Thursday, July 23, 2009 | MANILA, PHILIPPINES [ BusinessWorld Online ]
LOCAL CREDIT watcher Philippine Rating Services Corp. (PhilRatings) has assigned the highest grade to Gokongwei-led Robinsons Land Corp. planned bond issue, confident on the property firm’s ability to repay debts because of a strong balance sheet.
PhilRatings assigned a "PRS Aaa" to Robinsons Land’s P3-billion bond offering, which has an oversubscription option of an additional P2 billion, citing minimal risk.
"Obligations rated PRS Aaa are of the highest quality with minimal credit risk. Robinsons’ capacity to meet its financial commitment on the obligations is extremely strong," PhilRatings said.
The rating agency likewise retained its highest rating on Robinsons Land’s previous P5-billion issuance of five-year bonds, saying the property company’s balance sheet in relation to an increase in issue size remains solid.
"While some financial ratios have slightly changed with the higher amount of the planned issue, measures of profitability, liquidity and leverage remain generally strong and sound," the credit rater said.
The first offering received a strong demand from investors prompting the property firm to issue another batch of fixed-rate bonds, bringing the firm’s total bond offering this year to P10 billion.
The Gokongwei company had said proceeds of the two bonds would be used for capital expenditures, but did not provide other details.
The first bond offering carried a yield of 8.50% per annum and a tenor of five-year and one day, higher than the 8.25% that Sy-led holding company SM Investments Corp. obtained for five-year and one day bonds it recently offered.
Robinsons Land has yet to finalize the details for its second bond offering and must still secure the approval of the Securities and Exchange Commission.
The real estate arm of JG Summit Holdings, Inc. plans to spend around P8 billion this year, lower than the P9.5 billion in expenditures last year.
Robinsons Land also plans to launch five condominium projects this year, among which include Vimana Verde Residences in Pasig, and will open its first budget hotel, the Go Hotels, at Robinsons Cybergate Plaza in Mandaluyong.
In the first three months of the year, Robinsons Land earned P935 million in profits, a fifth higher from last year even if revenues declined by 4% to P2.71 billion.
The company attributed the gain to mall operations, office rentals, and residential projects, which managed to offset the decline in the firm’s hotel division.
Shares in the company yesterday jumped by 5.63% or P0.40 to P7.50 per share. — Kristine Jane R. Liu
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