2018 has been a pretty good year to San Miguel Corporation (SMC). The diversified conglomerate firm recorded a revenue of P1-Trillion for the year 2018. This was according to its presentation for investors posted in their website along with the report of its recurring net income that reached P55.18-billion, which was seen 1% higher year-on-year. This is a good news for SMC investors as the firm continuously hit big sales and income from its food, fuels, beverages, power, infrastructure, and petrochemicals.
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One of the major reasons of SMC’s increase in revenues and recurring income is the lower crude prices. The fuel prices fell because of the forex losses during the year and the inventory losses in its petrochemical business during the last quarter of 2018. Petron Corporation, SMC’s fuel business, has recorded an income drop of 50%, leading to P7.07-billion net income in 2018. This is primarily because of the rise of global oil production during the 4th quarter that caused a 9-week crash on the oil prices internationally.
Apart from the crude business of SMC, it has also noted an increase in revenue particularly in its food, beverage company. San Miguel Food and Beverage, Inc. (SMFB) made an 8% increase in profit or equivalent to P30.53-billion. This is along with its 14% raise in the consolidated revenue during the year which amounted to P286.38-billion. The firm said that the jump in sales came from all its units though the net income fell by 15% due to the increase of costs.
SMC’s increase in revenue is also driven by its power and infrastructure business. In fact, SMC Global Power Holdings Corporation reported a 37% hike in its operating income or equivalent to P33.17 billion. Its consolidated revenue also increased to 45% or P120.10 billion in figures. These good numbers are the fruits of the additional generation from the Mansiloc, Limay, and Malita powerplants. Meanwhile, the firm’s infrastructure unit has 13% increase in its operating income. The unit has reported an P11.83-billion operating income together with the P24.53 billion increase in revenue. This is merely because of more and more vehicles using the operating toll roads of the company.