Philippine Stock Market Research

URC’s 2016 Results and 2017 Outlook

January 29, 2017

Our Company Report this week is URC.  It released its 2016 financial results.  Sales grew only by single-digits.  The last times these occurred were in 2007 and 2012.  EBITDA likewise deteriorated slightly on higher opex.  URC’s bottom-line though was fortified by non-recurring gains.

URC was plagued by the Vietnam lead content issue and higher debt levels in 2016.  This year will be a “slowdown” as 2016 sales were boosted by the election campaigning period in 1H16.

Still, URC has a stable balance sheet with a big room for debt if it does need it.  Debt previously rose on overseas acquisitions of businesses like New Zealand-based biscuit-maker Griffin’s.

URC generously pays half of net income as cash dividends, and the projected increase in net income until 2018 is seen to enrich yields.


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