Household feud, falling earnings amid turmoil in milling enterprise

Publicly listed Liberty 4 Mills (LFM) has reached the largest problem confronting its 67 years of company existence amid the swirl of a brewing household feud, falling earnings, and the prospects of remodeling from what it’s now to what it could and should grow to be ensuing from a enterprise setting that’s altering. 

Reframing the state of affairs, LFM is not any much less at a significant crossroads to make modifications in its working administration and monetary technique, organizational tradition and competencies to reverse eroding revenue margins, depressed progress charges, and resolve its company instructions presently beneath strain from a turmoil in its flour milling enterprise and pernicious household feud. 

The familial battle in LFM is a bitter intra-corporate struggle between members of the identical household, involving the  group led by chairman emeritus William Carlos Uy and his brother John Carlos Uy towards the group of Sandra Judy Uy, former president and board member, and Stella Marie Jill Uy, former vice chairman and assistant treasurer.

In official firm disclosures, Stella Marie Jill Uy is just not recognized as a relative of the controlling Uy household in contrast to Sandra Judy Uy who, whereas at odds with the opposite facet, is the daughter of chairman emeritus William Carlos Uy.

The battle between the 2 camps is centered on two core points, particularly: company governance abuses and monetary irregularities. Every occasion is blaming the opposite for the misdeeds.

In late 2025, Sandra and Stella Uy already petitioned the Securities and Alternate Fee (SEC) to analyze the board for breach of fiduciary obligation and battle of curiosity concerning “related-party transactions” with the corporate’s distributor, Parity Values Inc, (PVI).  

PVI is liable for about 57 p.c of LFM’s gross sales. It’s also LFM’s greatest shareholder however has an collected unpaid debt to LFM amounting to P805 million. Due to the inter-locking relationships, LFM officers like William Ang and John Carlos Uy of the controlling Uy group are company secretary and president of PVI, respectively.   

PVI’s large unpaid money owed to LFM has put a pressure within the latter’s viability and sustainability, forcing a sequence of property disposals just like the sale of the Liberty Constructing in Makati Metropolis to subsidiary LFM Properties Company in early 2023.  

In flip, the present Uy management launched an inner probe into 9 distinct governance points involving previous officers like Sandra and Stella Uy.  These points embrace alleged over-procurement of wheat and non-disclosure of zoning issues, which the board claims might value the corporate P300 million.

As of the top January 2026, the LFM’s board has made important modifications in its management and inner company restructure. Notably, the corporate is working for a discount of its board measurement from 11 to 7 members, in step with present governance requirements. Jamie Marie C. Ang was additionally elected to the board on January 28, 2026 to take the seat vacated by Daniel R. Maramba, who resigned. This consolidated the maintain of the controlling Uy group with John Carlos Uy, the son of chairman emeritus William Carlos Uy, who was already holding the twin function of chairman and president of LFM.  

The board has additionally reportedly appointed formally a monetary advisor to overview a possible exit or sale of the flour milling enterprise to resolve its ongoing inner conflicts and monetary pressures. It listed “demerger” as one of many a number of paths it would take, in keeping with its disclosure to the PSE. This could contain separating the standard flour milling enterprise from the corporate’s different high-value property, significantly its actual property holdings.

Trade outlook and efficiency metrics of LFM and LPC 

Wanting nearer on the monetary efficiency of the LFM, it appears just like the household feud is clouding the visons of the stakeholders, and derailing the corporate. Based mostly on submitted numbers, LFM has a secure, worthwhile, and dividend-paying efficiency. Revenues averaged P1.42 billion from 2020 to 2024. Of observe, income for 2023 reached P1.544 billion. The corporate skilled a 14% improve in gross sales income for the 9 months ended September 30, 2023, pushed by larger gross sales quantity and value changes.  

The corporate has excessive profitability: it has a “Tailing Twelve Month” (TTM) internet revenue margin of 41.7%, considerably above trade averages, and with a TTM return on funding (ROI) of 20.64%.  

LFM declared a 3% (P0.30 per share) money dividend in Could 2024, alongside a property dividend involving LFM Properties Company, with whole property standing at P4.58 billion as of March 31, 2024.

In early 2024, too, the corporate began to reel from elevated enter prices in addition to endure monetary pressure from the load of excessive receivables — by you understand who.  

In the meantime, the Philippine flour milling trade is increasing. Imports of wheat was estimated to have reached 7.2 million metric ton (MT) in 2024-2025 attributable to inhabitants progress and rising demand for bakery merchandise. However together with this growth, the market has turned aggressive. And amid larger uncooked materials costs, different gamers like Common Robina Company and San Miguel Meals & Drinks Inc. have tailored to new, automated services to spice up capability and competitiveness to satisfy rising demand for bread, pasta, and different wheat-based merchandise.

Challenges and postscripts 

The Philippines depends totally on imports for wheat, with roughly 95.2% of its necessities sourced from the USA. The market has additionally grow to be extra aggressive with 22 lively firms, prompting some to diversify their product strains. However, sturdy demand for poultry and aquaculture merchandise retains feed wheat consumption regular. 

To remain within the play, trade gamers are more and more turning to know-how to enhance effectivity and meet the onslaught of foreign money depreciation, and pressured gross margins, precipitated by the Russia-Ukraine battle.  

In abstract, LFM’s income comes from flour (exhausting/smooth) and feed merchandise (approx. 81%), with a good portion from rental revenue (19%).  

By the way, a current research claims that LPC is just not a cut price primarily based on present accounting fairness. It’s a extremely leveraged play on the appreciation of its particular buildings. You might be primarily paying P1.80 for each P1 of internet property at present recorded on their books. (Extra on this in a succeeding article.) – Rappler.com

(The article has been ready for normal circulation for the studying public and should not be construed as a suggestion, or solicitation of a suggestion to purchase or promote any securities or monetary devices whether or not referred to herein or in any other case. Furthermore, the general public needs to be conscious that the author or any investing events talked about within the column could have a battle of curiosity that might have an effect on the objectivity of their reported or talked about funding exercise. You might attain the author at densomera@yahoo.com)