LISTED specialty food ingredients and oleochemicals manufacturer D&L Industries, Inc. said it’s monitoring potential disruptions to raw material supply and costs on account of the continuing conflict within the Middle East, while expressing confidence in managing the risks.
“Looking ahead, 2026 presents a brand new set of uncertainties, particularly with the continuing war within the Middle East and its potential impact on crude oil prices, raw material costs, and global supply chains,” D&L President and Chief Executive Officer Alvin D. Lao said during a media briefing on Wednesday.
The corporate said geopolitical tensions could disrupt oil prices, raw material supply, and global logistics, while also affecting growth and market confidence.
The corporate added that it sees opportunities to strengthen its position as a reliable supplier of essential goods amid volatility, supported by regular demand.
Mr. Lao said the corporate has not encountered a full shortage of materials but noted that access costs have increased. He warned that some items could grow to be scarce inside a month.
“The worth of every thing goes up. Actually, that’s not the one problem. Never mind if prices are going up, however it seems access to provide for a variety of products can also be affected. And that’s an enormous worry,” he said.
D&L said it’s negotiating with its global supplier network to take care of raw material flows.
It noted that several suppliers have declared force majeure, limiting deliveries to available supply and canceling contracted future shipments.
Despite the risks, Mr. Lao expressed confidence in the corporate’s ability to administer disruptions, citing its experience during past oil shocks.
“We were capable of survive. We’ve learned the teachings. Now we have put in a variety of measures to (take care of the issues) because we still remember what we did before,” he said.
The corporate said it has about 74 days’ value of inventory to support operations, but flagged replenishment as a key concern.
In 2025, D&L reported a ten.6% increase in recurring net income to P2.6 billion, supported by strong performance from its biodiesel, plastics, and consumer businesses.
Fourth-quarter recurring income rose 20% to P640 million.
Full-year earnings growth was driven by 8% volume expansion, despite elevated coconut oil prices, which have nearly tripled over the past two years.
“Coconut oil prices hit all-time highs, but we still grew earnings 10.6%. This got here from R&D investments, customized solutions, and long-term partnerships,” Mr. Lao said.
Volumes increased 8% across each high-margin specialty products and commodities. The corporate said stabilizing margins could support further earnings growth.
Segment performance was mixed. Chemrez Technologies posted a 24% increase in volumes and a 96% rise in net income, supported by global demand for coconut oil-based products and a better mandated biodiesel mix.
The Specialty Plastics segment recorded 9% earnings growth in 2025, following 32% growth in 2024. Margins reached record levels, supported by recent products developed through ongoing research and development.
“The segment stays well-positioned for continued growth, supported by ongoing investments in research and development and the corporate’s deal with delivering progressive and sustainable plastic solutions aligned with evolving customer needs,” the corporate said.
The Consumer Products original design manufacturing (ODM) segment posted an 80% increase in earnings, driven by the ramp-up of operations in Batangas. Exports accounted for 16% of total sales, up from negligible levels six years ago.
In contrast, the food ingredients segment saw earnings decline by 61% on account of higher commodity costs. While the corporate typically passes on cost increases to customers, the rapid rise in coconut oil prices led to short-term margin pressure on account of a 30- to 45-day lag in price adjustments.
“As coconut oil prices begin to normalize, coupled with pricing adjustments and ongoing portfolio optimization — rationalizing commodity exposure while increasing deal with high-margin specialty products — the corporate expects a recovery in profitability and margins,” D&L said.
Shares in D&L rose 5.71% on Wednesday to shut at P3.70 each. — Alexandria Grace C. Magno