Profit sees steady rise over first six months

PUBLISHED : Monday, 05 September, 2011, 12:00am
UPDATED : Monday, 05 September, 2011, 12:00am


Hong Kong-listed conglomerate First Pacific says its unaudited financial results for the first six months of the year saw a steady rise in net profit.

First Pacific says its recurring profit rose 14.3 per cent to US$219.4 million from US$191.9 million a year earlier, as a result of significantly stronger earnings by all operating companies in US dollar terms.

The company reports that net profit rose 16.3 per cent to US$219.3 million from US$188.5 million reported in the same period last year, as acquisitions and investments made in earlier periods by the company and its operating companies delivered increased contributions to earnings. Turnover rose 27.1 per cent to US$2.75 billion from US$2.16 billion a year earlier.

'Our strong first-half earnings are a result of continuing strength in the emerging markets where earlier investments made by the company are bearing fruit,' says Manuel Pangilinan, managing director and CEO of First Pacific.

First Pacific, based in Hong Kong, is a major shareholder in the Philippines' biggest telecommunications infrastructure PLDT and mining companies and in Indonesia's biggest vertically-integrated food company.

Contributions from operations rose 18.6 per cent to US$260.1 million from US$219.3 million. Each of the four operating companies reported increases in their own income in US dollar terms. Recurring earnings per share rose to 5.63 US cents from 4.97 US cents a year earlier. Basic earnings per share rose to 5.63 US cents from 4.88.

The company's board of directors approved an interim dividend of 8 HK cents per share, up 33 per cent from 6 HK cents per share a year earlier. The 2011 interim dividend, together with a special dividend of 1.2 HK cents paid on August 8, represents a payout ratio of 21 per cent of recurring profit, up from 16 per cent a year earlier.

The special dividend relates to the spin-off and separate listing earlier this year of PT Salim Ivomas Pratama Tbk.

Looking ahead, Pangilinan says First Pacific aims to invest in companies that will deliver strong cash flows under its management.

'We have proved successful at this over the years and as we release those cash flows, the result is showing up in our share price and increasingly in our dividend payments to our shareholders,' Pangilinan says.

First Pacific's profit increase in the first half of the year was driven mostly by higher contributions from Philex Mining Corporation (Philex), the largest listed mining company in the Philippines and the largest producer of gold and copper in the country, and from Metro Pacific Investments Corporation, the leading infrastructure company in the Philippines.

Philex's contribution rose 483.3 per cent to US$21 million from US$3.6 million a year earlier as the volume of ore milled, ore grade and prices for its products all rose from the year-earlier period. MPIC's contribution to the group increased 55.9 per cent to US$35.4 million from US$22.7 million a year earlier.