Cebu Holdings keeps top rating for P5-B bonds
Cebu Holdings Inc., an affiliate of property giant Ayala Land Inc., maintained its PRS Aaa credit rating for its P5 billion in outstanding bonds due in 2021.
Obligations rated PRS Aaa are of the highest quality with minimal credit risk. The obligor’s capacity to meet its financial commitments on the obligation is extremely strong. PRS Aaa is the highest rating assigned by PhilRatings.
The bond issue was also assigned a stable outlook by the Philippine Rating Services Corp.
A stable outlook, on the other hand, indicates that the rating is likely to be maintained or to remain unchanged in the next 12 months.
In assigning the rating, PhilRatings considered CHI’s sustained profitability, solid linkage with and support from ALI, strong competitive position, as well as the positive prospects for Cebu.
CHI is engaged in real property management, development, marketing and management. It was established on Dec. 9, 1988 with the vision of transforming the urban landscape of Cebu.
One of Cebu’s biggest real estate companies, CHI is engaged in the residential, commercial and shopping centers development. It is through these investments that CHI has been able to sustain and grow its operations amid stiff competition in the real estate industry.
The company is able to leverage on its solid linkage with and support from its shareholder, ALI.
On March 11, parent company ALI purchased P1.2 billion worth of additional CHI shares, effectively increasing its stake in the Cebu-based property firm to 66.9 percent from 56.4 percent.
CHI’s profitability has been consistently stable in the past three years. From only P2.2 billion in 2013, the company’s revenues has grown 68.2 percent to P3.7 billion, driven by higher leasing/ rental income from Ayala Center Cebu and e- Bloc Towers, as well as the sale of condominium units.
“Earnings will continue to be robust in 2016, driven largely by the strong revenues coming from the shopping mall segment. Significant improvements in terms of margins are likewise expected during the year,” PhilRatings said.