URC posts net income of P4.8 B

MANILA, Philippines - Universal Robina Corp. (URC), reported a 47.4 percent rise in net income to P4.79 billion in the first three months of fiscal year 2016.

The increase from year-ago levels came from unrealized foreign exchange gains and market valuation of financial assets “mainly from the gain of Griffins debt currency forward hedge.”

URC’s operating income, meanwhile, went up 16.1 percent to P5.14 billion for the first three months of fiscal year 2016 compared to the P4.42 billion posted in the prior year due to lower input prices of palm oil, creamer, robusta bean, PET resin and better cost management.

In terms of sales, the company reported an 11.3 percent sales growth for the first three months of fiscal year 2016 or from October 2015 to September 2016 amounting to P29.98 billion.

“URC’s strong sales was mainly driven by branded foods and complemented by sugar/renewables and feeds. Philippine branded consumer foods business increased sales by 5.8 percent while International branded consumer foods recorded a 19.2 percent growth,” URC said in its regulatory filing.

Sales of the company’s non-branded consumer foods group increased by 16.6 percent driven by the contribution of sugar/renewables (bioethanol and biomass cogen power) and feeds which grew 72.8 percent and 22.7 percent respectively.

By business group, URC’s branded consumer foods including the packaging division, increased sales of goods and services by 10.3 percent to P24.99 billion during the period as against the P22.66 billion posted in the prior year.

Its branded consumer food business in the country alone recorded modest sales growth of 5.8 percent in the first three months of fiscal year 2016 amounting to P15.69 billion as against the P14.84 billion in the prior year.

The company attributed this to muted sales as a consequence of the change in the mix of our coffee business with the shift to value for money offering of twin pack with lower selling prices.

“We are still experiencing the effect El Niño showing minimal growth in Mindanao area and wholesaler accounts which covers traditional sari-sari stores. Lastly, aggressive moves of competitors to recover or gain market shares were felt across all categories especially on snack foods and coffee.

Beverage remains to be the main driver for growth with C2 performing very well, while the domestic business showed mixed results with Chocolates and Noodles growing double digits while snacks, bakery and candies at low single digits,” it said.

On the other hand, URC’s International branded consumer food business registered sales of P8.98 billion for the first three months of fiscal year 2016, a 19.2 percent increase.

Among the different markets, Vietnam, Indonesia and New Zealand contributed to the strong top-line growth but Thailand recorded lower sales due to lower sales of biscuits.

The company’s non-branded consumer foods business, commodity foods group and agro-industrial group, meanwhile, posted revenues of P4.99 billion for the first three months of fiscal year 2016, an increase of 16.6 percent against last year, mainly due to the contribution of the company’s renewable business and feeds.