Universal Robina Corporation (URC), the food and beverage unit of the Gokongwei Group, reported that its attributable net income decreased by 17.6 percent to P8.03 billion in the first nine months of 2024 from P9.74 billion in the same period last year.
Based on the firm’s disclosure to the Philippine Stock Exchange (PSE), earnings dropped due to costs related to the closure of its China operations as well as lower foreign exchange gains.
Net foreign exchange gain fell 84 percent to P164 million from P998 million while equity in net losses of joint ventures increased to P107 million from P65 million mainly due to equity take up in the net losses of Calbee-URC Malaysia (CURM) this year versus gain last year.
URC reported a net loss from discontinued operations amounting to P525 million, a 3,602 percent surge from P14 million in the same period last year mainly driven by impairment arising from the closure of URC China this year.
Total operating income was at P12.3 billion, behind by three percent compared to the same period last year as the company reported lower profits in its Sugar and Renewables business because sugar prices continued easing in 2024 against last year’s record highs.
Net of its commodities businesses, URC sustained its double digit growth trajectory, recording an increase in operating income of 22 percent from last year as easing commodity costs and optimization initiatives supported the company’s margin expansion.
“As we begin to see early signs of a resurgent Philippine shopper in 2025, we will continue to offer the best value to our consumers through our wide portfolio of quality brands, while delivering the best value to our stakeholders by sustaining the company’s strong performance," said URC President and CEO Irwin Lee.
The firm generated a consolidated sale of goods and services of P118.89 billion for the nine months of 2024, ahead by 1.5 percent against the P117.62 billion in same period last year.
Sale of goods and services of URC’s branded consumer foods group (BCFG) segment increased by 1.4 percent to P82.68 billion for the nine months of 2024 from P81.56 billion recorded in the same period last year.
BCF domestic operations, excluding packaging division, posted 0.5 percent decrease in net sales from P56.16 billion for the nine months of 2023 to P55.88 billion for the same period this year due to lower sales contribution of Confectionery and Powdered Beverage.
Sale of goods and services of URC’s packaging division dropped by 9.6 percent to P858 million from P949 million driven by lower volume and selling prices.
BCF international operations reported a 6.1 percent increase in net sales from P24.46 billion in 2023 to P25.95 billion for the nine months of 2024.
Sale of goods and services of BCFG, excluding packaging division, accounted for 68.8 percent of total URC consolidated sale of goods and services for the nine months of 2024.
Sale of goods and services of URC’s Agro-Industrial and Commodity group amounted to P36.2 billion for the nine months of 2024, an increase of 1.7 percent from P35.6 billion recorded in the same period last year.
URC’s Agro-Industrial Group segment reported sale of goods and services amounting to P12.123 billion for the nine months of 2024, a decline of 3.7 percent from P12.58 billion mainly driven by Feeds.
Sale of goods and services of Flour business amounted P4.61 billion, a growth of 0.3 percent from P4.59 billion recorded in the same period last year.
For its sugar business, sales of goods and services grew 5.6 percent to P14.42 billion from P13.66 billion driven by higher refined sugar sales volume, while the Renewables business grew by six percent to P5.05 billion.
URC’s cost of sales 0.9 percent to P86.52 billion from P85.77 billion due to higher volume. Selling and distribution costs and general and administrative expenses increased by seven percent to P1.32 billion driven by higher advertising and promotions expenses and contracted services.
The firm’s finance costs increased to P1.25 billion from P1.13 billion due to higher debt levels. Impairment losses of P288 million were recorded for the nine months of 2024 from P205 million in the same period last year.
This year’s impairment is from inventory and PPE from Sariaya plant due to typhoon Aghon and equity investments while last year impairment pertains to farm assets.