Pryce Corporation (stock: PPC) has reported impressive financial results for the first nine months of 2024, with a 40% increase in net income compared to the same period last year. The company’s net income surged to Php 2.21 billion from Php 1.58 billion in the previous year, supported by improvements in key business segments and strategic initiatives.
PPC’s consolidated revenues increased by 7% to Php 15.01 billion as of September 2024, from Php 14 billion in the prior year. A key contributor to this growth was the company’s Liquefied Petroleum Gas (LPG) segment, which accounted for 93.77% of total revenues, generating Php 14.07 billion. This significant contribution underscores the core importance of the LPG segment in PPC’s overall business structure.
Other segments included:
- Industrial Gases contributed Php 665.51 million, or 4.43% of revenues. This segment showed significant progress as the company strategically strengthened its marketing initiatives and established a new air separation facility in Mindanao.
- Memorial Park Operations added Php 233.56 million or 1.56% to total revenues.
- Pharmaceutical Products brought in Php 36.48 million or 0.24% of total revenues.
Pryce’s gross profit jumped 29.4% to Php 4.41 billion, up from Php 3.69 billion in the previous year, despite a modest increase in the cost of sales and services, which rose by 2.78%. The company attributed its higher gross profit to two strategic factors:
- An ongoing shift towards branded LPG sales over generic products, enhancing margins in its Luzon market.
- Lower landed costs of LPG, achieved through the renewal of supply contracts under improved terms.
Earnings per share reflected these positive developments, rising by 42.6%, from Php 0.760 in the previous year to Php 1.084 in 2024.
The company’s industrial gases segment saw a remarkable 27.4% year-on-year increase in total sales volume, laying the groundwork for new opportunities. Notably, PPC has commenced operations of an air separation facility in Mindanao following an 18-month construction period. This new venture is expected to enhance the company’s production capacity and contribute substantially to consolidated income in the coming years.
This strategic expansion highlights the company’s efforts to diversify its revenue base and strengthen its presence in the industrial gas market, which benefits from shared logistical networks established by its LPG business. With lower operating and distribution costs, the industrial gases segment is poised to be a key growth driver moving forward.
Pryce’s income from operations rose by 23.32%, reaching Php 2.64 billion, up from Php 2.14 billion last year. However, operating expenses increased by 14.4%, from Php 1.55 billion to Php 1.77 billion. This rise in operating costs reflects the company’s efforts to support its growth strategies, particularly in the expansion and marketing of its industrial gas business.
Outlook and Market Performance
Pryce Corporation’s strategic initiatives have not only boosted its financial performance but also strengthened its market position. The company’s efforts to transition from generic to branded LPG products, coupled with lower supply costs, have resulted in improved margins and higher profitability. Additionally, the intensified focus on its industrial gases segment suggests potential for further revenue diversification and income stability in the future.
Pryce Corporation’s first nine months of 2024 have been marked by substantial financial growth, driven by strategic shifts and new ventures. The company's continued emphasis on strengthening its LPG and industrial gases businesses positions it well for sustained success in the coming years.