By Denise A. Valdez, Senior Reporter

Earnings of Ayala Land, Inc. (ALI) plunged 97% in the second quarter, as malls were shuttered and property sales dropped during the lockdown.

In a regulatory filing Friday, ALI said its attributable net income stood at P197 million in end-June, down from P7.8 billion in the same period last year.

Consolidated revenues were slashed 71% to P12.8 billion, while costs and expenses fell 61% to P12.09 billion.

On a six-month basis, ALI’s attributable net income slumped by 70% to P4.52 billion, as consolidated revenues were halved to P41.2 billion.

The suspension of construction activity and limitations in mobility, which came when the government imposed one of the world’s strictest lockdowns to contain the coronavirus outbreak, dragged ALI’s property development revenues 58% lower to P24.9 billion.

Revenues from the residential segment dropped 54% to P20.5 billion, while revenues from the sale of offices slumped 86% to P1.4 billion.

Slower selling activities pushed commercial and industrial lot sales lower by 31% to P3 billion, and reservation sales by 47% to P38.3 billion.

The only segment that grew during the period was office leasing, which booked a 7% increase in revenues to P4.9 billion. Outsourcing firms and headquarter buildings continued operations amid the lockdown.

Commercial leasing revenues declined 31% to P12.9 billion, shopping center revenues decreased 43% to P5.8 billion, and hotels and resorts revenues contracted 43% to P2.1 billion.

ALI said it waived rental fees for tenants that were unable to operate during the lockdown, resulting in some P5 billion worth of waived rent at the end of the second quarter. It also allocated P600 million for no-work, no-pay employees.

“Although we are seeing some positive signs of recovery in certain product lines, we expect the remainder of the year to be extremely challenging,” ALI President and CEO Bernard Vincent O. Dy said in a statement.

“Our property sales started to gain traction as the economy reopened but the performance of our malls and hotels continue to be seriously affected under the current environment,” he added.

As a way to maintain financial sustainability, ALI has cut its capital expenditures for the year to P69.8 billion from P110 billion originally. Some P34.8 billion had already been spent in the past two quarters.

It was able to launch P5-billion worth of projects in the first quarter located in Pampanga, Quezon City and Laguna. No new projects were launched in the second quarter to conserve cash.

“We are constantly making adjustments in our operations to position the company for renewed growth when the economy recovers,” Mr. Dy said.

Shares in ALI at the stock exchange shed 60 centavos or 1.83% to P32.30 each on Friday.