CAPAS, Tarlac—Pilmico Foods Corp. (Pilmico), the food subsidiary of listed conglomerate Aboitiz Equity Ventures Inc. (AEV), said on Tuesday it is planning to put up additional feed mills to expand its animal feeds production by more than a third.
Pilmico Assistant Vice President for Feed Mills Roderic A. de la Cruz said the company will increase its feeds production capacity by 40 metric tons (MT) to 153 MT per hour (MT per hour) from the present 113 MT per hour. De la Cruz noted that Pilmico’s mills have reached 85-percent capacity utilization rate.
“Production capacity will reach around 153 [MT per hour] in the next three years. This year until 2020, we are planning to add 40 MT,” he told reporters in a news briefing here.
“At present, our capacity utilization rate is at 85 percent. When you hit that, you are almost full, and that is the point you plan for expansion,” de la Cruz added.
Currently, Pilmico operates two feed mills—the one here was established in 1997, while its plant in Iligan was put up in 2008.
In a disclosure to the Philippine Stock Exchange, AEV said it will spend some P1.7 billion for the expansion of its food subsidiary this year, which includes its animal feeds production arm. The figure, de la Cruz noted, is about the same amount they are going to invest in the next three years to complete the construction of additional feed mills in Tarlac and Iligan.
“Our direction is really to protect our market and to grow the business, to be the one-stop shop protein provider and solution for feeds,” he said.
Pilmico produces animal feeds for swine, poultry (layers and gamefowls) and aquaculture.
De la Cruz said the company’s feed business could see lower sales this year due to higher costs of raw materials, such as corn and wheat. “The price of corn increased both locally and internationally. Plus, there is the weakening of peso.”
Pilmico’s net income during the January-to-September period declined by 14 percent to P1.2 billion, from P1.4 billion recorded in the same period last year.
The company attributed this to lower margins and higher operating costs.