Photo courtesy of D&L Industries Inc.
BUSINESS

D&L: Strong economy providing profit boost

Maria Bernadette Romero

D&L Industries Inc., a publicly listed leader in specialty food ingredients and oleochemicals, is bullish on achieving higher profits this year as inflation and interest rates ease, coupled with a projected uptick in consumer spending during the election season.  

“These are tailwinds for the economy, and the normal trend in our company is that as long as the economy is doing well, then we are a beneficiary,” D&L President Alvin D. Lao said in a recent interview.  

He noted that high inflation in recent years has posed significant challenges to both the economy and D&L’s profitability, as rising costs strained consumer spending.  

However, he observed a positive shift in recent months. “It looks like the peak of the price of rice happened several months ago. The price of rice has been coming down, and it’s another sign that inflation is coming down.  

In the first nine months of 2024, D&L Industries reported a net income of P1.8 billion, leaving the company just P520 million short of matching its full-year profit for 2023.

“Looking forward, it’s making us more optimistic this year with inflation much lower. There’s more breathing room now for consumers, so, hopefully, it means more money to spend and, hopefully, it also means a better economy,” Lao added.  

Lao pointed to the company’s biodiesel business as another driver of growth, noting that the mandated additional increase in the biodiesel blend is expected to bolster earnings.  

High biodiesel demand

The company’s biodiesel operations continue to enjoy a spike in demand, with D&L now operating at higher capacity following the mandated increase in biodiesel blends from 2 percent to 3 percent last October.  

With another scheduled increase in the biodiesel blend to 4 percent by October, Lao said the company anticipates higher orders from oil companies as early as two months before implementation, with sales expected to pick up in the third quarter. 

In the first nine months of 2024, D&L Industries reported a net income of P1.8 billion, leaving the company just P520 million short of matching its full-year profit for 2023. During this period, the company’s recurring income rose by 1 percent year-on-year, also totaling P1.8 billion. D&L is set to release its full-year 2024 financial results in February.