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San Miguel Profit Trebled

by 5m Editor
13 August 2008, at 10:31am

PHILIPPINES - San Miguel Corp. profit jumped by a factor of three in first half of the year. Feeds and poultry delivered "solid performances" following a rise in poultry sales volume.

A report in Manila Times says this profit was supported mainly by income from its beer and food operations.

South-east Asia's biggest food and beverage company disclosed its half-year results to the Philippine Stock Exchange.

The company said its net income reached 19.7 billion pesos (PHP) in the first semester as its total revenues went up by 9 per cent to PHP79.8 billion after businesses led by its beer subsidiary registered steady volume and revenue growth.

The end-June profit was 199 per cent higher than in the same period a year ago. Profit growth boosters included savings of PHP5.67 billion from discontinued operations in the first quarter, non-recurring gains from San Miguel Brewery Inc.'s initial public offering and the sale of San Miguel's stake in KSA Realty.

"Faced with challenging economic conditions affecting consumer spending behavior and escalating input costs, we're particularly encouraged by these results," said Ramon Ang, San Miguel president and chief operating officer, pointing to growth "achieved across almost all of our reporting segments in the first six months of 2008."

Mr Ang said to drive volumes in San Miguel food and beverage businesses, the company continues to expand brand availability into new consumption occasions and across the expanding network of outlets.

"We've also put in place several cost saving and productivity initiatives to meet near-term profitability challenges," he added.

During the period, the company’s consolidated operating income increased by 28 percent to PHP8.21 billion year-on-year. Profit from continuing operations during the period was significantly higher at PHP14.5 billion than last year.

Volumes of San Miguel Brewery Inc. rose 7 percent as revenues of PHP23.8 billion were 9 percent higher than last year. Operating income for the first semester reached PHP7.16 billion, a 25-percent growth from previous year.

San Miguel’s international beer operations ended the first half with overall volumes growing 4 per cent and revenues 30 per cent to $136 million. Volumes were strongest in Indonesia and Thailand and in San Miguel Brewing International Ltd’s export business.

Ginebra San Miguel's volume, meanwhile, grew 16 per cent on growth from gin and brandy. Net income was PHP243 million, 5 per cent higher than last year, while revenue grew 17 per cent year-on-year.

Despite unprecedented commodity and fuel price increases, San Miguel's Food Group under San Miguel Pure Foods Co. delivered consolidated revenue of PHP33.7 billion, 16 per cent higher than last year.

Feeds and poultry delivered solid performances and coffee turned in better margins. The Food Group's income from operations ended at PHP1.26 billion, 7 per cent higher than last year on account of stronger poultry volumes and contained fixed operating expenses, while higher live pig market prices allowed SMPF-Vietnam's piggery operations to post significant improvement.

San Miguel Yamamura Packaging Group posted operating income of PHPP758 million, a 156 per cent rise year on year, while revenue increased 8 per cent to PHP10.1 billion due to stronger sales in plastics and glass.

5m Editor