CONGLOMERATE San Miguel Corp. (SMC) said its income will further improve during the second quarter of the year, mainly as a result of the strong revenue pickup of refiner Petron Corp., while its power business will reach its peak in the second quarter.
SMC President and COO Ramon S. Ang said, with Petron now churning out a 93-percent liquid yield in its refineries, the company may achieve an operating income of $600 million to $700 million for the year, based on an oil-price average of $40 per barrel.
The liquid yield pertains to Petron’s recovery rate of white products, such as gasoline and diesel, from crude. Ang said, prior to the commissioning of its refinery, Petron can only produce 66-percent liquid yield from crude.
Petron’s gross profit of P31.74 billion last year will increase by at least 36 percent this year, based on Ang’s figures.
“We had a good first quarter and we expected a better quarter because Petron will deliver much better than that,” Ang said.
“The peak of our power business is at the second quarter because of summer and the same as in tollways. Our beer will also be okay, but it will also increase because of the elections. The second quarter is going to be much better,” Ang said.
He said the company’s Davao power plant will go online this month and its Limay plant will be commissioned by June or the third quarter, at the latest, both of which could add up to SMC’s revenues this year.
“Our tollway business is very stable and the increases were just at single-digit rates. What will really drive us is the turnaround Petron,” Ang said.
He said the refiner could post an annual income of at least P20 billion starting next year, an increase of at least threefolds, from the P6.3-billion income it had in 2015.
“The first quarter income of San Miguel is starting to gain traction. And this is just a start,” he said.
SMC’s net income soared more than twofolds to P13.5 billion for the first three months of the year, from the same period in 2015 at P6.11 billion.
Consolidated revenues reached P159.62 billion, 1 percent up from the prior year’s P157.75 billion.
Petron’s net income for the period rose to P2.8 billion, 10 times higher from last year’s, while operating income nearly doubled to P5.8 billion.
San Miguel Brewery Inc. posted robust topline and earnings growth for the period due to higher demand for its products, better performance of its international operations and successful activation of its various brands.
Consolidated sales revenues grew by 23 percent to P23.3 billion, while operating income rose 17 percent to P6.1 billion.
Liquor firm Ginebra San Miguel Inc.’s sales volume reached 5.3 million cases, 7-percent better than last year. Revenues grew 7 percent to P3.9 billion, while operating income doubled to P188 million.
SMC Global Power Holdings Corp.’s offtake volume grew 16 percent to 4,457 gigawatt hour, with all its power plants registering higher bilateral volumes for the period in review. Consolidated revenues marginally grew to P19.9 billion, while operating income rose 7 percent to P7.3 billion.
The revenue of its infrastructure unit revenue grew 16 percent to P4.7 billion and its operating income reached P2.4 billion.