Ayala Land’s 2023 capex up by 18% to P85 billion

AYALA LAND, Inc. (ALI) has earmarked P85 billion for its 2023 capital expenditure (capex) budget, which it will mainly use to fund the development of 10 more property estates.

“We are planning to spend about P85 billion this year. That’s up from P72 billion in 2022,” ALI President and Chief Executive Officer Bernard Vincent O. Dy said in a media briefing on Tuesday. “That’s an 18% growth.”

According to Mr. Dy, 39% of the capex will be used for residential projects, 23% for land acquisition, and 16% for estate development.  The remaining funds will be used for other expenditures, including those for malls, offices, hotels and resorts.

Last year, ALI’s capex reached P72.4 billion, of which 50% was spent on its residential projects, 19% on land acquisition, 16% on estate development, 11% on commercial projects, and 4% on other business purposes.

The company launched 30 projects valued at P91.4 billion in 2022. In terms of property brands, Ayala Land Premier accounted for P39.2 billion, Alveo for P29 billion, Avida for P15.9 billion, Amaia for P6.6 billion, and BellaVita for P700 million.

“We feel very [positive] for 2023. Expect us to continue to invest in all our business strengths that we are trying to grow not only in 2023 but also beyond 2023,” Mr. Dy said.

His optimism comes after ALI recorded a 52.2% surge in its 2022 net income attributable to equity holders to P18.62 billion from P12.23 billion in 2021.

Its topline rose by 19.2% to P126.56 billion in 2022 from P106.14 billion in the previous year.

Augusto Cesar D. Bengzon, ALI chief finance officer, treasurer and chief compliance officer, said the company recorded revenues of P81.2 billion in property development, 7% higher year on year, “led by solid commercial lot sales.”

Based on the company’s 2022 revenue breakdown, sales of commercial and industrial lots were up by 74.7% to P14.53 billion from P8.32 billion a year ago.

Mr. Bengzon said the rise was due to strong investor demand in its Arca South, Nuvali, and Broadfield estates.

Meanwhile, ALI’s revenues from commercial leasing increased by 61.8% to P33.39 billion in 2022 from P20.63 billion last year.

“[This was due to] normalized mall rents and foot traffic, the contribution of new office spaces, and higher hotel room rates,” Mr. Bengzon said. “This significant improvement brought average mall footfall and tenant sales to 87% of our pre-pandemic levels.”

Last year, revenues from services reached P8.42 billion, up 32% from P6.38 billion in 2021, while real estate revenues rose 19.5% to P123.05 billion from P102.95 billion previously.

In the fourth quarter of last year, ALI recorded a net income of P5.27 billion, almost flat quarter on quarter, despite the higher commercial lot sales and commercial leasing booked for the period,

Mr. Bengzon said ALI’s fourth-quarter revenues reached P40 billion.

In the October-December period, the company booked a 24% increase in its sales to P27.6 billion from P22.1 billion a year earlier or a monthly average of P8.7 billion in sales reservations.

“Solid commercial lot sales and commercial leasing recovery boosted our revenues,” Mr. Bengzon said. — Justine Irish D. Tabile