Thursday, August 14, 2008 [ philstar.com ]
Property giant Ayala Land Inc. (ALI) said its board approved yesterday a share repurchase program involving P3 billion worth of the company’s issued and outstanding shares.
In a disclosure to the Philippine Stock Exchange, ALI senior vice-president and chief finance officer Jaime Ysmael said the buyback program, which started yesterday, is aimed at improving the firm’s balance sheet structure and capital efficiency and enhance shareholder value. A listed firm usually resorts to a repurchase of its own shares whenever the stock is trading at a price discount perceived by the company as not reflective of its fair corporate value.
“The program will not involve any active solicitation from existing shareholders and will instead be implemented through open market purchases executed through electronic trading facilities of the PSE,” Ysmael said.
The shares to be acquired represent 2.1 percent of the firm’s current market capitalization.
ALI reported a 37-percent jump in its first half earnings this year on the back of a 25-percent increase in consolidated revenues, mainly driven by the sustained growth of its residential and construction businesses.
For this year, the company has set aside P24 billion for its massive expansion program. Bulk of the capital budget will go to the development of 5,600 new residential units from new projects and additional phases in existing projects. This represents an increase of eight percent from the 2007 level.
About 30 percent will be channeled to the expansion of its business process outsourcing space, significantly higher than the 12 percent a year earlier. With 26 BPO projects in construction, the company is on track to achieving its target of 700,000 square meters of gross lease area (GLA) by 2011 from only 36,000 square meters as of end-2006.
Other funds will be used to fund the redevelopment of the Ayala Center and Greenbelt, and beef up its landbanking activities with focus on acquiring key sites in the Mega Manila area and other geographies with attractive and fast-growing economies.
ALI said the second phase of Greenbelt 5 will open in the fourth quarter this year, making available 18,000 square meters of GLA in addition to the 13,326 square meters of GLA launched last year.
The company is also building Q Mall in Angeles City, Pampanga, slated for completion in 2009. It will also undertake a mixed-use development with a significant retail component on a nine-hectare property in Davao in partnership with the Floirendo family.
Within the Bonifacio Global City, ALI is now preparing for the development of the West Superblock area which will feature a luxury hotel to be developed by the Shangri-La Hotels Group, a new premium grade office building which will house the unified Philippine Stock Exchange, as well as a world-class Mind Museum.
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