JG Summit sets P87.5 B for capex

Published June 1, 2019, 12:00 AM

by manilabulletin_admin

By James A. Loyola

JG Summit Holdings, Inc., the flagship of the Gokongwei family, is allotting P87.5 billion for capital expenditures (capex) this year to fund the continued expansion of its various businesses.

Lance Y. Gokongwei
JG Summit President and Chief Executive Officer Lance Y. Gokongwei

In an interview, JG Summit President Lance Gokongwei said “approximately it’s about P32 billion for petrochemicals, P18 billion for Robinsons Land, P27 billion for airline, and P9 billion for the food business. The rest are quite minimal.”

Gokongwei said they are actually investing $1 billion for their petrochemicals business since “the Philippine economy continues to be quite buoyant. The demand for resins tends to grow faster than the economic growth specially in a country like ours where middle classes growing significantly.”

Because of this, Gokongwei said “we think that there is going to be, in the medium term, a significant market in the Philippines for plastics and the like.”

The firm is planning to expand its naphtha cracker plant capacity from 320,000 tons to 480,000 tons. “We are likewise expanding our propylene facilities. We are also putting in additional bimodal polyethylene, butadine, and BTX (benzene, toluene, xylene) facilities,” he said.

Gokongwei explained that, “right now, we don’t have a butadine and BTX factory. We are exporting the gas and the crude C4 to other countries. So we will be the first facilities in the Philippines to have butadine and BTX production facilities. That will help expand the value-added products in the Philippines.”

Robinsons Land is developing six residential condominium projects while continuing to expand its leasing portfolio by building more malls and office space.

On the other hand, Cebu Air continues to expand its fleet while Universal Robina Corporation is expanding several production lines for its snack food business.