SMC 2016 profit jumps 80% to P52B


Conglomerate San Miguel Corp. posted an 80-percent jump in net income to P52 billion for 2016 from P28.9 billion a year earlier on the back of higher revenues and better margins across its major businesses.

Excluding foreign exchange losses of P8.9 billion, consolidated net income more than doubled, or increased 111 percent, to P61.2 billion during the period, the company said.

Operating income on a consolidated basis rose 24 percent to P99.7 billion from P80.5 billion in 2015, with profits in most of its businesses registering double-digit growth.

Revenues, however, grew only 2 percent to P685 billion as lower prices of fuel dragged the sales of its oil retailer, Petron Corp.

Subsidiaries’ hefty gains

San Miguel Brewery (SMB) reported a 31-percent increase in net income to P17.7 billion in 2016 from P13.5 billion in 2015, while revenues climbed 18 percent to P97.2 billion on the back of record sales volume of 230.4 million cases.

Liquor unit Ginebra San Miguel Inc. registered a P361 million net income, a turnaround from a P386 million net loss the previous year. Revenues grew 12 percent to P18.6 billion on a 9 percent improvement in volumes to 25.2 million cases.

Food manufacturer San Miguel Pure Foods Co. Inc. reported a 26-percent rise in profit to P6 billion on improved margins brought about by higher sales volumes amid favorable selling prices. The unit’s consolidated revenues rose 4 percent to P111.6 billion.

San Miguel Packaging Group saw sales grow 9 percent to P27.4 billion, traced to its glass and plastics products, as well as higher contributions from its Australian businesses. Its operating income reached P2.6 billion, up 10 percent year-on-year.

Power vehicle SMC Global Power reported P78 billion in revenues. Operating income stood at P26.7 billion, which was 13 percent higher than the previous year due to lower generation costs and improvement in generation volume from both its Sual and Ilijan plants.

Oil refiner and retailer Petron recorded a 73-percent leap in net income to P10.8 billion from P6.3 billion the previous year, driven by sales volume growth, better efficiencies from both its Philippines and Malaysia operations, an increased crude run at higher product yields, and effective risk management. Its operating income rose 31 percent to P23.8 billion.

Its infrastructure business, through San Miguel Holdings Corp., posted P19.9 billion in revenues, up 13 percent on continued growth in traffic volume for all SMC-operated toll roads SLEX, Skyway 1 and 2, STAR and TPLEX. Operating income improved 6 percent to P9.8 billion.

SMC is currently preparing for the secondary tranche of its P60-billion bond program. The firm seeks to raise as much as P15 billion – with a P10 billion base offer and P5 billion in case of oversubscription – from offering a five-year Series D bond due 2022. This leaves SMC with P25 billion for future issuances under its three-year bond program.

The fresh funds are expected to partly finance SMC’s dollar-denominated debt obligations.

Established in 1890, SMC is a diversified conglomerate, currently led by businessman Ramon Ang, holding his business including beverages, food and packaging (San Miguel Brewery Inc., Ginebra San Miguel Inc., San Miguel Pure Foods Company Inc.), fuel and oil (Petron Corp.), energy and power (SMC Global Power), infrastructure (Eagle Cement Corp.), and banking (Bank of Commerce).


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