Lower sugar prices weigh on URC Q1 earnings

Universal Robina Corp. (URC) suffered a 4 percent decline in first-quarter net income from continuing operations to P4.1 billion, as lower sugar selling prices weighed on its commodities business despite higher sales across key segments.

The Gokongwei-led company said Thursday that core net income attributable to parent fell 2 percent year on year to P3.8 billion, while operating income slipped 2 percent to P5.4 billion.

Consolidated sales for the quarter rose 6 percent year on year to P47.9 billion, driven by broad-based, volume-led growth in the Branded Consumer Foods (BCF) Philippines business, alongside stronger contributions from the Animal Nutrition and Health and Flour divisions.

BCF sales increased 9 percent to P32.2 billion during the quarter. BCF Philippines grew 10 percent to P22.0 billion, supported by broad-based volume expansion and the carryover effect of last year’s pricing actions.

BCF International climbed 6 percent to P10.2 billion, led by Malaysia amid continued strong performance from the Munchy’s business.

“We started the year with strong, volume-led growth, led by BCF Philippines, reflecting accelerating momentum and continued excellence in execution. We are balancing targeted demand support with margin recovery,” URC President and CEO Irwin Lee said.

“We remain mindful that any inflationary spillover from the Middle East conflict could pressure consumer demand, and we will stay agile—managing pricing, mix, and costs carefully to sustain momentum,” he added.

Meanwhile, Agro-Industrial and Commodities sales were flat at P15.7 billion. Growth in Animal Nutrition and Health, which rose 22 percent, and Flour, which increased 17 percent as production from the Sariaya flour mill ramped up, offset declines in the Sugar and Renewables business due to lower distillery utilization rates.

URC said the new Sariaya flour mill contributed meaningfully to production during the quarter.