By James A. Loyola
Ayala Corporation reported a 5 percent growth in net income to P8 billion in the first quarter of the year, lifted by its real estate, banking, and telco units and boosted by net accounting gains from the merger of its education arm with the Yuchengco group.
In a disclosure to the Philippine Stock Exchange, Ayala said its sustained earnings momentum was a result of healthy equity earnings contribution from its business units, which grew seven percent to reach P9.9 billion.
Equity earnings contributions of Globe, Ayala Land, and Bank of the Philippine Islands grew 44 percent, 15 percent, and five percent, respectively in the first quarter.
Furthermore, Ayala’s net profits during the period was boosted by net accounting gains from AC Education’s merger with iPeople, which amounted to P1 billion.
“Our first-quarter results show the advantages of a diversified portfolio. The strong performance of Ayala Land, Globe, and BPI offset the challenges from Manila Water’s water supply issues and the market conditions facing AC Industrials,” Ayala President Fernando Zobel de Ayala said.
He added that, “capital generated from the closing of the transactions in AC Education and AC Energy provide a boost for funding new investments and reducing debt at the parent level.”
Apart from the gains from the merger of its education business with iPeople, Ayala will receive gross proceeds of US$573 million from the partial sale of AC Energy’s thermal assets to Aboitiz Power following the completion of the transaction last May 2.
Ayala Land sustained its double-digit growth trajectory in the first three months of the year, with net income expanding 12 percent to P7.3 billion.
BPI recorded a net income of P6.72 billion in the first quarter, up eight percent year-on-year on strong performance of its core banking business.
Globe Telecom registered robust performance in the first quarter, with a 44 percent surge in net income from its year-ago level to P6.7 billion.
Manila Water Company recorded a net income of P1.2 billion in the first three months of the year, 27 percent lower from the previous year on higher operating expenses, which reflects the impact of the water shortage in the Manila Concession.