FIRST Philippine Holdings, Inc. (FPH) will be spending about P30 billion in capital expenditures (capex) this year mainly to finance its power and property businesses.
“Our capex on a consolidated basis is over P30 billion, most of which is dedicated to First Gen (Corp.) and Rockwell (Land Corp.), some for the industrial park business, and then the construction business, and of course we mentioned the (Benpres) building,” FPH President and Chief Operating Officer Francis Giles B. Puno told reporters after the company’s annual shareholders’ meeting in Makati Friday.
This year’s planned capex is 36% higher than the P22 billion FPH programmed in 2018, with the increase due to higher investments in First Gen.
First Gen cornered P12 billion of the capex, bulk of which will go to its subsidiary Energy Development Corp. This gives the company some leeway to fund a geothermal-related project.
The listed power company is also scheduled to start the construction of its liquefied natural gas (LNG) terminal project this month. First Gen has partnered with Tokyo Gas Co., Ltd. for the project, although it expects to bring in more partners in the future. The $1-billion LNG terminal is seen to be completed within four years.
Listed property developer Rockwell Land will also get P12 billion for capex, steady from the P12.7 billion it spent in 2018.
Rockwell Land earlier said it will ramp up spending to increase its land bank until this year. The company targeted to acquire 284 hectares of land, in a bid to increase its land bank to account for about 12% of total assets, versus 3% by end-2017.
Mr. Puno said they will also fund the redevelopment of the Benpres Building in Ortigas Center, which has housed the Lopez Group of Companies for almost five decades. It is spending P8 billion for the project, spread out over the next four years.
FPH’s other business units include First Philippine Industrial Park, First Philippine Electric Corp. which handles manufacturing, and First Balfour, Inc., which handles the construction and energy services segment.
Meanwhile, Mr. Puno noted that their newly established education unit that offers senior high school programs is now on its second year
“The second year is important because that’s when they go through immersion with the locators so it’s still in its testing ground. But it’s looking quite successful because the locators want to be able to hire young talented Filipinos, well-trained,” Mr. Puno said.
The company also entered the health care business last year through a 68% stake in Asian Eye Institute, although Mr. Puno said there are no major investments for the business yet.
FPH said it will use internally generated cash to fund this year’s spending.
FPH’s net income attributable to the parent jumped 76% to P10.28 billion in 2018, against the previous year’s P5.86 billion. Gross revenues, meanwhile, grew 21% to P131.31 billion for the year. — Arra B. Francia