BDO Leasing posts flat earnings in Q1
BDO LEASING and Finance, Inc. (BDO Leasing) reported flat earnings for the first quarter, as an increase in revenues came alongside higher operating costs.
In a disclosure on Wednesday, the listed subsidiary of the Sy- led BDO Unibank, Inc. said it booked a P144-million net income for the first three months of 2017, steady from the P143.7-million profit recorded during the comparable period last year.
The financing firm saw its gross income rise to P754 million, 7% higher than the P701.7 million year-ago figure, according to its latest filing with the Philippine Stock Exchange. The increase was driven largely by a 9.3% jump in interest income from its lending and leasing activities, which reached P469.9 million from P430.1 million previously.
BDO Leasing said in a statement that its loan portfolio rose to P32 billion, surging by 15% from the year-ago level.
Rental income likewise posted a 6.4% rise to P237 million, but was partially offset by 3.7% decline in collections from service fees that dipped to P47.1 million from P48.9 million a year ago.
On the other hand, the leasing company incurred higher expenses between January-March, with operating costs surging by a tenth to hit P556.4 million from P505.6 million during the first quarter of 2016.
In particular, interest and financing charges grew by 18% to reach P191 million, which accounted for a third of total expenses.
“[ V] olume growth was negated by higher interest and financing charges due to increased bills payable to finance the company’s expanding portfolio,” BDO Leasing told the local bourse.
BDO Leasing grants direct leases, real estate rentals, and sale and leaseback deals for clients. BDO Leasing Vice- Chairman and President Roberto E. Lapid previously said that the company is looking to maintain the P570-million net income booked in 2016 for this year, alongside a 20% growth in its loan portfolio.
Mr. Lapid said the flat earnings growth was expected as the BDO subsidiary absorbs the impact of operations given its partnership with Mitsubishi Motors Philippines Corp., Sojitz Corp. and JACCS Co. Ltd. since January 2016, where they extend car financing deals to individual and corporate buyers.
The government’s infrastructure push is likewise expected to drive the financing company’s core business, with contractors seen to acquire more equipment to match the upbeat construction activities over the next six years, the company official added.
BDO Leasing shares gained 16 centavos or 4.03% higher to close at P4.13 apiece on Wednesday. •