Food and beverage company RFM Corporation ended the year with P625 million of net income. Based on its preliminary unaudited yearend report, net income posted a strong growth of 71%, and 39% over its original target of P450 million.

RFM President and CEO Jose A. Concepcion III said that the strong income performance reflects the much improved RFM business model that pushes for an increasing role of its branded businesses, in term of its contribution to total income and sales. He credited the remarkable performance of its key branded businesses like Selecta Ice Cream, a joint venture with world giant Unilever, and the flour-based businesses led by White King Fiesta, which continue to deliver increasing cashflows, while deepening its market leadership position in their respective categories.

Concepcion likewise credited the gains being realized due to improvements in cost structures and operating efficiencies. He expects these margins to improve further as more margin-improvement projects and rationalization efforts are executed this year to assure an even better cashflows moving forward.

RFM reported that the recent series of positive developments led to greater interest from equity holders and investors, both local and foreign. RFM also gained the full confidence of the financial sector with the recent successful issuance of its P1.5 billion corporate notes, on a floating rate and clean basis, participated in by six of the largest financial institutions in the country.

The reported income came on the back of net sales of P 8.8 billion, or 6% growth over the previous year. Concepcion attributed the sales performance to the growth of its core products, and enhanced by a continuing stream of product innovations in their branded businesses, backed by aggressive marketing campaigns, especially in Fiesta pasta, and Selecta milk. Selecta ice cream alone posted over 48% sales growth that pulled-up the entire ice cream market category growth to 20%. This led to a more dominant market leadership position of 66% for Selecta, while competitors declined to 21 % and 8 % market shares, as of November 2010.

RFM also reported the holding of a special stockholders meeting yesterday to approve the proposed equity fund raising consisting of a placement and subscription transaction offering not exceeding 450 Million shares as part of its efforts to raise funds of around P800 Million to P1 Billion to support its expansion plans and position RFM for further growth. It is also in response to the growing interest on RFM shares among investors in the market. This will also allow an increased public float of RFM shares after the offering, from 20% to 30% float.