URC doubles net income to P24B
UNIVERSAL Robina Corp. (URC) reported its net income was up 109% to P24.3 billion in 2021 as the consumer food manufacturer gained from the sale of its business in Australia and New Zealand.
“The sale provided an opportunity for URC to monetize the efficiencies and synergies it created in Australia and New Zealand, while reinvesting into higher-growth core markets such as the recently acquired Munchy’s business in Malaysia,” the company said in a stock exchange disclosure on Monday.
Excluding sales in Oceania, the company reported growth of 3% to P117 billion for the full year, despite supply chain disruptions and mobility restrictions from the coronavirus disease 2019 (COVID-19) pandemic.
In the second half of the year, URC said it accelerated with fourth quarter sales up 12% from the previous quarter and up 11% from the same period a year earlier.
However, operating income and core net income from continuing operations both declined 8%, due to higher material input costs.
“The impact on operating margins was tempered by price increases and various cost savings initiatives,” URC added.
Sales of the branded consumer foods group, excluding Oceania sales, ended flat at P83.5 billion. On the other hand, domestic revenues were down 2% to P61.4 billion.
“Key food and beverage markets, while slowly recovering, were still below pre-pandemic levels and aggravated by various lockdowns imposed across the region. Positive signs of recovery were seen in the second half of 2021, with sequential quarter on quarter growth, and culminating with a growth of 6% in the fourth quarter from the same period last year,” the company said.
URC’s international division grew 5% to P22.2 billion on a constant currency basis, as momentum in the first half was hampered by the resurgence of COVID-19 in the region.
“Operations were also affected with government restrictions and work force capacity limitations. However, the international division was able to end strong, with fourth quarter sales up 15% quarter-on-quarter and up 2% from the same period last year,” URC said.
Meanwhile, its agro-industrial and commodities division reported 13% growth to P33.4 billion from the same period last year, driven by acquisitions in its sugar and renewables group.
“The acquisition of Central Azucarera de La Carlota sugar mill and Roxol Bionergy in the fourth quarter of 2020 helped grow URC’s sugar business by double digits. Strong growth in Pet Foods also helped offset declines in farms and feeds volumes caused by lower hog populations in the Philippines,” URC said.
URC’s board of directors also approved an increase in dividend to P3.45 per share, up 5% and 10% from the dividends declared in 2021 and 2020, respectively.
“Coming through two years of the COVID-19 pandemic, URC remained strong — maintaining our leading positions in key markets and categories, continuing our innovation pipeline, becoming preferred partner of choice to customers and suppliers, step changing product supply chain transformation, and accelerating a people and planet friendly culture,” URC President and Chief Executive Officer Irwin C. Lee said in a statement.
“While the challenges and uncertainties of hyper cost inflation, global climate and political turbulence persist, our growth momentum and organizational commitment to excellence give us cause for optimism in 2022,” he added.
Mr. Lee said the company would continue to invest in its brands, build channel strength, and make future bets in “attractive white spaces.”
“URC remains strong today, and will be stronger tomorrow,” he added.
At the stock exchange on Monday, URC shares dropped 4.26% or P5.10 to close at P114.60 apiece. — Luisa Maria Jacinta C. Jocson
