Vitarich Corp. reported net income last year rising 44 percent to P128.98 million from previous year’s P89.44 million as it posted record revenues with all business segments profitable.
Revenues reached P12 billion, an increase of 23 percent from P9.7 billion and the first time in the company’s 60-year history that annual revenues exceeded P10 billion.
“2022 brought many challenges to families and businesses, particularly as inflation intensified and food prices rose in double digits. Despite this difficult environment, our team worked tirelessly and delivered solid revenue growth and improved net income,” Rocco Sarmiento, company president and CEO, said.
Cost of goods accelerated 23 percent to P10.9 billion following higher sales volumes and input costs. Key raw materials including wheat, soybean and corn, comprising 70 percent of feed costs, soared 25 percent. In addition, price increases in fuel, energy and labor exerted further pressure on handling costs and the return of some post-pandemic operating costs such as travel costs.
Gross profit grew 24 percent to P1.1 billion and operating profit increased 21 percent to P223.2 million. The impact of cost inflation was partially offset by volume growth, pricing changes and efficiencies, the company said.
“Looking ahead, the company expects another year of strong revenue growth as well as better margins in 2023, encouraged by an expansion in our sales channels and the positive reception of the recently launched value-added products. At the same time, we remain alert in assessing the risk of persistent higher input costs and supply chain disruptions,” Vitarich said.
Revenue from the foods segment amounted to P6.2 billion, an all-time high, equal to growth of 48 percent, as the more robust recovery in food services and restaurants lifted demand. The company’s value-added products unveiled in November also provided additional support.
Volume was up 22 percent led by demand in Luzon and Mindanao while average prices rose 19 percent, reflecting significant cost inflation. The foods segment comprised 52 percent of overall revenues.
Revenues of the feeds segment, accounting for 44 percent of total revenues, grew 11 percent to P5.2 billion driven by pricing which increased 18 percent from the year before, versus input costs of 23 percent. As expected, price actions had an unfavorable impact on volume which declined 6 percent.
Revenues from the farms segment were down 32 percent to P529 million due to the shortage of day-old chicks. A fair value adjustment on biological assets amounting to P12.1 million was recognized as part of revenues and P1.1 million as part of cost of goods.
