D&L Industries Inc., the country’s top specialty food ingredients and oleochemicals producer, is optimistic that 2026 will be a better year for its business even as it continues to target a 10-percent profit growth for 2025.

“From what we see, interest rates are coming down—not just in the Philippines, but even in the US [United States] and in other markets as well. That usually has a big impact on the economy. So, from that perspective, 2026 should be better,” D&L President and Chief Executive Officer (CEO) Alvin D. Lao said in a virtual media briefing.

He also noted, “You can see that our exports are continuing to do well. We have a lot more [overseas] customers lined up, and we have a lot more plans to continue to grow exports.”

“Just looking at exports alone, revenue grew by 20 percent [in the first nine months of 2025], gross profits are higher by 22 percent, and then the blended gross profit margin for exports is 17.2 percent, which is higher than the domestic blended gross profit margin, which is 11.4 percent,” Lao said.

D&L has set a profit growth target of 10 percent for this year, and it has reported an eight-percent growth for the first nine months of 2025.

“We’re not that far away from the 10-percent target, and we’re going to try our best to hit that,” Lao said, but added that it will depend on the Philippine economy continuing to do relatively well and on coconut oil prices continuing to go down.

Lao said, “For the rest of the year, we remain cautiously optimistic. While some customers continue to face pressure from elevated input costs, improving macro fundamentals—such as easing inflation and interest rates—should help spur economic activity.”

“Regardless of near-term market noise, our focus remains on executing our long-term strategies. We are still in the early stages of realizing the full potential of our Batangas plant, which we believe will anchor the next phase of our growth,” he added.

D&L’s recurring income reached ₱1.95 billion in the first nine months of 2025, up eight percent from the ₱1.85 billion earned in the same period last year. In the third quarter of 2025, recurring income reached ₱554 million, higher by 12 percent year-on-year.

The growth in earnings was mainly driven by resilient volume growth amid elevated coconut oil prices.

“The operating environment remains challenging, with coconut oil prices reaching a new all-time high in the third quarter. At its peak, prices have nearly tripled from the lows recorded just two years ago,” said Lao.

He noted, however, that “despite this, we delivered an eight-percent earnings growth for the period—driven mainly by healthy volume expansion, which underscores the fundamental strength of our business.

“While we cannot control commodity price movements, we can control how we navigate these challenges and where we direct our focus and resources. In this volatile environment, we continue to stay true to our core—investing in R&D [research and development] and innovation.

“We believe these investments will enable us to develop higher-value, more technical, and differentiated solutions for our customers, helping insulate the business from macroeconomic volatility,” Lao said.

D&L’s volume growth remains resilient, up 11 percent year-on-year, despite the unprecedented increase in coconut oil prices. Coconut oil, a key raw material for the company, saw its average price surge by 78 percent year-on-year during the period.

The firm expects margins to fully recover once commodity prices begin to normalize, as run-ups in coconut oil prices have historically been followed by equally swift corrections.

As margins normalize, the underlying strength of the business—underpinned by healthy volume growth—is expected to translate more visibly into earnings.

D&L’s export business continued to perform strongly, with revenues up 20 percent year-on-year to ₱11 billion in the first nine months of 2025. Export gross profit rose by 22 percent year-on-year, outpacing the eight-percent year-on-year growth recorded in the domestic business.

Exports remain a key growth driver for the company despite global uncertainties, including the recent implementation of new US tariffs. D&L does not expect a material impact from these higher tariffs, as the US accounts for only around three percent of total revenues.

The unprecedented surge in commodity prices weighed on the firm’s food ingredients segment, which recorded a 66-percent year-on-year decline in earnings for the period.

Nonetheless, the segment’s underlying strength remains evident, with total volumes up seven percent year-on-year—driven primarily by a robust 22-percent year-on-year growth in the high-margin specialty products (HMSP) segment.

Chemrez Technologies delivered strong results, with volumes increasing by 30 percent and net income rising 88 percent year-on-year. Growth was supported by sustained global demand for coconut oil-derived products and the implementation of the higher mandated biodiesel blend.

Building on a strong 32-percent increase in net income in the first nine months last year, the specialty plastics segment continued to deliver positive results, with earnings up two percent year-on-year in the first nine months of 2025.

The consumer products original design manufacturer (ODM) division sustained strong momentum, posting a 50-percent year-on-year increase in earnings for the period. The company expects growth to continue as easing inflation boosts demand for consumer discretionary products under this segment.