November 21, 2019 | 12:05 am [ bworldonline.com ]
By Denise A. Valdez, Reporter
AYALA LAND, Inc. (ALI) is looking to allocate over P100 billion for capital expenditures (capex) in 2020, of which about P15-20 billion will be financed through local debt.
In a media briefing in Makati City yesterday, ALI Chief Finance Officer Augusto Cesar D. Bengzon discussed the company’s borrowing plans for next year, saying ALI is looking at reaching a similar level of borrowing this year.
“Probably in between P15-20 billion of debt financing. Most likely most of those will be from the debt capital markets, in a bond format,” he said.
The proceeds will finance the company’s capex, which he expects “should breach the hundred billion mark.”
But Mr. Bengzon noted the financial plan of ALI is still subject to board approval.
This year, ALI was able to raise a total of P21 billion from the bond market.
Mr. Bengzon said for next year’s borrowing plans, ALI would prefer to have longer tenors in its issuances.
The company was able to book a net income of P23.2 billion in the nine months to September, up 12% year on year, driven by the robust performance of its office segment, commercial and industrial lot sales and commercial leasing revenues.
Capital spending during the period stood at P78.2 billion, which ALI used for expansion of its residential and leasing assets.
Meanwhile, Mr. Bengzon said he is starting to look at the possibility of issuing green bonds. “I’m challenging our underwriters to come up with something appropriate. I’d like it to be peso,” he said.
A green bond, also called climate bond, is a kind of debt financing that is specific to projects that have environmental impact. The Securities and Exchange Commission previously said it is adopting the ASEAN standard for green bonds, which require such bonds to be issued for projects located in ASEAN.
Mr. Bengzon said green bonds are interesting for ALI because it is also targeting to be carbon neutral by 2022. As part of this plan, the company is shifting its leasing assets to renewable energy and adopting forests to offset carbon footprint.
“It’s a lot of things we need to sort out. I don’t want it to be a green bond just for the sake of. I want it to be a true green bond,” he said.
Meanwhile, Mr. Bengzon was named ING-FINEX CFO of the Year on Wednesday, making him the sixth CFO from the Ayala group to receive such award.
In his speech at the awarding program at New World Makati Hotel, he praised the finance teams of companies, which he said comprise the “most under appreciated, and overworked, employees.”
“They commonly toil in what is commonly called the back office, giving one the impression that they are doing chores that are best kept out from public view. I know that this is farthest from the truth… I believe that it is the Finance group that provides the backbone on which the company rests, it provides the foundation which determines whether the company will flourish for generations, or fold up at the first sign of economic stress,” Mr. Bengzon said.
Shares in ALI at the stock exchange grew 0.70 point or 1.56% to P45.70 each on Wednesday.
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