AYALA Corp.’s attributable income in the first semester took a 79% dive to P7.9 billion as the coronavirus pandemic caused its real estate business segment to limit operations while bloating the loan-loss provisions of its banking unit.
In a regulatory filing on Thursday, the listed conglomerate posted P100.31 billion in total revenues between January and June, which is 30% lower year on year.
By business segments, Ayala Land, Inc. suffered the biggest profit decline at 70% to P4.5 billion due to reduced project bookings, suspended construction activities, restricted mall operations and temporarily closed resorts.
Its banking arm Bank of the Philippine Islands, Inc. (BPI) reported a 15% drop in net income to P11.7 billion as it reserved P15 billion in provisions for the potential adverse impact of the coronavirus pandemic to nonperforming loans.
Globe Telecom, Inc.’s income fell by 5% to P11.5 billion as more network investments raised depreciation expenses.
Ayala Corp.’s power arm AC Energy, Inc. posted an income of P4.5 billion, down 80.6% compared with P23.2 billion in the first half of 2019, mainly from partial divestment of its thermal assets.
Leading its industrial technologies business, AC Industrials shed P1.8 billion as the pandemic affected both global manufacturing industry and the Philippine automotive space.
Integrated Micro-Electronics, Inc. (IMI) also reported a loss of $21.5 million with a quarter slump in revenues following its plant shutdowns in the Philippines, China and Mexico due to quarantine policies.
AC Motors incurred a P575-million loss due to the demand crash. Via Optronics and STI, Ltd. netted combined revenues of $109 million in the period.
“While the health crisis has stifled the momentum of some of our businesses, we have started to see positive trends in the operations of BPI, Globe and Ayala Land since the easing of quarantine restrictions in June,” Ayala Corp. President and Chief Operating Officer Fernando Zobel de Ayala said.
Mr. Zobel noted the “unprecedented growth” of BPI Online and GCash over the past five months, as the country further adopted online financial services amid the crisis.
Year to date, the company spent P8 billion in capital expenditure, mostly for its new businesses. It recorded P93.8 billion in net debt, while cash at the parent level stood at P28.3 billion.
The Ayala group actively accessed both domestic and foreign capital markets during the public health crisis, expecting to raise $3 billion in combined proceeds, according to Ayala Chairman and Chief Executive Officer Jaime Augusto Zobel de Ayala.
Ayala Land and BPI already scored $1.2 billion from their bonds offering. An additional $1.8 billion will come from Ayala Land’s real estate investment trust offer, the first in the local bourse, BPI’s CARE bonds, Globe’s bonds, and Manila Water’s sustainability bonds
Shares in Ayala Corp. increased by 1.89% to close at P753 each on Thursday. — Adam J. Ang