Corporate News

By Krista Angela M. Montealegre, Senior Reporter

Ethanol, biomass plants to boost URC top line by P1.6B

Posted on July 07, 2015

UNIVERSAL Robina Corp. (URC) expects its renewable energy venture to make an annual contribution of as much as P1.6 billion to the Gokongwei-led snack food and beverage company’s revenues, the company’s president said.

At a May 6 earnings conference call between the public company and investors -- a transcript of which was seen by BusinessWorld -- URC President Lance Y. Gokongwei said the ethanol facility will add “about P1.2 billion to P1.5 billion a year,” depending on the price of the fuel.

Mr. Gokongwei told investors: “The ethanol plant recorded its first sale in the first quarter.”

“This year, I think we expect to sell about 18 million to 20 million liters of alcohol, but I guess by next year we’ll have a full year of operation on this plant,” he said.

Last year, URC inaugurated the ethanol plant in Barangay Tamisu, Bais City in Negros Oriental. The facility can make 100,000 liters per day of fuel-grade ethanol using sugar molasses generated from three sugar mills in the province.

In December, the listed food giant had said it started taking orders for ethanol fuel produced at that plant, with Flying V, as its first client.

Recently, URC also has commissioned its 46-megawatt biomass power facility in Negros Occidental.

The biomass plant’s contribution will be “in the high P100 million,” Mr. Gokongwei said.

URC had said it built the fuel ethanol plant and the cogeneration facility to support the government’s renewable energy program and to provide alternative uses for the company’s sugarcane.

First-semester bottom line rose 4.2% to P6.42 billion from P6.17 billion in 2014, as higher finance costs associated with its NZ$700-million takeover of NZ Snack Food Holdings Limited (NZSFHL) and foreign exchange losses tempered growth.

NZSFHL owns Griffin’s, New Zealand’s leading snack food company.

The consolidation of Griffin’s results boosted URC’s revenues from its international branded consumer business by 37.8% in the first half of its fiscal year ending September.

URC has full-scale operations in eight countries outside the Philippines, including China. It sells to mainstream markets in the US, Europe, Japan, Korea, the Middle East and frontier markets in West Africa like Ghana and Nigeria.

Shares of URC slid P1.20 or 0.62% to close at P192.60 apiece yesterday. Its parent JG Summit Holdings, Inc. lost P1.75 or 2.44% to end Monday’s trading at P69.95 per share.