San Miguel earns P12.7B in 9 months

MANILA, Philippines - Diversifying Conglomerate San Miguel Corp. (SMC) said its net earnings in the first nine months of the year reached P12.7 billion, a huge drop from the P57 billion recorded in the same period a year before.

In a statement, SMC said last year’s earnings reflected huge gains from the sale of its major stakes in subsidiaries. Without the extraordinary gains, SMC’s net income in the period January to September 2009 amounted to P7.61 billion.

The company’s nine-month operating income meanwhile, jumped 50 percent to P19.7 bilion as consolidated sales grew 28 percent to P161.8 billion.

Revenues from domestic beer operations improved nine percent to P40.1 billion while operating income rose 20 percent to P13.5 billion owing to higher volumes and stable raw material costs.   The group sold a total of 131.9 million cases, up three percent from the year-ago level.

International beer operations, on the other hand, maintained it positive growth in Thailand, Indonesia, and Vietman while volumes in North China and exports also consistently posted improvements in the third quarter. However, difficult market conditions in South China dragged consolidated sales revenue to $198 million, slightly lower than last year.

Hard liquor unit Ginebra San Miguel Inc. reported a net income of P748 million, 29 percent higher than in 2009 as domestic volume increased seven percent to 28.9 million cases. This resulted in an 18-percent increase in consolidated sales revenues, which reached P16.6 billion. Benefits from physical hedge of molasses contributed to a 36-percent increase in consolidated operating income, which stood at P1.2 billion.

Consolidated operating income of the SMC Food Group rose to P4.17 billion, surpassing year-ago level by 81 percent, mainly due to favourable raw material prices in poultry, basic meats, flour, and dairy. Consolidated sales revenues stood at P57.7 billion, three percent higher than last year, from volume improvements in poultry, feeds, flour, Vietnam feeds, and processed meats in Indonesia.

SMC’s packaging arm, meanwhile, registered revenues of P17.1 billion, up 18 percent, mainly driven by higher glass and plastics volumes as well as its Australian and Asia-Pacific accounts. Consolidated operating income rose eight percent to P1.49 billion.

SMC’s four power plants, Sual, Limay, San Roque, and Ilijan, generated an estimated 7.4 million megawatt-hours as of September, registering total revenue of P45.2 billion, while operating income reached P5.73 billion. This contributed revenues of P24.8 billion to the company.

It also reported that it recently took over operations of Caticlan Airport, gateway to Boracay island, the country’s top tourist draw, through Trans Aire Development Holding Corp.

The company said it has completed initial improvements to the terminal, sprucing up the building and installing new air-conditioning systems, waiting chairs, security equipment, and power generators. It also said that construction on Phase 1 of its Tarlac-Pangasinan-La Union Expressway project, has already started.

SMC chairman and chief executive officer Eduardo M. Cojuangco, Jr. said that while the company took on bigger initiatives, its traditional businesses continued to do well.