Posted on June 03, 2015 10:23:00 PM
ROBINSONS Land Corp. (RLC), the property arm of the Gokongwei family, is aiming to double net profit within the next five years anchored on the expansion of its residential, shopping mall, office and hotel businesses.
“I have announced a five-year plan to double my income from 2014 to 2019,” RLC President and Chief Operating Officer Frederick D. Go said during a forum organized by the Economic Journalists Association of the Philippines and ING Bank in Makati City yesterday.
The property developer pocketed P4.7 billion in its fiscal year ending September 2014. At end-March 2015, the real estate firm booked a consolidated net income attributable to equity holders of the parent company of P2.8 billion, up 25%.
“That’s our goal. We’re going to work hard which means every year, we’re going to have to keep building more of everything,” Mr. Go said.
“We’re expanding our malls. We’re expanding our office buildings.
We’re building more hotels. We’re also building more residential [projects]. All the core business we have, we are growing,” he said.
Mr. Go declined to provide a specific capital spending plan for the period, but indicated that bulk of expenditures will be allotted for its mall and office developments. For the current fiscal year, RLC had set aside P17 billion to beef up its property portfolio.
The company plans to open three to five malls every year until 2019, the biggest of which will be Robinsons Galleria Cebu.
“Right now, we are 80%-85% recurring. I think… it won’t change dramatically,” he said.
RLC is boosting earnings despite possible headwinds in the form of higher interest rates with the US Federal Reserve poised to hike borrowing costs later this year and a slowdown in the domestic economy.
“All businesses have challenges. You just have to find a way to work with them. It should not derail our long-term plan,” Mr. Go said.
The expansion also comes at a time when the regional malls are facing stiff competition from smaller mall formats such as community malls.
“Mall competition makes you work harder. It’s not going to be easier,” Mr. Go said, noting that most of its projects are located within mixed-use developments or areas that have “very little competition.”
RLC is part of JG Summit Holdings, Inc., which has interests in Universal Robina Corp.; JG Summit Petrochemical Corp.; CP Air Holdings Inc.; and Robinsons Bank Corp. The conglomerate also holds a stake in Philippine Long Distance Telephone Co. and Manila Electric Co.
Shares of RLC lost 0.35% or 0.1% to P28.75 apiece. -- Krista Angela M. Montealegre