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San Miguel Food profit drops 20% in Q1


San Miguel Food and Beverage, Inc. (SMFB) reported a 20 percent drop in consolidated net income to ₱5.8 billion in the first quarter of the year while operating income also declined by 20 percent to ₱8.6 billion.


In a statement, the firm said it registered consolidated revenues of ₱69.0 billion for the first quarter of the year, 9 percent lower than the same period last year as the impact of COVID-19 weighed on its performance in the latter part of the quarter.

Consolidated operating income was likewise impacted by an increase in excise taxes for the Beer and Spirits Divisions in January of this year.

While its Beer and Spirits Divisions started the year with good momentum, the declaration of the Enhanced Community Quarantine (ECQ), together with the imposition of liquor bans across key cities, negatively impacted sales of its alcoholic beverages.

This was partially offset, however, by higher sales from the Food Division. In the first quarter, the Food Division generated consolidated revenues of ₱33.2 billion, 2 percent higher than the same period last year.

While the Protein and Animal Nutrition business posted a 3 percent decline in revenues, there was a significant spike in sales of some food categories as consumers stocked up on essential supplies leading up to and during the ECQ period.

The Food Division managed to keep all the plants running and maintained the highest levels of safety and hygiene in all its premises.

As a result, revenues of the Prepared and Packaged Food segment expanded by 16 percent with strong demand in the processed meats, dairy, spreads, biscuits, and coffee segments.

Recovering from the widespread glut in 2019, the Protein and Animal Nutrition segment registered a positive operating income of ₱1.2 billion during the first quarter, a complete reversal from losses of ₱577 million last year.

The Beer Division posted consolidated revenues of ₱28.4 billion, 18 percent lower than the same period last year. Volumes for SMB were up single digits in the first two months of the year with March 2020 volumes experiencing a drop given the ECQ and the resulting liquor bans.

Similarly, the Spirits Division had a good start for the first two months of the year with sales volumes 15% higher than the same period last year, but ended the quarter 14 percent less year-over-year. First quarter revenues amounted to P7.5 billion, 10 percent lower than last year.

“Nonetheless, SMFB has the solid financial foundation to weather the current situation, including a strong balance sheet, relatively light debt service obligations, and ample liquidity,” the firm said.

It added that, “The Company is, likewise, taking the appropriate steps to managing its expenses and capital expenditures moving forward.”

“During these difficult times, we remain steadfast in our commitment to ensure that there is enough food for every Filipino. It is our goal to provide nourishment and safety especially to the most vulnerable communities,” said SMFB President and CEO Ramon S. Ang.

Source: Manila Bulletin (

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