AEV earnings more than double in January-September

MANILA, Philippines — Net earnings of Aboitiz Equity Ventures Inc. (AEV), the listed investment holding firm of the Aboitiz family, more than doubled in the nine months ending September on the back of strong performance of all its business units.

In a disclosure to the Philippine Stock Exchange yesterday, AEV registered a 135 percent jump in its January to September consolidated net income from P8.3 billion last year to P19.5 billion this year.

In the third quarter alone, net profit rose 38 percent from P4.4 billion to P6.1 billion.

Power subsidiary Aboitiz Power Corp. accounted for 58 percent of the total income, financial services subsidiary Union Bank of the Philippines with 26 percent, the food group with seven percent, infrastructure arm Republic Cement & Building Materials Inc. with six percent, and real estate unit Aboitiz Land Inc. with three percent.

“As we approach the end of 2021, we see the light at the end of the tunnel growing brighter in terms of the pandemic, and the Aboitiz Group’s performance trajectory continues to substantially improve throughout the current health crisis, posting figures that are again much higher than last year’s,” Aboitiz Group president and CEO Sabin Aboitiz said.

AboitizPower’s income contribution to AEV during the period amounted to P12.1 billion this year, 124 percent higher than the P5.4 billion recorded in the same period last year.

Its generation and retail electricity supply businesses, which accounted for 83 percent of total income contribution of the power unit, totaled P16.2 billion, up 157 percent  year-on-year.

This was primarily due to the commissioning revenue from GNPower Dinginin Ltd. Co.  Unit 1, higher water inflow for AboitizPower’s hydro plants, higher availability of the Therma Luzon Inc., Therma South Inc. and Therma Visayas Inc.  facilities, and higher wholesale electricity spot market  dispatch in compliance with the must-offer rule.

Meanwhile, the distribution business recorded an income share of P3.3 billion, a 19 percent increase year-on-year, and accounted for 17 percent of the total income contribution. This was driven by higher energy consumption resulting from recoveries in demand.

UnionBank’s income contribution to AEV amounted to P5.4 billion, a 26-percent growth from P4.3 billion last year, on the back of higher net interest margins, strong trading gains in the first semester, higher foreign exchange income, and higher fees and commissions.

AEV’s non-listed food subsidiaries – namely Pilmico Foods Corp., Pilmico Animal Nutrition Corp., and Pilmico International Pte. Ltd. which includes Gold Coin Management Holdings Pte. Ltd. – contributed P1.5 billion in net income, which is 54 percent higher than the P969 million reported last year.

The farms business segment recovered from a P703-million net loss last year, reporting a net income of P385 million this year.

The feeds business segment saw net income decline by 24 percent to P1 billion due to the continuous rise in raw materials costs, while the flour business segment halved its profit to P283 million on the back of lower by product contributions, in addition to higher operating and administration costs.

AboitizLand and its subsidiaries reported a consolidated net income of P646 million, which surged by 665 percent from P85 million last year due to higher sales, especially of sales with large spot downpayments, as well as the increased construction and site development activities.

Republic Cement’s income contribution to AEV amounted to P1.4 billion, 247 percent higher than the P400 million recorded last year due to stronger market demand from the residential and infrastructure segments, as well as capital investments which resulted in increased overall efficiency. The company also benefited from a one-time gain brought about by the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act, which reduced its deferred tax liabilities.