Gokongwei’s flagship JG Summit rakes in P22.2B profit at end-Sept

JG Summit Holdings Inc., the Gokongwei family’s flagship conglomerate, saw profits surge higher in the nine months through September on earnings from its core consumer, property and airline businesses.

JG Summit said in a stock exchange filing that net income from January to September hit P22.2 billion, a gain of 50 percent over the same period in 2018.

Revenues for the period amounted to P239.6 billion, up 10.5 percent, as snack food and beverage company Universal Robina Corp., Robinsons Land Corp. and Cebu Air Inc., which operates budget airline Cebu Pacific, delivered higher earnings.

Gains on those units offset the slowdown of JG Petrochemicals Group.

“The current overall economic slowdown has led to tepid petrochemicals demand,” said JG Summit, which also cited the effects of the United States-China trade row.

“Overall, the diversity of our portfolio including our minority investments has resulted in the group’s increase in earnings,” JG Summit president and CEO Lance Gokongwei said in a statement.

The group also receives dividends from its 8-percent stake in telco giant PLDT Inc. It also owns 29.56 percent of Manila Electric Co. and 30 percent of Global Business Power Corp.

JG Summit said equity in net earnings of associated companies and joint ventures rose over 41 percent to P11.2 billion.

During the third quarter alone, profit declined 2.4 percent to P4.84 billion even as group-wide revenues went up 12.2 percent to P81.16 billion.

Profitability took a hit as JG Summit said financing costs and charges rose 27.8 percent to P3.02 billion during the third quarter on higher debt.

JG Summit also cited a change in accounting rules on how interest expenses are booked.

The company said the increase in financing costs and charges would have been less when removing the impact of the new accounting rules under the Philippine Financial Reporting Standards 16.