Ayala Corp. earnings up 16% last year

Ayala Corp., the country’s oldest conglomerate, grew its net income 16 percent to P30.3 billion last year on the back of robust double-digit growth of its real estate and power businesses.

Company president Fernando Zobel de Ayala attributed the positive results to strong equity earnings contributions from Ayala’s business units led by Ayala Land and AC Energy, whose equity earnings contributions expanded 21 percent and 30 percent, respectively.

Equity earnings contributions reached P35.8 billion, 12 percent higher than the year ago.

“We are happy to see this earnings momentum sustained for the sixth consecutive year as the expansion strategy across our portfolio of businesses continues to bear fruit. Consistent doubledigit growth since 2012 has translated to a compounded annual growth rate of 22 percent. We remain positive about our trajectory as we move closer to our 2020 goals,” Zobel said.

Among the different business segments, the conglomerate’s Ayala

Land Inc. maintained its strong momentum with net earnings jumping 21 percent to P25.3 billion.

The company poured in P91.4 billion in capital expenditure last year, launching 28 residential projects amounting to P88.8 billion.

Banking arm Bank of the Philippine Islands recorded a net income of P22.4 billion, up 1.7 percent from a year ago.

Excluding one-off gains from the sale of securities in 2016, net income grew 31 percent in 2017.

On the other hand, Globe Telecom’s net earnings dropped five percent to P15.1 billion due to higher operating expenses and depreciation charges as a result of increased investments in its data network.

Nevertheless, topline growth remained strong, with service revenues using six percent to P127.9 billion.

The water business under Manila Water posted a muted net income growth

of one percent to P6.2 billion. Higher operating expenses and business development costs tempered topline growth.

AC Energy, the power generation arm, reported a 13 percent increase in net earnings to P3.5 billion in 2017, primarily driven by fresh equity earnings contribution from its geothermal platform, and boosted by solid contributions from its wind energy assets.

Services income derived from the financial close of a new power plant likewise contributed to AC Energy’s net earnings.

Similarly, AC Industrials registered a net income of P1.2 billion, up four percent on better performance of both its electronics manufacturing and vehicle retail units.

The Ayala group is increasing its capex this year by 44 percent to P249 billion, largely to support the parent’s own investment program as well as the growth strategies of Ayala Land, Globe and Manila Water.

At the parent level, Ayala has earmarked P51.8 billion in capital spending this year, primarily to fund its subscription to BPI’s stock rights offering and its investments in AC Energy, AC Industrials, AC Education and AC Health.