MANILA, Philippines - The parent firm of 2GO Group Inc. is aiming to increase its net income by more than four times this year from a year ago as it reduces its costs and as it benefits from the country’s economic growth and tourism push.
2GO president and chief executive officer, Sulficio Tagud, Jr. told reporters Negros Navigation Co. (Nenaco) is targeting a net income of P858 million this year from just P181 million last year.
He said the firm expects to achieve the higher net income this year as it reduces its costs.
With the integration of its shipping operations, he said, Nenaco was able to reduce the number of vessels used by removing redundant routes.
“That itself constitutes savings in operations,†he said.
The consolidation of shipping operations has also allowed the company to reduce manpower and facilities, generating savings.
Apart from the reduction in costs, the country’s positive economic performance is likewise seen to help support higher net income for this year.
Tagud said the strong domestic consumption which is helping drive growth in manufacturing activity in the country, is seen to support 2GO Group’s cargo business as more goods have to be transported.
He noted that during the last five years, 2GO’s cargo volume has been growing at an average of four percent.
For the first four months of this year though, its cargo volume rose 12 percent. “We expect that to be sustained for the rest of the year...should be about 10 or 12 percent,†he said.
He said the government’s tourism push would also help them achieve higher net income this year as well.
“There are more economic activities so there would be more people traveling, not only for tourism but for business,†he said.
He said they expect passenger volume to grow 12 percent this year from an average growth of six percent in the last five years.