Ayala sets P185B capital spending for 2015

CONGLOMERATE Ayala Corp. has set aside P185 billion for capital spending this 2015 to support a massive expansion program for core real estate and telecom businesses while ramping up investments in power generation and transport infrastructure.

In a press statement on Thursday, Ayala said bulk of this year’s capital outlays had been earmarked for Ayala Land Inc., which is spending P100 billion this year to bankroll its “2020 Vision” business plan. This vision refers to ALI’s new target to grow net profits by 20 percent annually and reach P40 billion in bottom-line by 2020 from P11.7 billion in 2013.

A large portion of the conglomerate’s capital spending this year will be via telecom unit Globe Telecom Inc., which has programmed around P29 billion in capital outlays for 2015 primarily for data-related initiatives and LTE (long term evolution) 4G network infrastructure upgrades. With P8 billion from its planned capital expenditures in 2014 sliding into the first half of this year due to timing issues, Globe’s total capital spending will be about P37 billion in 2015, the statement said.

At the parent level, Ayala committed to deploy P21 billion primarily to support investment programs in power generation and transport infrastructure. The rest of the amount will fund the growth initiatives of the other business units, including Manila Water Co. Inc., Bank of the Philippine Islands and manufacturing arm Integrated Micro-Electronics Inc.

“We started an aggressive growth strategy a few years back and we continue to undertake value enhancing opportunities amidst this sustained momentum in our economy. Each of our business units are seizing investment opportunities within their individual spaces under this positive environment,” Ayala chair and chief executive officer Jaime Augusto Zobel de Ayala said.

“In particular, we continue to strengthen our positions in power and transport infrastructure — two sectors that are presenting opportunities for investments with potential to become new growth platforms for Ayala,” Zobel added.

“We have seen robust growth in our earnings in the first three quarters of 2014 and we are optimistic that our fourth quarter growth will be at an even faster pace. We remain positive about the country’s overall macroeconomic environment this year as reflected in the aggressive capital spending we have planned out,” Ayala chief finance officer Delfin Gonzalez Jr. said.