CADP Reports Increase in Revenues

January 27, 1999 PSE CIRCULAR FOR BROKERS NO. 143-99 CADP REPORTS INCREASE IN REVENUES Despite recent events in the sugar industry, publicly-listed sugar refiner Central Azucarera Don Pedro (CADP) reported satisfactory operating results. CADP registered not revenues of P2.66 billion increasing 13% from P2.34 billion the previous year. Income from operations also from P415.1 million to P423.8 million in 1997-98. The higher revenues were achieved in spite of the decline in production outputs of both raw and refined sugar buoyed by strong market demand despite the slowdown, sugar prices were up during the period, which offset production output declines for the year. Consolidated net income went down, however, to P102.7 million from P191.4 million in fiscal year 1996-97, or P0.14 per share from P0.25 per share. "This positive performance, achieved in spite of higher inflation and difficulties resulting from the crisis, reflects CADP's sound operating fundamentals," remarked the company's Chairman and Chief Executive Officer, Pedro E. Roxas. The company also reported the completion of its acquisition of 49% of Central Azucarera de La Carlota. On a consolidated basis, net sales totalled P2.72 billion for the period in review, while income from operations amounted to P387 million. Consolidated net income after taxes totalled P103 million, or P0.14 per share, down from the P191.4 million in the previous year. Earnings per share the year before was P0.25. The decline in earnings was principally due to the higher interest expense during the period. The Company milled a total of 1.29 million tons cane, down 11.5% from 1.45 million tons the previous year. As a result, production of raw sugar also declined 7.7% to 135,555 tons from 146,863 tons the year before. The production decline was in line with the overall drop in domestic cane tonnage, which decreased 7% from 21.9 million tons in crop year 1996-97 to 20.4 million tons as a result of lower cane crop harvests. It is worthy to note, nonetheless, that the decline in raw sugar output was less than the drop in our total cane tonnage because of gains in recoveries. cdlex Past efforts to put in place modern and efficient milling equipment, as well as the improved quality of canes, increased CADP'S recovery to 2.11 50 Kg-bags per ton cane, or LKgTC, from 2.02 LKgTC in 1996-97. Average industry yield for the period was 1.76 versus 1.70 last year, lower than what CADP posted for both years. Production of refined sugar defined 18% to 3.25 million 50-kilogram bags for the period in review from the record-setting 3.95 million bags the previous year. CADP contributed 18% of the total output.