LTG Reports Unaudited Attributable Php20.25 Billion Net Income For 2021

LT Group, Inc. (LTG) posted an attributable unaudited net income of Php20.25 billion for the full year of 2021, 3.7% lower than the Php21.02 billion reported in 2020.

Photo Insert: TDI’s net income for 2021 was Php1.24 billion, Php124 million, or 11% higher than 2020’s Php1.12 billion. Liquor volume was slightly lower, but bioethanol sales were higher.

The tobacco business accounted for Php17.43 billion or 86% of LTG’s total attributable income. Tanduay Distillers, Inc. (TDI) added Php1.24 billion, 6% of total. Eton Properties Philippines, Inc. (Eton) contributed Php548 million or 3% while Asia Brewery, Inc. (ABI) accounted for Php475 million or 2%.

The 30.9% stake in Victorias Milling Company, Inc. (VMC) added Php258 million or 1% of total. Philippine National Bank (PNB) had a net contribution of Php308 million or 2% of total after eliminating the gain of Php33.44 billion from the transfer of real estate assets. Net expenses at the parent level amounted to Php14 million.

In November, LTG declared a Php0.60 per share special cash dividend or a total of Php6.49 billion and was paid in December. This brought total cash dividends declared in 2021 to Php1.08 per share or Php11.69 billion. This is equivalent to 55.6% of LTG’s 2020 attributable net income.

LTG’s balance sheet remains strong. Debt-to-Equity Ratio was at 3.98:1 with the Bank, and at 0.15:1 without the Bank as of end-December 2021.

Philippine National Bank (PNB)

Publicly-listed PNB’s net income under the pooling method was Php34.02 billion for 2021. This included the Php33.44 billion gain that the bank booked from transferring real estate assets into PNB Holdings Corporation (PHC), wherein 51% was subsequently declared as a property dividend.

Net Interest Income was 3% or Php977 million lower at Php34.84 billion. Net Service Fees and Commission Income were at Php5.30 billion, 43% higher than 2020. Trading and Foreign Exchange Gains were lower at Php1.48 billion. Other Income rose to Php35.39 billion from Php1.53 billion due to the gain on the transfer of real estate assets to PHC.

Tobacco

The industry’s volume was estimated at 55.4 billion sticks in 2021, 10.8% lower than 2020’s 62.1 billion sticks, primarily due to the impact of the COVID-19 pandemic and the various quarantine protocols on the purchasing power of consumers.

Illicit activities have been rising, which includes smuggled and locally produced products. The Government continued its efforts, with 194 enforcements in 2021, compared to 171 in 2020.

The tobacco business had a net income of Php17.50 billion in 2021, Php610 million or 4% more than 2020’s Php16.89 billion.

Republic Act (RA) 11346, signed into law in July 2019, further increased the excise tax on tobacco starting January 2020. From Php35 per pack in 2019, it increased to Php45 per pack in 2020 and to Php50 in 2021. It further increased to Php55 in 2022 and will increase by another Php5 in 2023, then by 5% annually thereafter. LTG is not against tax increases but believes that the hikes should be moderate. Continued price hikes to pass on higher excise taxes may result in further volume declines.

Tanduay Distillers, Inc. (TDI)

TDI’s net income for 2021 was Php1.24 billion, Php124 million or 11% higher than 2020’s Php1.12 billion. Liquor volume was slightly lower, but bioethanol sales were higher.

As of the end of 2021, TDI’s nationwide market share for distilled spirits was at 26.6%, compared to end-2020’s 22.5%. In the Visayas and Mindanao regions where most of TDI’s sales are generated, market share was at 66.9% and 74.3%, respectively, as of December 2021, compared to 62.2% and 78.9%, respectively, as of December 2020.

Eton Properties Philippines, Inc. (Eton)

Eton reported a net income of Php550 million in 2021, 31% lower than the Php802 million reported for the previous year. The lower net income is attributed to the decline in residential unit sales and lower leasing income.

Projects in the pipeline include Eton City Square 1, the 4.3-hectare neighborhood retail and commercial center in Sta. Rosa, Laguna will add 7,000 square meters of net leasable area to Eton’s commercial leasing portfolio in phase 1. Another project is phase 2 of WestEnd Square in Makati which will have 23,000 square meters of net leasable area.

Eton currently has a leasing portfolio of around 181,000 square meters of office space and over 45,000 square meters of retail space.

Asia Brewery, Inc. (ABI)

ABI’s net income for 2021 was Php475 million, 20% lower than 2020’s Php591 million. The volume of Cobra Energy Drink was higher, but volumes of Absolute and Summit bottled water and Vitamilk soymilk were lower, as ABI’s on-the-go sales at convenience stores continue to be adversely affected by the various forms of lockdowns imposed since March 2020.

Cobra Energy Drink remains the market leader with a 64% share. Vitamilk also maintained its leadership with a market share of 69%. Bottled water brands, Absolute and Summit, continue to have the second-largest share in this segment at 22%.

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