By AE Team | November 10, 2017
Aboitiz Equity Ventures, Inc. (AEV) ended the first nine months of 2017 with a net income of P15.9 billion, 7% lower than last year’s P17.1 billion. The company recognized non-recurring losses of P1.2 billion (versus last year’s loss of P17 million) coming from foreign exchange (forex) losses from the revaluation of dollar-denominated loans and pre-termination costs on refinancing. Without the one-offs, AEV’s core net income remained flat at P17.1 billion.
In the first nine months of the year, we faced challenges that tested the resilience of our portfolio and showed the underlying strength of our core operating businesses. We remain optimistic on the long-term fundamentals of our businesses, and we look forward to continuing to advance business and communities in the execution of our growth strategy.
-Erramon I. Aboitiz, President & CEO, Aboitiz Group
Strategic Business Units (SBUs)
AboitizPower’s income contribution to AEV increased by 4% year-on-year (YoY), from P11.6 billion to P12.1 billion as its net income jumped 4% to P15.7 billion.
The power generation business’ income share grew 22% YoY to P14.2 billion, accounting for 80% of AboitizPower’s business segments. The distribution business, meanwhile, reported a P3.0 billion income share, or 4% higher versus the previous year.
Banking & Financial Services
UnionBank’s income contribution to AEV decreased by 21% YoY, from P4 billion to P3.1 billion. On a stand-alone basis, the bank, together with its subsidiaries, recorded a net income of P6.4 billion, 22% lower compared to the P8.1 billion earned during the same period last year.
On the other hand, the income contribution of PETNET, the group’s other financial services company, increased by 315% YoY to P20 million.
AEV’s non-listed food subsidiaries (Pilmico Foods Corporation, Pilmico Animal Nutrition Corporation, and Pilmico International Pte Limited) reported a net income of P1.2 billion, 14% lower YoY. This was P188 million below last year’s P1.4 billion.
Feeds Philippines and Flour reported a drop in net income contributions largely driven by lower margins and higher operating costs, while Feeds Vietnam and Farms saw their incomes increase, driven by expansion in new markets, better margins, and improved selling prices of live hogs.
From the infrastructure group, Republic Cement’s income contribution to AEV decreased by 80% YoY from P1.3 billion to P249 million. Cement demand slowdown was experienced in the first nine months of 2017, as compared to the same period last year when there was strong demand due to the election season.
AEV’s land subsidiary, AboitizLand recorded a net income of P340 million – an increase of 128% from the same period last year. The increase in net income was mainly attributable to higher revenues booked by the industrial BU, and higher sales and notable construction progress by the residential BU.