NEWS

 

Source: Malaya Business Insights

Link:http://www.malaya.com.ph/june28/busi3.html

Chemrez Technologies Inc., the country’s largest producer of biodiesel, yesterday declared P195 million in cash dividends, 25 percent higher than last year’s P158.6 million.

The dividends are P0.06 per share in regular and P0.09 in special dividends.

The total cash dividend represents 39 percent of the company’s net income of P509 million last year.

"We have regular and special cash dividends every year to reward loyal shareholders. Last year, it was six centavos regular and another six centavos special cash dividend. The dividend this year is higher than last year due to higher income in 2010 compared with 2009," said ChemrezTech.

The company said shareholders on record as of July 27 will receive the dividend, which will be paid out on August 10. ChemrezTech has been consistently paying cash dividends since 2001.

ChemrezTech reported that its income for last year grew 7 percent to P509 million from P474 million the previous year as its consolidated sales reached P5.8 billion, 14 percent higher than the P5.1 billion recorded in 2009.

For the first quarter of 2011, ChemrezTech’s income after tax rose 28 percent to P205 million from P160 million in the same period last year.

Net profit margin increased from 11 percent in 2010 to 14 percent in the first quarter this year, mainly because of successful measures to bring down raw material costs.

ChemrezTech’s consolidated sales for this period improved 7 percent to P1.49 billion from P1.40 billion in the first quarter of 2010. Exports accounted for 14 percent of revenue in the first quarter of 2011.

The revenue mix was steady at 63 percent oleochemicals, 32 percent resins, and 5 percent powder coating.

The cost of goods sold as a percentage of sales was relatively lower than in the first three months of 2010. ChemrezTech attributed this to lower overhead and raw materials costs.

The company said expenses were reduced because of ChemrezTech’s ongoing efforts to trim its production costs through increased efficiency and good timing in purchasing raw materials.

The firm said profit was higher in the first quarter because of its material sourcing strategy, in which it was able to correctly predict that material costs would go up in 2011.

While raw material costs were not yet very high, ChemrezTech beefed up its inventories towards the end of 2010.

This is significant as raw material costs are around 90 percent of the company’s total costs.