Philippines’ SMFB income inches up by 1%YoY in Q1 2022

Its revenue rose 9% YoY due to volume growth and better pricing.

San Miguel Food and Beverage, Inc. (SMFB) saw a 1% year-on-year (YoY) increase in its consolidated income for the first quarter of 2022, reaching $242.4m (P12.7b), on the back of higher revenue.

In a disclosure, SMFB said that its consolidated earnings before interest, taxes, depreciation and amortization (EBITDA) grew 1% to $299.6m (P15.7b). Excluding non-recurring benefits in the first three months of 2021 related to the CREATE law, its net income for the period is also up by 1% to $175.6m (P9.2b).

The company’s consolidated revenue rose 9% YoY during the period to around $1.6b (P83.1b), boosted by a combination of volume growth and better pricing across beer, spirits, and food businesses, despite the disruption by the Omicron variant.

However, this was offset by the rising input costs on raw materials and utilities, “squeezing and muting the gains from volume growth" compared to the first quarter of 2021.

“We remain optimistic and steadfast in pursuing strategies that will drive long-term value for our shareholders. As the market continues to be dynamic, we will continue to manage the inflationary environment with the same level of discipline that carried us through the years,” said SMFB President and CEO Ramon S. Ang.

SMFB’s Animal Nutrition and Health and Flour segments posted strong double-digit revenue growth, while Poultry and Processed Meats also posted higher sales, with the growth of the food business supported by “advertising and promotional campaigns, expansion of distribution networks, superior product quality, and better pricing.”

The food businesses still felt the impact of inflationary measures with its EBITDA for the quarter amounting to $108.8m (P5.7b) from $116.4m (P6.1b), whilst its consolidated operating income slightly declined to $80.2m (P4.2b) from around $85.9m (P4.5b).

On the other hand, its beer business posted a 3% YoY increase in its revenue to $567m  (P29.7b) due to improve volumes in its international operations and price adjustments. The category’s EBITDA and income from operations “remained flat” at $152.7m (P8b) and $129.8m (P6.8b), respectively.

“The Beer business will continue to implement cost management initiatives to preserve profits moving forward. Nonetheless, the reopening of on-premise channels following the lifting of COVID-19 restrictions has boosted the Beer business’ prospects for the rest of the year,” it said. 

The Spirits business. Meanwhile, maintained momentum with revenues jumping 11% YoY to $240.5m (P12.6b) on the back of “strong thematic campaigns, consumer promotions, a broadening distribution network, and efficiencies.” 

Its EBITDA was up 32% YoY to $38.2m (P2b) from $28.6m (P1.5b), and income from operations rose 39% YoY to $34.4m (P1.8b) from $24.8m (P1.3b).

$1 = P52.40