JG Summit regains profitability despite airline woes

The Gokongwei family’s flagship JG Summit Holdings Inc. returned to profitability in 2021 as most businesses saw stronger earnings, blunting heavy losses from its airline unit during the second year of the COVID-19 pandemic.

In a statement on Wednesday, JG Summit said net income last year had reached P5.1 billion, reversing a loss of P468.16 million in the previous year.

Profits in 2021 were bolstered by a nonrecurring gain from the sale of businesses in Australia and New Zealand by industrial arm Universal Robina Corp. and tax relief from the passage of the Corporate Recovery and Tax Incentives for Enterprises Act.

“For the full year of 2021, the business experienced a mixed set of results,” JG Summit president and CEO Lance Gokongwei said.

“Our food and banking segments continued to be stable while the mobility restrictions and quarantine measures still affected our real estate (specifically malls) and airline businesses,” he added.

The company reported total revenues of P230.6 billion, up 13 percent. Core earnings alone were up 672 percent to P3.5 billion. Earnings were also lifted by its significant investments in Manila Electric Co., PLDT Inc. and Singapore Lan Group.

Not over the hump

“We are cautious, though, that headwinds continue to affect us with the current volatility in oil prices, rising input costs and peso devaluation will result in margin pressures,” Gokongwei said.

“To mitigate this, we will continue to be proactive in managing pricing and product mix while simultaneously putting in place productivity initiatives across our businesses,” he added.

Universal Robina booked a net income of P23.3 billion, up 117 percent, driven by its commodities and international segments amid an “overall market contraction.”

Robinsons Land Corp.’s profits jumped by 53 percent to P8.1 billion.

The petrochemicals segment via JG Summit Olefins Corp. incurred a P2.1-billion net loss due to depreciation costs, charges and foreign exchange losses.

Robinsons Bank recorded a 33-percent jump in net income to P1.2 billion.

Cebu Air ended 2021 with a net loss of P24.9 billion on lower demand for flights.