JG Summit net profit up 25%

Firm cites increase in forex gains, treasury income

GOKONGWEI-led JG Summit Holdings Inc. grew its first-semester net profit by 25 percent year-on-year to P2.56 billion as foreign exchange and other treasury gains rose alongside an increase in core earnings.

Core earnings before tax rose 12.9 percent to P9.9 billion while cash flow based on earnings before interest, taxes, depreciation and amortization (Ebitda) reached P12.86 billion, down 6.2 percent.

The increase in six-month net income was buoyed by the further appreciation of peso against the dollar in the second quarter, resulting in higher foreign exchanges gains of P1.3 billion, a turnaround from the net foreign exchange loss of P41.72 million a year ago. JG Summit booked mark-to-market gains of P960.6 million during the first semester, up 94.7 percent, due to the recovery of its bond investments and gains from additional investments.

Six-month consolidated revenues were up 10 percent at P67.09 billion due to the strong performance of all business units. However, equity in net earnings of associates declined 26.3 percent to P872.2 million due to reduced income from its investment in Singaporean property developer UIC Ltd. Lower rental income, drop in sale of properties and lower revenues from hotel operations dampened UIC's earnings.

Consolidated cost of sales and services for the first half rose 14.1 percent to P47.69 billion. The increase was higher compared to revenue growth due to the significant increase in the cost of sales and services in its food and airline business.

Group-wide operating expenses increased 14.2 percent to P10.91 billion as a result of higher general and administrative expenses particularly in the airline operations and food business.

Unlisted subsidiaries JG Summit Petrochemicals Corp. trimmed its net loss to P55.6 million in the first six months from P72.06 million and Robinsons Bank booked a net income of P244.15 million, up 67.7 percent, as higher trading gain boosted revenues.