MANILA – Ayala Land Inc. (ALI) on Monday reported a 41-percent decline in its net income in the first quarter of 2020, attributed to the impact of enhanced community quarantine (ECQ) measures due to the coronavirus disease 2019 (Covid-19) pandemic.
In a statement, ALI said net income reached PHP4.3 billion in the January to March period from PHP7.3 billion during the same period last year.
Its consolidated revenues also declined by 28 percent to PHP28.4 billion from PHP39.7 billion.
Revenues from property development contracted by 38 percent to PHP17.2 billion, mainly due to lower project bookings and the impact of the Taal volcano eruption in January this year on the sales of its projects in Southern Luzon. This was aggravated further by lower incremental completion as construction activities were interrupted by the ECQ.
“The severe impact of the ECQ resulting from the Covid-19 crisis and the Taal (Volcano) eruption caused a major decline in our net income. Our development business was particularly hit hard during the quarter as we saw buyers opting to defer purchases during this period. Our leasing assets were also significantly affected in the latter part of the quarter due to the ECQ. Given the continuing market uncertainty, we quickly made adjustments in our plans to ensure the long-term sustainability of the business,” ALI president and chief executive officer Bernard Vincent Dy said.
Residential revenues declined 39 percent to PHP13.8 billion while office for sale revenues dropped by 68 percent to PHP962 million. The earthquakes in Davao in the fourth quarter of 2019 also affected the sales of its projects in the province.
Nevertheless, revenues from the sale of commercial and industrial lots grew by 8 percent to PHP2.5 billion mainly from existing developments such as Arca South, Seagrove, and Laguna Technopark.
Commercial leasing revenues reached PHP8.7 billion, a slight 5-percent dip as sustained office leasing mitigated limited mall operations and the closure of resorts during the ECQ.
Shopping center revenues dropped 9 percent to PHP4.6 billion, while revenues from hotels and resorts ended 17 percent lower to PHP1.6 billion.
Office leasing revenues, meanwhile, increased by 15 percent to PHP2.5 billion through the sustained operations of business process outsourcing and headquarters buildings.
Meanwhile, ALI has waived about PHP2.6 billion worth of rent from tenants in its 32 shopping malls nationwide during the ECQ of Luzon and other key cities.
It has also earmarked PHP600 million to assist no-work-no-pay workers in its eco-system.
The company also ran an internal campaign called “ALI Pays it Forward” wherein it raised a total of PHP82.6 million through the participation of 99.9 percent of ALI Group Employees to support the three designated public hospitals as exclusive facilities to fight the disease (Philippine General Hospital, Lung Center of the Philippines and Dr. Jose N. Rodriguez Memorial Hospital), and Caritas Manila.
For Project Ugnayan, the ALI Group, together with its partners, raised a total of PHP426 million in donations.
Its wholly-owned construction company, MDC, transformed the World Trade Center into a 500-bed quarantine facility and retrofitted the Philippine Red Cross lobby into a Covid-19 testing laboratory to process 3,000 tests per day.
Likewise, in partnership with AC Health, ALI’s healthcare subsidiary, Qualimed expanded its hospital in Nuvali to create a Covid-19 dedicated facility including a triage tent, sampling room, PCR lab, doctor's office, nurse station, and personal protective equipment (PPE) changing rooms.
“We continue to provide assistance in various ways to help our country through this crisis. At the same time, we have completed plans to restart our various businesses post-ECQ. We expect the buildup to be gradual and to take some time. We are confident, however, that once the business environment normalizes, our products and services will continue to be well-positioned to benefit from the renewed growth of the Philippine economy,” Dy added. (PR)
