JG Summit profit falls 40% to P7.82B

MANILA, Philippines - JG Summit Holdings Inc. reported a 40 percent drop in net profit in the first nine months of the year to P7.82 billion, weighed down by lower earnings from its airline and telecommunications businesses as well as decreased foreign exchange gain and mark-to-market losses.

In a financial report submitted to the stock exchange, JG Summit said it recognized market valuation losses of P116.97 million, a reversal of the P1.01-billion net gain a year ago due to the decline in the market values of bond and equity investments for the period.

Core earnings declined 15.2 percent to P13.24 billion while EBITDA slid 5.9 percent to P25.74 billion.

Consolidated revenues, however, grew 16.5 percent to P105.31 billion due to the strong performance of all business units.

Airline unit Cebu Pacific saw its net earnings drop 54 percent to P2.22 billion from P4.83 billion largely due to higher aviation fuel prices. Revenues went up 13.6 percent to P24.26 billion on the back of a 12.8 percent rise in passenger volume to 8.7 million. Passenger revenues rose to P19.8 billion owing to the increased number of flights and higher seat load factor of 87 percent.

Net earnings of Digital Telecommunications Philippines Inc. plunged to P15.7 million from P850.8 million due to lower revenues from international and domestic tolls. Consolidated service and non-service revenues went up 15.7 percent P14.03 billion, driven by the 22.2 percent growth in the wireless business brought about by an aggressive drive to increase market share through subscribers’ acquisition efforts and regionalized product offerings.

The wireless communication services reported a 22.2 percent growth in operating revenues to P11.65 billion, owing to the continued success of the unlimited service portfolio, particularly the Text Unlimited products, which increased 41.4 percent.

Meanwhile, the net loss of JG Summit Petrochemicals Corp. decreased to P88.9 million from P317.46 million as a result of higher sales volume from 38,556 metric tons to 68,277 MT.

JG Summit reported that equity earnings from associated companies and joint ventures dipped 31 percent to P1.74 billion from P2.52 billion. The decline is mainly due to lower income recorded by UIC this year, from Songapore $225.27 million last year to S$150.27 million this year due to recognition of lower gain on sales of residential properties from S$164.12 million to S$59.92 million during the period.

Meanwhile, Robinsons Bank posted a net income of P286.55 million but since the company’s stake in the bank is reduced to 70 percent after its merger, only P202.97 million was recorded by the company as its net income from the bank, a decrease from last year’s P6.51 million.