D&L Industries Inc. weathered the volatility triggered by the Middle East conflict to post higher first-quarter earnings, buoyed by stronger demand for its industrial products and improved margins.

The listed manufacturer of specialty food ingredients, oleochemicals and plastics reported that its net income rose five percent to P717 million in the first quarter, driven largely by growth in its non-food businesses.

Earnings were also 12 percent higher than the previous quarter due to resilience amid geopolitical tensions, elevated oil prices and currency volatility.

At a media briefing on Wednesday, D&L President and CEO Alvin Lao said the earnings growth was driven by margin improvements and sustained profitability from the company’s Batangas plant, which recorded its sixth straight profitable quarter.

“The essential nature of our products and our diversified business model allow us to remain resilient even during periods of disruption,” Lao said.

The Middle East conflict boosted demand for D&L’s industrial products as customers stockpiled supplies and locked in prices amid fears of shortages and rising costs, driving double-digit growth in the company’s oleochemicals, specialty plastics and consumer products businesses. 

A weaker peso also supported exports, which made up 24 percent of first-quarter revenues.

Gross profit margin improved to 13.4 percent from 12.7 percent a year ago as coconut oil prices stabilized, while free cash flow turned positive at P339 million following lower working capital needs and reduced capex after the completion of the Batangas plant.

Chemrez led growth with earnings rising 34 percent, while Specialty Plastics and Consumer Products ODM posted profit growth of 22 percent and 65 percent, respectively. 

Food Ingredients remained weak, however, with earnings down 69 percent due to softer volumes and higher input costs.

Despite global uncertainties, D&L said it remains optimistic about its medium-term outlook as the Batangas plant ramps up and supports export expansion.