D&L Industries managed to book a record first-half income of P1.6 billion despite the Omicron surge in January and sharp increase in commodity prices for the same period.

Easing of mobility restrictions, coupled with the decline in active Covid cases, pushed D&L’s earnings recovery sharply to P851 million, up 22 percent year on year and well above pre-Covid income levels. The company’s food ingredients segment saw a sharp increase in earnings of 28 percent year on year in the second quarter, bringing first-half 2022 earnings growth to 5 percent and reversing the 19-percent year-on-year earnings decline recorded in the first quarter of the present year.

“Our record first-half results demonstrate that despite various global macroeconomic headwinds, our company is benefiting from renewed business momentum amid economic reopening and pent-up demand from the past two years. Barring any unforeseen event, we will likely at least match our record full-year income booked in 2018,” remarked President and Chief Executive Officer Alvin Lao.

The exports division continued its positive momentum, with revenues jumping 69 percent year on year for the period. Export contribution to total revenues stood at 34 percent, evidencing the company’s commitment to diversifying its revenue base by strategically growing its international customer base.

The second quarter of 2022 saw the food ingredients business registering an earnings recovery of 28 percent year on year, surpassing pre-pandemic quarterly earnings recorded in 2018 and 2019 for the same period. Earnings increased to 5 percent, reversing the 19-percent year-on-year decline recorded in the first quarter of 2022.

D&L’s other subsidiaries also contributed substantially to the recovery. Chemrez’s significant performance in the first half of the year saw earnings growth of 61 percent year on year. This was mainly driven by the oleochemicals division which saw its volume grow by 36 percent year on year, enabling the recovery of gross margins as the company adjusted its selling prices regularly to reflect higher input costs.

Specialty plastics income increased by 18 percent year on year in the first half of 2022 as the 2.6-percent margin expansion more than offset the impact of the 18-percent volume decline for the period. The margin expansion mainly came from the colorants and additive division due to the election-related demand for higher margin plastic colorants used in tarpaulins used as campaign materials.

Consumer products posted an income decline of 28 percent year on year due to higher raw material prices for the period and the normalizing demand for disinfection and sanitation products with the drop in the active number of Covid cases. However, earnings were still above prepandemic levels despite these factors.