AEV’s Q2 profit down 63%

Sabin Aboitiz

Conglomerate Aboitiz Equity Ventures Inc. saw a 63-percent year-on-year drop in second quarter net profit to P2 billion as most businesses – except for the food segment – were affected by the coronavirus (COVID-19) pandemic-induced lockdown protocols.

This brought AEV’s net profit for the first semester to P4 billion, down by 55 percent compared to the previous year, AEV disclosed to the Philippine Stock Exchange on Tuesday.

“The current COVID-19 crisis continues to disrupt and impact our organization in different ways. Throughout this, we have given significant attention to our ability to adapt to changes and to prepare for uncertainties,” Aboitiz group president and chief executive officer Sabin Aboitiz said.

“For the rest of the year, our goal is unchanged: to remain resilient and for our business units to be in the best possible position when we emerge from this crisis, in order to support the country’s economic recovery. As One Aboitiz, we will continue to be one with the nation in its fight against COVID-19,” Aboitiz added.

Power accounted for 49 percent of the total income in the first half while the banking business accounted for 39 percent. Income contribution from the food segment stood at 14 percent while the infrastructure and real estate businesses incurred net losses.

Bucking the downturn across other businesses, AEV’s non-listed food subsidiaries – Pilmico Foods Corp., Pilmico Animal Nutrition Corp. and Pilmico International Pte. Ltd. which includes Gold Coin Management Holdings Ltd., contributed P795 million in six-month net income, 44 percent higher year-on-year.

The local farm business incurred a net loss of P501 million due to decreased selling prices and sales volume resulting from the spread of the African Swine Fever in Luzon, as well as a decline in margins following higher farms and meat processing costs. However, the feeds business grew net income by 296 percent year-on-year to P448 million, due to lower raw materials and financing costs. The flour business segment also grew earnings contribution by 50 percent year-on-year to P346 million.

Income contribution international subsidiaries surged by 205 percent year-on-year to P502 million, due to the increase in income contribution of Gold Coin resulting from an increased equity ownership, alongside increased volumes from Gold Coin’s China, Vietnam, Malaysia, and Sri Lanka operations.