Ayala Land H1 profit jumps 28% to over P4-B

Rappler.com

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Growth is driven mainly by strong residential sales across all brands of the company

MANILA, Philippines (UPDATED) – Net income of property giant Ayala Land Inc grew 28% in the first half to P4.33 billion from P3.38 billion in the same period last year, thanks mainly to higher residential sales.

“We continued to post solid results in the first half of 2012 as we sustained our high growth trajectory,” said Ayala Land CEO Jaime
Ysmael. “Across the board, we have been consistent in growing revenues and improving margins.”

The company’s consolidated revenues jumped 18% to P25.02 billion, of which a large portion was accounted for by home sales.

Revenues of the residential segment rose 24% to P13.95 billion. While all the company’s brands experienced growth, Ayala’s expensive brands pulled in the bulk of profits with Ayala Land Premier bringing in P5.11 billion. Alveo, which caters to the upper and middle-income market, accounted for P3.64 billion of revenue. While Avida which is more affordable pulled in P3.43 billion.

Company vice president Bobby Dy told Rappler in April that the company would expand further into the mid and low-income markets outside Metro Manila and Metro Cebu. While the company’s mass housing brand Amaia brought in its lowest amount of revenues, Amaia experienced the most growth of Ayala’s 4 brands. Revenue from Amaia hit P608 million, an 88% jump compared to the first half last year.

Though Ayala Land has been traditionally known for its strength in the premium market, the developer has taken a new direction and is trying to make their residential offerings better reflect the economic pyramid in the Philippines.

In the commercial and industrial sector, revenues increased 29% to P1.35 billion in the first six months of the year thanks to the sale of 14 commercial lots and a parcel of raw land in NUVALI, as well as 3 industrial lists in Laguna Technopark.

Commercial Leasing as a whole, which includes shopping center and office leasing operations, grew 21% to P4.23 billion from P3.49 billion in the first half last year. The majority or 66% of that revenue came from shopping centers, which brought in 21% more profits, or P2.81 billion, driven by higher lease rates and the increase in occupied space. Meanwhile Office Leasing was driven by take up for business process outsourcing office spaces.

Profits from the hotel and resorts business increased 15% to P1.27 billion from P1.10 billion in the same period last year due to better revenue per available room, which improved by 12% for hotels and 37% for resorts.

Higher construction orders from ALI Group projects helped drive the services arm of the company up 47% to P9.35 billion from P6.38 billion in the first six months of 2011.

We are progressing very well on our 5-10-15 plan and are on track to achieving our targets for the year,” said Ayala Land CEO referring to their plan to in 5 years achieve P10 billion in after-tax income and a return on equity of 15%.  – Rappler.com

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