JG Summit clears P4.86 B in 1st qtr

MANILA, Philippines - A steep drop in the performance of its petrochemical business weighed down profits of JG Summit Holdings Inc. in the first quarter.

“Net income from equityholders of the parent slightly dropped to P4.86 billion from P4.91 billion in first quarter of 2012,” JG Summit said in a disclosure.

The listed holding firm of taipan John Gokongwei said consolidated revenues rose 8.4 percent to P38.43 billion from P35.46 billion.

“Revenues from our core businesses (foods, airlines, real estate), which posted double-digit percentage growth, and the consistent dividend income generated from our core investments were major contributors to the increased revenues for the first three months,” JG Summit said.

However, the lower income of the petrochemicals business dragged the company’s bottom line.

Revenues of JG Summit Petrochemicals Corp. sank 63 percent to P510 million in the first quarter from P1.38 billion a year ago.

“This is due to the technical shutdown of production since the start of its fiscal year in October 2012 in preparation for the naphtha cracker operations expected to commence in January 2014,” JG Summit said.

Consolidated cost of sales and services inched up 2.9 percent to P24.45 billion from P23.80 billion, offset by lower production of the petrochemical business.

“Consolidated operating expenses increased 14.9 percent as a result of higher general and administrative expenses in airline operations and food business,” JG Summit said.

Specifically, almost all units performed better in the first quarter.

Snacks and beverage giant Universal Robina Corp. (URC) grew its consolidated sales 11.8 percent to P20.1 billion in the first quarter, driven by the branded consumer food group.

“URC’s net income attributable to equityholders of the parent increased by P60 million to P2.28 billion for the three months of fiscal 2013 from P2.22 billion in the same period last year,” JG Summit said.

URC is the company behind market-leading brands such as Jack n’ Jill, Hunt’s, C2, Blend 45, Uno Feeds and Cream All.

The property business also contributed substantially to JG Summit. Robinsons Land Corp.’s net income picked up 3.8 percent to P1.19 billion in the three months that ended in December 2012.

“Real estate revenues were up nine percent to P3.33 billion against the previous year’s P3.05 billion while hotel revenues went up 16.7 percent to P397.8 million,” JG Summit said.

Airline firm Cebu Air Inc., which owns and operates budget carrier Cebu Pacific, posted a 20 percent growth in its earnings to P1.16 billion.

JG Summit said registered revenues rose 12.9 percent to P10.54 billion in the first quarter “due to the 4.9-percent growth in passenger volume to 3.5 million from 3.4 million last year driven by the increased number of flights in 2013.”