Century Pacific Food (CNPF) Q2 2024 earnings summary

Executive summary

• 1H24 revenue grew 13% year-over-year to PHP37.7B, driven by OEM recovery (+42%) and resilient branded segment (+7%).

• Net income increased 14% year-over-year to PHP3.6B, with gross margin expanding by 210bps to 26.1%.

• Branded segment grew 7% year-over-year in H1 2024, while OEM Exports surged 42% year-over-year, rebounding from a soft 2023.

• Growth supported by a diversified, all-weather portfolio and strong demand for value-for-money products.

• Gross margin expanded by 160 bps in Q2 and 210 bps in H1 2024 to 26.1%, driven by improved input costs.

Financial highlights

• 1H24 gross profit rose 23% year-over-year to PHP9.8B; operating income up 12% to PHP4.5B.

• EBITDA increased 11% to PHP5.4B; EPS up 14% to PHP1.03.

• Net margin stable at 9.6%; operating expenses rose 35% as margin gains were reinvested.

• Cash and cash equivalents stood at PHP2.8B as of June 30, 2024.

• Total stockholders’ equity increased by PHP1.9B to PHP34.8B as of June 2024.

Outlook and guidance

• 2024 topline and bottomline expected to grow in the low double digits.

• Capex guidance close to PHP4B, focused on coconut facility expansion.

• Margin improvements to be reinvested in innovation and demand generation.

• Cash is earmarked for planned capital expenditures and dividend payments in Q3 2024.