Wednesday, May 21, 2008 [ manilatimes.net ]
By Likha C. Cuevas-Miel, Reporter
ALLIANCE Global Group Inc. (AGI) announced on Tuesday that its first-quarter profit surged on the back of the improvement in its real estate despite weakness in its fast-food business caused by higher input costs.
In a statement, AGI said its profit attributable to shareholders for the first three months this year jumped 84 percent to P910.4 million, including interest income and income derived from investing activities of P279 million. Consolidated revenues for its three main businesses rose 26 percent to P7.3 billion year on year. The company is currently focused on the consumer business through Emperador Distillers Inc. (EDI) and Golden Arches Development Corp. (GADC), and on the property business through Megaworld Corp.
“AGI registered strong earnings in the first quarter in spite of the challenges that face our economy. Our consumer business will continue to be affected by inflationary pressures while our property business remains resilient and should maintain its growth momentum,” Kingson Sian, AGI president and chief operating officer, said.
The holding company’s real- estate business remained the biggest revenue contributor as Megaworld posted a net income growth of 29 percent to P1.01 billion year on year with revenues jumping 63 percent to P4.67 billion.
Key drivers for this growth came from real-estate sales that surged 79 percent to P3.31 billion as the company focused on mid-income residential and business process outsourcing (BPO) office developments.
EDI, which AGI acquired in February last year, produces the Emperador and Generoso brands of brandy. This will be the first full year of operations for EDI under the holding company. End-March earnings at the brandy-maker came in at P160 million.
GADC, which holds the master franchise of McDonald’s, suffered a 73-percent earnings decline to P16.5 million, even as revenues climbed 6 percent to P1.89 billion year on year. Rising inflation pulled down growth, with cost of sales increasing 9.7 percent to P1.54 billion. Operating expenses also rose 16 percent, with incremental expenses of P34 million due to one-time expenses incurred for the fast-food company’s expansion nationwide. GADC is planning to open at least 30 outlets this year with six new stores opened in the first quarter.
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