SMC swings to P29.6-B income

SAN Miguel Corp. (SMC) returned to profitability to finish the first half with a net income of P29.57 billion, reversing last year’s P3.99-billion loss, as all of its major business units posted “robust recoveries.”

“While there is no doubt that the uncertainties brought about by the pandemic will continue to have an impact on our businesses, our strong performance in the first half reflects the effectiveness of the strategies we’ve put in place and our ability to quickly adapt to the evolving needs of our consumers,” SMC President and Chief Operating Officer Ramon S. Ang said in a statement on Thursday.

The company’s topline grew by 16% to P410.12 billion from P352.8 billion in the same period last year due to higher sales generated by Petron Corp., SMC Global Power Holdings Corp., SMC Infrastructure, and San Miguel Food and Beverage, Inc. (SMFB).

SMC’s operating income climbed by 309% to P61.02 billion “brought about by improved margins, effective company-wide cost savings initiatives, and continuous improvements in operational efficiencies.”

SMFB’s net income grew by 137% in the first semester to P17.36 billion, while its operating income went up by 103% to P23.04 billion.

Meanwhile, SMFB’s consolidated revenues went up by 20% to P146.8 billion on the back of volume improvements, especially in its spirits division, and better selling prices for its food and beer divisions.

San Miguel Brewery, Inc. generated P9.51 billion in net income for the period, 89% higher year on year from P5.02 billion.

The unit’s net sales improved by 27% to P54.33 billion from P42.79 billion. SMC said the unit saw “strong volume growth” in the second quarter, which led to a 15% increase in consolidated volumes to 97.4 million cases in the first six months.

Ginebra San Miguel, Inc.’s net income grew by 66% year on year to P2.09 billion from P1.26 billion as the unit focused on ramping up its marketing campaigns, expanding its distribution, and continuing supply chain efficiencies.

“[It] further solidified its growth momentum with domestic volumes reaching 20.1 million cases, surpassing last year’s level by 21%,” SMC said, adding that Ginebra San Miguel posted a 36% topline growth to P20.23 billion.

SMFB’s San Miguel Foods “delivered a strong first half” as its net income grew by nearly four times to P6.18 billion, while its net sales went up by 11% to P72.24 billion. The growth was due to the performance of its protein and animal health and nutrition segments during the period, as well as gains from pricing and volume.

Meanwhile, SMC Global Power’s net income improved by 35% to P12.22 billion from P9.06 billion. The unit’s income from operations, however, went down by 5.3% to P17.16 billion from P18.12 billion.

“Operating income declined… due to higher purchase volumes resulting from gas supply restrictions for the Ilijan power plant and outages in the Sual power plant,” SMC said.

The power unit recorded off-take volumes of 13,552 gigawatt hours in the six-month period. Consolidated revenues grew by 5.4% to P60.28 billion from P57.18 billion as spot volumes and customer nominations improved.

Petron swung to profitability in the first half with P3.87 billion from a P14.24-billion loss in the same period last year. Its topline rose by 14% to P174.13 billion from P152.36 billion.

“Consolidated sales volumes were still down by 7% to 38.9 million barrels from 41.9 million barrels last year, as fuel consumption in the commercial sector, particularly the aviation industry, remained restrained,” SMC said.

SMC logged a 144% growth in SMC Infrastructure’s operating income to P2.32 billion in the first half from last year’s P951 million. Revenues went up by 27% to P8.49 billion from P6.68 billion.

“Average daily traffic flow in all operating toll roads continue to improve, while volumes also continue to increase for Manila North Harbor and Bulacan Bulk Water,” SMC said.

Its Skyway Stage 3 project opened in January this year and just started collecting toll fees on July 12.

On Thursday, shares of SMC at the stock exchange went up by 0.37% or 40 centavos to close at P107.20 each. — Keren Concepcion G. Valmonte