Cebu Air jacks up JG Summit’s Q1 earnings

GOKONGWEI-led conglomerate JG Summit Holdings chalked up a net profit of P6 billion in the first three months, 11.2 percent higher year-on-year, led by its airline business which benefited significantly from the slump in fuel prices.

Excluding non-recurring items, core net income increased by 10.1 percent to P6.2 billion for the first quarter, JG Summit reported to the Philippine Stock Exchange on Friday.

Aviation unit Cebu Air’s net income for the three months ended March 31 surged to P2.2 billion from P164.2 million. Gross revenues rose by 20.7 percent year-on-year to P11.8 billion attributed to the increase in passenger revenues by 22.2 percent to P10.8 billion in turn due to the increase in passenger volume and the number of flights.

Number of flights went up by 14.3 percent year on year as the company – which operates budget carrier Cebu Pacific – added more aircraft to its fleet to 55 as of end-March from 51 aircraft a year ago. The increase in average fares by 8.1 percent also contributed to the improvement of revenues. International flights increased by 10.5 percent year on year with the launch of long haul operations to Kuwait, Sydney and Riyadh in the latter part of 2014.

Food manufacturing arm Universal Robina Corp. (URC) posted a first quarter net income of P3.2 billion, 3.8 percent lower year-on-year as higher wheat prices tempered the flour business. Overall sales grew by 24.3 percent during this period. The group started consolidating Griffin – a leading snackfood company in New Zealand – into URC International starting mid-November upon closing of the acquisition.

Property arm Robinsons Land Corp. posted a consolidated net income of P1.4 billion, up by 23.8 percent. Total real estate revenues were up by 20.8 percent year-on-year to P4.5 billion while hotel revenues amounted to P439.7 million. The commercial centers division contributed 46 percent or P2.3 billion of RLC’s gross revenues, posting a 10.6 percent growth. The residential division contributed 34 percent or P1.7 billion, a growth of 30.9 percent versus last year’s level. The office buildings division contributed 11 percent or P524 million of revenues, up by 42.8 percent year-on-year.

Meanwhile, the petrochemical business under JG Summit Petrochemicals Corp. and JG Summit Olefins Corp. incurred a higher net loss of P892 million in the first quarter from P24.5 million in the same period last year. This was due to higher expenses and net foreign exchange losses for the period.

In banking, Robinsons Bank Corp.’s net earnings dropped to P28 million for the three months from last year’s net income of P30.7 million as the bank recorded higher final taxes related to higher volume of transaction on government securities during the period.

Meanwhile, JG Summit also reported that revenues from core investments declined this period compared to same period last year as dividend income received by the group dropped by 23.3 percent to P1.6 billion in the first quarter. This was attributed to lower dividends declared by PLDT for the period. Equity in net earnings of associates, primarily from investments in UIC and Meralco, slightly increased to P1.7 billion from P1.6 billion in the same period.