SMFB Net Income Dips 4% in H1 Amid Inflation, Geopolitical Headwinds

MANILA, Philippines — San Miguel Food and Beverage Inc. (SMFB) saw its earnings dip by four percent to P22.1 billion in the first half as inflation, slower economic growth and geopolitical disruptions weighed on consumer spending and some export markets. Revenue for the six-month period, however, improved by two percent year-on-year to P205.3 billion, led by the continued growth in its food business. SMFB said overall demand across the company’s core categories remained relatively stable despite pressures. “Our business remained resilient through the first half of the year, supported by the strength of our operations and the hard work of our teams across the businesses,” SMFB chairman Ramon Ang said. “We are managing our costs carefully, adding capacity where demand is growing and keeping our brands within reach,” he said. For the first half, the company’s food revenue grew by five percent to P99.3 billion, driven by its feeds segment and sustained demand for branded products, including Magnolia dairy and coffee products, Purefoods luncheon meats and Pinoy Favorites, as well as its more affordable product lines. Net income of the food segment rose by eight percent to P6.4 billion. Beer remained the group’s largest earnings contributor, although revenue inched down by one percent to P73.7 billion as consumers became more selective with discretionary spending amid elevated inflation and a weaker peso. Domestic beer revenue was steady at P66 billion, as price adjustment earlier in the year to offset higher excise taxes helped cushion softer volumes. International operations registered a revenue of $128.5 million, lower than a year earlier, as shipping disruptions in the Middle East affected deliveries to the region. Beer net income declined by 12 percent to P11.4 billion. Meanwhile, spirits revenue was steady at P32.3 billion as higher pricing offset softer volumes. Profitability improved despite the lower volumes, with net income increasing by three percent to P4.4 billion. Source: Philstar Business