D&L Industries Inc. said capital expenditure (capex) for the year could reach P1 billion, earmarked for minor expansions in its new Batangas plant, lower than the P1.6-billion spending in 2024.
Alvin Lao, D&L president, said in a statement on Sunday the company is done with its big spending phase as it has already completed the Batangas plant.
“Capex peaked in 2022 (at P3.5 billion) and it will continue to be lower. There are some projects started at the main phase of construction a couple of years ago that have been completed recently and we still have to release the retention fees,” Lao said.
“We are still making minor expansions, not as big as what we’ve done in the past couple of years, but on a much smaller scale. So there will still be some capex, but expectation is for it to be lower than what we did last year,” Lao added.
Crissa Mendoza, D&L investor relations manager, said the capex will likely be funded through internally-generated cash.
Lao said D&L’s Batangas plant is expected to increase its contribution to the company’s bottom line this year as export ramps up.
D&L expects exports to further improve from the 37 percent growth last year, at P12.4 billion from P9 billion, which accounted for 30 percent of the company’s topline. It did not give the figure.
The Batangas plant booked a profit of P244 million last year, said Lao.
To date, the new plant has successfully fulfilled several orders for both local and export customers with several audit and certification processes ongoing in order to on-board more customers, D&L said.
The company, which produced intermediate manufacturing goods for other companies, noted that units Natura Aeropack Corp. (NAC) and D&L Premium Foods Corp. (DLPF), the operating companies behind the Batangas plant, are aggressively pushing high-value added coconut oil-derived ingredients and finished products for the food, personal hygiene, and home care segments in the export market.
“With the increasing concern on the massive deforestation associated with the use of palm oil and the depletion of non-renewable energy sources and high carbon footprint associated with the extraction and use of petroleum, coconut-derived ingredients offer an excellent natural, organic, and sustainable alternative for many industries and applications,” it said in a statement.
D&L closed 2024 with a profit of P2.34 billion, up 2 percent from P2.3 billion the prior year. Sales reached P40.68 billion, up 21 percent from P33.5 billion.
