Robust consumption amid pandemic boosted URC profit in Q2 by 76%
Robust consumption of snack foods, noodles, powered drinks and other food ingredients by locked-down households boosted the second quarter net profit of Gokongwei-led Universal Robina Corp. (URC) by 76 percent year-on-year to P3.8 billion.
This brought URC’s first semester net profit to P6 billion, 13 percent higher year-on-year, as the regional food and beverage group benefited from the shift in consumer spending to essential items during the coronavirus pandemic.
“The current uncertainty driven by COVID-19 is still evolving but we are motivated by the fact that business results in the first half turned out better than our severe lockdown forecasts. While we have business continuity plans quickly set in motion, we were bracing for the worst due to quarantine restrictions, supply chain disruptions and fast demand shifts. Fortunately, our focus on execution and the heroic efforts of URC people and partners helped us deliver essential food and drinks to customers, consumers, communities and front-liners,” URC president Irwin Lee said in a press statement. For the second quarter, URC’s operating income of P4.3 billion went up by 16 percent versus last year, attributed to a favorable category mix and disciplined cost control amid the pandemic.
April to June net sales reached P34 billion, up by 1 percent year-on-year, due to the strong growth in snack foods, noodles, powdered drinks, animal feeds, flour and sugar, that offset out-of-home consumption declines in candies and ready-to-drink beverages.
Most parts of the country were locked down from mid-March to end-May, which is widely expected to result in a deeper economic contraction in the second quarter. Most businesses took a heavy beating during the second quarter, except those catering to essential needs like URC.
For the first semester, the double-digit profit growth was driven by an 8-percent year-on-year increase in operating income to P8.2 billion alongside lower foreign exchange losses. —Doris Dumlao-Abadilla INQ
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