Gokongwei's JG Summit hikes capex to over $1-B
MANILA, Philippines - JG Summit Holdings Inc., the holding firm of tycoon John Gokongwei, will spend a record $1.033 billion for the expansion of its subsidiaries in 2013.
The capital expenditure budget is 12% higher than the $926 million the company spent in 2012, according to JG Summit president and chief operating officer Lance Gokongwei.
Of the amount, $320 million will go to property developer Robinsons Land Corp. (RLC), $300 million to JG Summit Petrochemical Corp., $275 million to budget airline Cebu Pacific, $120 million to food and beverage manufacturer Universal Robina Corp. (URC), and $18 million to Robinsons Bank.
In the company's 2012 annual report, the young Gokongwei said their expansion plans are driven by their "rosy outlook" for the year.
"Coming from the higher-than-expected economic performance in 2012, this year promises to be even better.
"The attractive macroeconomic environment will benefit our company considering that most of the group's businesses are consumer-oriented.
"Rising urbanization and a growing middle-class should translate to higher disposable incomes which should bode well for impulse food consumption, air travel, retailing, property development, banking and others," he said.
Gokongwei said RLC's budget will be spent for the construction of 4 new malls, two office buidlings, 3 low-cost hotels, and at least 8 residential projects.
URC, on the other hand, wants to expand the capacities of its food and beverage facilities in the Philippines. It also plans to grow its snack, chocolate and biscuit lines in Thailand, Indonesia and Malaysia, and put up new beverage and bakery lines in Vietnam.
The petrochemical business eyes to finish constructing a naphtha cracker plant in Batangas this year so it can start commercial operations in 2014.
Cebu Pacific will take delivery of 5 Airbus 320s.
Robinsons Bank, now a commercial bank, is also expanding "to become a significant player in the industry over the next 5 years." The bank plans to open branches in 8 previously "restricted" cities. - Rappler.com