Conglomerate JG Summit Holdings incurred a net loss of P468 million last year as the COVID-19 pandemic bludgeoned its aviation and petrochemical businesses.
This was a reversal of the P31.28-billion net profit in 2019, when the pandemic had yet to wreak havoc on the economy. Excluding nonrecurring items, however, JG Summit posted a core net income of P450 million in 2020.
Nonrecurring items that gnawed on the 2020 bottom line included fuel hedging losses of airline operating arm Cebu Air and the group’s share in the impairment loss of Meralco Electric Co.
One unit that performed well even during the pandemic was its food and beverage manufacturing arm, Universal Robina Corp. (URC), which grew its net profit last year by 10 percent to P10.7 billion.
Robinsons Bank also grew its profit by 30 percent to P935 million despite a P1.1-billion provision for probable loan losses.
Property arm Robinsons Land Corp. saw a 39-percent decline in profit last year to P5.3 billion.
The biggest drag to JG Summit’s 2020 performance was Cebu Air, which incurred a net loss of P22.2 billion due to lower passenger volume and hedging losses.
JG Summit Petrochemical also booked a net loss of P2 billion versus a net income of P1 billion in 2019, when it reversed an impairment loss amounting to P2.3 billion. This segment saw lower sales volume and selling prices due to weak demand.
“Coming from a very strong 2019, COVID-19 has clearly disrupted the business, which dented our 2020 operating and financial results. Nonetheless, our diversified portfolio of market-leading businesses coupled with the strength of our balance sheet helped us navigate the situation,” said JG Summit president and chief executive Lance Gokongwei.
“The pandemic has further accelerated our multiyear transformation program that we laid out even prior to COVID-19. Most important of which is our thrust on digitalization and customer centricity that enabled us to quickly adapt our business model to the changing customer landscape,” he added.
URC’s operating income rose by 7 percent in 2020, driven by better product mix, lower input cost, favorable forex and cost management initiatives. Full-year topline hit P133.1 billion.
RLC’s 2020 revenue fell by 18 percent to P24.9 billion, as the lockdowns gnawed on its shopping mall and hotel businesses. Cebu Air’s revenue declined by 73 percent to P22.6 billion as the pandemic battered the tourism industry.
JG Summit Petrochemicals’ full year revenue fell by 27 percent to P21.3 billion. Robinsons Bank’s revene rose by 13 percent to P9.2 billion, driven by an 8-percent increase in loans and the P939-million trading gain.
Equity in net earnings of associated companies and joint ventures fell by 43 percent to P7.6 billion in the absence of the P3-billion gain from UIC’s Marina Mandarin deal in 2019 and JG Summit’s P1.3 billion share in Meralco’s impairment loss on its Pacific Light Power investment in 2020. Meanwhile, the dividends received by JG Summit from its investment in PLDT Inc. rose by 51 percent.