Alaska net profit falls 39% to P1.1 billion

MANILA, Philippines -  Uytengsu-led Alaska Milk Corp. (AMC) said its net earnings fell 39 percent last year to P1.1 billion as higher raw material costs slowed down sales.

AMC told the Philippine Stock Exchange that its net sales slipped by 3 percent to P11.8 billion as operating income plunged 32 percent to P1.25 billion.

Earnings per share declined to P1.25 from P2.06.

In the fourth quarter of 2011, however, AMC’s net profit climbed seven percent to P432 million as sales rose 13 percent to P4.05 billion.

Operating income grew at a slower pace of one percent at P516 million.

But cost of sales increased 22 percent to P2.95 billion as prices of skimmed milk powder, sugar and vegetable oil went up.

AMC said its portfolio of liquid canned milk products (evaporated milk and sweetened condensed milk) grew at double-digit rates even as the market contracted amid a slowing economy.

Sales volume and market share of its powdered milk drink likewise improved on the back of continuing promotional efforts and brand-building initiatives, notwithstanding increased market competition.

AMC’s UHT ready-to-drink line (flavored milk, yoghurt drink and UHT- processed fresh milk) and ready-to-use product (Alaska Crema All-Purpose Cream) sustained its growth trajectory on robust off- take, posting strong double-digit growth rates. The market share of Alaska Crema expanded to its highest in December 2011, solidifying its position as the second leading all-purpose cream brand in the market.

Moreover, sales of the non-dairy coffee creamer business, Alaska Krem-Top, likewise remained brisk amidst continuing efforts to expand the brand’s consumer base.

AMC said demand for dairy products remained strong, especially from regions that are already short of milk, such as China and Southeast Asia.