Ayala Corp. Q1 net profit falls 53%, outlook cautious
Thomson Financial
First Posted 14:50:00 05/13/2008
MANILA, Philippines -- The Philippines' largest conglomerate, Ayala Corp., reported Tuesday a 53 percent drop in first-quarter net profit to P2.6 billion ($61 million) in the absence of capital gains. It expects growth to be tempered this year due to a tough operating environment.
Excluding the P3.3 billion in capital gains from the sale of shares in the first quarter of 2007, net profit was up 11 percent, it said.
"The past couple of years presented unique opportunities to realize values from investments we have made in prior years. Conditions for value realization are limited this year given a more challenging operating environment," president and chief operating officer Fernando Zobel de Ayala said in a statement.
"We believe, however, that current conditions may present opportunities for value creation and we continue to be on the lookout for value propositions that may arise from the fallout in global and domestic markets," he said.
Strong earnings from the company's property, telecommunications, water distribution, electronics and automotive units had partly offset lower earnings from its banking and business process outsourcing operations.
Ayala Corp. has controlling stakes in publicly listed companies such as Ayala Land Inc., Globe Telecom Inc., Manila Water Co. Inc. and Bank of the Philippine Islands, and the unlisted Integrated Microelectronics Inc. and Ayala Automotive. It partly owns outsourcing company eTelecare Global Solutions Inc., which is listed in Manila and New York.
Ayala Corp. chairman and chief executive Jaime Augusto Zobel de Ayala said that while the underlying fundamentals of each of the units remain solid, the company is facing near-term challenges exacerbated by the US credit crisis and rising food and commodity prices.
"We expect a more tempered growth momentum across various industries which may impact some of our key businesses," he said.
"However, we believe the strong market and financial positions achieved by each of our operating units will provide resiliency in the face of these difficult conditions," he said.
Bargain hunters chased shares in Ayala Corp., which jumped 7.0 percent to P345.00 Tuesday ahead of the release of results, helping lift Manila's main index which gained 1.6 percent.
($1 = P42.60)
|
