By Arra B. Francia, Reporter
AYALA LAND, Inc. (ALI) is mulling the issuance of P5 billion worth of bonds before the end of 2018 to partly finance its capital expenditure for the year.
ALI Chief Finance Officer Augusto Cesar D. Bengzon said the company may issue the bonds out of its shelf registration from the Securities and Exchange Commission, as they have P8 billion left from the three-year program.
“(We can issue) maybe another P5 billion… We still have remaining P8 billion in our shelf registration. We can use it,” Mr. Bengzon said in a media briefing in Makati City on Monday.
The listed property developer earlier said it plans to raise P20 billion from a combination of bilateral loans from banks and retail bonds. So far, it has raised P15 billion — with P10 billion through the bond market and P5 billion from bilaterals.
“We’re still assessing the market. Technically, there is no urgency,” Mr. Bengzon said.
The funds will potentially be used to finance part of ALI’s P110.8-billion capex for this year. This year’s capex is 21% higher than the P91.4 billion it spent in 2017, as ALI wanted to take advantage of the strong demand for residential properties in the country.
ALI has already spent P48.4 billion from its capex during the first six months of the year. Residential projects cornered bulk of the spending at 45%, followed by commercial leasing projects at 25%. Fifteen percent was used for equity investments; 10% went to land acquisitions, while the remaining five percent was for real estate development.
Noting the capex rollout was slow during the first half, Mr. Bengzon said the company will still be able to spend what it has set aside. “We pushed back some project launches, but we will be able to catch up on that in preparation for next year,” ALI Senior Vice President and Head of Residential Business Group Robert S. Lao said.
The company targets to launch P125 billion worth of projects this year, consisting mostly of residential and offices for sale under its AyalaLand Premier, Alveo, Avida, Amaia, and BellaVita brands.
Mr. Lao said this will allow ALI to book a 13% growth in reservation sales for the year. In the first six months of 2018 alone, the company managed to book a 17% increase to P72 billion in reservation sales. This means that ALI sold P12 billion worth of projects each month this year.
ALI launched five residential projects for the first half, namely The Residences at Azuela Cove in Davao, Cerilo Phase 4 and 5 in Laguna, Callisto Tower 2 in Circuit Makati, Ametta Place Phase 3 in Pasig, and Avida Towers Abreeza Tower in Davao.
ALI’s net income attributable to the parent grew by 18% to P13.5 billion in the first six months of 2018, on the back of a 25% increase in revenues to P80.4 billion.
Shares in ALI went up by 0.12% or five centavos to close at P42 each at the stock exchange on Tuesday.