MANILA, Philippines - Buoyed by strong 2012 results, food and beverage company RFM Corp. said it will prepay P1 billion worth of long-term loans.
In a statement, RFM said it will use proceeds from the sale of its meat business and cash flow from its business units to pay the loans.
Last October, the Concepcion family-led company sold its meat business to Century Canning group. for up to P850 million.
On Monday, RFM said it posted P682 million in net income in 2012, 34% higher than the previous year's P508 million.
RFM president and chief executive officer Jose A. Concepcion said the company's increased profits were due to stronger sales of its higher margin businesses and lower cost of inputs.
"The lower commodity input costs this year, such as for milk, wheat and sugar, were also important in keeping the cost levels down, as well as better yields due to scale economies as we reach higher volumes in our key brands, such as Selecta ice cream, and Fiesta spaghetti," he said.
RFM recorded an 11% jump in sales to P11.1 billion in 2012.
Concepcion said the positive economic climate helped boost consumer confidence and spending, which in turn spurred sales of RFM brands such as Fiesta pasta, Selecta ice cream, White King cake and sauce mixes, Selecta milk and Sunkist juice.
RFM is expected to continue its growth momentum, amid a bullish economic environment, expectations of a credit rating upgrade for the Philippines and upcoming mid-term elections.
"It will be a more exciting year for Selecta and Fiesta as we introduce more product innovations and build up and equity," he said.