Listed firms’ incomes plunge 29% last year due to financial crisis

MANILA, Philippines – The total net earnings of companies listed on the Philippine Stock Exchange (PSE) fell 29.4 percent last year to P198.91 billion, from P281.54 billion, in 2007, due to the ill effects of the global financial turmoil.

The figures are based on the financial statements filed by 233 corporations, including those listed on the PSE board for small and medium-scale enterprises (SMEs).

Aggregate revenues of PSE-listed corporations, however, reached P2.67 trillion last year or an increase of 12.8 percent from P2.37 trillion in 2007.

“2008 was not an easy year for most of us. The lower net income figures reflected this reality. The decline in the figures is further compounded by the fact that all companies were trying to beat very high profit figures churned out during 2007 which was a banner year for the economy and for many corporations,” PSE president and chief executive officer Francis Lim said.

Out of the 233 companies, 159 reported net gains while the remaining 74 incurred a drop in their bottom line.

“This means that about bulk or 70 percent of our companies continue to eke out decent and even strong profits amidst the financial crisis. This is a signal that our companies continue to stay afloat and have found ways to rein in expenses and stay profitable despite the economic challenges,” Lim explained.

Among the reporting firms, telecommunications giant Philippine Long Distance Telephone Co. posted the highest net income, amounting to P34.64 billion, albeit 3.8 percent lower than the previous level.

The decline in PLDT’s net profit was mainly due to foreign exchange losses from the revaluation of the firm’s foreign-denominated liabilities.

Rounding out the top five profitable companies were food and beverage giant San Miguel Corp., which also posted the biggest gain in net income due to non-recurring gains from sale of investments; SM Investments Corp. (P14 billion); Pilipino Telephone Corp. (P11.35 billion); and Globe Telecom (P11.28 billion).

Oil refiner Petron Corp., meanwhile, topped all listed companies in terms of gross revenues, generating P268.03 billion in 2008, up 26.6 percent year-on-year, largely due to gasoline price hikes.  Also in the top five were Manila Electric Co. (P194.55 billion), SMC (P183.42 billion);  San Miguel (P153.36 billion) and PLDT (P152.73 billion).

Among listed firms, only the property sector fared well as lower profits were recorded by holding firms, banks and financial companies and service companies including those in the telecommunications, broadcasting, technology and gaming.

The financial sector suffered the worst drop of 41.06 percent followed by holding firms (39.56 percent) and mining and oil sectors (38.29 percent).

Lim said he believes the first quarter earnings results would be better than the full-year 2008 figures.

“We are in the process of compiling the net income figures of our listed companies for the first quarter of 2009. Looking at the positive market performance in the first quarter, I have reason to believe that many listed companies are faring better so far this year compared with last year,” Lim noted. –Zinnia B. Dela Peña, Philippine Star