SMC profit soars 21% to R43.8 B as revenues climb 20% to R597 B

Diversified conglomerate San Miguel Corporation reported a 21 percent hike in recurring net income to R43.8 billion in the first nine months of 2017 from last year’s R36.3 billion

Recurring profit is excluding the effect of foreign exchange translation and the one-time gain from the sale of its telecommunications business last year.

SMC’s revenues rose 20 percent to R597.0 billion for the first nine-months of the year on higher sales mainly from its core food, beverages, and packaging businesses.

Consolidated operating income reached R82.8 billion, 13 percent higher than last year, the result of sustained sales growth across its businesses and a group-wide execution of an effective fixed cost management strategy.

Consolidated EBITDA reached R108.8 billion, 13 percent higher than the previous year.

Recently, SMC announced a plan that would consolidate all its traditional food and beverage businesses under a holding company.

Combined revenues of the consolidated units for the period in review – San Miguel Brewery, Ginebra San Miguel and San Miguel Purefoods – amounted to R180 billion, up 11 percent, making up a significant 30 percent of SMC’s total revenues.

Operating income of the new F&B company rose 17 percent to R29.1 billion while earnings grew 21 percent to R19.55 billion.

San Miguel Yamamura Packaging Group’s revenues and operating income both grew 13 percent to R22.4 billion and R2.2 billion, respectively. The results were attributed to higher sales from its plastics and metal businesses and the continued growth of its Australian operations.

SMC Global Power’s revenues amounted to R62.1 billion, 2 percent higher compared to last year brought about by higher average realization and spot market prices.

Operating income ended 14 percent lower at R19.7 billion, due to higher coal costs, replacement power purchases, lower bilateral volumes, and the sale of the Limay Co-generation plant last year.

Petron Corporation continued to deliver outstanding results, posting profits of R11.8 billion, up 58 percent from last year. This was driven by its continued focus on high-value segments and strong sales volumes from both its Philippine and Malaysian operations.