MANILA, Philippines— Ayala Corporation (AC), the holding firm of the Ayala Group, saw its bottom line rise in the third quarter (Q3) of this year as well as the first 9 months of 2017 on strong performances of its land development and power units.
In a disclosure to the stock exchange on Friday, November 10, AC reported a Q3 net income of P8.3 billion, up 39% compared to last year’s figure, on strong performances of Ayala Land, Bank of the Philippine Islands (BPI), and AC Energy.
The holding firm also noted that its Q3 performance was boosted by the investment of Jack Ma’s Ant Financial in its Globe Telecom, as well as the income realized by AC Energy from services that enabled the financial close and construction of a power plant.
Without these nonrecurring times, AC said its year-on-year net income gain for the quarter would stand at 26%.
Up so far in 2017
The latest figures mean that the firm’s net income for the first 9 months of the year reached ₱23.2 billion, up 18% from P19.6 billion for the same period in 2016.
AC’s land development unit, Ayala Land, was the biggest contributor netting a 9-month income of ₱17.8 billion.
This was followed by BPI, which saw a 9-month net income of P17 billion, a 1.9% drop which the firm attributed to the absence this year of gains it saw from last year’s capital-raising effort.
The bank’s total revenues rose 5% to P53 billion, as net interest income rose 13.5% to P35.5 billion, driven by higher asset yields and the expansion of its average asset base.
Non-interest income fell to P17.5 billion, down 8.4% from a year ago, due to the absence of significant one-off securities trading gains similar to those realized in June 2016.
Globe telecom contributed P13 billion for the period, up 11% from a year ago. This was lifted by lifted by a ₱1.9 billion gain from the partnership forged by Mynt with Ant financial which offset Globe’s share in equity losses and amortization charges from the acquisition of San Miguel Corporation’s telco assets, higher interest expenses, and depreciation.
Without these one-time gains and losses, Globe’s core net income for the period hit P11.207 billion, down by 5% from the P11.7 billion recorded in 2016.
Manila Water’s net income for the period ended flat from a year ago at P4.9 billion, as higher operating costs and expenses from expansion initiatives weighed down its topline growth.
The utility’s revenues rose 3% to P13.8 billion, in step with a 3% expansion of total billed volume to 554.4 million cubic meters, while its operating costs and expenses rose 11% to P4.9 billion, on higher direct and personnel costs.
The net income of AC Energy, AC’s wholly-owned energy arm, surged by 73% to P2 billion for the period, which AC said was primarily driven by the new contribution of its geothermal asset in Indonesia, as well services income derived from the financial close of a new power plant.
Equity earnings from AC Energy’s operating assets also expanded 20% year-on-year to P1.6 billion.
AC Industrials, for its part, registered a net income of P1 billion for the period – a 5% increase from a year ago, as the solid performance of its electronics manufacturing business offset weaker contributions from its vehicle retail segment.
Integrated Micro-Electronics saw its net income rise by 16% to $24.1 million (P1.2 billion), driven by its automotive and industrial segments.
This was tempered by the slower performance of its vehicle retail segment which saw a 10% decline in net income to P445 million due to lower dividend income from Isuzu Philippines Corporation, and lower equity earnings from Honda Cars Philippines Incorporated.
AC noted that its consolidated assets breached the P1-trillion level as of end-September 2017, with cash at the parent level at P29.7 billion, while net debt stood at P67.2 billion.
The firm’s net debt-to-equity ratio during the period was 0.68 at the consolidated level, and 0.61 at the parent level. AC’s loan-to-value ratio or the ratio of its parent net debt to the total value of its investments was 10% as of end-September 2017. – Rappler.com