Food and beverage firm Monde Nissin Corporation reported a turnaround last year with a net income of ₱450 million from a net loss of ₱625 million in 2023 even though its meat alternative business continues to rack up losses.
In a disclosure to the Philippine Stock Exchange, the firm said attributable core net income rose 28.6 percent year-on-year to ₱9.8 billion last year with growth driven by a 23.4 percent year-on-year increase in its Asia-Pacific Branded Food and Beverage (APAC BFB)
core net income, which reached ₱10.6 billion.
However, reported net income amounted to only ₱450 million as this was offset by a ₱6.8 billion after-tax, non-cash impairment of assets in the Meat Alternative business and a ₱2.6 billion non-cash accounting loss on the fair value of the Meat Alternative guaranty asset.
“Our APAC BFB business delivered strong top-line growth and profitability, resulting in record revenues and core net income for both the quarter and the year,” said Monde Nissin Chief Executive Officer Henry Soesanto.
He added that, “This success was driven by volume growth across all categories. We anticipate mid-single-digit revenue growth in 2025, while we expect full year gross margin to be broadly in-line with last year.”
Regarding its Meat Alternative business, Soesanto noted that, “We achieved EBITDA neutral for the year by focusing on cost reduction and efficiency improvements. However, the challenging environment led to an additional impairment of ₱6.8 billion after tax, due to a tempered EBITDA cash flow forecast and a higher Weighted Average Cost of Capital (WACC).”
Additionally, he said “unfavorable market conditions resulted in a mark-to-market loss of P2.6 billion on our guaranty asset.
“Despite ongoing revenue challenges, we expect a noticeable and durable improvement in EBITDA this year compared to the largely breakeven numbers we have seen over the past couple of years, reducing the risk of further impairments.”
Consolidated revenue for the full year increased by 3.7 percent to ₱83.1 billion as gross profit grew by 16 percent to ₱28.7 billion.
Monde Nissin’s APAC BFB net sales for the full year grew by 5.4 percent to ₱69.5 billion largely driven by volume growth in all categories. The domestic business grew by 5.0 percent for the full year.
Meat Alternative (Quorn Foods) revenue declined by 9.3 percent on a comparable and constant currency basis for 2024 as category softness continues. On a reported basis, revenue declined by 4.5 percent.
Gross margin for the full year improved by 28 bps year-on-year to 21.5 percent due to lower raw materials and utilities costs and lower inventory obsolescence, partially offset by lower production volume as it brought down inventory, impacting fixed costs recovery.