EARNINGS of JG Summit Holdings, Inc. surged 63% to P31.3 billion in 2019, driven by the growth of its airline and banking units and gains from its stake in a Singapore-listed company.
In a statement on Wednesday, the Gokongwei-led holding firm said its 2019 topline was lifted by higher passenger volumes and bigger ancillary revenues of Cebu Air, Inc.; wider net interest margins and trading gains of Robinsons Bank Corp.; and a P3-billion gain from its share in Singapore-based firm United Industrial Corp.
JG Summit’s consolidated revenues climbed 3% to P301.8 billion, while its core net income rose 13% to P25.3 billion.
By business segment, food unit Universal Robina Corp. (URC) added P134.2 billion in revenues to grow 5% from a year ago. This was driven by the expanded distribution coverage of its branded consumer foods division and the improved sales of animal feeds and pet food from its agro-industrial and commodities division. URC’s bottomline rose 6% to P9.8 billion last year.
Airline unit Cebu Air, which operates budget carrier Cebu Pacific, posted a revenue improvement of 14% to P84.8 billion. The growth was traced to a double-digit rise in passenger volume, increase in average fares and bigger ancillary revenue per passenger. Cebu Air’s net income soared 133% to P9.1 billion.
Real estate arm Robinsons Land Corp. contributed revenues of P30.2 billion last year, higher by 3% from a year ago. The growth of cinema ticket sales in existing malls, higher rent renewal in offices, increased occupancy in hotels and additional revenue streams from newly opened projects lifted the company to a single-digit topline growth. Net income increased 6% to P8.7 billion.
Its petrochemicals group, however, was an outlier in the pack of stellar performing businesses. JG Summit Petrochemicals Corp. recorded a revenue decline of 31% to P29.1 billion, dragged by the weakening global market as affected by the Sino-US trade war. Its net income stood at P960.6 million last year.
Banking unit Robinsons Bank accounted for P8.1 billion of revenues to increase 32% from a year ago. The improved performance was attributed to a 17% expansion of its gross loan portfolio and trading gains from treasury business activities. Net income of Robinsons Bank jumped 126% to P719.4 million due to wider net interest margins.
“Coming from a very challenging 2018, we saw a strong recovery as [JG Summit] posted a significant earnings expansion in 2019 driven by our core businesses in food, air transport and banking,” JG Summit President and Chief Executive Officer Lance Y. Gokongwei said in the statement.
“Our plan is to sustain this growth in the coming years as we have clearly laid out our strategic priorities… — accelerating digital transformation, embedding a customer-centric culture and adopting global best practices in enterprise sustainability,” he added.
As the whole world grapples with the effects of the coronavirus disease 2019 (COVID-19) pandemic, Mr. Gokongwei said JG Summit is banking on its diversified portfolio and strong balance sheet to carry it through the crisis.
Shares in JG Summit at the stock exchange gained P2 or 3.64% to P57 each on Wednesday. — Denise A. Valdez
