Friday, June 12, 2009 | MANILA, PHILIPPINES [ BusinessWorld Online ]
LISTED HOLDING firm Filinvest Development Corp. will more than double its capital expenditure this year, with the bulk of the budget allocated for the expansion of its real estate business, the company’s top official said yesterday.
After the firm’s annual stockholders’ meeting yesterday, Filinvest Development President Lourdes Josephine G. Yap told reporters that 60% of its P12-billion budget is allocated for the real estate business, 30% for financial service subsidiary East West Banking Corp. and the rest for Pacific Sugar Holdings Corp.
The firm plans to spend P800 million over the next two to three years to expand the production capacity of its sugar mills, she said.
East West Bank, meanwhile, recently secured regulatory approval to hike its authorized capital to P8 billion from P5 billion, to accommodate a P2-billion infusion from Filinvest Development and affiliate FDC Forex Corp.
The Filinvest Development CEO added that Filinvest Land, Inc. may also tap debt markets within the year to raise up to P3 billion for expansion.
Asked if Filinvest Development is still interested in bidding for the government’s power assets, Ms. Yap said: "Currently, we are keeping our options open... But we are focusing more on expanding in businesses we are in [particularly our sugar and banking business.]"
As for the group’s outlook this year, Ms. Yap said Filinvest Development’s expansion would enable it to sustain earnings growth this year, but declined to give details.
She said sales of Filinvest Land were still steady, with the take-up of low- and mid-end projects still holding up.
Ms. Yap, however, noted that the Gotianun-led conglomerate’s sugar business may post lower revenues as weather conditions have dampened production.
"Hopefully everything will be balanced by a possible increase in pricing because of the supply situation," she said.
In the first quarter, the Gotianun-led firm’s profits went up by 3% to P571 million. It ended 2008 with profits down by almost a quarter to P2.57 billion.
The firm’s shares yesterday closed P0.10 higher at P2.02 apiece. — Don Gil K. Carreon