The Philippine’s oldest conglomerate Ayala Corporation, reported a 79 percent fall in net income to P7.9 billion in the first half of the year to lower earnings of its banking and property units.
The conglomerated owned, Ayala Land Inc. (ALI) net income dropped 70 percent to P4.5 billion, Bank of the Philippine Island(BPI) net profits declined 15 percent to P11.7 billion in the first half of year as it booked P15.0 billion and Globe Telecom (GLO) net income dipped five percent to P11.5 billion has dragged down the income of the conglomerate.
Ayala Chairman and CEO Jaime Augusto Zobel de Ayala said in a statement “Our group has taken advantage of the favorable debt market conditions to further solidify our balance sheet in these challenging times. Ayala Land, BPI, Globe, and Manila Water are expected to raise US$3 billion in combined proceeds from various domestic and international capital raising exercises”.
In a disclosure, Ayala said the drop is a combined effect of Bank of the Philippine Island’s aggressive loan loss provisions in the second quarter, Ayala Land’s limited construction activities and mall operations, and the base effect of divestment gains in power and education booked in the same period last year.
“It is encouraging to see the strength of the Ayala brand translate to its continued ability to attract sizeable capital under the current environment.” He added.
“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,” said Ayala President and COO Fernando Zobel de Ayala. He added that “The crisis has accelerated the country’s digital adoption, particularly in financial services. We are excited about the trajectory of our digital channels BPI Online and GCash, which have both experienced unprecedented growth over the past five months.”
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.
Ayala Corp is listed in the Philippine Stock Exchange as $AC, its share price increased by 1.89% to close at P753 each on Thursday.
-StockBytes PH, August 14, 2020.
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