RFM Closes 2011 with PhP504M Income

Mandaluyong–(PHStocks)–Food and beverage company RFM Corp. (PSE: RFM) reported a full year unaudited net income of PhP503.8 million in 2011, surpassing market analysts’ year-end estimate of PhP420-430 million.

Higher revenues and easing of commodity cost inputs such as milk and sugar in the second half, coupled with internal production improvements pushed-up profitability to PhP291 million in the second half, up 37% from first half income.

Topline sales registered a faster growth of 10% for the second semester, versus 7% growth in the first half of the year, ending the year with P9.9 Billion sales revenue, 8% higher compared to P9.1 Billion in 2010.

RFM President and CEO Jose A. Concepcion III reported that despite inflationary fears and more rains last year that normally dampen demand, the company did relatively well with sales growth. “We believe that stronger brand equity and product innovations have influenced the shift in buying pattern and frequency in a number of categories,” he said.

“The focus on core food and beverage businesses is paying off,” Concepcion said. “Selecta Ice Cream, a joint venture with world giant Unilever, is increasing its leadership of the industry with market share going beyond 71%, coming from around 66% at the start of 2011. Remarkable growth was seen in Selecta-Hersheys, Supreme, Classic and Cornetto lines, with innovations backed by strong marketing campaigns,” he said.

“Flour-based businesses led by White King Fiesta spaghetti likewise continued to hit record sales levels, with growth close to 50%, hitting rated capacity starting September, and pushing up its recent market share in its biggest key account to 35% by yearend, from 28% in January last year,” Concepcion added.

RFM reported that aside from Selecta ice cream and Fiesta pasta, sales of Selecta milk, White King Champorado and Arroz-Caldo mixes, Sunkist litro pack and Swift Mighty Meaty and Corned Beef Swak also performed very well as the company rationalized and focused its brand portfolio, supported by more exciting product repackaging, aggressive merchandizing and trade-related programs.