The Market Monitor Minding the Nation's Business
By Riza Lozada
Conglomerate LT Group Inc. (LTG) booked a 42-percent increase in profit in 2016, driven mainly by banking, tobacco and beverage businesses with a net income of P9.39 billion last year from P6.6 billion in 2015.
Philippine National Bank (PNB) accounted for Php3.42 billion, or 36 percent, of LTG’s attributable income.
The tobacco business contributed Php2.58 billion, or 27 percent of total, followed by Asia Brewery Inc. (ABI) at P1.75 billion, or 19 percent. Tanduay Distillers, Inc. (TDI) added P908 million, or 10 percent; and Eton Properties Philippines, Inc. generated P388 million, or 4 percent.
Equity in net earnings from Victorias Milling Company Inc. (VMC) amounted to P142 million, or 2 percent of total.
PNB reported a net income of Php7.38 billion for 2016, up 9 percent from Php6.77 billion the previous year.
LTG Group attributed this to increases in net interest income and other income due to higher trading income, gains from the sale of Real and Other Properties Acquired (ROPA) and the 51-percent stake in the life insurance business to Allianz, and re-measurement gain from the remaining stake in Allianz PNB Life Insurance, Inc.
Income from the tobacco business surged by whopping 149 percent to P2.59 billion last year from P1.04 billion in 2015.
Higher earnings were due to the change in the mix of Philip Morris Fortune Tobacco Corporation’s sales, with premium Marlboro accounting for a higher share of total volume.
ABI’s earnings amounted to P1.76 billion in 2016, up 60 percent from P656 million in 2015.
Cobra energy drink and Vitamilk soymilk continue to be market leaders, while Absolute and Summit bottled water have the second largest market share.
TDI’s earnings more than doubled to P908 million in 2016 from P422 million generated the previous year, attributable to the start of the contribution of bio-ethanol sales.
Volume of liquor sales rose 2 percent. Tanduay continues to be the dominant player in the Visayas and Mindanao areas where market share increased to 60 percent as of end-December 2016 from 58 percent in end- 2015.
Eton reported a net income of Php390 million for 2016, 25 percent higher than the P313 million reported a year ago.
Total revenues increased 14 percent to Php2.83 billion from the growth in leasing operations due to higher lease rates, and the sale of residential units.