SMC profit soars 195% to P20.9B in Jan-Sept

Boosted by gains from divestments and stronger sales, the net earnings of Southeast Asia’s largest food and beverage conglomerate San Miguel Corp. jumped 195 percent in the first nine months of the year to P20.9 billion.

Excluding the one-time gains, San Miguel’s net income would have amounted to P7.13 billion as of September 2008.

Sales revenues expanded 15 percent to P122.2 billion on the back of robust sales of San Miguel’s domestic beer operations and a turnaround in its international beer operations.

Ramon S. Ang, president and chief operating officer of San Miguel, said the conglomerate remains bullish on the company’s prospects next year in spite of tough business conditions.

“The current uncertainty in the global economy presents a challenge for our consumers, customers, suppliers and employees. But we continue to find new ways to cope with an extremely challenging set of business conditions and we’re proud of the results we’ve turned in. We remain confident about our future prospects,” Ang said.

San Miguel Brewery Inc., the flagship local brewery arm, reported a 23-percent growth in net income to P7 billion on the back of a 10-percent rise in revenues to P25.2 billion.

The group’s international beer division, on the other hand, registered revenues of $213 million, up 25 percent from the year earlier level on strong volume gains in Indonesia and Thailand and the recovery of its Hong Kong and North China operations which resulted in an operating income of $1.32 million.

Hard liquor unit Ginebra San Miguel, meanwhile, reported a 39 percent drop in net profit to P199 million from P326 million even as sales went up by 17 percent to P11.15 billion. Income from operations rose 14 percent to P621 million, mainly driven by higher sales from achor brand Ginebra San Miguel, GSM Blue and Gran Matador.

GSMI recently acquired the non-alcoholic beverage assets of its parent firm in a bid to transform itself into a total beverage company and further extend its operations beyond the mature liquor and spirits market into the faster-growing non-alcoholic beverage industry.

Reflecting gains from cost-driven pricing as well as strong performances across the poultry, feeds and processed meat segments, consolidated revenues of the San Miguel Food Group increased 19 percent to P53.1 billion

However, facing enormous pressures of higher costs and weaker consumer spending, San Miguel’s food business ended the period with an operating income of P1.53 billion, down 14 percent from the previous level.

The food group’s flour and dairy business were particularly affected by high wheat and dairy raw material costs, San Miguel said.

The group’s packaging business, meanwhile, continued its recovery, registering marked improvements in its costs structure. In the nine months ending September this year, San Miguel Yamamura Packaging Corp. (SMYPC) registered sales revenues of P14.8 billion, eight percent higher than last year while operating income amounted to P978 million, up 94 percent.

SMYPC continues to focus on developing overseas markets. Exports now reach Australia, South Africa, the Middle East and the US.