BIZ BUZZ: A series of unfortunate events at Del Monte
The tale of trouble continues to unfold at one of the country’s largest canned food makers—which 11 years ago swallowed an American business that was bigger than itself.
The independent auditor of Campos-led Del Monte Pacific Ltd. (DMPL), Ernst & Young LLP, released a disclaimer of opinion regarding its 2025 annual financial statement.
This essentially informs the public that there were discrepancies between the unaudited and audited financial statements of DMPL that Ernst & Young couldn’t ascertain.
For example, the audited financial statement covering the May 2024 to April 2025 period showed DMPL’s operating profit reaching $146.7 million. But the unaudited statement only reported this at $105.9 million. This represents a 39-percent difference.
As for the net profit, it was at $48.9 million in the audited statements but only $10.9 million in the unaudited statements, pegging the difference at a whopping 350 percent.
According to Ernst & Young, it was “not able to express an opinion” on DMPL’s financial statements because it had not been able to “obtain sufficient appropriate audit evidence” on the actual value and impact of losses in Del Monte Foods Holdings Ltd.
Del Monte Foods is the loss-making US subsidiary that had already filed for bankruptcy and had been deconsolidated from the group’s books by May 1.
DMPL said it had incurred $703.4 million in impairment losses due to the deconsolidation of its US subsidiary, which is now putting up more assets on the block.
However, Ernst & Young also noted it was not able to get enough evidence to review the “appropriateness” of DMPL’s share in the losses booked by Del Monte Foods, as well as the value of its investments in its subsidiaries.
All the delay has already resulted in DMPL’s local stock market trading suspension starting Sept. 16, especially since it was already given until Sept. 12 to file its report.
While it did manage to submit this on Sept. 18, it’s still nearly a week late.
The question now is whether its freedom from the shackles of its US unit would finally turn things around for DMPL. After all, it did manage a steep recovery in the first quarter.
DMPL is now in talks with creditors for a grace period for debts falling due in fiscal year 2026. It also plans to raise fresh equity while grappling with a $600-million capital deficiency.
Nonetheless, DMPL said it’s confident in its ability to maintain uninterrupted business operations and meet obligations as they fall due in the foreseeable future.
In particular, the Philippine business under Del Monte Philippines Inc. (DMPI), which had planned to go public in the past, has been doing well.
“Barring unforeseen circumstances and with the US business deconsolidated, DMPL expects to be profitable in FY2026 from continuing operations driven by DMPI,” the company said in its newly submitted annual report.
