San Miguel Food and Beverage, Inc. (SMFB), a core subsidiary of diversified conglomerate San Miguel Corporation, reported that its consolidated net income eased four percent to ₱22.1 billion in the first half of the year, as inflation, slower economic growth, and geopolitical disruptions weighed on consumer spending and select export markets.

In a disclosure to the Philippine Stock Exchange, the firm said revenue improved two percent to ₱205.3 billion, led by continued growth in its Food business, as overall demand across core categories remained relatively stable despite prevailing headwinds.

Gross profit held steady at ₱58.4 billion, supported by revenue growth and efficient cost management. Earnings before interest, taxes, depreciation, and amortization (EBITDA) slipped one percent to ₱38.8 billion, with margins at 19 percent, while operating income dipped 4 percent to ₱28.8 billion.

“Our business remained resilient through the first half of the year, supported by the strength of our operations and the hard work of our teams across the businesses,” said SMFB Chairman Ramon S. Ang.

“We are managing our costs carefully, adding capacity where demand is growing, and keeping our brands within reach,” he added.

Food revenue rose five percent to ₱99.3 billion, driven by its feeds segment and sustained demand for branded products—including dairy, coffee, and canned meats—as well as its value-priced product lines. Operating income increased two percent to ₱8.8 billion, while net income rose eight percent to ₱6.4 billion.

Beer remained the group’s largest earnings contributor, although revenue slipped one percent to ₱73.7 billion as consumers became more selective with discretionary spending amid elevated inflation and a weaker peso. Domestic beer revenue was steady at ₱66 billion, as a price adjustment earlier in the year to offset higher excise taxes helped cushion softer volumes.

International operations posted revenue of $128.5 million—lower than a year earlier—as shipping disruptions in the Middle East affected deliveries to the region. Beer operating income fell 11 percent to ₱14.4 billion, while net income declined 12 percent to ₱11.4 billion.

Meanwhile, Spirits revenue was steady at ₱32.3 billion as higher pricing offset softer volumes. Profitability improved despite lower volumes, with operating income rising eight percent to ₱5.4 billion and net income increasing 3 percent to ₱4.4 billion.

SMFB ended the first half with total equity of ₱205.3 billion, up four percent, alongside improved liquidity and leverage ratios.

The company expects consumer demand to remain under pressure in the near term, but noted that its market-leading brands and robust financial position leave it well-placed to navigate the current environment.

It added that it will continue investing in capacity, operations, and its supply chain while maintaining cost discipline to support long-term growth. (James A. Loyola)