SMC Recurring Net Income Up 29% in First Half to P35.5B

August 09, 2018

San Miguel Corporation (SMC) reported a 29% increase in recurring net income to P35.5 billion for the first six months of 2018 as consolidated revenues reached P499.0 billion, 27% higher than the same period last year. Growth was mainly driven by higher volumes and favorable selling prices.

All major businesses in food and beverage, power, fuel and oil, and infrastructure sustained their respective growth momentum. Including effects of unrealized mark-to-market losses as a result of foreign exchange translation, reported net income amounted to P27.6 billion, up 6%.

SMC’s operating income also registered higher growth at 25% to P67.0 billion brought about by higher volumes and better margins. Group EBITDA amounted to P83.5 billion, 18% higher than the prior year.

SMC President and Chief Operating Officer Ramon S. Ang said, “Increased business focus and a lot of hard work were key to our group’s stellar performance. We’re encouraged by the results we’ve had so far, and are very hopeful that this momentum will carry through for the rest of the year.”

Combined sales revenues of San Miguel Food and Beverage, Inc. for the first half totaled P137.4 billion, 15% higher than P119.1 billion in 2017. Similarly, operating income and net income of P22.9 billion and P15.4 billion both grew 20% from the same period last year.

San Miguel Brewery, Inc. continued its solid performance posting strong volumes mainly driven by increased consumption of our beer products nationwide and boosted by the implementation of new campaigns and consumer and trade programs that continued to further strengthen the equity of our SMB brands. Revenues of P62.5 billion, grew 18% higher vs. last year. SMB’s consolidated operating income and net income of P17.3 billion and P11.8 billion, grew 23% and 26% from last year respectively.

Ginebra San Miguel Inc. likewise recorded a strong first semester performance posting a net income of P506 million, almost double from last year. Core brands Ginebra San Miguel and Vino Kulafu continued to drive growth momentum, benefitting from new thematic campaigns launched early this year and ongoing consumer promotions. Revenues rose 19% to P12.0 billion while operating income reached P862 million, 57% higher than previous year.

Food Group’s consolidated revenues for the first half of the year, reached P62.9 billion, 12.4% higher than last year mainly driven by the strong performance of Agro-industrial and Branded Value-Added businesses. Income from Operations, on the other hand, grew 5.7% to P4.7 billion, on the back of the business segments’ overall higher revenues and improved operational efficiencies. Net income amounted to P3.1 billion.

San Miguel Yamamura Packaging Group’s total sales revenues reached P17.6 billion, 25% higher from 2017. Strong sales from the glass, plastics, metal and our Australian operations continue to drive growth. Operating income amounted to P1.6 billion, 17% higher than 2017.

SMC Global Power Holdings Corp. consolidated revenues grew 41% to P57.4 with additional revenues from Masinloc, Limay and Malita, higher off-take volume of SMELC-RES, higher average realization prices for Sual’s bilateral and spot sales, and higher spot sales from Ilijan.

Operating income reached P17.0 billion, 28% higher than the previous year at P13.3 billion.

Petron Corporation also sustained its strong performance with consolidated net income of P9.5 billion, 16% higher from P8.2 billion in the same period last year. Consolidated revenues grew 32% to P273.5 billion, compared to last year’s P207.0 billion, mainly driven by sustained sales volumes of its Philippine and Malaysian operations and higher prices of crude oil and finished products. Consolidated operating income amounted to P15.6 billion, higher by 7% than last year.

SMC’s Infrastructure business, meanwhile, posted consolidated revenue of P12.1 billion, 11% higher than last year on the back of continuous growth in traffic volume at all operating tollroads. Operating income grew 19% to P6.2 billion.