LT Group Inc., the listed holding company of tycoon Lucio Tan, expressed a guarded outlook for 2020 because of the lingering effects of the coronavirus pandemic on its core businesses.
LT Group president Michael Tan said during the annual stockholders’ meeting held via teleconference that sales volume of tobacco and beer could be affected by the decline in purchasing power of Filipino consumers.
He said the group’s banking unit under Philippine National Bank would also have to grapple with non-performing loans and slower demand for loans, while property arm Eton Properties Philippines Inc. would be affected by lower rental revenues as some tenants might end their lease contracts.
Tan said that despite the challenges, he was hopeful that LT Group’s strong 2019 results would give the conglomerate a strong foundation to weather the current crisis.
He said the core businesses started feeling the effects of COVID-19 in mid-March when the government declared the enhanced community quarantine in Luzon.
“Some plants were not allowed to operate when ECQ was declared as the products were considered non-essential. Sari-sari stores that play a big role in reaching consumers were closed in some areas. There were also liquor bans declared by some local government units,” he said.
“Even as the economy restarts under different permutations of the quarantine thereafter, LTG believes it will take a while before the Philippine economy goes back to the normal, or to what it used to be. The key to faster recovery would be the availability of a vaccine for COVID-19 which it hopes will be sooner than later,” he said.
LT Group’s attributable net income reached P23.12 billion in 2019 or 43 percent higher than P16.19 billion in 2018. This was the highest income that the company achieved since its re-IPO in April 2013.
The conglomerate’s net income grew 41 percent in the first quarter to P6.21 billion from P4.42 billion a year earlier.