DAVAO CITY, Philippines – Aboitiz Equity Ventures, Inc. (AEV), the public holding company of the Aboitiz Group reported its P47. Billion net profit during the first quarter of 2017.
AEV’s major investments include power, banking and financial services, food, infrastructure, and land.
But the net profit, AEV said, represented a 7 percent decrease year-on-year compared to previous net profits.
“The company recognized non-recurring losses of P442 million (versus last year’s gain of P186 million) coming from foreign exchange (forex) losses recognized upon revaluation of dollar-denominated liabilities and mark-to-market losses on derivatives,” AEV said.
Among its investments, AEV said power accounted for 67 percent of the group’s total earnings while income contribution of the banking and financial services, food, infrastructure, and land strategic business units (SBUs) were at 22 percent, 6 percent, 4 percent and 1percent, respectively.
“Our performance reflects the underlying strength of our core operating businesses as we continue to invest for the future. In pace with the country’s upward growth momentum, we will use our gains to create long-term value for all our stakeholders,” Erramon I. Aboitiz, AEV President and Chief Executive Officer, said in the statement.
AEV is currently recognized as one of the best-managed companies in the Philippines and in the region, consistently cited for its commitment to good corporate governance and corporate social responsibility.
Aboitiz Power Corporation’s (AboitizPower) income contribution to AEV also decreased by 13 percent YoY, the statement said, from P3.9 billion to P3.4 billion as income performance also recorded a 13 percent decline YoY at P4.4 billion.
Power generation business also reported a net income drop due to higher interest and depreciation expenses from the initial take up of GNPower-Mariveles costs, and increase in unrealized forex and mark-to-market losses, AEV said.
Power generation accounts for 81 percent of earnings contributions from AboitizPower’s business segments.
On the other hand, the banking and financial services of AEV posted an increase in income contribution during the period, the statement said.
“Union Bank of the Philippines’ (UnionBank) income contribution to AEV increased by 30 percent YoY, from P837 million to P1.1 billion.”
Other subsidiaries, such as the SBU also recorded a net income of P2.2 billion for the first quarter of 2017, which is 27 percent higher as compared to the P1.7 billion earned for the same period last year.
“The increase in net income was largely in view of the sustained growth in recurring income, coupled with trading profits.”
AEV added that the income contribution of other financial services, such as the PETNET, also increased by 207 percent YoY or a figure of P4.4 million.
The decrease in income contribution was also recorded in the public holding’s food subsidiaries, the statement said.
It’s food subsidiaries include the Pilmico Foods Corporation, Pilmico Animal Nutrition Corporation, and Pilmico International Pte Limited.
AEV said income contribution for the quarter of food subsidiaries decreased by 25 percent YoY from P389 million to P292 million during the period.
“Feeds Philippines and Flour reported a drop in net income contributions largely driven by lower selling prices and higher raw material (RM) and operating costs. Depressed flour prices, higher wheat cost, and increase in operating costs dragged Flour’s net income for the period to P87 million, 46 percent lower YoY.”
AEV said Feeds Vietnam’s income also doubled to P7 million that was driven by the 5 percent volume growth.
The boost in income, AEV added, was the result of the expansion in new markets: export and commercial, and better margins.
“The recovery in live hog selling prices of Farms resulted in four times higher YoY net income of Farms division to P81 million.”
Meanwhile, Aboitiz Land, Inc. (AboitizLand) registered a net income of P72 million, figure 46 percent higher than last year’s P50 million.
“The increase in net income was mainly attributed to higher revenue recognition by the industrial BU (business unit), and improved sales and construction progress by the residential BU.”
AEV added that AboitizLand posted a revenue of P640 million for the first quarter of 2017 – an increase of 28 percent from the same period last year.
“Of this revenue, the residential BU contributed 53 percent (P339 million), the industrial BU 41 percent (P264 million), and the commercial BU and others, 6 percent (P37 million),” the company holding said.
Income contribution of AEV’s infrastructure group, the Republic Cement and Building Materials, Inc.’s (Republic) also decreased during the period by 48 percent YoY from P391 million to P202 million.
“Cement demand slowdown was experienced in the first quarter of 2017, as compared to the same period last year when there was strong demand due to the election season,” AEV said. (davaotoday.com)
