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Feb 21, 2023

ALI FY22 net income up 52% to P18.6B

Ayala Land, Inc. (ALI) bounced back strongly in 2022 on the strength of the Philippines' reopened economy since the 2020 pandemic. Its diversified real-estate portfolio generated a net income of P18.6 billion, 52% higher, while consolidated revenues grew to P126.2 billion, 19% more year-on-year.

With resilient demand amidst a higher interest-rate environment, the company registered P104.9 billion in reservation sales, 14% better than the previous year. Fourth-quarter sales totaled P27.6 billion, 24% more year-on-year. Sales from local Filipinos comprised 66% of the total, complemented by overseas Filipinos and other nationalities, with a 22% and 13% share, respectively. Sales from overseas Filipinos and other nationalities surged by 59% and 39%, respectively. The projects that received the most demand were Ayalaland Premier’s Ciela at Aera Heights in Carmona, Cavite, Avida’s Serin East Tower 4 in Tagaytay City, and Patio Madrigal in Pasay City, Amaia’s Skies Cubao Tower 3 in Quezon City, and Alveo’s Astela Towers in Circuit Makati. ALI launched ten residential developments worth P31.8 billion in the fourth quarter, bringing the consolidated value to P91.4 billion totaling 30 projects by yearend.

Property development revenues reached P81.2 billion, a 7% growth from 2021. Commercial lot sales led the segment’s advance as revenues surged by 75% to P14.5 billion on investor demand at Arca South, Nuvali, and Broadfield estates. The steady construction progress of residential projects resulted in revenues of P63.5 billion, a slight dip from the previous year due to stretched downpayments. Meanwhile, office-for-sale revenues declined by 16% to P3.2 billion due to the completion of Alveo’s Park Triangle Tower at BGC and the moderate take-up on remaining limited inventory.

In commercial leasing, revenues accelerated by 62% year-on-year to P33.4 billion with normalized mall rents and foot traffic, the contribution of new office spaces, and higher hotel room rates. With the resurgence in foot traffic and mobility, shopping centers and hotel revenues doubled to P16.1 billion and P6.2 billion, respectively. Revenues from office leasing grew by 13% to P11.1 billion with the added contribution from One Ayala East and West Towers.

“We are encouraged by our solid performance in 2022, driven by the full reopening of the Philippine economy and the support of our customers. All major business lines achieved meaningful recovery, a testament to our employees’ hard work and dedication,” said ALI President and CEO Bernard Vincent O. Dy. “Despite ongoing challenges in the operating environment, we remain positive in our outlook for 2023, and look forward to introducing new offerings that will meet the evolving needs of the market. Our focus on customer satisfaction, operational excellence, and innovation will continue to guide our efforts as we pursue sustained growth,” he added.

ALI launched two new estates in 2022: Areza at Lipa City, Batangas, and Crossroads at Plaridel, Bulacan. Areza, a 92-hectare development, is ALI’s first master-planned, mixed-use estate in Batangas. It will have a mix of residential and commercial uses and complementary facilities such as a food terminal, a public market, and retail areas. The estate’s first locator is the new Lipa City Hall which broke ground in July 2022. Meanwhile, Crossroads is an 83-hectare integrated mixed-use master-planned estate with residential and commercial components in the rising enterprise zone on the eastern side of Bulacan.

The company also made significant progress in its community development and environmental sustainability initiatives. Its Alagang AyalaLand program has aided over 1,000 social enterprises and benefitted 9,700 families by providing rent-free spaces in its malls to offer ecological and socially sustainable products.

Ayala Land’s commercial properties have neutralized their scopes 1 and 2 emissions with approximately 90% of its mall and office gross leasable area using renewable energy. By shifting to renewables, the company reduced its emissions by more than 150,000 tons of CO2 in 2022. The company has replanted more than 216,000 native trees and revegetated 445 hectares through assisted natural regeneration of its 586-hectare carbon forest since the program started in 2017. An estimated 95,000 tons of CO2 equivalent are stored within these carbon forests. On top of this, its malls in Metro Manila segregate, measure, and collect clean and dry plastics. About 232 tonnes of clean and dry plastics have been collected from its malls, offices, and estates since 2019. These were used as part of MDC’s ready-mix concrete and eco products for sidewalks, perimeter fences, and plastic pallets for AyalaLand Logistics Holdings Corp.

Ayala Land is the first Philippine real estate company to complete a scope 1,2 and 3 emissions inventory. The company has a leadership A- rating on climate change and has the highest rating of B- on water security management for a Philippine company from the CDP (Carbon Disclosure Project). Ayala Land ranked in the top three in the Philippines and the top 20 in the ASEAN based on the 2021 ASEAN Corporate Governance Scorecard.

Capital expenditures reached P72.4 billion, wherein 50% was spent on residential projects, 19% on land acquisition, 16% on estate development, 11% on commercial projects, and 4% for other purposes. ALI has a well-managed debt portfolio, with 97% contracted into long-term tenors, 90% locked in fixed rates and an average maturity of 5.3 years. The net gearing ratio stands at 0.76:1, ensuring that the company maintains the highest investment-grade rating in the domestic debt market.

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