JG Summit incurs P468M net loss in 2020

Gokongwei-led conglomerate JG Summit Holdings suffered a financial beating in 2020 amid the disruption brought by the COVID-19 pandemic on its businesses.

In a disclosure to the Philippine Stock Exchange on Wednesday, JG Summit reported a consolidated net loss of P468 million last year, “incorporating nonrecurring fuel hedging losses and a one-off impairment charge from Meralco.”

The company said its equity earnings from its core investments in Meralco, Global Business Power Corporation (GBPC) and United Industrial Corporation (UIC) also declined year-on-year.

Its consolidated revenues stood at P221.6 billion, down 27% from a year earlier.

“Coming from a very strong 2019, COVID-19 has clearly disrupted the business which dented our 2020 operating and financial results. Nonetheless, our diversified portfolio of market-leading businesses coupled with the strength of our balance sheet helped us navigate the situation,” said Summit president and CEO Lance Gokongwei.

The company said its double-digit revenue growth in its banking and office segments, robust sales in food, and higher dividends from its telecommunications investment, tempered the negative impact of the pandemic to the company’s overall operating results.

Its petrochemical unit, however, saw lower sales volumes and selling prices on the back of weaker global industrial demand while its air transport business was severely impacted by flight restrictions particularly in the onset of the enhanced community quarantine (ECQ).

The strong margin expansion in its food and banking units also provided some buffer to offset profit declines in other businesses, JG Summit said.

In particular, JG Summit’s food unit Universal Robina Corp.’s saw a 10% net income growth to P10.7 billion.

Its real estate arm Robinsons Land Corp. posted a net income of P5.3 billion, down 39% amid lower revenues from malls and hotels, which were severely impacted by the lockdown.

Cebu Air Inc., the operator of Cebu Pacific, reported a net loss of P22.2 billion due to lower passenger volumes coupled with hedging losses.

JG Summit Petrochemicals Group recorded a net loss of P2 billion. It said JG Petrochemicals is nearing the final stages of its $1.1 billion expansion project with some of its key components coming online in the second quarter of 2021.

“This would improve overall profitability as the company starts to capture more margins with its new downstream products,” it said.

Robinsons Bank recorded a net income of P935 million, up 30% year-on-year driven by 8% increase in loans, as well as the P939 million gain from trading activities.  —KBK, GMA News