JG Summit doubles earnings in ’04

JG Summit Holdings Inc., the investment holding company of the Gokongwei family, more than doubled its net income last year to P5.9 billion from P2.07 billion in 2003, mainly due to extraordinary gains from debt repayment and gains from investments.

In a financial report filed with the Securities and Exchange Commission, JG Summit said it posted a recurring income of P2.66 billion last year or 17.9 percent higher than the previous level as a result of gains from mark-to-market of debt securities .

Consolidated revenues rose 13.7 percent to P61.55 billion from P54.12 billion, driven by the strong performance of its food, air transportation, real estate and textiles businesses. Bulk of total revenues came from JG Summit’s food manufacturing arm Universal Robina Corp. (P27.23 billion) followed by Cebu Pacific Air (P7.4 billion), Digital Telecommunications Phils. (P7.4 billion), Robinsons Land Corp. (P4.7 billion), and Litton Mills (P2.78 billion).

All its businesses posted sales increases except for the petrochemicals unit which reported a five-percent decline in revenues from P6.7 billion to P6.4 billion.

Net operating income grew 50.6 percent to P2.59 billion from last year’s P1.72 billion, JG Summit said.

Meanwhile, cost and expenses went up by 12.5 percent to P58.95 billion from P52.39 billion, largely due to higher expenses incurred by its telecommunications business, particularly the mobile phone business.

Digitel widened its net loss last year by 40 percent to P1.81 billion from P1.29 billion in 2003.

This was despite a 14.4-percent increase in revenues from P6.47 billion to P7.4 billion. The company’s cost and expenses surged to P7.69 billion or an increase of nine percent from P7.02 billion as a result of higher interest expenses and financing charges.

EBITDA (earnings before interest, taxes, depreciation and amortization) grew 42.2 percent to P19.78 billion from P13.91 billion. Excluding the non-recurring items, EBITDA would have increased by only 17.3 percent from P14.09 billion to P16.53 billion.

Cebu Pacific posted a net income of P130.3 million, more than 19 times the P130.3 million reported in 2003. Revenues rose 21.6 percent to P7.41 billion from P6.09 billion largely due to improved domestic operations.

On the other hand, net losses of JG Summit Petrochemicals increased to P1.66 billion from only P119 million as it recognized a P1.45-billion impairment loss on its assets. The company’s revenues likewise fell to P6.37 billion from P6.71 billion.