San Miguel signals continued investments despite headwinds

SAN MIGUEL CORP. (SMC) said it would continue investing in projects aligned with domestic growth despite a sharp decline in first-quarter (Q1) net income caused by the absence of one-off gains booked last year and foreign exchange losses.

“Our businesses performed well in the first quarter, supported by steady demand and the hard work of our teams across the group,” SMC Chairman and Chief Executive Officer Ramon S. Ang said in a statement on Monday.

“While global conditions remain challenging, we will stay disciplined in how we operate, serve our customers well, and continue investing where we can support our country’s growth,” he added.

For the first quarter, SMC reported a decline in consolidated net income to P22.5 billion from P43.4 billion a year earlier, mainly due to the absence of a P21.9-billion one-off gain from the partial sale of power assets in 2025, as well as foreign exchange losses booked in 2026.

Despite the lower bottom line, consolidated revenues for the January-to-March period rose 19% to P428.3 billion, driven by growth across the company’s core businesses.

The increase was supported by higher fuel and oil volumes and movements in global oil prices, as well as additional contributions from the energy business and steady volume growth in the food segment.

Consolidated operating income climbed 31% to P59.6 billion, boosted by higher revenues and improved margins in the energy business, which helped offset margin pressure in Petron Corp.

SMC’s food and beverage unit San Miguel Food and Beverage, Inc. (SMFB) reported a 2% increase in net income to P11.8 billion as revenues grew 4% to P103.1 billion.

The improvement was driven by gains in the food and spirits segments, steady performance from beer, and tight cost management.

San Miguel Foods reported revenues of P49.6 billion, up 7%, supported by growth in the feeds segment and steady demand for branded products such as Magnolia dairy, coffee, and Purefoods meats.

San Miguel Brewery, Inc. posted consolidated revenues of P36.8 billion, reflecting steady performance compared with the previous year. Domestic revenues reached P32.7 billion, supported by price adjustments amid volume and cost pressures, including higher excise taxes. Operating income held at P7.9 billion, while net income stood at P6.2 billion, aided by cost controls and continued investments in brand and channel initiatives.

Ginebra San Miguel, Inc. posted a 3% increase in revenues to P16.7 billion, with operating income at P2.8 billion and net income at P2.3 billion.

San Miguel Global Power Holdings Corp.’s net income slipped to P23.9 billion from the previous year, largely due to the P21.9-billion gain from an asset disposal recognized in the first quarter of 2025. Revenues, however, increased 26% year on year to P53.6 billion, supported by output from five battery energy storage system facilities and power supply contracts for the Mariveles and San Roque power plants.

“Offtake volumes amounted to 6.5 million MWh, down 13% year on year, largely reflecting the deconsolidation of the Ilijan Power Plant and Batangas Combined Cycle Power Plant. Income from operations increased 163% to P28.1 billion, driven by topline growth, improved gross profit margins, and higher contribution from the BESS facilities,” SMC said.

Petron posted a net income of P1.8 billion in the first quarter of 2026, down 56% from P4.0 billion a year earlier, following lower refining volumes in both its Philippines and Malaysia operations.

Operations at the Port Dickson refinery have been suspended since November 2025 after Tropical Storm Senyar damaged its product jetty, while Petron Bataan underwent planned maintenance. The impact of these interruptions was further compounded by rising geopolitical tensions in the Middle East.

Revenues climbed 27% to P246.0 billion in the first quarter, lifted by stronger sales volumes and higher average Dubai crude prices, which increased to $86 per barrel from $77 per barrel a year earlier.

“Excluding trading transactions from the company’s operations in Singapore, Petron recorded sales volume of 25.7 million barrels in the Philippines and Malaysia, 7% lower than the previous year’s 27.6 million barrels, due to lower production. Operating income declined by 36% to P6.1 billion,” the company said.

“Margins were squeezed by higher product costs, with the absence of refinery production in Malaysia and reduced output in the Philippines,” the company added.

SMC Infrastructure recorded P10.4 billion in revenue in the first quarter of 2026, up 7%, driven by higher traffic and efficiency gains across its toll road network, with average daily vehicle volume rising 3% to 1.1 million. Operating income increased 12% to P6.0 billion as revenue growth outpaced higher costs.

SMC’s cement business, which includes Eagle Cement Corp., Northern Cement Corp., and Southern Concrete Industries, Inc., posted P9.2 billion in revenue, a 3% increase, as stronger sales volumes offset softer pricing in a competitive market.

Growth was supported by wider demand, fewer imported shipments after anti-dumping duties took effect in February, and advance buying ahead of March price increases. Operating income came in at P1.7 billion, also up 3% from a year earlier.

On Monday, SMC shares rose 0.07% to P70 apiece. — Alexandria Grace C. Magno