URC profit up 1.3% to P8.55B

MANILA, Philippines - Profits of snacks and beverage giant Universal Robina Corp. (URC) inched up in the nine-month period of its fiscal year as higher sales of branded products were offset by the drop in non-recurring gains.

In a regulatory filing, Gokongwei-led URC said its net income rose 1.3 percent to P8.55 billion in the October 2013 to June 2014 period from P8.44 billion a year ago.

“URC generated a consolidated sale of goods and services of P69.23 billion for the nine months ended June, a 14.5-percent sales growth over the same period last year,” the company said.

Total branded consumer foods (BCF) net sales hit P57.58 billion, up 19.9 percent from a year ago “with the strong sustained momentum of BCF Philippines and sales acceleration of BCF International, which registered topline growth rates of 26 percent and 10 percent, respectively,” URC said.

URC is one of the largest branded consumer food and beverage product companies in the Philippines. The company behind top brands Jack n’ Jill, Hunt’s, C2, Blend 45, Uno Feeds and Cream All also has a significant and growing presence in the Southeast Asian markets.

In the nine-month period, operating income jumped 37 percent to P10.52 billion, with margins expanding due to lower average prices of major materials, managed operating expenses and additional scale, the company said.

“(Net income) growth was slower than operating income due to lower non-recurring gains as the company disposed of all bond investments and a significant portion of equity investments last year,” URC said.

For its operations, BCF Philippines posted a 26-percent uptick in net sales to P38.88 billion as all segments contributed to the growth led by the beverage division, which managed to grow 42.9 percent.

“The increase in beverage sales was driven by the powdered beverage business, mainly from coffee, and complemented by the ready-to-drink business,” URC said, adding that snack food sales rose 15.3 percent as salty snacks, bakery, and confectionery segments posted growth.

BCF International posted a 10-percent increase in net sales to P17.94 billion, led by Thailand and Vietnam.

However, the non-BCF business, which is composed of the commodity foods group and the agro-industrial group, recorded a 6.3-percent decline in net sales to P11.65 billion.

The company budgeted about P9 billion for its capital expenditures this year, higher than the P5.54 billion for fiscal year 2013, P5.12 billion for 2012 and P4.55 billion for 2011.

Last month, URC announced that it is taking over New Zealand-based Griffin’s for around P26 billion. URC’s largest acquisition to date jumpstarts its goal of becoming a major regional player.