RFM posts 51% income growth

Higher gross profit, lower interest expenses and higher income from affiliates propelled RFM Corporation’s net income for the first three quarters by 51 percent, registering at P109 million from last year’s P72 million.

Net sales for the period hit P11.9 billion, marking a six percent year-on-year growth as softdrinks juice, flour, chicken, processed meat, canned tuna, and its pizza delivery business posted higher volumes. RFM president and CEO Jose A. Concepcion III said that, "More than half of RFM’s total revenues was accounted for by our branded businesses."

Operating expenses rose by 28 percent to P2.4 billion as the company continued its aggressive marketing program to promote its key brands.

Concepcion added that Cosmos Bottling Corp., RFM’s beverage subsidiary, led the growth as its net sales grew 29 percent from P2.9 billion to P3.8 billion, as sales volume surged 24 percent.

Cosmos, likewise, cited heavier marketing spending, a wider and more effective distribution system, and better dealer incentives as the main drivers of the strong growth. Metro Manila remained the highest growth area with sales volume increasing 31 percent, followed by Mindanao with 24 percent.

PSi Technologies Inc., RFM’s semiconductor unit, announced nine-month revenues of $55.2 million, up 49 percent from $37 million recorded for the same period last year, as volumes surged by more than 50 percent. Net income was at $6.5 million for a 163 percent year-on-year growth from $2.5 million in 1999.

Meanwhile, Swift’s meat products posted a strong nine-month growth with processed meat volumes, rising 71 percent year-on-year, while canned meat volumes expanded by 13 percent. This was mainly due to promotional campaigns and more effective brand building activities.

Concepcion revealed that RFM intends to continue on brand building specially for flagship brands such Pop Cola, Swift hotdogs, Selecta Ice Cream, Little Caesar’s pizza, Selecta Moo milk drinks and Sunkist juice drinks, in an effort to further increase its volume and improve its profitability.

The company looks forward to an even better performance in the fourth quarter with the onset of the holiday season.