CONCEPCION INDUSTRIAL Corp. (CIC) booked a single-digit growth in net income attributable to the parent for the April to June period, as pressures such as weather and the increase in raw material prices weighed on the company’s sales for the quarter.
The listed supplier of air-conditioners and refrigerators reported an attributable net income of P352.6 million for the second quarter, up by 1.5% from the P347.3 million it delivered in the comparable period a year ago.
The minimal uptick follows a 3.5% increase in net sales for the April to June period at P4.06 billion, from the P3.92 billion in same period in 2016.
“The company’s performance was in line with market guidance in anticipation of headwinds such as weather, raw material price increase and FX. We expect these to continue for the rest of the year. However, we remain optimistic about the market and continue to invest in both capacity and capabilities,” CIC Chairman and Chief Executive Officer Raul Joseph A. Concepcion said in a statement.
This brought the company’s first half attributable profit to P570.17 million, 8% higher than the P528.22 million during the first six months of 2016.
“The first half of 2017 was marked by market softness with heightened margin pressure. This environment is likely to continue through the end of the year. We will continue to focus on operational execution and organizational efficiencies cognizant of these external challenges,” CIC Chief Financial Officer Victoria A. Betita was quoted as saying in a statement.
Amid challenges in the market, Mr. Concepcion said they continue to be optimistic for the latter half of the year, where they will also be launching a new segment slated to be a major contributor to the company’s growth.
“The next six to twelve months are going to be exciting for CIC as we launch our first IoT (Internet of Things) products. These will be our initial foray into offering practical smart appliances and solutions to Filipino consumers,” he said.
During its shareholder meeting last June, Mr. Concepcion said they will be launching a new company preliminarily called Cortex. This will offer both hardware and software that will create an enabling system of technology for consumers to monitor the electric consumption of appliances, among others.
CIC looks to grow both its net income and revenues by 15% for 2017, in order to hit its target of P50 billion in revenues by 2020. — Arra B. Francia