San Miguel grows net income by 80% despite depreciating peso

MANILA, Philippines – Diversified conglomerate San Miguel Corporation (SMC) saw its net income for 2016 surge by 80% to P52 billion from P28.9 billion in 2015, as most of its units delivered strong growth.

Excluding foreign exchange losses of P8.9 billion, its consolidated income reached P61.2 billion.

San Miguel told the local bourse that its net sales for 2016 went up by 2% to P685.3 billion versus P672.2 billion a year ago, while income from operations rose 24% to P99.6 billion.

San Miguel chief finance officer Francisco Constantino earlier said 2016 was a "good year" for the company due to various factors including election-related spending, good weather conditions, stable interest rate, and low inflation rate. 

The conglomerate also booked a one-time gain in 2016 from the sale of its telecommunication business to PLDT Incorporated and Globe Telecom Incorporated.

Not as good as 2016

Constantino said they expect 2017 to be another good year for San Miguel, but it will not be as good as 2016.

The conglomerate’s beer unit San Miguel Brewery Incorporated posted 31% hike in 2016 net income to P17.6 billion as sales increased by 18% to P97.1 billion.

Ginebra San Miguel Incorporated also booked P361 million net income, a sharp reversal from P386 million net loss recorded in 2016. Sales also grew 12% in 2016 to P18.5 billion.

San Miguel Purefoods, the conglomerate's food manufacturing unit, booked net income of P5.97 billion, up 26% from a year ago level as sales went up by 4% to P111.5 billion.

"We’re very encouraged by the company’s strong performance in 2016 and we are determined to build on this momentum by investing in our brands and innovation to drive long-term profitable growth and enhance shareholder value," said San Miguel president Ramon Ang.

San Miguel’s packaging unit also posted net sales of P27.3 billion, an increase of 9% from 2015 level; while power unit SMC Global Power Holdings Corporation booked net sales of P77.9 billion in 2016, 1% higher from a year ago level.

Petron Corporation also delivered strong performance in 2016 with net income growing by 73% to P10.8 billion despite a 5% decline in revenues to P343.8 billion.

Meanwhile, the group’s infrastructure unit San Miguel Holdings Corporation posted sales of P19.8 billion, up 13% from P17.6 billion, while its income from operations rose 6% to P9.8 billion in 2016. –