May 13, 2011
URC October-March net profit dips 28%
Philippine food and beverage conglomerate Universal Robina Corporation announced a plunge of its net earnings for the first half of its fiscal year ending September 2011 by 28 percent due to the decline in market values of its bond and equity investments and lower operating income.
In a submitted financial report to securities regulators, URC said its unaudited consolidated net income fell to P3.28 billion in the period October 2010 to March this year from PHP4.56 billion (US$105.53 million) a year earlier, even as net sales rose 15.9 percent to PHP33.3 billion (US$770.65 million).
The largest contributor to the group''s sales revenue, URC''s branded consumer foods segment including the packaging division, registered sales of PHP24.77 billion (US$573.06 million), up 17.1 percent from the year-earlier level due to the robust performance of its international operations.
Sales from international business climbed 45.3 percent to US$215 million. In peso terms, net sales increased 36.6 percent largely due to the increase in sales volume, supported by strong sales growth in Vietnam, China, Thailand and Malaysia.
Domestic operations, on the other hand, rose by a modest five percent to PHP14.6 billion (US$337.85 million) from PHP13.9 billion (US$321.71 million), largely driven by the strong performance of its snack foods category, which grew 12.4 percent on account of growth in sales volume and increase in selling prices.
Net sales of URC''s agro-industrial group reached PHP3.25 billion (US$75.26 million), down 7.9 percent from last year. The feeds business however expanded 20.1 percent to PHP1.63 billion (US$37.74 million) because of increases in sales volume and selling prices. The farms business declined 25.4 percent as sales volume and farm gate prices dropped.
URC''s commodity foods group chalked in sales of PHP5.27 billion (US$37.74 million) or 30.8 percent more than the previous level. This was primarily due to the 52.3-percent jump in net sales of the sugar business, driven by higher sales volume and better prices. The flour business also went up 4.5 percent as a result of price increases.
Operating income slid 12.1 percent to PHP3.82 billion (US$88.41 million), mainly due to the increase in commodity prices compared to the second quarter of last year. The higher input costs were partly offset by the price adjustments made in the company''s domestic products.
URC said its balance sheet remains strong with a net cash position of PHP6.6 billion (US$152.70 million).