SMC Yamamura’s operating profit nearly triples in first half

San Miguel Yamamura Packaging Group (SMYPG), the packaging unit of food and beverage conglomerate San Miguel Corp., said its operating profit nearly tripled to P782 million in the first six months of the year due to higher sales and cost-cutting measures implemented by management to enhance efficiency.

In a statement, SMYPG said income from operations jumped 164 percent during the period from only P296 million a year earlier as sales rose seven percent to P9.91 billion.

“We are encouraged that sales trends for our products continue to improve, particularly for our biggest segments, glass and plastics which represent 42 percent of our total packaging revenue,” said San Miguel president Ramon Ang, who is also chairman of SMYPG.

He said sales of their glass products grew 40 percent on robust demand from domestic customers and exports to Australia and the Middle East.

“Despite economic pressures, we have sales momentum coming from both internal and external customers. We’ve also tapped customers in overseas markets. This is important as we anticipate continued pressures from a weakened economy and a challenging competitive environment,” Ang added.

The packaging unit accounts for around 12 percent of San Miguel’s sales. In the first quarter, it contributed nine percent to the group’s operating income.

San Miguel completed early this year the sale of a 35 percent stake in the packaging business to Nihon Yamamura Glass, a leading Japanese manufacturer of glass and plastics packaging, for around P5.3 billion.

The move is expected to allow both parties to combine their production and marketing expertise in developing new metal, carton and plastics packaging for beverage makers in the Asia Pacific region.

Nihon Yamamura also has presence in China and Taiwan.