging segments outperformed, while core segments sustained their growth performance.

Meanwhile, the Company’s OEM Tuna and Coconut Exports segment was challenged for the first nine months, declining by 10 percent year-to-date. 

Third quarter 2023 revenues were likewise down by 15 percent versus the same period last year. Apart from a high base in 2022, the OEM business was beset by softer markets in light of global inflation. Nonetheless, on a quarterly basis, sales were largely sustained.

“Amidst headwinds, we saw domestic consumer demand for our brands and products remain resilient, underscoring the relevance of affordability and accessibility. We focused our programs towards value-for-money offerings and innovations,” said CNPF Chief Financial Officer Richard Manapat.

He added that, “we also continued to benefit from a diversified, all-weather portfolio, which allowed us to deliver a consistent growth performance for both the topline and the bottomline despite a complex operating environment.”

In terms of profitability, CNPF began to see margin improvements in the third quarter when gross margin climbed by 130 basis points versus the same period last year to 24.6 percent, softening the contraction year-to-date gross margins, which landed at 24.2 percent, to 30 basis points compared to the first nine months of 2022. 

This can be attributed to favorable movements in most of the Company’s major raw materials as well as cost optimization measures. Operating expenses as a percentage of sales was at 13 percent for the nine-month period, 110 basis points less than last year.

According to Manapat, this was driven by cost management, with OPEX spending deliberately skewed towards the second half of the year to support key innovations and demand generating activities.