Message from the
To our valued
shareholders,
I write this with the past year still clearly in view - a period shaped by persistent geopolitical tensions, shifting trade alignments, and continued volatility in key commodities, particularly coffee. These forces defined the economic environment of 2025, testing how businesses respond when conditions are both uncertain and fast-moving.
We entered the year with a clear understanding of this landscape. While inflation began to ease in parts of the world, its effects lingered in everyday spending, reshaping consumer behavior and sharpening expectations around value. In this environment, clarity in direction and courage in execution were not aspirations, but operating requirements.
At URC, we responded by staying anchored to what matters most. We sharpened our priorities, aligned our organization around them, and executed with discipline.
Where conditions required difficult tradeoffs, we acted with conviction. Where opportunities emerged, we moved with speed.
This combination - clarity in direction and courage in action - defined our year.
URC delivered revenues of P168.0 billion, up 4% year-on-year, reflecting steady, volume-led growth across our key businesses. Operating income stood at P16.0 billion, down 4% versus the prior year, primarily due to persistently elevated coffee input costs that compressed margins. Net income from continuing operations reached P11.6 billion, while core net income attributable to parent closed at P11.0 billion, broadly in line with operating performance.
Volume-led growth and execution discipline
While headline profitability was tempered by external cost pressures, the underlying momentum of the business remained strong. Across our portfolio, we saw sustained volume growth, improving execution, and strengthening fundamentals that position us well for the years ahead.
In the Philippines, our volume-first strategy gained traction. Stronger in-store execution, clearer value communication, and improved availability translated into consistent growth across priority categories. More importantly, we are seeing early signs of share recovery - an outcome that reflects not just demand, but the quality of our execution in converting that demand into repeat purchases.
Internationally, our business continued to scale with greater efficiency. As we deepened our presence in key Southeast Asian markets, the benefits of scale - better mix, improved cost structures, and stronger margins - began to come through more clearly.
Across the enterprise, we remained disciplined in how we allocate resources. We invested behind our core categories, strengthened our supply chain capabilities, and continued to build the systems that enable faster, better decision-making.
At the same time, we made deliberate choices - absorbing input cost peaks and sustaining brand investments - to protect the long-term health of our business.
These were not always easy decisions. But they were necessary ones.
Courage, in this context, is notabout bold gestures. It is aboutconsistency. Making the rightdecisions, repeatedly, even whenthe near-term impact is difficult.
This discipline also underpinned our financial position. We generated strong cash flows, maintained a conservative balance sheet, and continued to return value to shareholders through higher dividends. For 2025, we declared a total cash dividend of P4.20 per share, reflecting our confidence in the long-term strength of the business.
Taken together, our performance in 2025 reflects a business that is not only resilient, but steadily strengthening - guided by a clear sense of direction and supported by the courage to act on it.
2025 Financial Highlights
Balance Sheet, Cash, and Debt
Contribution and Per Share Highlights
Divisional Performance
In 2025 our Branded Consumer Foods (BCF) business remained the primary driver of growth, delivering P115.0 billion in revenues, up 5% year-on-year.
In the Philippines, BCF recorded P79.0 billion in sales, also growing 5% versus the prior year. This performance was underpinned by sustained volume growth across key categories, particularly Snacks, Ready-to-Drink Beverages, and Bakery. Our focus on sharper value messaging, improved availability, and tighter in-store execution enabled us to consistently grow at or above category levels.
While margins were impacted by elevated coffee input costs, the strength of the underlying commercial engine remains clear. Excluding coffee, operating income would have grown ahead of topline, demonstrating the resilience of our core branded portfolio.
Internationally, BCF delivered P36.0 billion in revenues, up 4% year-on-year. Growth was driven by continued scale and execution improvements across key markets, particularly Malaysia, Vietnam, and Indonesia.
Munchy's remains a central pillar of our international expansion strategy. In Malaysia, the brand continues to strengthen its leadership position, while in Indonesia, it has rapidly scaled, significantly expanding both presence and contribution. Across markets, improved mix, disciplined cost management, and operational efficiency gains translated into stronger margins and improved earnings quality.
Overall, BCF continues to demonstrate the effectiveness of our volume-led growth strategy - building demand, strengthening market positions, and laying the foundation for sustained profitability.
The Agro-Industrial and Commodities (AIC) business delivered P53.0 billion in revenues for the year, up 2% year-on-year.
Within AIC, performance varied across segments. The Sugar and Renewables business faced pressure from lower average selling prices, particularly in the latter part of the year, as well as temporary operational disruptions. These factors weighed on revenue and profitability in the near term.
The Animal Nutrition and Health business continued to navigate a challenging environment shaped by the secondary effects of ASF. Despite this, we are encouraged by improving demand trends, particularly toward the latter part of the year, as industry conditions gradually normalize.
Importantly, our pet care segment is showing strong early momentum. Sales in this category have grown significantly from a low base, supported by expansion into cat food and cat litter, as well as increasing penetration in modern trade channels.
Meanwhile, our Flour business delivered steady growth, supported by increasing volumes and stable pricing. The ongoing ramp-up of the Sariaya facility is enhancing production stability and is expected to drive further efficiency gains as utilization improves.
Overall, while AIC faced near-term headwinds, it continues to play a critical role as a stable cash generator and strategic enabler for our broader portfolio.
Other Updates
Beyond financial performance, 2025 was a year of focused execution and strategic refinement.
Execution Discipline and Capability Building
We continued to strengthen the capabilities that translate strategy into results.
Across the organization, we reinforced five key execution priorities:
- Brand building and innovation
- Supply chain excellence
- Commercial execution
- Organizational capability
- Digital enablement
These capabilities are not standalone initiatives - they operate as an integrated system. When aligned, they allow us to build demand, serve it efficiently, and convert it into sustained growth and improved returns.
Operational Efficiency and Cash Discipline
We improved our cash conversion cycle from 101 to 86 days, driven by better inventory management and more efficient collections. This reflects our continued focus on operational discipline and capital efficiency.
We also maintained a conservative balance sheet, with gearing at 0.19x, providing us with flexibility to invest in high-return opportunities while preserving financial strength.
Strategic Portfolio Optimization
During the year, we took steps to refine our portfolio and sharpen capital allocation. A key development was the agreement for Nissin Foods Asia to increase its stake in our joint venture, Nissin-URC, to 70%.
This move reflects a deliberate strategy. For URC, it allows us to redeploy capital toward priority growth platforms while maintaining a strong partnership in the noodles category. For Nissin, it enables deeper investment in product innovation and technology.
Importantly, this remains a collaborative partnership - one that we believe will strengthen the long-term potential of the business.
Sustained Investment in Growth
We continued to invest behind our brands and capabilities, even as cost pressures persisted. Advertising and promotion spending increased in key periods to support brand equity and sell-through, reflecting our commitment to long-term growth over short-term margin optimization.
Opportunities
Ahead
As we look ahead to 2026, our direction is clear and our confidence is grounded.
We expect mid-single-digit revenue growth, supported by continued momentum in BCF Philippines and a scaling international business. At the same time, we anticipate challenges in Commodities, particularly in sugar, where pricing pressures may persist.
On profitability, we expect operating income growth to outpace revenue, driven by three key factors: normalization of input costs, particularly coffee; continued benefits from productivity and cost programs; and sustained pricing discipline.
The normalization of coffee costs is especially significant. After reaching peak levels in 2025, prices have begun to moderate, providing a clearer path toward margin recovery.
More broadly, we are positioned for what we describe as quality growth - growth that is volume-led, supported by strong execution, and translated efficiently into earnings and returns.
Our long-term ambition remains unchanged:
- Sustainable high-single-digit topline growth
- Double-digit profit growth
- Accelerating returns on invested capital
To achieve this, we will continue to focus on two fundamental questions: where to play, and how to win.
We will concentrate our resources on the categories and markets where we have the strongest right to win - our core leaders and high-potential challengers. At the same time, we will continue to build the capabilities that enable us to compete effectively and scale efficiently.
Execution will remain our defining advantage. Strategy sets direction, but it is consistent, disciplined, and aligned execution that delivers results.
We are also mindful of the uncertainties that remain in the external environment. Geopolitical tensions, particularly in the Middle East, continue to influence global markets and may introduce volatility in commodities, logistics, and cost structures.
While these risks are real, we are prepared. We have strengthened our supply resilience, improved our cost structures, and built the organizational agility needed to respond quickly to changing conditions.
In this environment, clarity and courage are not abstract ideas. They are practical disciplines.
Clarity ensures that we focus on what matters most. Courage ensures that we act on it.
Together, they provide the direction and momentum that will carry us forward.
We have laid the groundwork. We have strengthened our capabilities. And we are entering the next phase with a clearer view of where we are headed - and the confidence to get there.
Thank you for your continued trust and support.
Irwin C. LeePresident & CEO