Geri targets 20% growth in annual income
Screengrab from www.global-estate.ph
MANILA, Philippines–Global-Estate Resorts Inc. (Geri), led by property tycoon Andrew Tan, has built up a property inventory worth about P30 billion, out of which the tourism estate developer expects to post an annual growth in net profit and revenues of at least 20 percent.
During the company’s annual stockholders’ meeting on Thursday, Geri president Ferdinand Santos reported that the bulk of this inventory built over the last three years was from the company’s flagship project—the beachfront estate Boracay Newcoast—where eight projects had so far been launched with net sellable area of 223,124 square meters valued at P21.3 billion.
Other projects brought to the property market new inventory with value broken down as follows: Twin Lakes in Tagaytay (P3.8 billion), Sta. Barbara Heights township in Iloilo (P1.8 billion), Pahara at Southwoods (P2.8 billion) and Southwoods residential development (P250 million).
This year, reservation sales are targeted to hit P10 billion, the same level as last year, but from January to May this year, sales take-up had already amounted to P7.4 billion, Santos said.
To achieve the annual growth target of 20 percent in both top line and bottom line moving forward, Santos said Geri would launch additional components in existing integrated tourism estate, particularly Boracay Newcoast and TwinLakes.
In Boracay, Geri is set to launch phase 2 of the Belmont Luxury Hotel and phase 3 of Boracay Portico as well as Shiraz, the third condominium development at Twin Lakes’ Vineyard Residences.
Likewise part of the growth strategy is to develop the 561-hectare Southwoods City in Laguna into a fully integrated township project envisioned to be the next central business district, residential, business, commercial and leisure hub south of Metro Manila.
Geri expects to break ground for the Southwoods Mall by July and start operations by the fourth quarter of 2016, boosting its recurring income base.
The mall is envisioned to be a vast lifestyle shopping center with 68,515 square meters of leasable space.
The P30-billion property inventory cited by Santos represented the products launched by the company since 2011 when Alliance Global Group Inc. took over the landbank-rich Fil-Estate Land Inc. AGI afterward ceded control of Geri to flagship unit Megaworld Corp., which now controls 80.4 percent of the leisure estate developer.
In 2013, Geri grew its revenues by 26 percent year on year to P1.76 billion while net income went up by 29 percent to P341 million, marking the third consecutive year of growth in sales and profitability. A 20-percent growth target this year thus suggests that net income will hit at least P409.2 million on the back of at least P2.11 billion in revenues.
Asked how much of the existing P30-billion inventory had been taken up by the market to date, Geri assistant vice president Alain Sebastian said in a press briefing after the stockholders’ meeting that P1 billion was taken up in 2011, P8 billion in 2012 and P10 billion in 2013. On top of the P19-billion inventory already taken up in the last three years, the P7.4 billion in reservation sales so far this year suggested that 88 percent of the inventory had been absorbed by the market.
“There are no indications that these macroeconomic conditions will stop or slow down so I think the momentum is there,” Sebastian said.
Geri’s capital spending is expected to reach P5 billion for 2014.
This is intended to continue the development of various tourism estates, complete and expand existing subdivision developments, launch new residential projects and start the Southwood mall construction.
Included in the P30-billion inventory are new projects to be launched this year: P2.6 billion from phase 2 of Belmont, P1.6 billion from phase 3 of Boracay Portico and P490 million from Twinlakes Shiraz, Sebastian said.
Originally posted at 5:41 pm | Thursday, June 26, 2014
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