Conglomerate Aboitiz Equity Ventures Inc. (AEV) posted a 27-percent year-on-year drop in first quarter net profit to P3.5 billion due to slower earnings by its power, banking and food businesses.
Excluding nonrecurring loss of P334 million during the period, which was mainly due to unrealized foreign exchange losses from the revaluation of dollar-denominated assets and recognized losses on hedging instruments, AEV’s core net income was P3.9 billion, down by 27 percent year-on-year.
“Despite challenges, our long-term fundamentals remain intact. Our growth platform has expanded to 10 other countries across the Asia Pacific, providing us natural listening posts for expansion opportunities,” said Erramon Aboitiz, AEV president and CEO.
“Our economy continues to grow at a healthy rate, and that is great for us Filipinos as well as all of us in business who are supplying the different consumers in the Philippines. We continue to invest in all of our units both here and abroad. We remain committed to our purpose of driving change for a better world by advancing business and communities,” Aboitiz added.
Power accounted for 71 percent of total income while the financial services and food made 27 percent and 4 percent, respectively. The real estate and infrastructure units incurred losses.
AboitizPower’s core net income in the first quarter hit P4.1 billion, down by 21 percent year-on-year. Taking into account nonrecurring losses of P440 million in the same period, net income was P3.6 billion, or down 9 percent lower from a year ago.
Income contributions from the generation and retail electricity supply businesses fell by 12 percent year-on-year to P3.4 billion in the first quarter. Higher volume and cost of purchased power due to exceptionally high spot market prices gnawed on cash flow. The company had purchased replacement power as a result of outages and overcontracting in anticipation of incoming capacities.
AboitizPower’s net income contribution to AEV in the first quarter declined by 9 percent year-on-year to P2.8 billion.
The income contribution of Union Bank of the Philippines fell by 25 percent to P1.1 billion. UnionBank and its subsidiaries recorded a net income of P2.2 billion in the first quarter, down by 26 percent year-on-year, mostly due to nonrecurring items that boosted earnings in the comparative year. —DORIS DUMLAO-ABADILLA