Listed specialty chemicals and food ingredients manufacturer D&L Industries Inc. saw its January to September 2021 earnings exceed pre-pandemic levels, helped by further recovery of the economy and lower tax rates.
At a virtual press briefing on Wednesday, D&L president and CEO Alvin Lao said that the company posted a net income of P2.163 billion in the first nine months of the year, up 57% from P1.374 billion in the same period last year.
Compared to the pre-pandemic January to September 2019 period, D&L’s bottom line grew 7% from P2.03 billion.
According to Lao, net income for the first nine months of the year already accounted for 83% of the full-year 2019 bottom line, indicating that “the company is on track to hit [full-year] pre-pandemic profit levels.”
In the third quarter alone, D&L’s net income grew 34% to P768 million from P573 million year-on-year. It is also higher by 25% compared to third quarter 2019’s P617 million.
“Our third quarter numbers place us in a good position to achieve full year pre-pandemic income levels, an outstanding achievement given the macroeconomic challenges that continue to weigh on economic recovery globally,” Lao said.
He said that lower corporate taxes provided by the CREATE law had a positive 4% impact on D&L’s nine-month earnings.
The Comprehensive Recovery and Tax Incentives for Enterprises (CREATE) Act, which took effect early this year, reduced the corporate income tax from 30% to 25%.
D&L’s food ingredients segment showed continued recovery, with nine-month 2021 volumes up 4%, sales up 39%, and net income rising 105% from the previous year.
“With quarantine restrictions now easing across the country and in the economic hub of Metro Manila, the company anticipates that further recovery is set to continue as fully vaccinated individuals are granted more freedom of movement, especially when frequenting restaurants, hotels, and the service industry,” Lao said.
Chemrez, the company’s oleochemicals segment, posted 33% growth in net income in the first nine months of 2021, while volume grew 13%.
Specialty plastic also saw 46% growth in income during the period.
“From a consumer spending perspective, the second half of the year appears more encouraging with the early onset of the Christmas season in the Philippines which typically starts as early as September. Pent-up demand is anticipated to contribute to higher spending during the peak holiday season, subject to the further easing of movement restrictions,” Lao said.
The national elections in May 2022 “may also likely provide an added boost in economic activity,” he added.
“Election spending typically begins in the fourth quarter preceding the election. In the last Presidential election which happened in 2016, the company saw its total volume and income increase by 9% and 15%, respectively,” he said.
D&L is a company engaged in the manufacturing of customized food ingredients, specialty raw materials for plastics, and oleochemicals for personal and home care use. — VBL, GMA News
D&L earnings in Jan-Sept exceed pre-pandemic levels
Source: News Panda Philippines
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