Ayala’s core Q1 profit declines to P7B

AYALA Corp.’s core net income slipped by 9 percent year-on-year to P7.2 billion in January to March as the pandemic continued to impact most of its businesses.

In a disclosure on Friday, the diversified conglomerate said its reported net income slumped by 19 percent year-on-year to P5.4 billion during the period.

Ayala’s real estate segment, Ayala Land Inc., posted a 36-percent weaker net income of P2.8 billion and 13-percent lower revenues of P24.6 billion in the first quarter.

The net effect of one-time tax adjustments from the effectivity of the Comprehensive Recovery and Tax Incentives for Enterprises (Create) Law pushed down the first quarter net income of the Bank of the Philippine Islands by 22 percent to P5 billion.

The net income of Manila Water Co. Inc. also declined by 8 percent to P1.3 billion due to lower billed volume across the group and lower supervision fees, along with recognized net foreign exchange gains partially offset by lower equity share in net income of associates.

Meanwhile, Globe Telecom Inc. and AC Energy managed to end the period with double-digit growths.

Globe’s net income climbed 11 percent to P7.3 billion on the back of “higher gross service revenues, decline in non-operating charges and significant upside from the retroactive implementation of the Create Law.”

AC Energy’s higher earnings from its local and international businesses enabled the firm’s profit to improve by 24 percent to P2.4 billion in the first three months of the year.

Ayala’s industrial technologies segment also reported improvements in its businesses.

AC Industrials narrowed its net loss to P200 million attributed to the improved contributions of its global manufacturing business and local automotive operations.

Integrated Micro-Electronics Inc. ended with a $2.2-million income, reversing its year-onyear loss, amid tight supply levels in the electronics component market.

AC Motors, on the other hand, benefitted from the improved demand in the local automotive market and minimized its loss to P39 million in the first quarter.

“The challenges and prospects brought about by the pandemic is an opportune time to recalibrate Ayala’s portfolio strategy. In the next three years, we aim to sharpen the components of our portfolio to optimize returns and further strengthen our balance sheet,” Ayala President and Chief Executive Officer Fernando Zobel de Ayala said in the disclosure.

“We will place greater emphasis on portfolio strategy with a sharper focus on optimizing returns from existing businesses and a disciplined process on capital deployment. In parallel, we will actively explore opportunities for value realization to fund future investments,” Ayala continued.

Shares of Ayala Corp. shed P2 or 0.28 percent to finish at P725 apiece on Friday.