By Leslie D. Venzon
MANILA, June 11 (PNA) — Gokongwei-led conglomerate JG Summit Holdings Inc. is expecting to post 13 to 15-percent growth in core net income in 2015 as its food, airline, property and petrochemical businesses benefit from the country’s robust economic growth.
Its core earnings are projected to reach up to PhP23.34 billion this year from PhP20.3 billion in 2014.
“Generally, the outlook is bright because we are in the right country. The Philippines is in fact a growing economy. Many of our businesses also are benefiting from lower oil prices in general,” JG Summit president Lance Gokongwei told reporters after the conglomerate’s stockholders’ meeting.
Gokongwei said the growing middle class is driving demand for consumer goods and services being offered by its consumer-related businesses, particularly food, malls and airlines.
The combined profit of subsidiaries Universal Robina Corporation, Cebu Air Inc. and Robinsons Land Corporation (RLC) comprised over 70 percent of JG Summit’s PhP5.98-billion net income in the first quarter of this year.
In 2015, Gokongwei said RLC is aggressively expanding its investment portfolio by opening two new malls, complete one office building, add 15 percent to the hotel portfolio and launch PhP6 billion to PhP12 billion worth of projects across its four residential brands.
“We hope that the petrochemical business will be the fourth leg (supporting the conglomerate). Because as it continues to progress, it generates PhP2.3 billion to PhP3 billion a month in turnover so it becomes a substantial business,” he said.
Gokongwei said JG Summit Petrochemicals Group’s Batangas naphtha cracker facility, the country’s first, resumed commercial operations last November after completing its expansion and rehabilitation.
“As you have a growing middle class, the requirements for plastic products increases, appliances, furniture, plastic packaging and the like. These all grow as the country further industrializes. I believe on the revenue basis, that (the petrochemical business) will grow very significantly this year,” he added.
Gokongwei expects the petrochemical business sharing about 12 percent to 15 percent to the conglomerate’s total revenues in 2015.
The Petrochemicals Group booked a whopping 3,543 percent increase in net income in the first quarter to PhP900 million. (PNA)