Forex Losses, CREATE Act Pulls SMC H1 Income

San Miguel Corp. said. (SMC) said its first-half income fell 33 percent to 19.8 billion pesos from 29.57 billion pesos last year, due in part to the effects of foreign exchange (forex) losses and the CREATE Act.

Recurring income, which excludes forex losses and the creation or corporate refund law and corporate tax incentives, rose 24 percent to 32.48 billion pesos from 26.09 billion pesos last year.

Consolidated sales revenue increased 73 percent to 711.4 billion pesos from 410.12 billion pesos previously thanks to continued volume growth and improved selling prices.

The company’s operating income grew 41 percent to 85.85 billion pesos from 61.01 billion pesos last year mainly due to improved performance of its Petron Corp. fuel and oil subsidiary and continued paybacks for its food and beverage, packaging and infrastructure businesses.

“Overall, it was a very difficult period, with geopolitical conflict leading to uncertainty, supply issues and serious costs affecting industries around the world. Nevertheless, even as the effects of the pandemic persist, we are encouraged by the strong and growing demand for our products and services, as evidenced by of our higher volumes and revenue in the first half,” said Ramon, President and CEO of San Miguel Sang.

This indicates that the economic recovery and growth in our country is advancing. We will maximize every opportunity to further enhance our performance in the second half.”

San Miguel Food and Beverage Inc’s revenue rose 12 percent to 10.65 billion pesos from $9.5 billion last year, driven by volume growth and improved selling prices across the beer, spirits and food divisions.

Meanwhile, SMC Global Power Holdings Corp’s purchase volumes were 14,336 GWh during the period, an increase of 6% over last year.

Consolidated revenue was 102.6 billion pesos, an increase of 70 percent from the previous 60.27 billion pesos driven by improvements in Miralco’s nominations, increased demand from distribution facilities, competing customers and the start of commercial operations for the 20MW Kabancalan battery energy storage system.

However, operating income fell 26 per cent to 12.76 billion pesos from 17.15 billion pesos last year due to the unprecedented increase in fuel input costs and the dwindling Elian Gas plant due to supply problems from the Malambaya gas field.

Petron’s income doubled to 7.7 billion pesos from 3.87 billion pesos last year as consolidated volumes from its operations in the Philippines and Malaysia grew 34 percent to 51.4 million barrels on the back of rebounding demand due to continued easing of travel restrictions and an improving pandemic situation.

Meanwhile, revenue from the company’s infrastructure arm grew 58 percent to 13.4 billion pesos from the previous period of 8.48 billion pounds. Operating income more than doubled to 6 billion pesos from the previous 2.31 billion due to increased traffic.

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