The stock brokerage house said core earnings rose to P4.09 billion, up 11.4 percent from the previous quarter and 4.3 percent from last year, beating market forecasts by 26.6 percent, AP Securities research analyst Cholo Miguel Ramirez said in a recent report.
Most of the growth came from its Branded Consumer Foods (BCF) business, with strong performances in Vietnam and the Philippines helping soften the impact of pricier coffee and chocolate ingredients.
AP maintained its target price of P99.67 per share, citing BCF’s solid growth and the improving outlook for sugar and flour. The target offers a roughly 20 percent upside from URC’s current price.
While gross margins dropped slightly to 26.6 percent, AP Securities said the company’s wide product range and strong sales kept profitability stable. URC’s commodities segment, mainly sugar and flour, is also starting to bounce back, with revenues up 14 percent and flour alone rising 9 percent.
The animal nutrition and health unit remained weak, but it makes up a small part of the business and poses little risk overall.
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