MANILA, Philippines – The Taal Volcano eruption in January and the coronavirus pandemic caused Ayala Land’s earnings dip in the 1st quarter of 2020.

Ayala Land informed the Philippine Stock Exchange on Monday, May 11, that its net income stood at P4.3 billion in the 1st quarter, 41% lower than in the same period last year, mainly due to lower project bookings and construction interruptions.

Revenues stood at P28.4 billion, 28% lower year-on-year, largely due to a decline in residential revenues (down by 39%) and office sale revenues (down by 68%). Sales reservations during the period also dipped by 27%. 

Commercial leasing and shopping center revenues dropped by 5% and 9%, respectively, due to the enhanced community quarantine (ECQ) implemented in Metro Manila and various areas.

Revenues from the sale of commercial and industrial lots grew by 8%, mainly from existing developments such as Arca South, Seagrove, and Laguna Technopark.

“Our development business was particularly hit hard during the quarter as we saw buyers opting to defer purchases during this period. Our leasing assets were also significantly affected in the latter part of the quarter due to the ECQ,” said Ayala Land president and chief executive officer Bernard Vincent Dy. 

Due to the coronavirus crisis, Ayala Land slashed its capital expenditures for 2020 from P110 billion to P69.8 billion. It will not be launching new projects this year.

“Given the continuing market uncertainty, we quickly made adjustments in our plans to ensure the long-term sustainability of the business,” Dy said.

Ayala Land also confirmed that it continues to pursue its plans for a Real Estate Investment Trust (REIT) offering, the timing of which will depend on market conditions. It was the first to file its application for an REIT offering at the Securities and Exchange Commission earlier this year.

The company has waived around P2.6 billion worth of rent from its tenants in 32 shopping malls nationwide during the ECQ in Luzon and other key cities in the country. It also earmarked P600 million to assist workers. (READ: SM Group, Ayala Corp donate to fight coronavirus) – Rappler.com