JG Summit 2015 Core Net Income Up 38%

Pasig—(PHStocks)—JG Summit Holdings Inc. (PSE: JGS) posted a 38.1% increase in consolidated core net income, earning a total of PhP28.05 billion in 2015 compared to PhP20.3 billion in 2014.

The increase in core net income is due to the double-digit income growth in the company’s core operating businesses particularly in Cebu Air Inc. (Cebu Pacific, PSE: CEB), which benefited from the reduction in fuel prices, as well as in the Petrochemicals group, whose business expanded significantly since the start of its integrated operations in November 2014. The Group’s consolidated net income from equity holders of the parent amounted to PhP22.61 billion in 2015, a 23.9% increase from PhP18.25 billion last year. The increase is lower compared to the growth of core net income because of foreign exchange losses caused by the depreciation of Philippine peso vs. U.S. dollar by more than PhP2.00 by year-end 2015, as well as mark-to-market losses in 2015. Consolidated EBITDA reached PhP63.79 billion, a 29.6% increase compared to last year.

Consolidated revenues grew 24.1% from PhP184.81 billion in 2014 to PhP229.27 billion in 2015 due to the strong performance of the following core subsidiaries.

Revenues from our core investments, declined this year as dividend income received by the group dropped 43.9% from PhP5.07 billion last year to PhP2.85 billion this year mainly to PhP1.7 billion dividend income declared by PLDT from PhP185 per share in 2014 to PhP152 per share in 2015.

Consolidated cost of sales and services increased by 22.5% from PhP115.01 billion last year to PhP39.06 billion this year due to higher selling, general and administrative expenses in the food and airline business units. As a result, Operating Income or EBIT went up 31.7% from PhP37.48 billion in 2014 to PhP49.35 billion in 2015.

The Group’s consolidated total assets reached PhP596.33 billion as of end of December 2015. Current ratio stood at 1.04. The Company’s indebtedness remained manageable with a gearing ratio of 0.71 and net debt to equity of 0.52 as of December 31, 2015. Stockholders’ equity, excluding minority interest, stood at PhP223.39 billion as of December 31, 2015 from PhP207.62 billion last year. Book value per share stood at PhP31.18 as of December 31, 2015.

Universal Robina Corp. (PSE: URC) generated a consolidated sale of goods and services of PhP112.01 billion for the year ended December 31, 2015, 15.9% sales growth over last year’s PhP96.65 billion. The branded consumer foods segment, excluding packaging division, increased 16.3%, to PhP92.96 billion in 2015 from phP79.9 billion registered in 2014. Domestic operations posted a 7.3% increase in net sales from PhP54.49 billion in 2014 to PhP58.46 billion in 2015 as RTD tea continues to grow strongly with additional capacities while noodles continue to gain traction with Nissin Cup Noodles. Sales growth was muted mainly due to aggressive competition across all categories, mostly coffee and snacks. BCFG’s international increased by 35.8% to PhP34.5 billion in 2014 against PhP25.41 billion in 2014, the top-line growth coming from Vietnam, Indonesia, and Thailand with sales contribution from New Zealand.

The Group started consolidating Griffin’s sales into URC International starting mid-November 2014 upon closing of the acquisition. Sale of goods services in URC’s packaging division slightly went down to PhP1.15 billion in 2015 from PhP1.19 billion recorded in 2014 due to decline in volume. Agro Industrial segment’s amounted to PhP8.97 billion in 2015, an increase from PhP8.41 billion recorded in 2014 as Feeds business increased by 21.2% due to higher sales volume while farms business declined by 4.4% due to lower selling price and volume. Sale of goods and services in commodity foods segment amounted to PhP8.93 billion in 2015, up by 25.0% from PhP7.15 billion reported in 2014 with growth coming from sales contribution of the renewable energy business, distillery and cogeneration, which amounted to PhP1.58 billion. Sugar business also reported a 6.9% sales growth due to higher sales volume while flour business remained flat.

Robinsons Land Corp. (PSE: RLC) generated total gross revenues of PhP20.3 billion for calendar year 2015, an increase of 16.4% from PhP17.43 billion total gross revenues for calendar 2014. EBIT (Operating income) grew 24.3% to PhP7.92 billion while EBITDA (Operating income plus depreciation) posted a 20.5% growth to PhP11.13 billion. Net income stood at PhP5.95 billion, up by 24.7% compared to last year. The Commercial Centers Division posted a 12.6% revenue growth to PhP9.4 billion in 2015 from PhP8.35 billion last year, driven by the steady same mall rental revenue growth of 7% as well as the contribution of the newly opened malls Robinson Place Antipolo, Robinson place Las Pinas, Robinson Place Antique, Robinsons Novaliches expansion and Robinsons Galleria Cebu. The Residentials Division realized revenues stood at PhP6.7 billion in 2015 versus PhP5.88 billion last year, an increase of 14.0%. The Office Buildings Division revenues grew by 47.3% to Php2.42 billion in 2015 from PhP1.65 billion last year as Tera Tower, RLC’s newest office building, as well as Cyberscape Alpha and Cyberscape Beta contributed to the strong  growth of the division being 100% leased out as of December 31, 2015. The Hotels Division registered gross revenues of PhP1.8 billion for the year, posting a 13.8% increase compared last year with contribution coming from the opening of Summit Hotel Magnolia and GO Hotels Butuan.

Cebu Air generated gross revenues of PhP56.50 billion for the year ended December 31, 2015, 8.7% higher than the PhP52.0 billion revenues earned last year mainly attributed to the increase in passenger revenues by 6.2% to PhP42.68 billiom for the year ended December 31, 2015 from PhP40.19 billion registered in 2014. This increase was primarily due to the 8.9% growth in passenger volume to 18.4 million from last year’s 16.9 million driven by the 7.6% increase in number of flights in 2015 as CEB added more aircraft to its fleet. The number of aircraft increased from 52 aircrafts as of December 31, 2014 to 55 aircrafts as of Decmber 31, 2015. The 2.5 decrease in average fares partially offset the increase in revenues. Cargo and ancillary revenues grew 10.0% and 19.5% respectively following the increase in the volume of cargo and improved online bookings, together with a wider range of ancillary revenues products and services.

JG Summit Petrochemicals Group (consisting of JGSPC and JGSOC) combined gross revenues reached PhP26.78 billion in 2015 as compared to last year’s PhP3.23 bilion as JGSPC resumed its commercial operations after the completion of its polymer plant expansion and rehabilitation projects and the commencement of JGSOC’s commercial operations in November 2014 resulting to increase in polymer volumes sold by JGSPC and increase in volume exported olefins of JGOC, A net foreign exchange loss of PhP307.0 million was recorded in 2015 from PhP45.84 million last year due to Weakening of Philippine Peso against U.S. dollar. Petrochemicals posted a net income of PhP3.16 billion in 2015 versus the net loss of PhP759.45 million in 2014, an improvement of 524%.

Robinsons Bank Corp., generated banking revenue of PhP2.97 billion in 2015, a 9.3% increase of last year’s PhP2.72 billion, brought about the higher interest and commission income for the year, net of lower trading gains in 2015. However, cost and expenses also increased, higher than the revenue growth as the bank continued its expansion contributing to lower net earnings of PhP106.67 million for the year ended December 31, 2015, a 27.4% decline for last year’s PhP146.91 million.

Equity in net earnings of associated companies and joint ventures amounted to PhP7.31 billion for the year ended December 31, 2015, a slight increase for last year’s PhP7.25 billion mainly attributable to the 6.1% increase in equity earnings from Meralco from PhP4.68 billion last year to PhP4.96 billion this year, partially offset by the higher losses on equity investments in CURC and DURBI. Equity income from UIC remained flat at PhP2.51 billion.

United Industrial Corp. Ltd recorded a 6.1% growth in its net income from operations from US$222.79 million in 2014 to US$236.8 million in 2015 mainly due to higher trading property sales. Since the Group’s policy for the valuation of property, plant and equipment is the cost basis method, the equity income taken up by the Group represents the adjusted amounts after reversal of the effect in the income statement of the revaluation of the said assets.

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