Business World Online
Posted on May 06, 2011 06:37:31 PM
LISTED HOLDING firm Aboitiz Equity Ventures, Inc. said on Friday its profits declined by more than a quarter in the first quarter from yearago levels due to a drop in earnings of its power subsidiary, the core business.
"Aboitiz Equity Ventures ended the first quarter of 2011 with a consolidated net income of P4.6 billion, recording a decline of 26% year-on-year," the holding firm said in a disclosure to the local bourse.
The fall comes after net income ballooned by 341% to P6.2 billion in the first quarter of 2010 due to a profit surge in its power generation business.
The recent performance comes as profits of Aboitiz Power Corp., which makes up the bulk of the holding firm’s business, dropped by 34% to P3.6 billion less non-recurring gains.
The one-time gain worth P266 billion had come from a "revenue adjustment in the tariff structure".
"The decline in the group’s bottom line performance was mainly due to the lower average selling price and net generation recorded for the period," the firm added.
Furthermore, a cooler climate in the first quarter resulted in lower demand for electricity.
Meanwhile, income contribution from the banking business--represented by Union Bank of the Philippines (UnionBank) and City Savings Bank-- posted an 11% growth to P422 million, Aboitiz Equity said.
UnionBank contributed P319 million to total earnings, down by a tenth from last year. This comes despite a 3% rise in net interest income to P1.8 billion.
But UnionBank’s interest income on trading and investment securities slipped by 5% this year due to lower average yields, Aboitiz Equity Ventures said.
As of end-March, the holding firm had a 41% stake in Unionbank, up from 39% in the previous year.
Furthermore, non-listed thrift bank City Savings Bank contributed earnings P102 million to total earnings, up by 294% from the previous year as Aboitiz Equity Ventures’ stake in the bank surged to 99.25% from 36%.
Lastly, the food business, through Pilmico Foods Corp., posted a 24% decline in its first quarter income contribution to P282 million from P372 million in the previous year.
"The bottomline contribution of the flour, feeds and swine segments for the first quarter was reduced by 18%, 27% and 28%, respectively," Aboitiz Equity Ventures said, without citing absolute figures.
Pilmico Foods, the unlisted feed, flour and hog production unit of the Aboitiz Group, last year increased the feed milling capacity in its Iligan plant by 10,000 metric tons (MT) from about 100,000 MT per year capacity.
Shares in Aboitiz Equity Ventures closed P1.65 lower at P37.55 each on Friday. -- Neil Jerome C. Morales
The fall comes after net income ballooned by 341% to P6.2 billion in the first quarter of 2010 due to a profit surge in its power generation business.
The recent performance comes as profits of Aboitiz Power Corp., which makes up the bulk of the holding firm’s business, dropped by 34% to P3.6 billion less non-recurring gains.
The one-time gain worth P266 billion had come from a "revenue adjustment in the tariff structure".
"The decline in the group’s bottom line performance was mainly due to the lower average selling price and net generation recorded for the period," the firm added.
Furthermore, a cooler climate in the first quarter resulted in lower demand for electricity.
Meanwhile, income contribution from the banking business--represented by Union Bank of the Philippines (UnionBank) and City Savings Bank-- posted an 11% growth to P422 million, Aboitiz Equity said.
UnionBank contributed P319 million to total earnings, down by a tenth from last year. This comes despite a 3% rise in net interest income to P1.8 billion.
But UnionBank’s interest income on trading and investment securities slipped by 5% this year due to lower average yields, Aboitiz Equity Ventures said.
As of end-March, the holding firm had a 41% stake in Unionbank, up from 39% in the previous year.
Furthermore, non-listed thrift bank City Savings Bank contributed earnings P102 million to total earnings, up by 294% from the previous year as Aboitiz Equity Ventures’ stake in the bank surged to 99.25% from 36%.
Lastly, the food business, through Pilmico Foods Corp., posted a 24% decline in its first quarter income contribution to P282 million from P372 million in the previous year.
"The bottomline contribution of the flour, feeds and swine segments for the first quarter was reduced by 18%, 27% and 28%, respectively," Aboitiz Equity Ventures said, without citing absolute figures.
Pilmico Foods, the unlisted feed, flour and hog production unit of the Aboitiz Group, last year increased the feed milling capacity in its Iligan plant by 10,000 metric tons (MT) from about 100,000 MT per year capacity.
Shares in Aboitiz Equity Ventures closed P1.65 lower at P37.55 each on Friday. -- Neil Jerome C. Morales
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