MANILA, Philippines - Conglomerate Ayala Corp. reported strong profit growth in the first quarter of the year, driven by its real estate, telecom and water units.
Ayala said its net income increased 22 percent to P5.5 billion in the first three months of the year. The conglomerate also got a boost from the P1.8 billion capital gain from the sale of Stream Global Services, Inc., one of its investee companies under its business process outsourcing unit.
This was enough to offset the drop in earnings contribution of Bank of the Philippine Islands (BPI). BPI reported lower profits in the first quarter due to the absence of trading gains compared to year-ago.
"We are glad to see the strong momentum continue across our core businesses as well as the improving profitability of our international businesses... We are confident this momentum will continue for the rest of the year as the fundamental drivers of domestic economy remain firmly in place. This will continue to underpin demand for our real estate products, banking, telecom and water services,” said Fernando Zobel de Ayala, President and Chief Operating Officer of Ayala.
Ayala Land posted a P3.46 billion net income in the first three months of the year, 25 percent higher than a year ago.
Globe Telecom reported its profit quadrupled to P2.9 billion in the first quarter of the year from only P686 million a year ago. This was attributed to healthy top line growth and the tapering of accelerated depreciation charges following its network modernization program.
Manila Water, concessionaire for the East Zone, said its net income also went up by 9 percent to P1.4 billion, as revenues from new business areas grew.
However, BPI's profits fell 57% to P3.6 billion, due to lack of gains from trading securities.
Meanwhile, Ayala's international businesses reported improved earnings. Integrated Microelectronics, Inc.’s (IMI) net income increased twenty times to P226 million, while LiveIt said its earnings were boosted by the sale of Stream.
This year, Ayala has allocated P49 billion in capital expenditures, mostly for its investment in BPI with its participation in the stock rights offering, on-going power projects, and the transport infrastructure projects it has won thus far.