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JG Summit H1 profit down 30.8% to P5.17B

Peso depreciation vs dollar results in P2.97B forex losses
/ 04:20 AM August 15, 2013

Gokongwei-led conglomerate JG Summit Holdings Inc. saw a 30.8-percent year-on-year decline in its first semester net profit to P5.17 billion due mainly to treasury losses.

JG Summit’s core earnings before taxes rose by 31.7 percent to P13 billion from year-ago level as all subsidiaries achieved double-digit growth except for the petrochemical unit.

Group-wide revenue went up by 8.9 percent to P75.4 billion.


However, JG Summit said the 5.2-percent depreciation of the peso against the dollar during the first semester resulted in a foreign exchange loss of P2.97 billion, a reversal of the P1.3 billion foreign exchange gain in the same period last year.

The group also incurred a mark-to-market loss of P155.37 million, compared to a gain of P992 million a year ago, due to the volatility of the global financial markets.

Consolidated cash flow rose by 24.5 percent year on year to P18.35 billion.

In separate disclosures to the Philippine Stock Exchange, key operating units Universal Robina Corp. and Robinsons Land Corp. reported higher net profits in the first nine months of their fiscal year ending in September.

In October 2012 to June 2013, URC registered a 38.7-percent year-on-year growth in net profit to P8.49 billion on higher volumes and margins, boosted by some one-time gains.

Property unit Robinsons Land Corp. reported that net profit for the nine-month period rose by 8.8 percent year on year to P3.65 billion on higher earnings across the commercial, residential and hotel segments of its property development business.

For URC, sales grew by 13.3 percent in October 2012 to June 2013 to P60 billion.

Philippine-branded consumer foods business was the main driver of the company’s growth as this unit increased sales by 22.4 percent. Its international business also accelerated sales momentum in the third quarter of its fiscal year.


The growth was further buoyed by strong sales from its sugar and farms businesses, which grew by 42.2 percent and 21.4 percent, respectively, in the same period.

URC’s operating income stood at P7.64 billion for the nine months ending June, 32.1 percent higher than the level a year ago.

“Lower prices of soft commodity inputs and double digit increase in sales volumes resulted in margin expansion for branded foods while the sugar business benefited from the early start of the milling season and farms from better selling prices of hogs,” the company reported.

Net profit growth was also boosted by one-time gains from the sale of URC’s investment portfolio last January. At the same time, the company benefited from lower financing cost as it retired some short- and long-term debts.

For RLC, the commercial centers division contributed 44 percent, or P5.5 billion, of the gross revenue, posting a 15.7-percent growth. The residential division contributed 38 percent, or P4.7 billion, up by 42.8 percent year on year.

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TAGS: Business, Earnings, JG Summit, net profit
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