LT Group Q1 profit surges 61% to P3.63B

Tycoon Lucio Tan-led conglomerate LT Group Inc. (LTG) jacked up its first-quarter net profit by 61 percent year-on-year to P3.63 billion on higher contribution from its tobacco, banking and property businesses.

The tobacco business contributed 65 percent of total attributable income compared to the 45 percent share a year ago as a major competitor was penalized by the government for illicit trading last year.

The banking business under Philippine National Bank (PNB) contributed 23 percent of earnings, followed by Asia Brewery Inc. (ABI) at 4 percent. Tanduay Distillers Inc. (TDI) and Eton Properties contributed 4 percent and 3 percent, respectively, while the group’s 30.9-percent stake in Victorias Milling Co. Inc. (VMC) contributed 2 percent.

Income from the tobacco business under PMFTC Inc., a joint venture with Philip Morris, was P2.36 billion in the first quarter, while equity in net earnings from LTG’s 49.6-percent stake reached P2.29 billion, more than double the P1-billion contribution last year.

The cigarette industry’s total volume was estimated to have decreased by 8 percent to 15.3 billion sticks in the first quarter, largely due to excise tax-driven price increases. Continued price increases may result in a further drop in volume, the group said.

On the banking business, PNB’s first-quarter net income rose by 18 percent year-on-year to P1.5 billion. Net interest income expanded by 25 percent to P6.43 billion as loans and receivables increased by 17 percent to P504 billion while net interest margin improved to 3.3 percent from 3 percent.