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Higher property sales lift GT Capital Q3 profit

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GT CAPITAL Holdings, Inc. logged a 6% growth in attributable profit for the third quarter of 2018, as the surge in real estate sales and higher income from associates offset the auto unit’s drop.

In a regulatory filing, the holding firm of tycoon George S.K. Ty said net income attributable to the parent climbed to P3.8 billion, higher than the P3.58 billion posted in the same period a year ago.

Revenues dipped by 2% to P60.18 billion as automotive operations — which accounted for about 80% of revenues — slumped by 12% to P47.94 billion.

Toyota Motor Philippines (TMP), GT Capital’s joint venture with Toyota Motor Corp. of Japan, reported a 13% decline in wholesale volume for the quarter to 42,303 units, from 48,645 in the same period a year ago. Demand for vehicles continued to be dampened by higher excise taxes, soaring inflation, and rising fuel prices.

With this, GT Capital’s attributable profit for the first nine months of the year was flattish at P10.94 billion, a percent higher than the P10.82 billion booked in the same period a year ago.

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The company’s revenues further went down by 5% to P161.34 billion, as wholesale volume of TMP slipped by 12% to 117,080 units. TMP’s revenues accordingly fell by 11% to P132.92 billion.

“Our year-to-date results show the counterbalance between the soft auto sector volume sales mitigated by strong growth in financial services, property, and insurance segments. The consensus is that the decline in auto sales may have bottomed out as monthly volumes have stabilized,” GT Capital President Carmelo Maria Luza Bautista said in a statement.

Real estate sales from Federal Land, Inc. and Property Company of Friends, Inc. (PCFI) compensated for the auto unit’s weakness, rising by 45% to P15.7 billion in the nine-month period. Federal Land was boosted by sales from its middle-market condominium projects and lot sales, while PCFI benefited from affordable and economic housing projects.

GT Capital also saw 39% higher equity in net income of associates to P9.13 billion for the period due to profit increases among the companies.

For Metropolitan Bank and Trust Company, net income for the nine months ending September expanded by 27% to P16.18 billion due to higher deposits and loans. GT Capital holds a 36.36% stake in the lender.

Infrastructure conglomerate Metro Pacific Investments Corp. also posted an 8% increase in consolidated core profit to P12.2 billion. This was driven by increased investments in the power sector, continued traffic growth in its operating toll roads, and tariff adjustments coupled with volume increase from its water unit.

Earnings of AXA Life Insurance Corp. meanwhile jumped by 21% to P2.14 billion, following higher life and non-life premium income for the period.

GT Capital Chairman Arthur V. Ty said they remain optimistic for the company’s performance next year, noting that macroeconomic indicators have shown positive trends as of the third quarter.

“Oil prices have declined, foreign exchange rates have shown some strength, and food prices have stabilized. We believe that these factors, combined with the increased spending levels in the last quarter, provide a good backdrop for improved conditions in 2019,” Mr. Ty said in a statement. — Arra B. Francia

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