By Adam J. Ang
EMPERADOR, INC. has slashed its capital expenditure (capex) this year by 40% due to the impact of the global coronavirus pandemic on its operations.
“Considering the current environment, we have held back capex by about 40% this year,” Emperador President Winston S. Co said during the company’s annual stockholders’ meeting, Thursday.
The decision considered the impact of the pandemic on its capacity to expand, the rollout of strategic projects, and depreciation of its value.
To recall, Alliance Global Group, Inc., its parent, reduced its capital expenditure to P42 billion across businesses with Emperador only getting P1 billion for the rest of the year.
Emperador posted a 23.8% growth in second-quarter attributable income to P1.87 billion despite a ban on liquor sales in the Philippines. Its first-half core earnings slightly went up 2.5% to P3.31 billion.
The company saw its quarterly revenues increase by 4% to about P10.7 billion, bringing its first-half revenues to dip slightly to P21.06 billion.
“Given the fluidity of the situation, it is difficult to see a clear path ahead,” Mr. Co said.
“However, if the situation remains stable and the world returns to some sort of normality, we expect both our brandy and whiskey businesses to perform quite good this year and hopefully to beat last year’s performance,” he added.
This week, the liquor company started trading as part of the 30-member benchmark Philippine Stock Exchange Index (PSEi), which includes corporations with the highest market capitalization. Presently, it has a market value of P163 billion.
The company owns Emperador Distillers, Inc., Scotch whiskey maker Whyte and Mackay Group and Spain-based Bodegas Fundador.
On Thursday, shares in Emperador inched down 0.79% to close at P10.10 each.