JG Summit Holdings, Inc.

JG Summit spending P78.1-billion capex this year

JG Summit Holdings Inc., the holding firm of the Gokongwei family, said it is increasing its capital expenditures (capex) this year to P78.1 billion, with most of the spending on its property-development arm after it sees declining residential sales.

Lance Y. Gokongwei, the company’s president and CEO, said P30 billion will be allocated for its property-development arm, near double than last year’s spending of about P17.3 billion. Net income of its property arm, Robinsons Land Inc., last year came flat at P5.9 billion, while revenues fell by 1 percent to P22.4 billion. It showed some recovery during the first quarter.

This year’s capex was 22 percent higher than the previous year’s P43.5 billion in actual spending.

Gokongwei said P20 billion each will be allocated for its petrochemical and airline businesses, and food group Universal Robina Corp. (URC) will spend between P7 billion and P8 billion. The rest will be allocated to its other smaller businesses, such as banks.

He added that for the first quarter alone, the company already spent P11 billion.

“Profitability remains a challenge for URC as our domestic operations face declines in volumes and changes in product mix particularly for our coffee business,” Gokongwei said.

“For URC, we will accelerate our sales and profitability for different categories. We will drive portfolio optimization for brand renovation, performance-driven promotions and review of our current assortments,” he said.

The new tax package, which slapped taxes on sugary drinks, has put a strain on its sales. Gokongwei said the company had an average price increase of about 22 percent to 23 percent.

“This effectively just recovered the increase in sugar taxes. We’ve seen a significant reduction in volumes from 12 percent to 15 percent in the first quarter because of the higher prices,” Gokongwei said.

He added the effect of the fuel price and currency has been significant for the company, which owns Cebu Air Inc., and the country’s second-largest airline, Cebu Pacific.

“The effect of fuel, approximately P20 million per month for every dollar increase in fuel and the effect of currency, is about P65 million per month…because of the weaker peso,” he said.

“In aggregate, it is costing us P700 million more per month to fly the same net worth. So we will have to avoid losses and we will really have to. We will really try to become more efficient, but likewise, we have to put in, we have applied for fuel and fare surcharge increase with the Civil Aviation Authority of the Philippines.

“The fuel surcharge we’re asking for ranges from P70 to P250 for domestic flights. This approximately recovers the cost that we’re facing. We’re really trying to minimize the increase to the lowest possible amount.”

Meanwhile, Robinsons Retail Holdings Inc., another Gokongwei-led firm but separate from JG Summit’s, said it will spend some P3.5 billion in capex this year, slightly higher than last year’s P3.1 billion.


...profit drop din 'tong isang 'to Tongue  tinamaan ng TRAIN Law

JG Summit profits drop in Q2

JG SUMMIT Holdings, Inc.’s attributable profit dropped by a third in the second quarter of 2018, as the weaker peso, higher fuel prices, as well as rising prices of raw materials for its food, airline, and chemical units tempered the double-digit increase in revenues.

In a regulatory filing, the listed conglomerate said net income attributable to equity holders of the parent went down to P5.02 billion in the April to June period, against the P7.13 billion it generated in the same period a year ago.

In contrast, revenues climbed 11.4% to P74.6 billion, thanks to the performance of Universal Robina Corp. (URC)’s branded consumer foods and agro-industrial units, the growth in Robinsons Land Corp. (RLC), and higher average selling prices of products under JG Petrochemcial Group.

“While we continue to face the challenges arising from inflation and the weaker currency further exacerbated by tougher competitive dynamics, we are delighted to see improvements in our 2Q18 results,” JG Summit President and Chief Executive Officer Lance Y. Gokongwei was quoted as saying in a statement.

“We believe that we can navigate this environment with the fundamentals of each of our businesses intact and issues are more cyclical than structural,” Mr. Gokongwei added.

On a six-month basis, JG Summit’s attributable profit went down 32.8% to P9.84 billion, while revenues rose 8% to P145.3 billion.

For the food and beverage unit, URC reported a 23.1% decline in attributable profit to P4.81 billion during the first half. This was due to higher costs of raw materials and foreign exchange gains.

URC’s consolidates sales of goods and services amounted to P64.37 billion by end-June, 5.9% higher year-on-year.

Meanwhile, RLC’s attributable profit went up by 14% to P3.33 billion for the period, driven by higher sales of residential properties, leases of commercial spaces, and more malls operated from January to June. Revenues from the property business rose by 19% to P13.1 billion

Cebu Air, Inc., which operates low budget carrier Cebu Pacific, saw a 23.6% drop in earnings to P3.31 billion, despite a 6.1% uptick in revenues to P37.83 billion. The airline recorded a 6.3% increase in passenger revenues to P28.3 billion for the period, alongside a 28.1% increase in cargo revenues to P2.65 billion.

Operating expenses of Cebu Pacific however grew 14% to P33.06 billion, due to the rise in fuel prices during the year. The airline also recorded net foreign exchange losses of P1.58 billion as a result of the weaker peso. Cebu Pacific currently has long term dollar-denominated debt used to fund its aircraft acquisitions.

Earnings of the petrochemical business meanwhile slumped by 50.2% to P1.6 billion, amid an 8.9% climb in revenues to P21.18 billion.

JG Summit’s banking unit, Robinsons Bank Corp., delivered a 31.1% profit increase to P211.43 million, as banking revenues likewise went up 32.2% to P2.73 billion.

Mali ang pasok ko ditto kala ko paakyat na to 70 pesos
nakapasok ulet ako sa 58, yari na nman, hehe
nakaabang ako ulet sa 51
(09-18-2018, 10:54 PM)gnod21 Wrote: nakaabang ako ulet sa 51

...pwede pwede

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