SMC 2026 sales should hit P2 trillion, a new record
By TONY LOPEZ
Fearless forecast: San Miguel Corp. (SMC) will hit P2 trillion in consolidated revenues in 2026, becoming the first Philippine industrial conglomerate to have 2,000 billion pesos in annual sales and bolstering its unrivaled position as the country’s largest company in sales.
SMC is also on track to become a P3-trillion company in assets or total resources. This makes SMC the Philippines’ largest diversified conglomerate in total assets.
In first half of January-June 2026 SMC posted consolidated revenues of P964.1 billion, up a whopping P246 billion or 34% from its year-ago sales of P718 billion.
Factors fueling sales growth
With momentum, a recovering economy, strong year-end Christmas buying, and crude oil hovering at $85-90 per barrel (refined petroleum products is 63% of total SMC sales), it should not be difficult for the diversified conglomerate to hit another P1 trillion in sales in July-December 2026. Add the P1 trillion to the P964.1 billion (P trillion without so-called eliminations), and it’s easy to predict a record annual sales of P2 trillion for SMC.
Asked for comment, however, SMC Chair and CEO Ramon S. Ang demurred about a P2 trillion sales forecast for 2026. “You cannot be sure if we would do P2 trillion sales this year,” he cautioned. “The economy is weak,” he notes.
And money that should go to consumption—the main engine of San Miguel’s furious sales increases in the past—is instead going to gambling or online gaming, which does P2.5 trillion in business today.
The savings rate, as a percent of GDP or annual value of economic output, is 25.8%, or P7.74 billion based on GDP of P30 trillion. If P2.5 trillion is bet on online gambling, that means a third of people’s savings goes to such an unproductive enterprise as gambling.
No wonder the hottest stocks in the stock market are gambling stocks. With ports and gambling businesses, Enrique Razon has become the nation’s first peso nrillionaire. He is worth almost P2 trillion.
Where SMC sales come from
Extraordinarily strong sales increases by San Miguel’s Fuel and Oil Business (Petron Corp.), Energy, and Real Estate, Banking and Other Businesses fueled San Miguel’s P964 billion record sales in January-June 2026, despite formidable challenges during the semester.
In first half 2026, Petron sales swelled 57% (or P214.8 billion) to P597.8 billion; Energy sales rose 27.56% (P20.86 billion) to P96.57 billion; while Real Estate and Other Businesses leaped 19.5% (P5.897 billion) to P36.2 billion.
Other businesses showed only modest single-digit growth rates, reflecting a slowing economy, reduced household spending, and the vagaries of doing business in an economy where corruption is rampant, red tape is crippling, and costs like energy remain daunting.
Other segments
Food and Beverage sales increased only 2% to P205.25 billion; Infra 3.3% to P20.5 billion; Packaging 1.56% to P19.31 billion; Cement up 1.23% to P18.15 billion.
In first half 2026, Fuel and Oil accounted for 63% of SMC’s total consolidated sales of P964 billion; Food and Beverage 20.7%; Energy 10.56%; Real Estate and Others 3.57%; Infra 2.1%; Packaging 2%; and Cement 1.8%.
Resilient
In the first half of 2026, SMC Chair and CEO Ramon S. Ang said “underlying businesses remained resilient despite volatile global markets, higher costs and cautious consumer spending.
Gushed RSA, today’s hottest CEO: “Our businesses performed well in the first half despite a more challenging operating environment. While cost and market pressures may continue, our underlying operations remain sound. We will stay disciplined on costs, continue improving efficiency, and invest in areas that support our long-term growth and the country’s broader economic development.”
First half sales up 34%
The 34% jump in SMC’s first half revenues to P964.1 billion was “driven by higher volumes and prices in its Fuel and Oil business, stronger contributions from Power, and continued growth in Food.”
SMC’s first half operating income increased 17% to P102.3 billion.
However, reported consolidated first half net income was 44% lower at P37.7 billion, “reflecting foreign exchange effects and other non-core items.”
The net income in first half of 2025 “also benefited from a P21.9 billion gain from the Chromite transaction, which involved the de-consolidation of certain power assets.”
Strong investor confidence
Futurely, San Miguel sees positive signs of strong investor confidence and huge growth potential:
• SMC’s recent P30 billion preferred shares follow-on offering was 3.27x oversubscribed, reflecting strong investor confidence in the Group’s long-term growth strategy and its continued investments in infrastructure and nation-building projects.
The preferred shares offer yields of 8.04% to 8.648%. They have no fixed maturity dates and are not convertible into common stock.
The P30 billion will refinance or repay maturing bonds, go into further investments in infrastructure, and help finance the New Manila International Airport in Bulakan, Bulacan.
• SMFB’s capacity expansion is progressing across its Food and Beverage businesses.
Key projects include GSMI’s Lucena washing facility, commissioned in March, and its Cabuyao production line targeted for November; Beer’s Lucanin Malt Terminal; and additional food manufacturing, feedmill, cold storage, and grain-handling capacities.
• SMC Global Power remains committed to its energy transition strategy through its Hydro and Solar projects, with plant development, construction, and solar panel importation currently in progress.
Infra on track
• Key infrastructure projects continue to advance, with ongoing toll road construction and improvements, sustained progress on MRT-7 and MIA, and significant operational improvements and upgrades at NAIA to enhance capacity and passenger experience.
• SMC’s diversified portfolio, scale, and operational resilience continue to support stable performance amid a more challenging operating environment.
With a disciplined approach to operations, capital allocation, and risk management, San Miguel remains well-positioned to pursue long-term growth opportunities while maintaining financial strength and adaptability across economic cycles.
Petron profits down
Meanwhile, Philippine oil giant Petron Corp. posted a first half net income of P3.8 billion, down 27% from P5.25 billion in profits in first half 2025, despite record revenues of P605 billion, up a whopping P219.5 billion or 57%, thanks to higher crude prices and higher volume sold in Singapore.
For its profit decline, Petron blamed the continued impact of geopolitical tensions in the Middle East, which pushed crude prices, import premiums, and freight costs to record levels.
The global oil market remained highly volatile following the onset of the US-Iran conflict
The benchmark Dubai crude prices fell to $79 per barrel in June after peaking at $129 per barrel in March.
Despite the sharp decline, Dubai crude averaged $96 per barrel in the second quarter 2026, up from $86 per barrel in the first quarter.
As a result, Dubai crude averaged $91 per barrel in the first half of the year, a 27% increase from the same period in 2025.
Dubai crude at $88 a barrel
As of Sept. 3, 2026, Dubai crude was doing at $88.75 per barrel; Brent crude at $95.20, and West Texas Intermediate $90.
“While the first half of the year has been challenging, we are confident that our financial discipline, operational resilience, and competitive strengths will enable us to navigate these temporary headwinds. We remain focused on delivering on our commitment to ensure fuel security and meet the nation’s fuel demand amid the continued market volatility,” said Petron Chair and CEO Ramon S. Ang.
Petron’s consolidated sales volume for the first six months rose by 6% to 67.9 million barrels, driven by the 86% surge in the trading transactions by Petron’s Singapore subsidiary.
Domestic volume down
This more than offset the 6% decline in the combined sales volume of Petron’s operations in the Philippines and Malaysia, which reached 52.9 million barrels during the period.
Motorists were turned off by record-high prices of gasoline, diesel, and other refined products.
While Petron’s retail fuel segment in the Philippines posted a strong 15% growth, overall sales volume was affected by the decrease in refining output caused by the temporary production shutdown at the Port Dickson Refinery in Malaysia, as well as the scheduled first-quarter maintenance at the Petron Bataan Refinery in Limay.
However, Petron said the higher cost of products sold, both from production and importation, as well as increased operating expenses, exerted pressure on the company’s margins, closing the first half with an operating income of P12.6 billion, down 17% compared to the same period last year.
With the construction of the replacement jetty at Port Dickson Refinery already underway and on track for commissioning in the first quarter of 2027, the company has begun limited and intermittent refining operations in Malaysia to process existing crude inventory to support product availability in the market.
Petron’s coco-methyl ester (CME) plant, with an annual capacity of 180,000 tons, in the Philippines is nearing completion.
The facility situated within the Petron Bataan Refinery complex will provide a more reliable CME supply for the Philippines’ only remaining refiner.
Bigger storage capacity
The company is also expanding the storage capacity of its terminals to improve supply reliability and operational efficiency.
Among those in the pipeline, the company will build four new storage tanks in Limay, including one 25,000-barrel tank for Jet A-1 and three CME storage facilities with a total capacity of 48,000 liters, for completion by early 2028.
In Bacolod, Petron will construct a 1,500-MT LPG mounded tank and an LPG canister filling facility, both targeted for completion in the third quarter of 2028.
Scenarios
An ING analyst sees three scenarios this year for crude oil:
Base case: Stalemate persists until shortly before the November US mid-term elections, followed by a limited stabilisation agreement covering Hormuz, military de-escalation and possible sanctions relief. Persian Gulf oil flows remain near 50% of pre-war levels in October, then recover to about 90% by December, including bypass volumes. Brent averages $80/bbl in the fourth quarter, up from our previous forecast of $74/bbl.
Optimistic case: A September agreement restores flows to pre-war levels by year-end, with Brent averaging $75/bbl in the fourth quarter.
Pessimistic case: Escalation increasingly disrupts Hormuz and bypass routes, leaving year-end flows near 50% of pre-war levels and lifting fourth-quarter Brent to an average of $104/bbl.
Acute diesel supply tightness
Diesel and gasoil cracks have reached record highs as Persian Gulf disruptions coincide with reduced Russian supply.
Following Ukrainian drone attacks on refineries, Russia has banned diesel exports until the end of September amid domestic supply concerns. This matters because Russia is the world’s second-largest diesel exporter.
Combined disruptions are equivalent to around 20% of global seaborne diesel trade. With little spare refining capacity, meaningful relief requires a recovery in Persian Gulf and/or Russian flows.
Fuel and Oil
Petron is the largest and the only oil refining and marketing company in the Philippines and a leading player in the Malaysian market. Petron has a combined refining capacity of 268,000 barrels per day.
Petron owns and manages the most extensive oil distribution infrastructure in the Philippines.
Petron has an extensive network of around 1,800 retail service stations in the Philippines and more than 800 retail service stations in Malaysia as of Dec. 31, 2025.
Petron also exports various petroleum products and petrochemical feedstock, including LSWR, gasoline, diesel, jet fuel, LPG, molten sulfur, naphtha, mixed xylene, benzene, toluene and propylene, to customers in the Asia-Pacific region.
In the Philippines, Petron owns the Petron Bataan Refinery complex located in Limay, Bataan, which is a 180,000 barrel-per day full conversion refinery.
The Petron Bataan Refinery is capable of producing a range of white petroleum products such as LPG, naphtha, gasoline, kerosene, jet fuel and diesel, with no residual fuel oil production.
It also produces petrochemical feedstocks benzene, toluene, mixed xylene, and propylene. It has its own product piers and offshore berthing facilities, one of which can accommodate very large crude oil carriers.
Petron also owns a refinery in Malaysia with a capacity of 88,000 barrels per day, a palm oil methyl ester plant with an annual capacity of 78,000 metric tons and 10 product terminals, with presence in the airport segment through a 20% ownership of a multi- product pipeline to Kuala Lumpur International Airport.
Energy
The Energy business, which is conducted through San Miguel Global Power Holdings Corp. (“San Miguel Global Power”), together with its subsidiaries, associates and joint ventures, is one of the largest power companies in the Philippines, controlling 5,710 MW of combined capacity as of Dec. 31, 2025 per the Energy Regulatory Commission.
For 2025, SMC’s market share was approximately 20% of the National Grid, 25% of the Luzon Grid, 5% of the Visayas Grid and 9% of the Mindanao Grid.
Market share is computed by dividing the relevant installed generating capacity for the period by the total installed generating capacity of Luzon Grid, Visayas Grid, Mindanao Grid or National Grid (20,659,316 KW, 3,443,158 KW, 4,287,600 KW and 28,390,074 KW, respectively.
San Miguel Global Power benefits from a diversified power portfolio, including natural gas, coal, renewable energy such as hydroelectric power and battery energy storage systems (“BESS”).
San Miguel Global Power is currently undertaking the following expansion projects through its subsidiaries:
Battery storage
1. The BESS Projects, which are currently undertaken through SMGP BESS, will provide an additional ~500 MWh capacity to the Energy business’ existing power portfolio.
2. Units 4 and 5 of the Masinloc Power Plant with a planned gross installed capacity of 350 MW each will utilize supercritical boiler technology, considered as another expansion project by MPCL after it completed Unit 3 in September 2020.
3. The planned hydropower projects in Aklan, Apayao and Pangasinan to be constructed by SRHI and Pan Pacific Renewable Power Phils. Corp. (“Pan Pacific”), pursuant to the Notices of Award issued by the Department of Energy (“DOE”) in their favor for the third auction round of the Green Energy Auction Program conducted on Feb. 11, 2025 as follows:
(i) SRHI’s pump storage hydropower across three facilities to be located in Aklan and Pangasinan and to be completed between 2031 and 2035, with an aggregate capacity of 1,850 MW; and
(ii) Pan Pacific’s pump storage hydropower and impounding hydropower across three facilities to be located in Apayao with an aggregate capacity of 2,300 MW and to be completed between 2030 and 2031.
San Miguel Global Power owns a 40% equity interest in FPSP Holdings Corp. that wholly owns Pan Pacific.
Solar projects
4. The planned solar projects in the provinces of Bulacan, Davao and Isabela are to be constructed by SMC Global Light and Power Corp. (“SGLPC”) pursuant to the Notice of Award issued by the DOE in its favor for the fourth auction round of the Green Energy Auction Program launched on March 29, 2025.
As a winning bidder, SGLPC bid for an aggregate offered capacity of 2,225 MWac floating solar and ground- mounted solar projects with expected completion dates from 2026 to 2029.
Food and Beverage
San Miguel Food and Beverage, Inc. (“SMFB”) is a leading food and beverage company in the Philippines.
The brands under which SMFB produces, markets, and sells its products are among the most recognizable and top-of-mind brands in the industry and hold market-leading positions in their respective categories.
Key brands in the SMFB portfolio include San Miguel Pale Pilsen, San Mig Light and Red Horse for beer, Ginebra San Miguel for gin, Magnolia for chicken, dairy, ice cream, flour mixes and salad aids, Monterey for fresh and marinated meats, Purefoods and Purefoods Tender Juicy for refrigerated and canned meats and prepared meals, Star for non-refrigerated margarine and processed meats, Dari Crème for refrigerated margarine, San Mig Super Coffee for coffee, B-MEG for animal feeds, NutriChunks and AlphaPro for dog food, and Majesty for cat food.