Del Monte Pacific (D03) Q1 2025 earnings summary

Executive summary

• Group sales rose 4% year-over-year to $537 million, driven by strong international and Philippine market performance, with DMPI achieving a 13% sales increase in peso terms and a 52% net profit rise.

• Group net loss was $34.2 million, mainly due to high costs and increased interest expense in the US subsidiary, but losses were more than halved sequentially from the previous quarter.

• Recovery in the Philippines was supported by new leadership, increased marketing, and operational improvements.

• U.S. operations faced headwinds but saw stabilization in core categories and growth in Joyba Boba tea.

Financial highlights

• Turnover rose to $536.9 million from $516.7 million year-over-year, but gross profit declined 19% to $87.6 million, with gross margin at 16.3%.

• DMPI operating profit up 46% to $27.7 million; net profit up 52% to $17.3 million.

• International sales grew 20% year-over-year, led by fresh fruit exports to China, Korea, and Japan.

• Net debt reduced to $2,226.2 million from $2,299.7 million due to better inventory management.

• Cash flow from operations improved to $74.7 million, up from $47.5 million year-over-year.

Outlook and guidance

• Philippine business expects continued strong performance, with further marketing investments and new product launches planned through FY2028.

• U.S. business anticipates margin improvement in the second half of FY2025 and significant benefits in FY2026 as high-cost inventory is cleared and cost reductions take effect.

• Plans for selective US asset sales and equity injection via strategic partnerships to lower leverage.

• Full financial impact of initiatives expected in FY2026; FY2025 net loss anticipated but lower than FY2024.

• Fresh pineapple exports expected to grow at mid- to high double-digit CAGR through FY2028.