JG Summit Sustains Recovery Momentum With Revenue Expansion Of 7% YoY

JG Summit Holdings, Inc. (JGS), one of the leading Philippine conglomerates, sustained its recovery momentum, growing its revenues for the first quarter of 2022 (1Q22) by 7% year-on-year (YoY) and 6% quarter-on-quarter (QoQ) as mobility restrictions have eased.

Photo Insert: JG Summit’s President & CEO Lance Gokongwei

Topline growth was evident across all subsidiaries, except for Robinsons Land Corporation (RLC), whose strong recovery is masked by a high base that was boosted by its Chengdu Ban Bian Jie project revenues last year.

Excluding the effect of Chengdu, JGS’ total revenue growth would be 28%. While the reopening of the economy fueled significant improvements in topline and substantially trimmed Cebu Air Inc.'s core net losses, unprecedented volatility in oil and input prices weighed on the group’s margins, particularly in JG Summit Olefins Corporation (JGSOC).

As a result, JGS posted a consolidated core net loss of Php689 million in 1Q22, vs a core net income of Php232 million in the same period last year (SPLY). Coupled with peso depreciation and mark-to-market losses, JGS ended the quarter with a net loss of Php2.8 billion.

JGS’ balance sheet remains healthy and robust, with the capacity to further support post-pandemic recovery. As of March 2022, consolidated gearing and net debt-to-equity ratios stood at 0.70 and 0.53, respectively.

At the parent level, cash amounted to Php23.7 billion while net debt stood at Php74.3 billion as of end-March 2022, which shall be further reduced as JGS expects to receive cash dividends of Php11.0 billion from its investments in the second quarter of 2022.

JG Summit’s President & CEO Lance Gokongwei said, “For the first quarter of this year, we have seen that the reopening of the economy has positively impacted most of our subsidiaries, with our overall revenues exhibiting quarter-on-quarter and year-on-year improvements. However, market volatility with the increasing prices of oil and key input costs, coupled with peso depreciation have affected our profitability and we expect these to linger and put pressure on our margins. To mitigate these risks, we are proactively managing pricing & product mix, and at the same time, implementing productivity initiatives and cost management measures.”

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