Pryce posts higher profit

PRYCE CORP. recorded a 22.3% increase in consolidated net income in the first half to P711.89 million, the company told the stock exchange on Tuesday, as it ends the semester reaching nearly half of its full-year target profit of P1.55 billion.

“Growth in the company’s consolidated revenues drove the improvement in net income for the comparative period,” the company said.

Shares in the company were trading higher by 3.33% at P6.20 each just after it disclosed its income for the first six months of 2018, from P581.90 million in the same period last year.

The first-half figure came out short of the net income expected by its Chief Executive Officer Salvador P. Escaño, said earlier the company probably posted P750 million during the period.

However, he said the company makes 55-60% of revenues and income in the second half because the rainy season augurs well for the sale of liquefied petroleum gas (LPG), its main business.

In the first half of the year, gross revenues reached P4.83 billion, up 14.2% from P4.23 billion. LPG sales accounted for 91.6% of the group’s total revenue, while the sale of industrial gases, real estate and pharmaceutical products made up the rest.

In volume, LPG sales were strong in Visayas and Mindanao at a combined 13.5% growth. Luzon recorded an increase of 2.35%.

Pryce said collectively, LPG sales grew by nearly 7% to 97,590 metric tons (MT) in the first half from 91,243 MT a year ago.

“The growth in sales volume was achieved despite the rising LPG prices mainly because of the growing demand in fuel for household cooking,” it said.

Average LPG contract prices, which affect LPG consumer behavior, increased by roughly 8% to $515 per MT from last year’s $477 per MT, Pryce said.

“Sale of real estate likewise contributed to the group’s increase in revenue with a 166.6% growth due to the sale of office condominium units of Pryce Tower in Davao City,” the company said.

The company said its other subsidiaries also recorded “positive growths” at 10.1% for industrial gases and 47.1% for pharmaceutical products.

During the review period, operating income rose 46.9% to P815.67 million from P555.40 million, attributed largely to the increase in revenue and efficient management of operating expenses.

“The ongoing expansion projects on the company’s marine-fed terminals and refilling plants nationwide are expected to encourage growth in LPG sales volume in the second half of the year as the LPG product becomes available over a wider area and brought even closer to the market dealers and consumers,” Pryce said.

Net income after tax at first half stood at P711.89 million, equivalent to P0.3229 earnings per share.

The company said it remains positive of achieving a 15% rise in LPG sales volume in the VisayasMindanao area, and meet its projected net income of P1.5 billion “plus or minus 10%” for this year.