Emperador Inc. (EMP) showed resilience amidst the pandemic. EMP was able to grow net profit to owners in the first half of 2020 by 2.4% as compared to the same period last year. The increase in net profit to owners might be small but in the midst of the ravages of the COVID-19 pandemic it is already a big feat. What’s impressive with EMP is that it was able to quickly adjust to the new operating environment and was able to slash operating costs by 11%. The quick adjustments enabled EMP to generate cash from operations. EMP paid debts, distributes dividend, and even bought back its shares using basically its own cash.
The COVID-19 pandemic saw Jollibee Foods Corporation (JFC), another home-grown multinational, burned cash from operations of 5.2 Billion Pesos. The cash burn from operations led JFC to raise massive capital from debt and debt-like securities.
On August 17, 2020 EMP rejoined the Philippine Stock Exchange Index (PSEi) after the semi-annual review by the Philippine Stock Exchange. Despite its inclusion in the PSEi trading volume of EMP shares went down. Sixty-five day average is at 31,911,561 while recent trading volumes hovers just below one million shares.
Against this backdrop, Alliance Global Group, Inc. (AGI) in the month of August 2020 bought 524,885,000 Emperador Inc. (EMP) shares boosting its stake to 83.43%. Tycoon Andrew Tan knows well his companies.
Disclaimer and Disclosure: This is an independent analysis for discussion purposes with the aim of giving stock traders and investors an independent view point. Accuretti Systems Inc. in the course of day to day trading may have own, or is considering buying or disposing, the shares of the companies mentioned in this commentary.