San Miguel's H1 net income falls sharply to P6.28-B

Reuters

Posted at Aug 12 2010 04:31 PM | Updated as of Aug 13 2010 11:12 PM

MANILA, Philippines -- Conglomerate San Miguel Corp. said its net income fell sharply in the first half from a year earlier, when assets sales had boosted profits, although it said its push into power ventures had yielded strong results.

San Miguel, already one of the country's biggest power players just two years after it entered the sector, said net profit in January to June was P6.28 billion ($138 million) from P56.25 billion a year earlier.

Last year, the company recorded net income of P52.9 billionin the second quarter alone, a figure which was boosted by extraordinary gains from asset sales.

The 120-year-old conglomerate has added power, mining, oil refining, telecommunications and infrastructure to its business lines after dominating the local food and drinks sector for decades. It is now selling substantial stakes in its food and drinks units to finance more acquisitions in high-growth sectors.

San Miguel's flagship brewery unit, San Miguel Brewery, recorded a net income of P5.56 billion in the first half, up 14% from a year earlier. San Miguel sells 9 out of every 10 beers sold in the Philippines.

Analysts do not give quarterly forecasts for San Miguel but they expect the company to make a net profit of P12.06 billion this year, sharply lower than a 2009 profit of nearly P58 billion which was boosted by asset sales, according to the mean estimate of Thomson Reuters.

The results were released after the market closed. On Thursday, San Miguel's A and B shares were down 0.15% and 0.73% respectively against a 1.13% drop in the broader market.