• D&L’s diversified business helped cushion the impact of oil shocks and supply disruptions.
• The Lao family continues buying shares despite weak market sentiment.
• With Batangas capex largely done, D&L is shifting toward stronger cash flow and deleveraging.
Rising oil prices and supply disruptions tied to the Middle East conflict are pressuring manufacturers, but D&L Industries Inc. still grew first-quarter earnings as stronger margins cushioned the impact.
Recurring net income during the first three months of 2026 rose 5 percent to P717 million, while the Batangas plant stayed profitable for a sixth straight quarter.
The performance offers an early look at which industrial companies are better positioned to absorb volatility as inflation and fuel costs ripple across the economy.
Management’s view
Over the past periods, we have navigated significant volatility—from a sharp surge in coconut oil prices, one of our key raw materials, to the recent oil price shocks arising from geopolitical tensions in the Middle East,” said Alvin Lao, president and CEO of D&L.
D&L’s exposure across essential sectors such as food ingredients, plastics, chemicals, and consumer products helped cushion weakness in individual segments during the quarter.
“The essential nature of our products, catering to basic needs, provides a stable foundation even during periods of disruption. At the same time, our diversified business model offers resilience, allowing strength in one segment to offset softness in another,” Lao said.
Margins improved as coconut oil prices stabilized after months of volatility, while the company continued passing through higher costs to customers.
D&L also maintained around two months of inventory, helping buffer supply and price shocks as global supply chains tightened and crude oil prices climbed above $100 per barrel.
Lao family keeps buying
Even as Philippine equities continue to struggle with weak liquidity and global uncertainty, the Lao family has continued buying D&L shares through holding company Jadel.
Moreover, with free cash flow turning positive and major expansion spending largely completed following the Batangas plant, the company is signaling it has the flexibility to reduce debt and improve its balance sheet.
“Amid global uncertainties and domestic headwinds that have weighed on Philippine market valuations and liquidity, we continue to see compelling value in fundamentally strong businesses with long-term staying power,” Lao said.
Jadel increased its stake in D&L by around 4.4 percent since the pandemic, including roughly 106 million shares purchased in 2025 and another 4 million shares since the start of the year.
D&L shares rose 0.28 percent to P3.58 apiece on Wednesday.
Miguel R. Camus has been a reporter covering various domestic business topics since 2009.
