JG Summit swings to P5 billion profit in Q1

MANILA, Philippines — Gokongwei-led JG Summit Holdings Inc. rebounded strongly in the first quarter of the year with a reported income of P5 billion, a turnaround from a net loss of P2.8 billion a year ago.

Core net income was at P4.4 billion compared to a P689 million loss a year ago as Cebu Air Inc. (CEB) achieved its first profitable quarter since the pandemic and property arm Robinsons Land Corp. (RLC) doubled its earnings year-on-year (YoY), while Universal Robina Corp. improved operating margins.

Cebu Pacific posted a net income of P1.1 billion in the first quarter, a reversal of the P7.6 billion net loss a year ago. while RLC generated a net income of P2.7 billion, nearly twice its  P1.4 billion profit  a year ago. URC’s income was flat at P3.4 billion.

JG Summit’s revenue reached P82.3 billion during the period, up 28 percent.

Lance Gokongwei, president and CEO of JG Summit, said the momentum that started in the latter part of 2022 continued to accelerate in the first quarter, with strong topline results and a recovery in core earnings.

‘Thus, despite the lingering market challenges on the petrochemicals industry, most of the conglomerate’s core businesses are now poised to approximate or even eclipse their pre-pandemic highs with strong recovery in our airline, consistent growth of our food driven by buoyant demand, and the reliability of our real estate earnings,” Gokongwei said.

He said inflation has also been cooling, which should result in further margin recovery across the group’s portfolio.

Inflation slowed down to 6.6 percent in April from 7.6 percent in March.

“We are continuing to invest for growth with our planned capex program in place, such as new aircraft deliveries for Cebu Pacific, land banking and development projects for RLC, and capacity additions for URC, to name a few. This appetite to invest supports our belief that demand will continue to be robust for the balance of the year and onwards,” Gokongwei said.

With the recovery in travel demand, JG Summit likewise witnessed revenues tripling in its air transport business while it saw sustained growth momentum across its property and food segments.

Likewise, there were sizable increases in its equity earnings from Manila Electric Company and its dividends from PLDT.

Equity earnings from Meralco amounting to P2.1 billion improved by 30 percent.  This was mainly on account of the strong performance of its power generation units in the Philippines and in Singapore. Its power distribution arm also saw a two percent growth in energy sales volumes.

PLDT, meanwhile, declared a regular dividend of P45 per share or three pesos higher than last year, and an additional special dividend of P14 per share. This led to a total dividend income of P1.4 billion from PLDT, up 40 percent YoY, JG Summit said.