Phillipines - Aboitiz-led Pilmico Foods Corp. will expand its feedmill facility in Iligan City in 2010 to boost its presence in the feed market, president and chief executive Sabin M. Aboitiz said Thursday night.
Aboitiz, who took over last month, said P80 million would be spent to increase output at 10,000 metric tons a month.
“I am looking at several options but I don’t want to broadcast plans to competitors," he said.
During the first semester, the food subsidiary of Aboitiz Equity Ventures Inc. contributed more at 67 percent at P386 million.
In a regulatory filing, AEV said lower average selling prices had slackened flour business earnings by 14 percent year-on-year while sales volume dragged swine business earnings by 51 percent year-on-year.
But feeds posted a significant jump in earnings on the back of improved margins due to higher prices, coupled with freight cost savings resulting from the operation of the Iligan feedmill.
The growth in earnings of feeds outpaced the decline in income of both flour and swine businesses, resulting to the over-all improvement of the food group's net income.
With the recent acquisitions in the energy sector, the Aboitiz Group has 2,600 megawatts of power.
Aboitiz said his mandate is to expand the food business as power investments become so big.
“Our market share of feeds is still very small," he added.
Pilmico is now experimenting cockfight feeds in Visayas where the feedback is “good."
“Ninety percent of the barangays have cockpits," he said.
“We are going to start branding these products such as cockfight to be able to expand. Then we are going to aqua foods for bangus. The sky is the limit. With feeds and flour, you can do whatever," he added.
While poultry feeds are just 10 percent of its business, Aboitiz sees it as a “growth" area.