San Miguel 2013 net profit jumps 42% to P38B

MANILA, Philippines—Conglomerate San Miguel Corp. grew its 2013 net profit by 42 percent to P38.1 billion, boosted by extraordinary gains from the sale of a stake in Manila Electric Co.

In a press statement, SMC said the sale of its entire 27-percent interest in Meralco yielded a gain of P40 billion, which was able to offset P15.6 billion in foreign exchange losses brought by the strengthening of the dollar in the second half of 2013. Without these forex losses, net income would have improved by 210 percent to P53.6 billion, SMC said.

As core and new businesses brought stable margins and a healthy cash flow, SMC said its consolidated revenues rose 7 percent to P748 billion. New businesses accounted for 70 percent of total revenues, improving by 9 percent over the previous year.

SMC’s traditional beverage, food, and packaging businesses posted a modest growth of 2 percent.

San Miguel Brewery’s operating income amounted to P21.6 billion on healthy margins combined with cost-containment measures even as higher excise taxes dampened sales volume by 9 percent to 204 million cases. Despite this, SMB still matched its year-ago revenue performance of P75.1 billion.

Liquor unit Ginebra San Miguel Inc. incurred operating losses of P793 million on higher excise taxes and lower volumes. Sales recovered in the third quarter, particularly for flagship Ginebra San Miguel, which grew its market share by nearly 3 percent over the previous year. Volumes in the non-alcoholic segment grew 20 percent, with revenues also expanding by nearly double-digits. As a result, consolidated revenues grew by 3 percent to over P14 billion.

For food unit San Miguel Purefoods Corp., operating income improved by 6 percent to P5.5 billion as the company derived better margins from higher selling prices of meats, improved availability of cassava, lower prices of dairy raw materials and better efficiencies.

Purefoods’ revenues improved by 4 percent over the previous year, reaching almost P100 billion, driven mainly by the strong performance of the branded value-added businesses.

San Miguel Yamamura Packaging contributed P2.1 billion in operating income for the year on the back of P25.2 billion in revenues.

On the other hand, SMC Global Power Holdings’ operating income grew by 20 percent to P20.5 billion, which was attributed to lower generation costs for Sual following a deal with Meralco last year. Revenues were slightly lower at P74 billion due to lower prices in the spot electricity market mainly for the supply months of November and December.

Total off-take volumes of 16,163 GWh were slightly better than the previous year’s due to better utilization of the Sual power plant.

Petron Corp.’s income from operations reached P11.7 billion, up 49 percent from the year before. Operating income from Philippine operations grew by 48 percent, reaching P9.5 billion. Petron Malaysia added to overall profitability with a P2.21-billion contribution, a 50 percent increase from 2012.