Tobacco unit pulls down LT Group first-half earnings
The six-month profit of LT Group Inc., the listed holding company led by taipan Lucio Tan, flatlined on lower returns from its tobacco business, which was hit by the proliferation of vaping products and illicit trade.
LT Group on Tuesday said earnings during the January to June period ended at P12.8 billion, down 2 percent.
Philippine National Bank (PNB) contributed the biggest income share at P5.77 billion, or 45 percent of the total.
The country’s seventh-largest bank, in terms of assets, saw its net income go up by 5 percent as its loan portfolio grew.
PNB’s net interest income jumped by 11 percent to P24.03 billion.
The group’s tobacco business, meanwhile, booked lower profits due mainly to losses from illegal trade and the rising popularity of vaping products.
According to LT Group, the segment posted P4.89 billion in earnings during the period, falling by 16 percent.
The business is driven by Philip Morris Fortune Tobacco Corp. (PMFTC), in which LT Group has a 49.6-percent stake.
PMFTC also reported lower earnings at P4.43 billion, representing a 22-percent plunge. This, as volume fell by 14 percent to 10.6 billion cigarette sticks.
Liquor arm Tanduay Distillers Inc. saw a 14-percent leap in earnings, which reached P712 million as volumes rose.
Higher selling prices likewise boosted revenues by 15 percent to P14.63 billion, buoyed by the Visayas and Mindanao markets.
Asia Brewery Inc.’s profits in the first half soared by 49 percent to P509 million on higher sales across all its product lines.
ABI revenues went up by 12 percent to P9.4 billion as its Cobra energy drink maintained market dominance.
The net income of Eton Properties Philippines Inc. surged by 59 percent to P327 million on higher leasing revenues.
Eton’s leasing portfolio currently stands at 288,000 square meters, of which 192,000 sq m comprises office spaces.
LT Group president Lucio Tan III earlier said they were optimistic about earnings growth for the full year, particularly in Tanduay, banking on the anticipated rate cuts to temper high costs.
LT Group ranked 169th in Fortune Magazine’s inaugural Southeast Asia 500 list with total revenues reaching $2.01 billion last year.
