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JG Summit swings to P468-million loss

JG SUMMIT Holdings, Inc. incurred a consolidated net loss of P468 million last year, a reversal of its P31.3-billion net income in 2019, as it took into account nonrecurring fuel hedging losses and a one-off impairment charge from its utility investment Manila Electric Co.

“Coming from a very strong 2019, COVID-19 (coronavirus disease 2019) has clearly disrupted the business, which dented our 2020 operating and financial results,” JG Summit President and Chief Executive Officer Lance Y. Gokongwei said in a statement on Monday.

The company’s core net income after tax finished at P450 million, declining by 98.22% from P25.3 billion the previous year due to the impact of the pandemic on the company’s petrochemical segment and air transport business.

Consolidated revenues for the year declined to P221.6 billion, falling by 27% from P301.8 billion.

JG Summit said its diverse business portfolio and the “strength” of the company’s balance sheet helped it face the pandemic.

Food manufacturing arm Universal Robina Corp. (URC) net income grew by 10% to P10.7 billion. The company said it gained market share in key categories through branded consumer foods (BCF) in the Philippines by introducing new products and keeping up with consumer demands.

URC revenues also inched down by 0.82% to P133.1 billion year on year from P134.2 billion as BCF Philippines saw “flat sales,” while strong revenues from agro-industrial and commodities offset the lower top line of BCF international.

The net income of real estate unit Robinsons Land Corp. declined by 39% to P5.3 billion after taking into account interest expense from its P13.2-billion bond issuance in July 2020 and the additional depreciation of properties that opened in late 2019.

Robinsons Land revenues also dropped 18% last year to P24.9 billion from P30.2 billion previously.

Cebu Air, Inc. suffered a net loss of P22.2 billion, a reversal of its P9.1-billion income in 2019, as travel restrictions were imposed amid the pandemic.

Revenues for the air transport business fell by 73% to P22.6 billion from P84.8 billion the previous year. Passenger traffic fell by 71%. Meanwhile, its cargo business benefited from increased demand for online deliveries, inching down by 6%.

JG Summit Petrochemical Corp. incurred a loss of P2 billion in 2020, a reversal of the P970.6-million income from the previous year. Revenues declined by 27% to P21.3 billion from P29.1 billion in 2019.

“Despite global implementation of strict quarantines, [the petrochemicals group] was able to continue with its manufacturing operations and perform its delivery commitments upon restart of its integrated cracker and polymer operations in early March 2020,” JG Summit said.

Polymer sales volumes increase by 14% in 2020. The petrochemicals group capitalized on demand for packaging of essential items and agricultural requirements, making the company gain market share.

Meanwhile, Robinsons Bank Corp.’s (RBank) net income climbed by 30% to P935 million from P719.4 million on the back of strong revenues, despite setting P1.1 billion in provisions for bad loans.

The banking segment gained P939 million on trading activities, leading to a top line growth of 13% year on year to P9.2 billion from P8.1 billion.

JG Summit said the pandemic prompted it to fast-track its efforts on digitalization for various businesses.

“We will continue to invest in the necessary assets and capabilities needed to sustain the business in the years to come. This will allow us to take advantage of emerging opportunities as the economy pivots back to growth,” Mr. Gokongwei said.

Food business URC dipped into other selling platforms to adjust to lockdown restrictions. Robinsons Land rolled out pickup stations in Robinsons Malls, RDelivery, and RPersonal Shopper for consumers.

Meanwhile, Robinsons Bank launched mobile app RBank Digital, QR code cashless solution QuickR, and RBankMo, where banking agents provide basic financial services.

On Wednesday, JG Summit shares at the stock market declined by 1.81% or P1.10 to close at P59.75. — Keren Concepcion G. Valmonte

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