AEV posts P2-billion net income for 1st quarter of 2020

CEBU CITY, Philippines — Although the coronavirus 2019 outbreak has adversely affected the country’s economy, the Aboitiz Equity Ventures Inc. (AEV) still generated P2-billion net income for the first quarter of 2020, an emailed company statement revealed.

However, the figure is 42 percent lower when compared to its P3.5 billion net income recorded in the same period last year.

AEV registered non-recurring losses of P262 million during the period, which is lower than the P334-million recorded in the same period last year. These were due to unrealized foreign exchange losses from the revaluation of dollar-denominated assets.

Without these one-off losses, the company’s core net income for the first quarter of 2020 would reach ₱2.3 billion, a 41-percent decrease year-on-year (YoY).

AEV recorded consolidated earnings before interest, tax, depreciation and amortization (EBITDA) of ₱11.8 billion, which was five percent lower YoY.

“The strong showing of our banking and financial services and food units has helped shore up our operational performance, underscoring the resilience provided by a diversified portfolio. This same resilience will also help us face headwinds from Coronavirus Disease 2019 (COVID-19),” said AEV president and chief executive officer Sabin Aboitiz.

Aboitiz Power Corp. accounted for the biggest net income contribution or 55 percent to AEV’s total income for the same period, amounting to P1.6 billion. However, this is 43 percent lower than the P2.8 billion contribution in 2019.

Union Bank of the Philippines contribution to AEV’s income amounted to ₱1.3 billion, 23 percent higher than the ₱1.1 billion recorded in the same period last year. The bank and its subsidiaries net income reached ₱2.6 billion, 22 percent higher than the ₱2.2 billion recorded in the same period last year.

Meanwhile, Pilmico International Pte Ltd and other AEV’s non-listed food subsidiaries Pilmico Foods Corporation and Pilmico Animal Nutrition Corporation contributed P60 million to AEV, 56 percent lower than the P137 million recorded in the first quarter last year.

AEV’s unlisted food subsidiary Pilmico International Pte Ltd recorded net income of ₱297 million in the first quarter of 2020, a 116 percent increase from the same period last year.
This was due to the increase in income contribution of Gold Coin Management Holdings Limited (Gold Coin) resulting from increased equity ownership and increased volumes from Gold Coin’s China, Vietnam, Malaysia, and Sri Lanka operations.

However, the gains from Pilmico International were outweighed by a net loss for Pilmico’s local subsidiaries.

AEV’s infrastructure group, Republic Cement & Building Materials, Inc.’s income contribution to AEV for the first quarter of 2020 amounted to ₱61 million, an improvement over the ₱32-million loss recorded in the same period last year.

The growth resulted from strong demand growth during the first two months of the year. However, construction activities in March slowed down due to the Luzon-wide enhanced community quarantine.

Aboitiz Land Inc. and its subsidiaries contributed ₱508 million in revenues for the first quarter of 2020, 24 percent lower than revenue contributions from the same period in 2019.

This decrease was primarily due to higher forfeitures and lower construction progress resulting from the eruption of Taal Volcano and enhanced community quarantine (ECQ) due to COVID-19. The real estate units’ operating costs were also higher YoY.

The real estate business units reported a consolidated net loss of ₱110 million for the first quarter of 2020 versus ₱44 million in losses recorded in the same period last year.

“We will continue to look for opportunities to keep the country’s economy moving as we carefully evaluate our business strategy,” Aboitiz said. /rcg