By James A. Loyola
San Miguel Food and Beverage, Inc. (SMFB) the food and beverage arm of San Miguel Corporation (SMC), is confident of weathering the economic crisis brought about by the COVID-19 pandemic.
“Our strong fundamentals enabled us to get through this period. SMFB has a strong balance sheet, manageable debt service obligations, and ample liquidity,” SMC president and chief operating officer Ramon S. Ang said.
He added that, “The company is also taking the appropriate steps to manage its expenses and capital expenditures moving forward.”
Following the consolidation of its operating businesses in 2018--namely, San Miguel Brewery Inc., San Miguel Foods, and Ginebra San Miguel Inc.--SMFB started broadening its category reach to capitalize on synergies and further strengthen its business.
It has also started to leverage on the extensive networks that each business has built through the years and has maximized the unique value proposition of San Miguel Corporation’s other businesses.
SMFB reported strong results for 2019 registering consolidated revenues amounting to P310.79 billion, 9 percent higher than the prior year.
Consolidated net income amounted to P32.28 billion, 6 percent higher year-on-year, while consolidated operating income amounted to P47.78 billion, up 4 percent.
SMFB’s growth momentum carried through in the first two months of 2020, with all divisions generating sales volume growth.
However, the impact of the COVID-19 pandemic, which forced a stop to virtually all economic activities, weighed down on the company’s performance towards the end of the quarter.
As a result, first quarter consolidated revenues declined 9 percent year-on-year to P69.02 billion. This was partially offset, however, by higher sales from its Food Division.
An increase in excise taxes for its Beer and Spirits Divisions in the early part of this year also affected consolidated operating income and consolidated net income as both declined by 20 percent to P8.64 billion and P5.83 billion, respectively.