Metro Manila (CNN Philippines, May 8) — San Miguel Food and Beverage, Inc. (SMFB) netted ₱7.4 billion in the first quarter, riding on strong beer sales.
The listed food manufacturing firm said its net income grew by one percent from a year ago, while consolidated revenues picked up by 14 percent to ₱75.7 billion.
The San Miguel unit enjoyed a boost from a surge in demand for beer at 18 percent, together with a 24 percent increase for liquor and spirits.
Beer sales raked in ₱34.8 billion, 17 percent higher from last year led by its brands Red Horse and San Miguel Pale Pilsen. Hard liquor also generated ₱8.3 billion in sales through the Ginebra San Miguel drink, alongside their Chinese wine Vino Kulafu.
Meanwhile, San Miguel Pure Foods reported total revenues of ₱32.6 billion, up by nine percent from the first quarter of 2018. The unit saw higher volumes for its products under the Prepared & Packaged Food, Animal Nutrition & Health, and Protein segments, but earnings slid from a year ago.
“While top-line growth remains robust, the continuing chicken oversupply and the higher raw material costs for some of the products in the food segment led to a decline in our margins,” SMFB said in a disclosure, noting that higher costs of some raw materials also added some pressures.
It added that the sustained oversupply of frozen chicken has pulled market price down, with San Miguel saying that industry players are taking steps to “stabilize” inventories to protect margins.
“Despite certain cost pressures, we remain optimistic that we are capable of sustaining overall momentum moving forward and will continue to invest in areas that we believe will provide SMFB with sustainable and profitable growth,” SMFB President and Chief Executive Officer Ramon Ang said.
The company added that new breweries in Tagoloan, Northern Mindanao and Sta. Rosa, Laguna will open this year to meet the steady increase in demand.
