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San Miguel profits zoom 1,471% in Q1 2021

Ralf Rivas

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San Miguel profits zoom 1,471% in Q1 2021

BUSINESS. San Miguel Corporation president and COO Ramon Ang.

Rappler

Ramon Ang's San Miguel Corporation saw significant gains in the first quarter of 2021, as demand for food and liquor soared while maintaining cost saving efforts

San Miguel Corporation reported a net income of P17.2 billion in the first quarter of 2021, 1,471% higher than the P1.1 billion earned in the same period in 2020, as almost all of its businesses saw significant recoveries amid the coronavirus pandemic.

While the percentage change was due to base effects, it was nonetheless higher than the P12.8 billion it earned in the first quarter of 2019 or before the pandemic.

It also reported a 175% surge in its operating income (calculated by subtracting operating expenses and the other costs of running the business from total revenue) to P32.2 billion, on the back of lower raw material costs and cost saving efforts.

While the bottomline improved significantly, consolidated revenues for the first quarter dipped 6% to P201.2 billion, as volumes of Petron, San Miguel Brewery, and SMC Infrastructure were still affected by prevailing restrictions.

“We’re encouraged by these improvements, as they reflect that our businesses are definitely headed towards full recovery. Despite the challenges ahead, we’re determined to sustain our performance and continue taking on meaningful projects and investments that will help our economy recover,” said San Miguel president and chief operating officer Ramon Ang.

San Miguel saw its full-year profits plunge by almost 55% to P21.9 billion in 2020 from the P48.6 billion it earned in 2019, largely due to the economy’s contraction and COVID-19 quarantine restrictions.

Here is a snapshot of how San Miguel’s businesses performed during the first three months of 2021:

San Miguel Food and Beverage

San Miguel Food and Beverage (SMFB) first quarter consolidated revenues grew 11% to P76.4 billion on the back of all-time high volumes from its spirits business and higher sales from food and beer businesses.

SMFB’s consolidated operating income and net income reached P12.6 billion and P9.7 billion, increases of 45% and 66%, respectively. 

San Miguel Brewery

San Miguel Brewery, Incorporated (SMB) recorded consolidated revenues of P28.8 billion for the first quarter, a 2% improvement from last year, while consolidated volumes, which continue to be affected by various quarantine restrictions and liquor bans in the domestic operations, ended at 51.5 million cases, down by 11%. 

SMB’s operating income grew 25% to P6.8 billion on the back of cost management efforts. 

Net income increased 45% from the same period last year to P5.5 billion. 

Ginebra San Miguel

Ginebra San Miguel posted a net income of P1 billion for the first quarter, up 120% year-on-year and its highest jump ever in a single quarter. 

Consolidated revenues and operating income reached P11.3 billion and P1.3 billion. 

The boost in performance was brought about by a combination of strong consumption, wider distribution, better selling prices, and lower alcohol cost.  

San Miguel Foods

San Miguel Foods’ consolidated revenues stood at P36.2 billion, up 9% versus the comparable period in 2020. 

San Miguel Foods’ strong performance was supported by the steady growth of its network of community resellers as well as newly launched products in the seafood and plant-based categories. 

SMC Global Power

SMC Global Power Holdings reported revenues of P27.4 billion, slightly lower compared to last year’s results as off-take volumes of 6,344 gigawatt hours declined by 5%. 

Net income stood at P7.8 billion.

This was mainly due to continuing quarantine restrictions and lower spot sales, which were mitigated by higher average realization prices. 

Operating income year-on-year grew 8% to P8.4 billion, brought about by lower fuel costs and operating expenses.  

Petron

Petron Corporation reported a net income of P1.7 billion, a significant reversal of its P4.9 billion net loss in the first quarter of 2020. 

While sales volumes continue to improve, the slowdown in demand due to the COVID-19 pandemic is still evident in first quarter volumes of 19.4 million barrels, 21% lower than the 24.7 million barrels sold in the same period in 2020. 

Consolidated revenues settled at P83.3 billion, down 20% from P104.6 billion a year ago.

SMC Infrastructure

SMC Infrastructure’s revenues for the first quarter stood at P4.3 billion, down 7% versus the same period last year, due to lower traffic volumes amid the pandemic.

Operating income amounted to P1.2 billion, a decline of 33% year-on-year, due to lower revenues and higher operating expenses. – Rappler.com

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Ralf Rivas

A sociologist by heart, a journalist by profession. Ralf is Rappler's business reporter, covering macroeconomy, government finance, companies, and agriculture.