D&L INDUSTRIES, Inc., a listed producer of specialty food ingredients and oleochemicals, sees a positive financial performance this year, citing easing inflation and increased spending due to the midterm elections.
“Looking forward, it’s making us more optimistic this year with inflation much lower. Costs are much lower. There is more breathing room now for consumers. Hopefully, it means more money to spend and a better economy,” D&L President Alvin D. Lao told reporters last week.
“Spending in the economy during a presidential election is much higher compared to a midterm election, but there is still an increase. As long as the economy is doing well, then we are a beneficiary,” he added.
Full-year inflation averaged 3.2% in 2024, slower than the 6% in 2023. This marked the first time that full-year inflation fell within the central bank’s 2-4% target since 2021.
In December, Philippine inflation accelerated to 2.9% from 2.5% in November. The Philippines will have its midterm elections on May 12.
Mr. Lao said D&L’s profitability has been challenged by high inflation, which tempered consumer spending.
“If you look at how prices went up so much, especially during the pandemic, everything was very expensive. For consumers, their pockets were hurt. Rice prices really went up in the last two years,” he said.
Mr. Lao said D&L could also benefit from the expected recovery of the country’s tourism sector.
Department of Tourism (DoT) data showed that the country logged 5.9 million foreign arrivals in 2024, missing the government’s target of 7.7 million, but higher than the 5.45 million in 2023.
Despite the lower foreign arrivals, the DoT reached a new high of P760.5 billion in tourism receipts last year.
Mr. Lao also said D&L is looking at the possibility of converting some of its other operations to meet the surging demand for biodiesel.
“The demand is quite strong,” he said.
In October last year, the biodiesel fuel blend was raised to 3% on order of the Department of Energy. The blend will further increase to 4% by Oct. this year and to 5% a year after.
With the scheduled blend increase in October, Mr. Lao said orders from oil companies are expected to start increasing around two months before implementation.
D&L shares were last traded on Jan. 10 at P6 apiece. — Revin Mikhael D. Ochave
