Concepcion Industrial nets P661 M last year, up 3.5%

MANILA, Philippines – Listed appliance maker Concepcion Industrial Corp. (CIC) reported a net income of P661 million, up 3.5 percent year-on-year.

Sales likewise increased 15 percent to P10.6 billion.

In a disclosure to the Philippine Stock Exchange, CIC said the fourth quarter of 2015 showed strong results as sales jumped by over 25 percent, “driven by overall strong market performance in both consumer durables and building solutions with marked contribution of first-time buyers to the sales mix.”

CIC chief executive officer and chairman Raul Joseph Concepcion said the company’s performance reflects strong private sector confidence in the economy.

“Our performance is an affirmation of rising income levels and strong private sector confidence in the economy. This indicates a bright outlook for 2016 and over the long-term. Additionally, last year was a milestone for CIC with selling over 750,000 units of consumer durables from air conditioning, refrigeration and new products in laundry and kitchen appliances as well as breaking the P10-billion mark with sales of P10.6 billion,” he said.

For her part, CIC chief finance officer Victoria Betita said the 3.5 percent growth in earnings came from a high 2014 income base.

“Our fourth quarter results at 25 percent growth shows that CIC remains highly profitable and cash flow efficient despite peso depreciation in the second half of 2015,” she said.

Moving forward, the company is confident it will achieve accelerated growth plans for the next five years.

“2015 was about taking action towards achieving longer-term goals. In addition to our constant focus on cost reduction and profitability, we have made significant strides in building organizational capability and processes,” Bettita said.

However, financial services provider COL Financial said CIC’s earnings were below consensus and estimates.

“We currently have a HOLD rating on CIC with an FV (fair value) estimate of P41.30 per share. Although we continue to have a positive view on CIC’s long-term growth prospect, the company’s short term profitability is being hurt by numerous factors that are pressuring margins. Valuations are also not yet compelling with the stock trading almost at par with its FV despite the downside risk to its earnings,” COL said.

Established in 1962, CIC has grown its business to be the largest most established and experienced provider of airconditioning in the Philippines. It has  developing leading brands, forming strategic alliances and joint ventures with key partners and investing in facilities and capabilities that continue to build its leadership. Among these brands include Condura and Kelvinator.