RFM posts 42% profit hike in H1 on higher sales

Manila, Philippines - Food and beverage company RFM Corp. reported a 42 percent jump in net earnings during the first half of the year to P302 million, on the back of a 16 percent rise in sales.

In a disclosure to the Philippine Stock Exchange, RFM said sales reached P5.3 billion as most of its brands exhibited continued growth led by Selecta ice cream (a joint venture with Unilever), White King Fiesta pasta, Selecta milk and Sunkist juice.

RFM president and chief executive officer Jose A. Concepcion III attributed the company’s strong performance to lower commodity costs such as milk and sugar, as well as increasing sales of higher value products.

Concepcion added that the bullish economic climate has also boosted consumer spending.

Also, strong demand for Magnum ice cream has helped lift RFM’s earnings. The Belgian chocolate ice cream on stick has become an instant hit especially among the young generation since it was launched in March.

With greater supply availability, RFM has reduced the frequency of out-of-stock experiences.

Selecta, a dominant leader in the local ice cream industry with a 71 percent market share, continues to grow its operations with affordable yet exciting innovations in its Cornetto and Classic lines, such as the Selecta Overload, the Selecta super-thick Classics, the Hersheys collection and the Cornetto disc. 

RFM’s White King Fiesta division, which includes its fast-growing pasta business, has also been performing very well, expanding its market leadership position to 29 percent from 25 percent last year.

In key accounts, Fiesta posted an even larger market share of 38 percent. “The consistently firm pasta quality at affordable pricing levels has made Fiesta more preferred among pasta brands,” Concepcion said.

Other White King products such as all-purpose flour, hotcake and flour mixes, Arroz Caldo and Champorado have also captured a good slice of the market that prefers easy-to-prepare Filipino native cakes and hot porridge dishes, with good value-for-money.

Sales of Selecta milk, Sunkist juice drinks and Swift corned beef and karne norte in sachets also posted double-digit growth rates.

In the first half, RFM forged a partnership with Kansas-based Engrain LLC to produce and sell flour and bread-related products.

The joint venture company, Engrain-RFM Pacific Inc., will distribute flour mixes that improve the quality and performance of flour in bread and other products.