Weak power unit pulls down AEV income

By VG Cabuag November 4, 2020
https://businessmirror.com.ph/2020/11/04/weak-power-unit-pulls-down-aev-income/

Aboitiz Equity Ventures Inc. (AEV) said its net income in January to September fell 35 percent to P4.4 billion from last year’s P6.8 billion, as the contribution of its power unit declined.

Power accounted for 49 percent of total income contributions to the company while financial services accounted for 39 percent, food at 9 percent, infrastructure at 3 percent and real estate at 1 percent.

The company did not provide its revenue for the period.

“The first nine months of the year brought about unprecedented challenges that truly tested the resilience of the nation and the Aboitiz group as well. We saw some signs of recovery in the third quarter, but we will continue to operate with caution and focus on providing the country with the services it needs to cope and recover,” Sabin M. Aboitiz, the company’s president and CEO, said.

“Moving forward, we expect our environmental, social and governance initiatives will help us achieve our targets by the end of the decade and in the years to come. Digital innovation played an important role in helping us cope with this year’s challenges, and will continue to enable us in the future.”

Aboitiz Power Corp.’s net income contribution to AEV in January to September plunged by half to P5.4 billion from last year’s P10.4 billion.

On a standalone basis, Aboitiz Power’s core net income was at P6.47 billion, 53 percent lower than last year’s record.

Income contribution from the generation and retail electricity supply businesses, which accounted for 69 percent of total income contribution from Aboitiz Power’s business segments, was cut by half to P6.3 billion from last year’s figure.

Union Bank of the Philippines’s income rose by a mere 2 percent to P4.3 billion, from last year’s P4.2 billion. On a standalone basis, Union Bank recorded a net income of P8.5 billion, 1 percent lower than the P8.6 billion last year.

AEV’s non-listed food units’ income contribution reached P969 million, 5 percent lower than the P1 billion last year. These food companies are Pilmico Foods Corp., Pilmico Animal Nutrition Corp. and Pilmico International Pte. Ltd., which includes Gold Coin Management Holdings Pte. Ltd.

Its domestic unit reported a net income of P585 million for the period. Its farms business segment reported a net loss of P703 million due to decreased margins due to higher production costs and lower selling prices caused by the industry-wide effect of the African swine fever. This was exacerbated by lower sales volume due to transport restrictions on pork and pigs imposed in several provinces in Luzon.

The feeds business segment recorded a net income of P728 million, double from last year’s figure, while the flour business segment recorded P572 million in net income, 27 percent higher than the previous year’s record.

Contribution from its international food units reached P383 million, a 22-percent increase from last year, due to the full-year effect of the 100-percent ownership in Gold Coin.

Aboitiz Land Inc. reported a consolidated net income of P85 million, 90 percent lower than the P829 million a year ago.

Its revenues reached P2.1 billion, 2 percent higher than last year due to higher revenue from its industrial business, resulting from an increase in revenue recognized from industrial lots sold. However, the performance of Aboitiz Land’s residential business offset the gains from the industrial business due to a slowdown caused by lockdown restrictions.

The residential business unit contributed P715 million, the commercial business unit contributed P159 million, while the industrial business unit and other subsidiaries contributed the remaining P1.3 billion.