AEV net income declines to P10.1 B for H1

Aboitiz Equity Ventures Inc. (AEV) reported a two percent drop in net earnings in the first semester to P10.1 billion on foreign exchange losses and higher costs from its various subsidiaries.

In a disclosure to the Philippine Stock Exchange yesterday, the company said it recognized non-recurring losses amounting to P467 million versus last year’s losses of P495 million, representing net foreign exchange losses recognized on the restatement of dollar-denominated net debt.

Of its businesses, power accounted for 68 percent of total income contributions, followed by banking and financial services at 22 percent, food (six percent), land (three percent), and infrastructure (one percent).

“Our first half results reflect challenges that continue to test the resilience of our diversified portfolio,” AEV president and CEO Erramon Aboitiz said.

Energy arm Aboitiz Power Corp. reported a six percent decrease in its net income contribution to P7 billion. On a stand-alone business, the power firm’s net earnings dipped six percent to P9.1 billion owing to non-recurring losses of P1.4 billion.

“We continue to grow the business with the capacity additions and the expanding distribution business,” AboitizPower president and CEO Antonio Moraza said.

“Energy sales are up, however, margins are getting tighter due to competition. This is a reality that we have prepared for-- and our organization is equipped to compete,” he said.

Union Bank of the Philippines’ income contribution to AEV increased nine percent to P2.3 billion. The bank and its subsidiaries posted a net income of P4.7 billion for the first half, up nine percent.

Earnings of Pilmico Foods Corp. and its subsidiaries fell eight percent to P662 million, largely due to higher raw material costs.

Property unit Aboitiz Land Inc. reported a 40 percent jump in net income to P283 million, due to higher revenues which were attributed to the industrial business.

Meanwhile, Republic Cement and Building Materials Inc.’s income contribution to AEV fell 91 percent year-onyear to P44 million. Although prices grew modestly with demand remaining from the previous quarter, this was offset by increased fuel and power costs during the period.

“For the rest of the year, we remain confident in ably executing our focused strategy. We look forward to more opportunities as well as the contributions of newly-acquired businesses as we stay true to our purpose of driving change for a better world by advancing business and communities,” Aboitiz said.