D&L profit rises on food business rebound

D&L Industries Inc. posted a 15-percent increase in net income to P2.24 billion in the first nine months of 2026, driven by a strong recovery in its food ingredients business and improving profit margins as raw material costs stabilized.

At a media briefing on Friday, the company announced that its earnings rose from P1.95 billion in the same period last year, despite persistent inflationary pressures, higher interest rates, and geopolitical uncertainties.

Third-quarter net income jumped 32 percent to P735 million from P554 million a year earlier, reflecting sustained improvements in profitability.

“While the business environment continues to be challenged by unresolved geopolitical tension, local inflationary pressure, coupled with a depreciating peso and higher interest rates, the company was able to post earnings growth of 15 percent for the first nine months,” D&L President and CEO Alvin Lao said.

The company’s food ingredients segment emerged as a major growth driver, with earnings surging 77 percent as margins improved by 2.7 percentage points, supported by easing coconut oil prices and a shift toward more profitable products.

Specialty Plastics also delivered a 30-percent earnings increase, while Consumer Products ODM posted a modest 3-percent gain.

These improvements helped offset a 27-percent decline in Chemrez earnings, which was weighed down by softer biodiesel demand, scheduled plant maintenance, and elevated fuel prices.

D&L’s consolidated revenues slipped 4 percent to P39.65 billion from P41.29 billion, although gross profit increased 6 percent to P5.68 billion as the company shifted toward higher-margin specialty products.

High-margin specialty products accounted for 51 percent of total sales, with gross margins expanding by 2.4 percentage points.

Meanwhile, exports contributed 23 percent of revenues, supported by the company’s Batangas manufacturing facility. Specialty product exports grew 14 percent year-on-year.

“While the weakening peso benefits our export business by enhancing our competitiveness and supporting market diversification, the continued growth of our exports also provides a natural hedge against our foreign currency exposure from imported raw materials.

This further complements our specialty products strategy, allowing us to pass on pricing adjustments while preserving margins,” Lao said.

The company also reported positive free cash flow of P1.9 billion, supported by lower working capital requirements and reduced capital expenditures.

D&L expects profitability to improve further as commodity prices stabilize, specialty products account for a larger share of sales, and its Batangas plant increases production.

“Our long-term business outlook remains stable and unwavering. With raw material costs continuing to stabilize and our ongoing product portfolio optimization initiatives, we remain optimistic about D&L’s ability to deliver more resilient and improved profitability moving forward,” Lao said.