Ayala Corp. nets P4.5B in first quarter
MANILA, Philippines–Conglomerate Ayala Corp. grew its first quarter net profit by 29 percent year-on-year to P4.5 billion driven by the strong performance of its banking and property businesses.
Excluding the impact of extraordinary items, particularly Globe Telecom’s accelerated depreciation, Ayala’s three-month core profit rose by 49 percent to P5.2 billion over a year ago.
The conglomerate said the strong earnings momentum in the first quarter was driven largely by Bank of the Philippine Islands, which delivered a record net income of P8.4 billion (+43 percent year-on-year) for the quarter combined with Ayala’s increased equity stake in the bank. Property unit Ayala Land Inc. likewise posted robust earnings growth (+30 percent to P2.8 billion) during the period. BPI and ALI accounted for 88 percent of equity earnings during the quarter.
On the other hand, the network modernization of Globe Telecom resulted in higher depreciation charges during the period which brought down the telecom unit’s net income by 76 percent year-on-year to P656 million. Excluding the impact of the accelerated depreciation, Globe’s core net income rose by 13 percent to P3.1 billion.
Manila Water’s first quarter net income was steady at P1.4 billion as cost of services and operating expenses increased at a much faster rate than revenues due to water and wastewater expansion.
Meanwhile, Ayala’s international businesses saw continued growth despite the sluggish global economic conditions.
Integrated Micro-Electronics grew consolidated revenues by 9 percent year-on-year despite slower demand for electronic products in the Eurozone, the US, Japan, and China. However, net income declined to $253,000 from $854,000 a year ago due to lower capacity utilization, particularly of its facilities in China.
Ayala’s international business process outsourcing operations under LiveIt Investments reported growth and margin improvement. LiveIt’s share of revenues from its investee companies reached $93.2 million, up by 13 percent versus last year, while share of cash flow grew by 8 percent to $8.3 million mainly to higher revenues and improved profitability at Stream and Affinity Express. This resulted in a reduction in LiveIt’s net loss by $1.5 million, Ayala reported.
