Ayala Land earnings surge in first semester
Source: http://www.tradingmarkets.com/.site/news/Stock%20News/1815510/
Aug 09, 2008 (The Manila Times – McClatchy-Tribune News Service via COMTEX) — AYAAF | Quote | Chart | News | PowerRating — Aug. 9–THE Philippines’ biggest real estate developer turned in double-digit profit growth in the first half of the year owing to higher growth in its residential and construction businesses.
Ayala Land Inc. (ALI) disclosed to the Philippine Stock Exchange its net income increased 37 percent to P2.91 billion, while its consolidated revenues went up by 32 percent to P15.38 billion over the same period last year.
“This robust financial performance was driven by strong growth in operating revenues, improved equity earnings from affiliates, higher interest and other income, and effective cost control,” the company said.
Operating revenues increased 26 percent to P13.71 billion on higher residential and construction businesses. Ayala Land’s strategic landbank management, corporate business and Visayas-Mindanao operations also contributed to its consolidated revenue growth.
Bannered by the strong growth of the construction business, the residential business contributed P7 billion, accounting for the bulk of revenues at 45 percent, and support businesses, P3.8 billion, during the six-month period.
At end June, ALI’s revenues reached P7 billion, or 12 percent higher than P6.2 billion in the same period a year ago.
Profits from its shopping centers were unchanged in the first six months at P2.1 billion, as base rent for building leases were escalated within a range of 8 percent to 12 percent; however, this was offset by the loss of Glorietta 2 and Park Square 2 revenues and some concessions offered to merchants directly affected by the ongoing construction and redevelopment of Ayala Center.
Controlled by one of the country’s old-rich families, ALI hit the front pages of newspapers last year when a section of its premier shopping mall, the Glorietta, exploded. The police blamed the incident on building administrators, but the company suspected foul play.
Meanwhile, corporate business earnings grew 8 percent to P428 million at end-June due to higher average rental rates, coupled with the sale of three hectares at Laguna Technopark’s expansion phase. Average rent at headquarter-type office buildings went up 15 percent while occupancy level remained at 98 percent.
For ALI’s contact center buildings, average rent of all operational tenants grew 8 percent, while occupancy dropped to 65 percent.
Last year, ALI posted a 13-percent growth in net income to P4.4 billion but consolidated revenues inched up by one percent to P25.7 billion over the previous year.
ALI’s current ratio at end-2007 stood at 1.65:1 while cash and equivalents went up by 43 percent to P13.6 billion due to the collection of full payments from the completed Serendra units in Fort Bonifacio and deposits from preferred shares subscriptions.
Last year, ALI spent P15.2 billion for capital expenditures with residential development cornering more than half at P7.3 billion.
For this year, the company has set aside P24.3 billion, the bulk of which would go to residential development and corporate business at 42 percent and 30 percent, respectively. Malls will get 14 percent of the total while the balance will be used for strategic land banking.
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