Conglomerate JG Summit Holdings Inc. said net income in the first nine months of 2018 dropped 30 percent to P14.79 billion from P21.24 billion year-on-year due to lower profits of the petrochemicals, food and airline businesses and the depreciation of the peso against the US dollar.
JG Summit said in a disclosure to the stock exchange nine-month consolidated revenues rose 7.3 percent to P217.5 billion from P202.6 billion on year.
Cost of sales grew at a faster rate of 12 percent to P142.3 billion from P126.9 billion due to higher input costs across all core businesses.
“We are pleased to see pockets of growth in our third quarter results as our businesses continue to traverse a very challenging macro-economic and competitive environment,” JG Summit president and chief executive Lance Gokongwei said.
“JG Summit has a diversified portfolio with a combination of defensive and cyclical businesses. Our airline and petrochemical divisions are more susceptible to the volatility in oil prices and the weaker peso but the effect on earnings has been partly cushioned by our other core businesses in food, real estate and banking,” he added.
Gokongwei said the company would continue invest wisely for growth as well as transform and strengthen its organizational capabilities to enable it to reap the benefits when the cycle turned more favorable.
The group has investments in food manufacturing, real estate, air transportation, petrochemicals and banking.
JG Summit posted a net income of P5.6 billion in the third quarter, down 23 percent from P4.62 billion recorded in the same quarter in 2017
The conglomerate said the decline in the company’s net income had tapered off. The improvement was mainly driven by Universal Robina Corp.’s recovering operating margins on the back of higher selling prices in its domestic branded consumer foods business, Vietnam’s recovery and better cost management.
Real estate unit Robinsons Land Corp. sustained double-digit growth, boosted by gains from sale of land to its joint ventures with Shang Properties and Hong Kong Land.