Del Monte to close several US plants

Iris Gonzales (The Philippine Star) - September 7, 2019 - 12:00am

MANILA, Philippines — Del Monte Pacific Ltd. (DMPL) has announced plans to close some facilities of its US subsidiary Del Monte Foods Inc. (DMFI).

In a disclosure yesterday, DMPL said the facilities are located in Sleepy Eye, Minnesota and Mendota, Illinois, which will cease production at the end of the current peak season.

The company will also unload its facilities in Cambria, Wisconsin and in Crystal City, Texas.

DMPL managing director and chief executive e officer Joselito Campos Jr. said the restructuring is necessary.

“The restructuring is a necessary step for us to remain competitive in a rapidly changing marketplace. Our asset-light strategy will lead to more efficient and lower cost operations,” Campos said.

The facilities are part of DMPL’s 10 plants in the US. It also has two plants in Mexico.

The group, however, will continue to expand its existing branded business in Asia, through the Del Monte brand in the Philippines, where it is a dominant market leader.

S&W, both packaged and fresh, will continue to gain more traction as it leverages its distribution expansion in Asia and the Middle East, while the group’s joint venture in India will continue to generate higher branded Del Monte sales and maintain its positive EBITDA.

The company incurred a net loss of $38.3 million in the first quarter. Sales amounted to S$375.9 million, down 14 percent year-on-year due to the divestment of the Sager Creek vegetable business in September 2017, lower sales in the US and lower exports of processed pineapple products, partly offset by higher sales in the Philippines and the S&W business in Asia.

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