URC income drops

MANILA, Philippines — Universal Robina Corp., the consumer business of the Gokongwei group, said yesterday that its profitability remained weak amid decline in volumes and a change in mix particularly on the coffee category of the Branded Consumer Foods Group in the Philippines.

In a disclosure yesterday, URC said it posted a net income of P8.408 billion during the nine month period, a decline of 21.2 percent.

This, URC said, was attributable to the lower unrealized net forex gains and the lower market valuation gain on financial assets at fair value through profit or loss (FVPL).

“Profitability remained weak as the company faced a decline in volumes and a change in mix particularly on the coffee category of BCF Philippines, a slower than expected recovery in Vietnam, and an overall unfavorable forex and input cost inflation,” URC said.

It likewise posted lower operating income at P10.767 billion during the nine-month period or a 7.4 percent decline.

Core earnings before tax registered at P9.735 billion, a 13.3 percent drop versus last year.

URC said this was due to higher net finance costs from the additional long-term debt interest expense from the loan used for Snack Brands Australia acquisition; the continued servicing of the onshore debt in New Zealand; and the higher share of equitized losses from both the consolidation of the new JV with Vitasoy, and the continued heavy investments in advertising and promotions and distribution for the JVs with brands Calbee and Danone.