Universal Robina Corp., the listed food unit of the Gokongwei Group, posted modest revenue growth last year but saw profits ease as unusually high coffee input costs squeezed margins, highlighting how volatile commodity prices continue to challenge food manufacturers.
The Gokongwei-led snack and food giant reported full-year sales of P168.0 billion, up 4 percent from a year earlier, supported by broad-based volume growth across its consumer and agro-industrial businesses.
Operating income slipped 4 percent to P16.0 billion, largely due to elevated coffee prices that weighed on profitability. Excluding the coffee segment, URC said operating income would have posted high single-digit growth, reflecting steady category demand, improved cost efficiencies in its international operations, and tighter execution across markets.
Net income from continuing operations declined 9 percent to P11.6 billion, partly reflecting smaller foreign exchange gains compared with the previous year. Core net income attributable to the parent company fell 4 percent to P11.0 billion, broadly tracking the drop in operating earnings.
Despite the earnings pressure, URC maintained shareholder returns. The board approved a cash dividend of P2.10 per share, 5 percent higher than last year, payable on May 7 to shareholders on record as of April 10.
The company’s branded consumer foods division remained the main growth engine. Sales from the segment rose 5 percent to P115.0 billion, with its Philippine operations climbing 5 percent to P79.0 billion on the back of stronger volumes, improved in-store execution, and disciplined pricing.
International consumer food sales increased 4 percent to P36.0 billion as operational efficiencies and scale gains helped offset softer demand in parts of Indochina affected by geopolitical tensions.
Meanwhile, the agro-industrial and commodities segment posted P53.0 billion in sales, up 2 percent. The division faced headwinds from weaker animal feeds revenue linked to a smaller hog population and lower sugar selling prices late in the year, although the flour business supported growth through rising volumes.
URC president and chief executive Irwin Lee said the company’s core strategy continues to deliver results despite temporary commodity pressures.
The outlook hinges largely on one key factor: coffee. If input costs normalize, URC expects the current momentum in volumes to translate into stronger margins and market share gains.
