DIVERSIFYING conglomerate San Miguel Corp. (SMC) is reporting higher profits for the first nine months of the year driven by its liquor and beer units.

Consolidated profits from the January-to-September period rose 173 percent to P57 billion. Operating income ended the period 12 percent higher at P13.1 billion.

The consolidated income includes one-time gains, such as SMC’s sale of a 43.25-percent stake in domestic beer to Japan’s Kirin Holdings Co. for P50.7 billion earlier this year. SMC said without one-time gains, it net income during the period rose 6 percent to P7.61 billion from last year.

No financial statement was released on Thursday, although analysts noted that third-quarter profits will likely be higher from the same period in 2008 on the expectation that SMC will receive the full impact of its 27-percent stake in Manila Electric Co. (Meralco). The country’s largest power retailer continues to be profitable as it reported last week that third-quarter net income rose over 41 percent to P5.3 billion.

For its beer unit San Miguel Brewery Inc. (SMBI), the firm said volume improvements coupled with stable prices and better cost management, boosted its performance.

SMBI said revenues rose 5 percent to P37 billion while operating income also went up by 5 percent to 11.3 billion.

Liquor unit Ginebra San Miguel Inc. reported double-digit results, with revenues rising 27 percent to P14.1 billion from the first nine months last year. Likewise, operating income rose 41 percent to P872 million. The company credited this to improvements in alcohol production and distribution costs.

SMC said its food business maintained a strong sales performance, registering revenues of P55.9 billion, up 5 percent while operating income increased by more than half to P2.31 billion.

The conglomerate also continues to diversify outside its core business of food and drinks.

Apart from Meralco, other investments include telecommunication firms Liberty Telecoms Holdings Inc. The conglomerate also recently entered the toll road management sector by purchasing a significant stake in the consortium building the P19-billion Tarlac-Pangasinan-La Union Expressway.

In addition, SMC maintains an exclusive option to buy 51 percent of listed oil refiner Petron Corp until 2010, though it admitted earlier this week that it is revisiting this in light of the recent price restrictions on petroleum companies. 

The conglomerate  also said it is interested in entering the lucrative mining sector and has expressed its intention to go into bulk water supply, proposing to build the $1.3-billion Laiban Dam in Tanay, Rizal.