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Condo developer cleared to offer up to P200M worth of debt papers

Posted on September 03, 2013 09:59:15 PM [ BusinessWorld Online ]

CITY & LAND Developers, Inc. has secured the Securities and Exchange Commission’s (SEC) approval to sell up to P200 million worth of commercial papers as it prepares for new projects, the condominium developer said in a disclosure yesterday.

  An SEC certificate of permit to offer securities for sale dated Sept. 2 -- signed by the regulator’s acting director Justina F. Callangan and attached to the disclosure -- said City & Land “securities consisting of P200 million worth of short-term commercial papers have been registered and may now be sold or offered for sale to the public, subject to full compliance with provisions of the Securities Regulation Code and its Amended Implementing Rules and Regulations, Revised Code of Corporate Governance, and other applicable laws and orders…”
Company officials were not immediately available for comment on the proceeds of the fund raising.

The issuance of debt papers comes amid plans by the firm to launch new projects to boost revenues. “With the latest acquisition of prime lots, the company plans to launch new projects in the future to increase inventory and consequently generate more sales,” the company had said in the first-half financial report it submitted to the Philippine Stock Exchange (PSE) last month.

The company said it recently acquired “prime lots” along Taft Avenue, Malate and Roxas Boulevard in Manila, as well as in Veterans Village and along Samar Avenue in Quezon City.

The company’s net income was more than halved to P64.67 million in the first semester from P149.73 million in the same six months last year on lower revenues. Revenues plunged 57.21% to P174.54 million from P407.86 million, while expenses fell 60.62% to P93.92 million from P238.52 million.

“The company’s current projects, Manila Residences Bocobo and Grand Emerald Tower (Pasig City) were already sold at 90.85% and 95.22%, respectively as of December 31, 2012, resulting in limited available units for sale which accounted for the decrease in revenues,” the company said in its first-half financial report.

“On the cost side, cost of sale and operating expenses decreased by 68.25% and 44.19% (respectively) as these move in tandem with sales,” it added.

In September last year, SEC also allowed City & Land to sell P200 million worth of short-term commercial papers to bankroll operations, according to the company’s 2012 annual report.

City & Land was incorporated on June 28, 1988 to acquire and develop land for residential, office, commercial, institutional and industrial use, according to the company’s profile on PSE’s Web site.

The company is 49.73% owned by Cityland Development Corp., another publicly listed company.

Shares of City & Land ended trading yesterday at P1.80 apiece, unchanged from Monday, while those of its parent last closed P1.05 each on Monday. -- Cliff Harvey C. Venzon        

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