AYALA Land, Inc. (ALI) raised P8 billion from the issuance of fixed rate bonds on Friday, which are expected to fund several mall, office, and hotel projects it has in the pipeline.
The property developer listed the bonds — due 2023 — at the Philippine Dealing and Exchange Corp. yesterday. With this, ALI has fully exhausted its three-year shelf registration program worth P50 billion filed with the Securities and Exchange Commission.
“We have completely exhausted the P50-billion shelf registration six months ahead of schedule, and what we would like to highlight is the fact that this has been very beneficial to Ayala Land, notable of which has been the speed to market,” ALI Chief Finance Officer Augusto Cesar D. Bengzon said during the listing ceremony for the bonds yesterday.
“Through the shelf registration, we have been able to issue tranches successively within an average of two months, which is a full month faster than what we have been able to do,” Mr. Bengzon said.
The bonds carry an interest rate of 7.0239% per annum, and were granted the highest credit rating — PRS Aaa — alongside a stable outlook by local debt watcher Philippine Ratings Services Corp.
Mr. Bengzon reported that after using up its shelf program, ALI has been able to fix up to 90% of its debt portfolio, which could help shield the company from the effects of rising interest rates.
“We have fixed up to 90% of our debt portfolio which should insulate us against the rising interest rates. We have secured up to 95% of our debt in stable term funding, we managed to source 60% of our debt from the capital markets, and we issued a variety of tenors ranging from as short as a year to as long as 20 years and this has allowed us to make our maturity towers quite manageable,” Mr. Bengzon explained.
ALI earlier disclosed that the funds raised from the issuance will be used to partially finance ALI’s pipeline of projects, specifically Seda Hotels Bay Area in Parañaque, Seda Hotels Bonifacio Global City expansion, leasing projects in Arca South, the Taguig Integrated Terminal Exchange, and the Vertis North Corporate Center Tower 3.
The company will also be funding projects outside Metro Manila, namely Ayala Malls Capitol Central in Bacolod, the Bacolod Capitol Corporate Center, and the Cebu Central Bloc mixed-use complex.
ALI’s issuance brought the total outstanding listed securities in the PDEX to P933.06 billion, from 149 securities of 47 companies. A total of P141.18 billion worth of securities have been listed for 2018 alone.
The listed property giant booked P13.5 billion in net income attributable to equity holders of the parent in the first six months of 2018, 18% higher as revenues likewise picked up by a fourth to P80.4 billion.
“We believe the market continues to be supportive of our plans and we will continue to exhibit the performance we have been doing for the rest of the year,” Mr. Bengzon said.
Shares in ALI climbed 1.04% or 40 centavos to close at P39 each at the stock exchange on Friday. — Arra B. Francia