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ALI margins stable; on pace for 2014 target

Posted on August 11, 2014 10:40:00 PM [ BusinessWorld Online ]
AYALA LAND, Inc. (ALI) said on Monday that it expects stable margins for the rest of the year, after reporting a 25% rise in its bottom line for the first half to stay on track with its profit target.
Net profit for the first half was P7.1 billion, from P5.6 billion a year earlier, while revenue rose 26% to P46.2 billion.

“This is in accordance with our expectations, to be able to get to the 25% [growth rate]. This is an indication that the margins are fairly stable across the board,” Ayala Land President and Chief Executive Officer Bernard Vincent O. Dy told reporters at the company’s first-half briefing on Monday in Taguig City.

In a statement on Monday, the company said the result was driven by “significant contributions” from all of its business units, including property development, commercial leasing, hotels and resorts, construction and property management.

“We are expecting fairly stable margins for the rest of the year given the good economic environment,” Mr. Dy said. He noted that considering the company’s latest earnings results, it is “reasonable to expect 20% growth in the near future.”

Ayala Land’s property development business, which includes the sale of residential lots and units, office space, as well as commercial and industrial lots, booked a 28% increase in revenue to P29.3 billion.

Revenue from the residential business, on the other hand, jumped 40% to P24.3 billion, on the back of strong bookings and project completions across all its residential brands.

“Sales take-up for ALI residential products registered an all-time high of P48.5 billion which is equivalent to an average monthly sales take-up of P8.1 billion,” the statement read.

For the first six months, Ayala Land’s residential brands launched a total of 5,525 units, generating sales of P26.8 billion.

Ayala Land Premier registered a 59% rise in revenue to P9.8 billion, driven by significant bookings for its projects such as Soliento, Luscara and Elaro in the Nuvali estate south of Manila, as well as high-value condominium units such as Park Terraces and Garden Towers in Makati City, and East Gallery Place and The Suites at Bonifacio Global City.

The Alveo and Avida brands posted revenue of P5 billion and P5.8 billion, respectively, while the office division booked P827.2 million, mainly from HSS Corporate Plaza Towers and One Park Drive in Bonifacio Global City and BPI Corporate Center in Cebu.

Amaia Land, Inc., on the other hand, reported a 47% rise in revenue to P1.4 billion.

Ayala Land’s shopping centers, office and hotels and resorts operations posted a 22% increase in combined revenue to P10.4 billion.

“We are giving our commercial business a steady push with new offerings in retail, offices, hotels, and even health care… We have been consistent in the execution of our planned projects, and we are making sure that we continue to build integrated estates that will generate economic growth in more areas,” Mr. Dy said.

Ayala Land gained 35 centavos or 1.14% on Monday to P31.05. -- Daphne J. Magturo     

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