LT Group, Inc. (LTG), the flagship of taipan Lucio Tan, reported a 313 percent surge in consolidated attributable net income to P15.40 billion for the first half of 2022 from the P3.73 billion earned in the same period last year.
In a disclosure to the Philippine Stock Exchange, the firm said “The improvement in the banking segment’s result more than offset the decline in the tobacco, beverage, distilled spirits and property development segments’ performance.”
Philippine National Bank’s net income of P11.1 billion for the first half of 2022 was significantly higher than its first half 2021 net contribution as last year’s income of P22.2 billion included a P33.6 billion gain on the loss of control of PNB Holdings Corporation (PHC) that was eliminated at the consolidated level because PHC is still owned and controlled ultimately by LTG.
LTG’s share of the gain, at P19.0 billion was eliminated from LTG’s attributable net income from PNB, bringing the bank’s 1H21 contribution to a P6.5 billion loss.
The banking segment’s higher net contribution in the current period was mainly due to the net reversals of impairment, credit and other losses coming from the reclassification of previously booked non- performing loans to performing status during the second quarter of the year.
This was a turnaround from last year’s additional provision for impairment, credit and other losses at P19.0 billion.
Consolidated revenues were higher at P45.8 billion for the first semester ended June 30, 2022 due to higher beverage and distilled spirits revenues.
LTG said its tobacco business accounted for P7.74 billion or 50 percent of total attributable income, PNB contributed P6.28 billion or 41 percent, Tanduay Distillers, Inc. (TDI) added P561 million or 4 percent of total, while Asia Brewery, Inc. (ABI) accounted for P294 million or 2 percent.
Eton Properties Philippines, Inc. (Eton) contributed P257 million or 2 percent and LTG’s 30.9 percent stake in Victorias Milling Company, Inc. (VMC) added P186 million or 1 percent of total.
LTG also booked net other income of P84 million, less than 1 percent of total attributable income, at the parent level.
The tobacco business reported a net income of P7.77 billion for the first semester of 2022, 14 percent lower than the P9.01 billion reported in the first half of 2021. Volume was relatively flat.
But the lower profits can be attributed to the increase in excise taxes that PMFTC had to absorb as a price increase was only implemented in the end of March 2022.
The industry’s volume was estimated at 26.9 billion sticks in the first half of 2022, 0.4 percent higher over the same period.
TDI’s net profit for the first six months of 2022 was P564 million, 7 percent lower than the P605 million in the same period last year.
Liquor volume was 10 percent higher while bioethanol’s volume was 25 percent higher. The lower profit is largely attributed to higher alcohol and fuel costs.
ABI’s net income for the first semester of 2022 was P294 million, 14 percent lower than the P343 million reported for the first half of 2021.
Despite the higher volumes of its products, higher raw material, fuel and other costs resulted in lower profits.
Eton reported a net profit of P258 million in the first six months of 2022, 10 percent lower than the P288 million reported for the same period in 2021.