MANILA: The Philippine unit of Nestle SA, the world’s largest food and drink company, said on Tuesday it is investing P2 billion to build a new plant to make a key ingredient in its Milo chocolate and malt drink.
Nestle Philippines Chief Executive Officer Jacques Reber said the new facility, located in Batangas province south of the capital, will start operations late next year. It will be the fourth Nestle plant in the world producing ‘protomalt’, a set of carbohydrates extracted from cassava and barley, he said.
With nearly $2.6 billion sales in 2015, the Philippines is Nestle’s eighth-largest market worldwide and the second-biggest in Asia after China. Milo is a “significant” contributor to Nestle Philippines revenue, Reber said, without disclosing sales figures.
The Philippines is Nestle’s second-biggest market after Malaysia for Milo, which is sold in powder form to be mixed with water or milk, or as a ready-made drink. Developed in Australia in the 1930s, Milo is marketed by Nestle in a range of countries in the Asia-Pacific region and Africa.
Nestle Philippines has invested nearly $300 million in the past five years to expand the production capacity of various brands. Reber said the new plant will cater to the domestic market, but could be expanded for exports of protomalt.
