THE government-sequestered CIIF-Oil Mills Group (CIIF-OMG) posted a net income of P173 million in January to July on the back of good coconut oil (CNO) prices.
Jesus L. Arranza, who was just reappointed by President Aquino as president and CEO of the CIIF-OMG, attributed the increase in gross revenues and income to the high value the commodity commanded in the international market and the effective trading strategy instituted by its management.
“Despite lower volume, revenue has gone up due to high prices of the commodity and trading was properly managed. This situation [of the low copra production] we are in right now is far worse than what happened in 2005 to 2007 when the company incurred about P1.5 billion in losses, and showed that, indeed, the previous CIIF-OMG leadership committed numerous blunders in managing the company’s trading position,” said Arranza in a statement.
In the first half of the year, CIIF-OMG only recorded a sales volume of 164,148 metric tons (MT) in copra terms, or 49 percent lower than the 323,257 MT sold in the same period last year.
However, the management’s trading strategy allowed the company to take advantage of the huge jump in the selling price of coconut oil to $1,800 per MT from last year’s $772 per MT.
“There is now a gradual increase in the supply of copra. We hope this will continue until the end of the year and even up to the first quarter of next year, which happened also in 2010. This will definitely increase our capacity utilization and sales, and increase our revenue and income from operations further for the rest of the year,” said Arranza.
The Office of the President, through a transmittal letter sent by Executive Secretary Paquito Ochoa to PCGG chairman Andres Bautista dated Aug. 10, announced Arranza’s reappointment as president and CEO of CIIF-OMG.
Arranza and his team are credited with turning around the company from incurring about P1.5 billion in losses from 2005 to 2007 to become one of the few profitable government-sequestered firms today.
Arranza replaced Danilo Coronacion in July 2009 and immediately delivered net profit the same year.
“We appreciate the fact that President Aquino is recognizing what we have done at the CIIF-OMG, and along with the support and examples being set by Chairman Bautista in managing sequestered assets, we are inspired to work harder for the benefit of the company and the coconut farmers who are the beneficiary-owners of the coconut-levy fund,” he said.
In 2010 CIIF-OMG more than doubled its operating income to P171 million from only P82 million in 2009.
