San Miguel Food profits up in H1 on fatter sales

San Miguel Food and Beverage Inc. (SMFB) reported fatter net earnings in first half on the back of higher sales growth posted by its food, beer and spirits businesses despite elevated inflation.

Net income rose by 6 percent year-on-year to P20 billion in the first six months of 2024, SMFB told the Philippine Stock Exchange on Wednesday.

Figures showed earnings before interest, taxes, depreciation and amortization (Ebitda)—another measure of financial health—jumped by 5 percent to P33.9 billion. In a statement, Ramon Ang, company chairman, said SMFB “had a strong start to the year” even in the face of high inflation that can hurt demand.

READ: SMFB profit up 10% to P38.1B in 2023

”We remain focues on leveraging our strengths to drive growth and efficiency,” Ang said.

Dissecting SMFB’s latest financial results, the company’s six-month consolidated sales grew by 4 percent to P192.9 billion, while income from operations hit P26.6 billion, fatter by 16 percent.

That performance was driven by healthy sales recorded by all its business segments. Figures showed San Miguel Foods saw a 3-percent sales growth to P87.8 billion due to “double-digit” expansion in its prepared and packaged foods, and “resilient” poultry sales.

SMFB said its key products such as Tender Juicy Hotdogs, Purefoods Luncheon Meat, Magnolia dairy, and San Mig Coffee “maintained strong sales.” Meanwhile, a combination of higher volumes, improved pricing, and lower raw material costs contributed to the 41-percent increase in San Miguel Food’s Ebitda to P10 billion, while operating income doubled to P6.4 billion.

Meanwhile, “improved” sales in the second quarter pushed up the first half revenues of San Miguel Brewery Inc. by 1 percent to P75.1 billion. The company said it expects stronger performance in the second half of 2024, supported by “targeted sales initiatives and increased focus on specific channels.”

Lastly, spirits sales of Ginebra San Miguel Inc. climbed by 18 percent to P30 billion on the back of a 10-percent volume growth, along with “effective marketing campaigns, new products, and expanded distribution.”

Despite rising costs amid elevated inflation, Ginebra San Miguel’s six-month operating income rose by 31 percent to P4.4 billion which, SMFB said, showed “strong brand performance and supply chain efficiency.”

Shares in SMFB ended the Tuesday trading up by 0.32 percent to P46.70 apiece, tracking an upswing in the main index.