Holding firms as well as those in the industrial and service sectors posted the worst declines.
Combined earnings for January to September of 235 listed firms fell by 10.1% to P308.86 billion even as consolidated revenues grew by 15.4% to P2.78 trillion, PSE said in a statement yesterday.
“While it’s good to note that revenues of our listed firms continue to improve, their net incomes had to contend with the challenges in the economy such as rising production costs and lower-than-expected demand,” PSE President and Chief Executive Officer Hans B. Sicat said.
“Despite the uncertainties in the global landscape particularly in the Euro zone and US, some key sectors have managed to post higher net income figures. This, together with the country’s sound fundamentals and exciting growth potential, continue to bolster interest in our listed companies,” Mr. Sicat added, noting that the bellwether PSE index continues to be a top performer among its regional peers this year.
The industrial sector registered the steepest decline after firms’ combined net income slipped by 35.3% to P78.11 billion, dragged down by First Philippine Holdings Corp. and San Miguel Brewery, Inc. in particular..
The net income of the services sector also was also down by 16.6% to P62.26 billion last year. Firms behind carriers–PAL Holdings, Inc. and Cebu Air, Inc.–reported double-digit net income decreases on peso-dollar exchange rate fluctuations and rising average aviation fuel prices. Lower volumes of domestic and international calls also contributed to the dip in Philippine Long Distance Telephone Co.’s profits for the January to September period.
Holding firms similarly posted a 9.6% decline in consolidated income to P73.38 billion. It was largely attributed to lower net earnings in associates or subsidiaries, with leading family-owned conglomerates Lopez Holdings Corp. and JG Summit Holdings, Inc. incurring double-digit drops.
“Poor third-quarter earnings of many large companies as well as the volatility in global markets may have contributed to the decline in overall net income of the listed firms,” analyst Freya B. Natividad of 2TradeAsia.com said in a telephone interview on Friday.
In contrast, the sector mining and oil saw its aggregate income rise by 162.8% to P21.25 billion as average global metal prices improved. Top miners Philex Mining Corp. and Semirara Mining Corp. posted robust growth due to rising gold, copper, and coal prices, while Nickel Asia Corp. saw its net income improve due to an increase in nickel ore prices.
Property firms’ combined net income, meanwhile, gained by 19.4% to P31.08 billion, as improved sales volume of residential and commercial units boosted the respective net incomes of Ayala Land, Inc. and SM Development Corp. A nonrecurring gain from the sale of investment in available-for-sale shares lifted Megaworld Corp.’s net income by 62.8%
Not to be outdone, financials advanced by 17.1% to P53.9 billion on the back of improved net interest income lifting the net income of Metropolitan Bank Trust Co., while foreign exchange gains and higher service charges and fees boosted the profits of BDO Unibank, Inc. and Union Bank of the Philippines, respectively.
The PSE was first incorporated in 1992 as the country’s only stock exchange replacing the now-defunct Manila and Makati Stock Exchanges. It has 248 companies listed to date. — Franz Jonathan G. de la Fuente