Saturday, 16 May 2009

Philippines' JG Summit’s Q1 income up

Don Gil K. Carreon

Gokongwei-led JG Summit Holdings, Inc.’s profits rose by more than a quarter in the first three months of 2009 due to the better performance of its various units, which range from snack and beverage manufacturing, to airlines, and property development.

In a disclosure last Friday, JG Summit said its net income reached P863.99 million in the first quarter, up from P675.85 million last year. Consolidated revenues, meanwhile, went up by nearly a fifth to P26.48 billion from P22.30 billion last year.

"The substantial growth was driven by the continued improvement in sales of and revenues of our core businesses: food, airline and real estate development, plus the revenue contribution of our telecom business particularly the wireless sector," it said.

JG Summit, however, noted that growth was somewhat tempered by the 35% decline revenues of its petrochemical business to P1.30 billion. Snack and beverage unit Universal Robina Corp. accounted for more than half of the revenues with P13.27 billion, followed by budget carrier Cebu Pacific Air, Inc. (P5.30 billion) and Digital Telecommunications, Inc. or Digitel (P3.21 billion).

JG Summit said its food unit’s growth was due to the more than a quarter increase in the sales of snacks, candies, chocolates and biscuits.

It attributed Cebu Pacific’s improved performance to the addition of five new routes, and the growth of Digitel, which operates under the Sun Cellular brand, to the increase in business of its wireless segment.

Consolidated cost of sales and services during the quarter climbed by 15.8% to P16.46 billion due largely to higher raw material expenses of the food unit as sales volume grew.

JG Summit’s mark-to-market losses more than doubled to P263.72 million from P91.59 million the previous year, as financial assets continue to be affected by the volatility in the markets. Interest income likewise went down to P490.51 million from P732.95 million.

The firm’s shares ended P0.020 higher at P4.30 on friday for a price-to-earnings ratio of 33.08.

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