Delfi Limited has reported lower earnings of US$17 million ($22.04 million) for the 1QFY2025 ended March 31, 2025, down 27.2% y-o-y.

The group’s net sales saw a 0.5% y-o-y decline to US$149.8 million for 1QFY2025. However, on a constant currency basis, group net sales increased by 1.5%.

Delfi says that its performance was affected by weaker regional currencies, in particular the Indonesian Rupiah, and the impact from lower sales in our Agency Brands business following decisions by certain agency partners in Indonesia which reduced promotional spending for their products during the period.

However, its Own Brands sales for Indonesia were higher, particularly for its premium products segment, which partially offset the decreased sales in Agency Brands.

Higher Owned Brand sales was driven by greater promotional investment.

The growth in Regional Markets was driven by robust Own Brands performance in the Philippines, and improved Agency Brands sales in both Malaysia and the Philippines.

Delfi’s gross profit margin for 1QFY2025 was down 28% y-o-y, or 220 basis points (bps) due to weaker regional currencies, the promotional investment in key brands, and lower Agency Brands margins.

The group’s net cash from operations after working capital came in at US$37.6 million in 1QFY2025. The cash was used to fund capital expenditures of US$3.2 million and repay US$6.1 million in debt.

As at end March, cash balance stood at US$70.4 million.

Delfi says that high cocoa bean prices continue to be the most significant headwind for chocolate manufacturers globally and are expected to continue exerting pressure on industry earnings.

Shares in Delfi closed flat at 71 cents on May 20.