The domestic operations of Philippines food company San Miguel have posted a second quarter operating income of 800m pesos (US$14.3m) for the second quarter, four times the first quarter result and 27% up from last year, boosted by the company's poultry business.

In terms of sales revenues, SMC's domestic Food operations posted16bn pesos in the second quarter, growing 18% from 2004.

The domestic Food Group includes San Miguel Pure Foods Co. Inc. (and its subsidiaries, San Miguel Foods, Inc., Magnolia, Inc. and The Purefoods-Hormel Co.), Monterey Foods, and SMC's Agribusiness division.

The group's notable second quarter operating income figures mitigated the weak first quarter results, the company said.

Poultry's performance is attributed to improvements in operational efficiencies and installation of the latest technologies in chicken farming such as the controlled climate or tunnel-ventilated system.  This technology increases feed-conversion ratio and average live weight, and lowers mortality rates in the farms.

Aside from poultry, the basic meats business of Monterey Foods and the sustained strong performance of the flour business also contributed to the strong performance in the second quarter.

The flour business is expected to strengthen for the year especially with the inauguration of its milling and flour blending facility in Batangas in May 2005.  The flour facilities have a combined capacity of close to 2,000 tons per day, making it the largest flour producer in the country.

The Food Group's new businesses - coffee (San Mig Coffee 3-in-1 Instant Coffeemixes), pet food (PetKo) and ice cream (Magnolia Dairy Ice Cream) - together fetched almost 200m pesos in sales revenues year-to-date, giving the group bigger growth opportunities in the future.

Management is confident that the strong performance of the company, particularly with the good showing of its poultry and flour businesses, will resound for the remaining two quarters of the year, the company said.