Lucio Tan’s LT Group achieves record profits in 2024 with help from tobacco and banking.

The conglomerate owned by Lucio Tan, a prominent Filipino businessman, achieved its highest profits in 2024, with significant contributions from its tobacco and banking divisions. The annual report submitted to the Philippine Stock Exchange by the conglomerate, LT Group (LTG), revealed a 14% increase in attributable net income to P28.92 billion for the year.

Fortune Tobacco Corporation (FTC) emerged as the primary driver of LTG’s profits, accounting for P12.7 billion or 44% of the group’s net income. Notably, FTC’s profits surged by 12% in 2024, primarily due to increased dividends from PMFTC, the local affiliate of Philip Morris International, in which FTC holds a substantial 49.6% stake.

Despite facing challenges such as declining cigarette volumes, LTG observed an 11% decrease in 2024 attributed to affordability concerns, a rise in illicit trade, and the growing appeal of vaping. The Philippine government’s seizure of 1.2 billion illegal cigarette sticks in 2024, doubling the previous year’s confiscation, further highlighted these issues.

The Philippine National Bank (PNB) emerged as the second most significant contributor to LTG’s net income, generating P11.89 billion. PNB experienced an 11% increase in net interest income to P49 billion, driven by enhanced returns and loan volumes. The banking unit also managed to reduce its operating expenses by 2% to P33.6 billion through lower provisions for impairment, credit losses, and other expenditures.

In the spirits sector, Tanduay Distillers achieved record profits of P2.15 billion in 2024 by capitalizing on heightened liquor and bioethanol volumes and increased liquor prices. Despite a marginal drop in its nationwide market share to 32.2%, Tanduay Distillers maintained a dominant 70% market share in the Visayas and Mindanao regions.

Similarly, Asia Brewery, another subsidiary of LTG, witnessed a substantial profit surge in 2024, with its bottom line climbing by 46% to P841 million. The beverage manufacturer attributed this growth to a 5% rise in sales across its primary product lines, with Cobra energy drink securing a 53% market share and water brands Absolute and Summit maintaining a combined 17% share of the market.

On the other hand, Eton Properties experienced a 53% decline in net income to P212 million due to higher operating costs and reduced leasing revenue. However, residential sales generated P501 million in 2024 as the company resumed selling its remaining inventory in Quezon City projects and the Eton City development in Laguna.

Overall, Lucio Tan’s conglomerate, LT Group, demonstrated robust performance in 2024, driven by its diverse portfolio of companies across the tobacco, banking, spirits, and beverage sectors. Despite facing challenges in the tobacco industry, the conglomerate’s strategic approach led to record profits and sustained growth across its various business units.