Ayala firms up bond issue
Ayala Corporation has firmed up plans to raise R10 billion from the issuance of fixed rate bonds which have been assigned the highest issue credit rating of PRS Aaa, with a Stable Outlook, by the Philippine Rating Services Corporation (PhilRatings).
The bonds are part of a three-year Fixed Rate Bonds Program (FBP) of up to R20 billion.
PhilRatings has likewise maintained its Issue Credit Ratings of PRS Aaa, with a Stable Outlook, for Ayala’s R10 Billion Retail Bonds due on April 30, 2017; R10 Billion Retail Bonds due on November 23, 2019; R10 Billion Retail Bonds due on May 12, 2021 and R10 Billion Retail Bonds due on May 11, 2027.
Obligations rated PRS Aaa are of the highest quality with minimal credit risk. The obligor’s capacity to meet its financial commitment on the obligation is extremely strong. A Stable Outlook is defined as: “The rating is likely to be maintained or to remain unchanged in the next 12 months.”
The issue ratings assigned to Ayala’s bonds reflect Ayala’s strong brand equity and leading market position for its core businesses; well-defined strategy, backed by a strong management team with a solid track record; sustained profitability; and healthy cash flows, and financial flexibility.
Ayala booked R5.8 billion in net income attributable to equity holders of the parent in the first quarter of 2016, a 15 percent increase from the R5 billion recorded in the same period last year.
This was backed by the sustained growth of its major operating subsidiaries. With total net income of R9.8 billion, profit margin remained healthy at 18 percent.
Following the attainment of its five-year plan of growing net income to R20 billion and return on equity (ROE) to 15 percent, Ayala is committed to increase its earnings capacity to R50 billion and to sustain an ROE of 15 percent over the next five years.
Ayala’s major business units will continue to drive earnings going forward. It is likewise the company’s intention, though, to diversify and expand its portfolio.
Such will be achieved by pursuing opportunities in the energy sector, establishing an increasing presence in Southeast Asia, and exploring further new sectors like healthcare and education.