PHILIPPINES – Poultry company, Bounty Fresh is reported to be preparing to announce losses for the first half of the financial year.
The Bounty Fresh group of companies expects to record a net loss in the first half as its two units reel from high costs of chicken feed and other inputs, its top executive said.
Business World Online reports Tennyson G. Chen, president and chief executive of the Bounty Fresh Group, saying last week: “We are in a difficult situation now. We hope in the second half, we will be able to recoup our losses.”
The group is composed of Bounty Agro Ventures, Inc. and Bounty Fresh Food, Inc.
Last year, the company posted 10 billion pesos (PHP) in sales partly due to higher demand induced by election spending, up from more than PHP9 billion in the previous year.
But this year, Mr Chen said higher prices of commodities like oil, soybean, wheat and corn have hurt margins.
The wholesale price of yellow corn, the main ingredient for animal feed, for instance averaged PHP15.22 per kilo in the last month of the first quarter, up 6.2 per cent from the same period in 2010, according to data from the Bureau of Agricultural Statistics.
Yellow corn prices have eased to PHP14.54 per kilo as of the first week of May.
Gasoline prices have meanwhile gone up by PHP9.75 per litre from the start of the year to PHP58.35 as of Friday (13 May), data from the Energy department show.
“We hope we can catch up. We try to control costs,” Mr Chen said.
In the long run, the company is banking on growth in the provinces to increase sales.
Mr Chen added: “As consumers in the provinces get richer, they will buy more chicken. Eventually over time, the provinces will also have better income and more ability to buy chicken.”
Bounty Fresh expects to end the year with 1,500 ‘Chooks-to-go’ branches which retail roast chicken from the current 1,100 stores, Mr Chen added.
The Bounty Fresh Group was founded in 1993, dressing 1,000 chickens per day, reports Business World Online, and now processes 6,000 birds per hour.
Information ThePoultrySite News Desk