Nurturing Growth

 

 

We are a global branded food and beverage company that caters to today’s consumer needs for premium quality, healthy products.

 
 
 
Growth 1

The economic impact of Del Monte Pacific Group goes beyond our over 6,000 regular employees. In addition, we have engaged about 20 service providers in all areas of our operations.

In the United States, Del Monte Foods is one of the largest producers, distributors and marketers of premium quality, branded food products for the US retail market. DMFI contracts with over 1,000 farmers across North America which supply about 1,000,000 tons of produce. 100% of the tomatoes, 99+% of the vegetables and about 70% of the fruits we produce are grown in the US.

Our relationships with farmers extend more than three generations. The fruits and vegetables are contractually grown on farms. Some Del Monte fruit growers include farm families that have produced for Del Monte for over 70 years. Our growth has a broader implication for farms across the United States.

Our pineapple plantation in the Philippines encompasses 10 municipalities in Bukidnon and seven towns in Misamis Oriental, Mindanao. We engage with over 50 supplier partners which provide various goods and services to the Company. An estimated 15,000 families or approximately 75,000 individuals directly or indirectly depend on the Company in southern Philippines.

Overall, our presence has immensely contributed to the region’s economic growth, creating a multiplier effect on the local economy by fueling local business, supporting the Group’s operations as well as serving day-to-day needs of our employees and their families.

DMFI maintained its leading market share position for the full year in canned vegetable and fruit. Business fundamentals remain on solid ground with strong shelving, new innovation and sustained marketing investments.

Specific to distributor operations, FY2019 was a year of transformation as the Group worked to upgrade operations and processes. As some of its legacy distributors have lagged in terms of modernisation required, the Group felt it necessary to transition out of these distributors and replace them with those that could support the level of expansion that the Group expects, particularly in a fast-changing, highly competitive environment. While the transition impacted Philippine market sales in FY2019, the Group believes it will help set up a stronger base for future growth.  Improvements are expected to be seen beginning in the first quarter of FY2020.

DMPL continues to lead in market share position in most categories it competes in despite operational issues.

The Group acknowledges the importance of building a strong partnership and healthy relationship with its suppliers. Accordingly, the Group conducts business with all customers on the basis of integrity, mutual interest and fairness. The Group prohibits the practice of forced and child labour.

In the United States, DMFI has a Supplier Code of Conduct that applies to any entity providing goods or services, including suppliers and subcontractors. The objective is for suppliers to practice and uphold ethical business standards. Del Monte’s Supplier Diversity Programme enables small and diverse businesses to be considered fairly as subcontractors and suppliers.

In selecting suppliers, Del Monte in the Philippines uses its Supplier Quality Management Programme (SQMP) which assesses the quality and delivery performance, feedback, recognition and continuous improvement programme for all direct materials suppliers and toll manufacturers.

 
 
 
 
 
 
 
Del-Monte-Pacific--Ltd-products

Del Monte Pacific Ltd products

 

Our Performance

 

  1. DMPL generated sales of US$2.0 billion in FY2019, lower by 11% versus the prior year as higher sales in S&W in Asia and the Middle East were offset by lower sales in the United States, Philippines and Europe.
  2. The Group reported a net income of US$20.3 million for the full year, favourable compared to the prior year’s net loss of US$36.5 million. Of the US$20.3 million of Group income, DMFI reported a loss of US$51.5 million while DMPL ex-DMFI reported a net income of US$41.9 million.
  3. DMPL’s US subsidiary, Del Monte Foods, Inc (DMFI), generated sales of US$1.4 billion or 73% of Group sales, lower by 14% versus prior year due to the divestiture of the Sager Creek vegetable business in September 2017, and lower volume of retail branded products due to price increase and reduced promotional spend.  There was also a decline in non-branded products which was in line with DMFI’s strategy.
  4. A new, integrated master brand campaign “Growers of Good” was launched in September 2018 promoting Del Monte as an advocate for doing what is good – Del Monte nurtures the Earth’s goodness today to grow a healthier and more hopeful tomorrow.
  5. Significant strides have been made at an accelerated pace in introducing new, more convenient and better-for-you products to the American public especially in FY2019. DMPL’s US subsidiary, Del Monte Foods, Inc. (DMFI), has taken a leadership role in addressing consumer preferences by fast tracking innovation.
  6. The Philippine market sales in FY2019 were US$307.8 million, down 4.2% and 8.0% in peso and US terms, respectively.
  7. Foodservice sales in the Philippines remained strong, riding on the rapid expansion of quick service restaurants and convenience stores, as well as Del Monte Philippines’ growth of its juice dispensers, meal partnerships and customised products.
  8. The Group will continue to drive dispenser juice and condiments sachet expansion to grab opportunities in convenience stores as emerging channel for ready-to-eat meals amongst young, urban professionals. It will expand its portfolio range via ready-to-eat recipe ideations with convenience store commissaries.
  9. Sales of the S&W business in Asia and the Middle East reached US$115.4 million in FY2019, 9% higher than the US$106.1 million in FY2018, a record for this brand since the Group acquired it in 2007.
    a.  The fresh segment accounted for 79% of S&W’s total sales.
    b.  Improved sales were driven by the robust 19% growth of the S&W Sweet 16 fresh pineapple.
  1. The Group’s Nice Fruit joint venture, utilising patented technology that allows fruits to be picked at their optimal ripeness and frozen for up to 3 years, while preserving its nutrients and original properties, successfully launched frozen pineapple spears in 7-Eleven stores.
  2. DMPL intends to enhance cross market cooperation between USA and Asia, and vice-versa as part of DMPL’s growth and globalisation initiative.
  3. The Group donated US$1.5 million (in cash and products) to various foundations and institutions in the US and the Philippines to fund numerous projects such as scholarship grants, technical training to unemployed community members, feeding programmes and relief operations.
 
 
 
 
 
 
 
 
 
 
Growth 2

Green bean deliveries

 

Responsible Sourcing Practices

The Group acknowledges the importance of building a strong partnership and healthy relationship with its suppliers. Accordingly, the Group conducts business with all customers on the basis of integrity, mutual interest and fairness. The Group prohibits the practice of forced and child labour.

In the United States, DMFI has a Supplier Code of Conduct that applies to any entity providing goods or services, including suppliers and subcontractors. The objective is for suppliers to practice and uphold ethical business standards. Del Monte’s Supplier Diversity Programme enables small and diverse businesses to be considered fairly as subcontractors and suppliers.

In selecting suppliers, Del Monte in the Philippines uses its Supplier Quality Management Programme (SQMP) which assesses the quality and delivery performance, feedback, recognition and continuous improvement programme for all direct materials suppliers and toll manufacturers.

  1. The Company performs periodic audits of contract manufacturers and direct suppliers. Some independent and unannounced audits are used to address quality assurance and compliance issues.

  2. It is our policy to seek out opportunities to buy from these suppliers where price, quality and delivery of service are competitive.

  3. DMFI has a Supplier Code of Conduct for suppliers to practice and uphold ethical business standards.

  4. DMPI issued a Code of Business Conduct to its suppliers which outlines the Company’s practices in building its relationship with suppliers while adhering to the principles of integrity, mutual interest and fairness in conducting business.

  5. In the Philippines, the Company has an SQMP for direct materials suppliers and toll manufacturers as an aid in the selection of best suppliers for the Company.

  6. The objective of the programme is to align DMPI’s quality parameters with that of suppliers, provide suppliers with performance scorecards, classify suppliers into certified, preferred, approved and conditional suppliers, and align suppliers with DMPI’s goals that would help support growth in the next five years. The programme serves as a tool to determine allocation of the Company’s requirements to suppliers.

  7. The suppliers are rated based on quality performance, delivery performance and competitiveness.