URC income rises by 15% on lower debt, forex losses

Universal robina Corp. (URC), the food unit of the Gokongwei Group, said its net income grew 15 percent last year to P11.6 billion from the previous year’s P10.11 billion.

The company attributed this to the growth in operating income, lower debt and interest expenses and lower foreign exchange losses.

Net sales for the year, however, fell 1 percent to P133.1 billion from the previous P134.17 billion, as the company was also not spared by the onslaught of the Covid-19 pandemic which affected trading conditions and consumer sentiment.

The company said it saw market contractions in several snack food and beverage categories that the company competes in.

“The best response to the challenges we face with this crisis is to push forward, not to pull back. We are focused on better serving our consumers, our customers, and our communities,” Irwin lee, the company’s president and Ceo, said.

“Consumption of our products is not likely to dissipate; in fact, the relevance of our categories in consumers’ lives potentially increases as we adjust to changing consumer and shopper trends. As we look to the future and the new normal, we remain well-positioned for the long term to delight everyone with good food choices.”

operating income grew by 7 percent to end at P16 billion from the previous P15 billion, on improved margins compared with the previous year. Sales of domestic and international branded consumer foods amounted to P103.6 billion, a 2-percent decline from the previous year’s P105.9 billion.

Domestic revenues were flat at P61.2 billion, as growth of snacks, noodles and other filler type categories were able to offset the decline of out-of-home consumption categories such as ready-to-drink beverages and candies.

International revenues hit P41.2 billion, 5 percent lower versus last year in peso terms at P42.2 billion, but flat in local currency basis. Growth in oceania was able to offset the slower recovery of other Asean markets.

Sales of its agro-industrial and commodities businesses reached P29.6 billion, a 7-percent increase versus last year’s P28.3 billion. The commodities foods group posted strong growth of 21 percent with sugar and renewables growing 33 percent.

The acquisition of Central Azucarera de la Carlota and Roxol bioenergy Corp. from Roxas Holdings Inc. contributed to the growth, the company said.

Sales of the agro-industrial group fell by 10 percent, due to the downsizing of its hog farming operations.

At the end of last year, URC has a cash balance of P18.9 billion and a low gearing ratio of 0.42. Net debt amounted to P 22.1 billion or close to the previous year’s levels.