SMC earnings pick up in Q3 on easing lockdown

SAN MIGUEL Corp. (SMC) posted a net income of P15 billion in the third quarter, up from the P13.54 billion it reported the same period last year, as its business units started bouncing back after subdued demand earlier in the year.

In a statement Thursday, the company said it returned to profit after posting a net loss of P4 billion in the first six months of 2020 due to the relaxation of quarantine rules in Metro Manila and key cities.

However, on a year-to-date basis, SMC’s net income remains down 73% to P10.75 billion, based on a presentation to investors uploaded on its website on Thursday.

Net sales during the nine months is lower by 30% at P531.13 billion, while operating income is down 53% to P41.46 billion.

By business segment, SMC Global Power Holdings Corp. generated the largest net income year-to-date at P14.48 billion, up to 27% from last year. The bottomline growth came amid a 16% decline in revenues at P87.87 billion.

The food and beverage group, through San Miguel Food and Beverage, Inc., posted a net income of P14.36 billion, down 37% from a year ago. Net sales likewise slid 14% to P194.56 billion.

The slowdown is largely due to the beer and food segments, which posted a 44% income decline to P11.08 billion and a 13% income decline to P1.55 billion, respectively. This offset the 67% income growth of Ginebra San Miguel, Inc.

SMC’s fuel business, through Petron Corp., posted a consolidated net income of P1.63 billion for the third quarter, but remained unprofitable for the nine-month period with a P12.61-billion net loss.

The improvement in the three months was attributed to stabilizing world crude prices and the relaxation of lockdown protocols since the end of the second quarter. Petron has also come back to normal operations since August.

SMC’s infrastructure business, which operates toll roads across the country, recorded improved traffic quarter-on-quarter, but still 37% down on a nine-month basis. It generated revenues of P10.3 billion, down 42% from last year.

“The country has proven its adaptability and resilience in these trying times, and we, in San Miguel Corp., will continue to deliver on our commitment to help the country build back better and stronger as we emerge from this pandemic,” SMC President and Chief Operating Officer Ramon S. Ang said in the statement.

SMC shares picked up P1.30 or 1.27% to close at P104 apiece on Thursday. — Denise A. Valdez