Higher operating expenses curbed Phinma’s 9-month profit

November 19, 2022 12:00:00

Diversified conglomerate Phinma Corp. said profits in the first nine months of the year slowed as higher costs at its education and construction materials segments blunted overall growth in revenues.

From January to September, net income declined 7.5 percent to nearly P822 million while consolidated revenues expanded by 11.5 percent to P13.43 billion.

Phinma, whose businesses span education, property development, construction materials and hospitality, underscored the growth at most of its businesses despite the high-inflation environment.

"Our strong top line growth is testament to the capability of Phinma and our businesses to absorb difficult economic circumstances and still serve our customers," Chito Salazar, president and chief operating officer at Phinma, said in a statement on Friday.

The company's education arm, for example, saw profits decline to over P568 million as the return of in-person classes bloated costs. This was despite a 30-percent increase in enrollment for the current school year. Phinma's education arm saw revenues increase 8 percent to P2.86 billion.

Phinma Construction Materials Group (CMG), composed of Union Galvasteel Corp., Philcement Corp. and PHINMA Solar Corp., was also hit by "higher input costs amidst global supply chain issues and a weak peso."

"CMG had a challenging nine months, as it faced rising costs of raw materials, fuel and freight resulting from global supply chain disruptions, as well as soft construction demand particularly in the third quarter," Phinma said.

Net income at CMG slowed to P467.3 million while revenues grew 10.9 percent to P10.29 billion.

Meanwhile, Phinma Property Holdings Corp.'s equitized net income was P12.27 million during the nine-month period, up by over 57 percent from the same period in 2021.

"Phinma Properties, which brought home numerous awards and citations from industry leaders and homeowners last month, remains on track to launch its horizontal projects, including a township in Western Visayas," the conglomerate said.

Moreover, equitized net loss in Coral Way City Hotel Corp. amounted to P5.35 million.

"Cash from operations nevertheless remained positive, as the company continued to maximize bookings from the leisure and corporate market segments given the gradual resumption of leisure and business travel," Phinma said.

The group earlier approved a P50-million investment for the expansion of Microtel by Wyndham in the Mall of Asia Complex. —Miguel R. Camus INQ