D&L Industries Inc., the country’s top producer of specialty food ingredients and oleochemicals, expects its profitability to continue growing in the coming years as it ramps up exports, giving it confidence that it will sustain its strong dividend payouts.

In an online media briefing after the firm’s annual stockholders’ meeting, D&L President and CEO Alvin D. Lao said cash flow will continue to be healthy and “we do expect profitability to continue to increase. So, we’re quite comfortable in terms of the outlook of future years’ dividends.”

Meanwhile, he said that, “as part of the efforts of ramping up production in our Batangas plant, we’re focusing on exports and, because of that, we are visiting clients in other countries, attending trade shows and exhibitions, to try and drum up business. Because of that, we are able to get new clients in new markets all the time.”

While global uncertainties seem to be the dominant theme affecting business sentiment in the near-term, D&L remains unfazed and continues to focus on building resiliency and long-term growth strategies.

“Management believes that with D&L’s product portfolio, the majority of which cater to basic and essential industries, the company will continue to grow and be relevant in an ever-changing business environment and world trade order.

“Over the longer-term, management has a lot of confidence that the new investments that the company has made over the past years will pave the way for higher and more sustainable profit growth,” D&L said.

During the stockholders’ meeting D&L Industries declared total cash dividends of ₱1.52 billion, higher than the ₱1.49 billion payout last year.

This year’s dividends consist of a regular cash dividend of ₱0.164 per share, plus a special cash dividend of ₱0.049 per share, to shareholders of record as of June 18. Ex-date is on June 17 and payment will be made within 30 days of the dividend declaration or on July 2.

“Management remains highly committed to its regular dividend policy of a 50 percent payout ratio based on prior year’s net income. On top of that, for the fifth consecutive year since the peak of the pandemic in 2020, D&L was able to declare special dividends,” the company said.

Including this year’s payment, the Company has returned a total of ₱18.3 billion in cash to shareholders through dividends since the IPO in 2012. The company also paid a 100 percent stock dividend in September 2015.

This year’s special dividends amount to 15 percent of prior year’s net income. In total, this year’s payout ratio remains at 65 percent of prior year’s net income, consistent with the payout ratio over the past three years. The ₱0.213 per share dividend this year translates to a 3.8 percent yield based on May 30’s closing price of ₱5.64 per share.

In 2024, D&L Industries’ recurring income reached ₱2.3 billion, or earnings per share of ₱0.328 centavos. This is higher by two percent year-on-year.

Despite the higher operating and interest expenses associated with the new plant in Batangas, the continued ramp up in operations helped offset the incremental expenses.

The new plant turned profitable in 2014, booking a net profit of ₱246 million for the full year. This is ahead of the initial schedule of within two years of operations which was based on the performance of the older plants that the company had built over the years.

With the boost coming from the Batangas plant, D&L’s income for the first quarter of 2025 grew by 10 percent YoY to ₱681 million despite macroeconomic uncertainties during the period.

With the increasing income contribution from Batangas plant, the company’s return ratios have started to see improvements.

ROE stood at 12.1 percent for the quarter, higher by 1.4 ppts from the full year 2024 level. Meanwhile, ROIC stood at 10 percent for the quarter, higher by one ppt from the full-year 2024 level. Management targets a steady improvement in both ratios to reach mid to high-teens in the medium-term.