Ayala Land plans P6B in debt
By Elizabeth Sanchez-Lacson
Philippine Daily Inquirer
First Posted 03:12:00 07/25/2008
MANILA, Philippines—Property giant Ayala Land Inc. (ALI) plans to borrow at least P6 billion this year to refinance debt acquired at higher interest rates and fund an aggressive expansion ahead of expected increases in borrowing costs, company president Jaime Ayala said.
Following the launch of the new name for ALI’s middle-income housing arm — Alveo Land Corp., formerly Community Innovations Inc. — Ayala (relation to the Zobel de Ayala family that controls the company) said ALI was closely watching the debt market after the central bank raised its key interest rates by half a percentage point late last week.
“We actually foresaw this and locked in quite a bit of new debt. Our debt rates have come down significantly from two to three years ago,” Ayala said.
ALI chief financial officer Jaime Ysmael said the company had shifted toward fixed-rate debt.
“In terms of ratio, it was 70 to 30 in favor of variable rates,” Ysmael told the Philippine Daily Inquirer. “Now it’s the reverse. In terms of tenor, our average was 3.4 years as of end-2007, from two years in the past.”
Ayala said he expected ALI’s net income to grow 42 percent year-on-year in the second quarter, similar to the growth posted in the first quarter.
“The trajectory we showed in the first quarter will continue,” he said. “The second half will remain strong.”
Alveo president Dante Abando said ALI’s middle-income housing arm booked sales of P2.9 billion in the first half, up 58 percent from the same period last year, compared with the industry’s 17-percent growth.
Alveo has recorded P15 billion in sales in the six years since its inception, he said. Edited by INQUIRER.net
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