Aboitiz Equity posts profit drop on weak power results

Business World Online
Posted on March 02, 2012 05:53:52 PM


ABOITIZ EQUITY Ventures, Inc., the listed holding company of the Aboitiz group, posted a 3% drop in its net earnings for 2011 after contributions from its business fell, a disclosure on Friday showed.


The firm said its consolidated net income fell to P21.2 billion from P21.87 billion in 2010. Core income, which includes a P366 million one-time gain, similarly fell by 4.59% to P20.8 billion year-on-year, the disclosure read.


Aboitiz Power Corp., a unit which accounted for nearly 80% of the holding total income last year, contributed lower earnings of P16.5 billion in 2011 versus P19.1 billion two years ago.


This was reportedly a result of a 7% drop in the average selling price of electricity, as well as a decline in net power generation to 9,422 GWH from 9,762 GWH in 2010, the disclosure noted.


"Demand for electricity was relatively flat [in 2011] versus [the previous] year," Aboitiz Equity Ventures said.


The full year results come as core income in the fourth quarter alone slipped by 1.85% to P5.4 billion versus P5.3 billion in the same period in 2010. The holding firm had recorded a P94-million, non-recurring loss from loan and placement revaluations during this period.


Aboitiz Equity Ventures' latest financial statement was not readily available yesterday.


The holding firm went on to report mixed results for its food and banking units, which respectively contributed 6% and 16% to Aboitiz Equity Ventures' total income for 2011.


Pilmico Foods Corp., Aboitiz Equity Ventures' unlisted food arm, saw its income contribution fall by 19% to P1.2 billion from P1.5 billion in 2010 as higher input costs outweighed the company's higher average selling prices and expansion of the subsidiary's feeds and swine operating divisions.


Aboitiz Equity Ventures' banking group, which is composed of Union Bank of the Philippines, Inc. and City Savings Bank, Inc., managed to hike its income contribution by 31% to P3.4 billion from higher interest earnings on loans and Aboitiz Equity Ventures' increased ownership stakes in the two banks.


Shares of Aboitiz Equity Ventures rose by 3.31% to P49.90 on Friday from its previous close, while Aboitiz Power climbed by 3.59% to P33.15 apiece.


Union Bank shares, however, slipped by 1.12% to P106.00 on Friday from P107.20 on Thursday. -- Franz Jonathan G. de la Fuente