Ayala Land posts sharp rise in first-half earnings

The local property market showed no signs of peaking, much less weakening, as Ayala Land Inc. on Friday reported a sharp rise in its earnings for the first semester of 2015.

In a statement, the country’s second-most valuable real estate developer by market capitalization said its net income hit P8.39 billion for the first six months of the year, a 19-percent increase over the P7.05 billion recorded in the same period last year.

ALI—a publicly listed unit of the Zobel family’s Ayala Corp.—said the strong performance of its various business lines contributed to the sharp rise in its first half bottom line.

Consolidated revenues amounted to P50.61 billion, which increased by 10 percent driven by the sustained momentum of its real estate businesses composed of property development, commercial leasing and services, which increased 10 percent year-on-year to P47.43 billion.

“We are on track relative to our annual target and we plan to sustain the momentum with new launches in the coming months,” ALI president and CEO Bernard Vincent O. Dy said. “Development continues in all our estates, with products in residential, shopping centers, offices and hotels on the rise.”

Property development—which includes the sale of residential lots and units, and office spaces, as well as commercial and industrial lots—posted revenues of P31.85 billion in the first six months of 2015. This was 9 percent higher than the P29.30 billion reported in the same period in 2014.

Commercial leasing, on the other hand—which covers the operation of shopping centers, offices, and hotels and resorts— generated total revenues of P11.40 billion, 10 percent higher than the P10.36 billion recorded in the same period in 2014.

ALI’s wholly owned construction and property management units generated combined revenues of P19.90 billion, 37 percent higher than the P14.57 billion posted in the same period in 2014.

“Building large scale mixed-use developments that are strategically located in the country’s emerging growth centers will continue to be our focus,” Dy said.

ALI has so far launched P54.85 billion worth of residential projects in the first six months of 2015.

Reservation sales grew by 8 percent, reaching a total of P52.47 billion. Revenues from the residential segment reached P26.93 billion, 10 percent higher year-on-year driven by sustained bookings and project completion across all residential brands.

The company’s marquee residential brand, Ayala Land Premier, posted revenues of P10.82 billion, 16 percent higher than the P9.30 billion posted in the same period in 2014, driven by bookings from its high-value horizontal projects such as The Courtyards in Imus and Dasmariñas, Cavite and Soliento at Nuvali, Sta. Rosa, Laguna, and residential building projects such as Arbor Lanes Towers 1 and 2 at Arca South, Taguig, Park Terraces at Ayala Center, Makati City, and Park Point Residences at Cebu Business Park.

The mid-market Alveo brand contributed revenues of P6.90 billion, 22 percent higher year-on-year driven by sales from Lumira at Nuvali and higher bookings from residential building projects such as Verve Residences Towers 1 and 2, Maridien Towers 1 and 2 and Park Triangle Residences, all located in Bonifacio Global City and Kroma Tower in Makati City.

Affordable housing unit Avida posted revenues of P6.60 billion, 14 percent higher than the P5.78 billion posted in the same period in 2014 driven by higher sales from Avida Towers Vita 1, 2 and 3 at Vertis North, Quezon City, Avida Towers Verte and The Montane in Bonifacio Global City and horizontal projects such South Grove Estates in Dasmariñas, Cavite and Avida Settings Alviera in Porac, Pampanga.

Finally, socialized housing unit Amaia generated revenues of P1.77 billion, 23 percent higher than the P1.44 billion generated in the same period in 2014 due to higher sales of Amaia Steps at Nuvali, Amaia Skies in Shaw Boulevard, Mandaluyong City, Amaia Skies Cubao Tower 2 in Quezon City and Amaia Scapes General Trias in Cavite. BellaVita, meanwhile, more than tripled its revenues to P167 million from P47 million in the same period last year mainly due to solid bookings generated by its existing and new projects in Tayabas Quezon, General Trias, Cavite, and Alaminos, Laguna.

Steady sales of office spaces by Alveo and Avida in Bonifacio Global City, as well as commercial and industrial lots, especially at Arca South in Taguig, also contributed to total revenues, the company said.

Meanwhile, revenues from shopping centers reached P6.01 billion, 9 percent higher year-on-year from P5.52 billion due to the increased contributions of Fairview Terraces, which opened in 2013, as well as the higher occupancy and average rental rates of existing malls.

Revenues from office leasing reached P2.43 billion, 16 percent higher year-on-year from P2.10 billion due to the contribution of new offices and the higher occupancy and average rental rates of existing offices. Average occupancy rate increased to 92 percent compared to the 91 percent registered in the same period last year.

Revenues from hotels and resorts reached P2.96 billion, 8 percent higher year-on-year from P2.75 billion due to improved “revenue per available room” performance of ALI’s internationally-branded hotels, its own SEDA hotels, and El Nido Resorts in Palawan.

Revenues from construction reached P19.21 billion, 36 percent higher year-on-year from P14.10 billion due to the increase in projects within the Ayala Land group. Revenues from property management reached P688 million, 45 percent higher year-on-year from P474 million due to the increase in managed properties from completed projects.

The company has so far spent a total of P41.10 billion in capital expenditures for project construction and land acquisition.