Corporate News

Listed Aboitiz Equity Ventures hikes capex to P77 billion

Posted on March 18, 2017

LISTED Aboitiz Equity Ventures Inc. (AEV) has scaled up its 2017 capital expenditures (capex) by 83% year-on-year, with the bulk of the money to be poured into power and infrastructure projects.

On Friday, AEV told the stock exchange that it was hiking its spending on its business units to P76.7 billion -- as against 2016’s P42 billion -- amid “sustained optimism” over the Philippine economy’s growth, particularly in the power and infrastructure sectors.

Getting the lion’s share in this year’s spending, AEV’s energy sector capex totals P59 billion, to be channeled toward various ongoing power generation projects with the aim of expanding its energy portfolio to 4,000 MW by 2020.

The firm is allocating P8.1 billion for infrastructure.

“We support government’s efforts to implement the necessary reforms to ensure inclusive growth for the greater good,” AEV President and Chief Executive Officer Erramon I. Aboitiz said in the statement.

“This year, the Group will take even more deliberate steps in bringing progress to communities in line with our strategic objectives, particularly in our key growth areas of power and infrastructure.”

AEV’s property unit Aboitiz Land, Inc. P5 billion is programmed “to acquire more industrial and residential properties as it continues to expand its business outside of Cebu, and into the national arena.”

A total of P3 billion will go to operating expenses, P1.2 billion for new businesses, and P787 million for expansions and upgrades.

AEV will use P3 billion for banking and financial services to boost growth in customer businesses and loan expansion, while P21 million will be allotted for the network expansion of the Aboitiz Group’s financial services unit, PETNET, and the full execution of CitySavings’ loan origination program.

Meanwhile, P1.7 billion will be allocated to its food unit, Pilmico Foods Corp. Of this, P1.3 billion will be used for expansion and upgrade initiatives while the remaining P434 million will go to operating expenses.

“Pilmico is currently expanding its customer reach in the Association of South East Asian Nations (ASEAN) region while diversifying national operations,” the statement read, noting that it will support various initiatives for its flour, feeds, and farms divisions in the country.

Shares in AEV climbed 2.08% to close at P72.90 apiece on Friday. -- Janina C. Lim