Filinvest Development Corporation, the investment arm of the Gotianun group, reported a 29 percent decline in attributable net income to P8.5 billion in 2020 from the P12 billion earned in 2019.

 In a disclosure to the Philippine Stock Exchange, the firm said consolidated net income dropped by 28 percent to P11.5 billion.  

Revenues and other income retreated by 15 percent to P72 billion from P84.3 billion as the growth posted by the banking business was offset by the contraction of the property business.

EastWest Bank, FDC’s banking and financial services subsidiary, delivered a net income contribution to the group of P6.4 billion, equivalent to 46 percent of FDC’s bottom line.

Banking was followed by the property business, composed of the real estate and hospitality segments, which delivered a combined P5.3 billion or 38 percent of total.

The power subsidiary contributed P1.9 billion in net income or 14 percent of total, while the balance of 2 percent came from other businesses.

Expenses rose on account of higher provisioning by East West Bank as a prudential measure against probable bank loan losses resulting from the economic impact caused by the COVID-19 disruptions.

“Amidst the difficult business environment in 2020, we are pleased that we were able to strike a balance in our overall performance. Some businesses took a harder hit but other businesses continued to deliver solid performances,” said FDC President Josephine Gotianun-Yap. 

She added that, “Coming from a landmark year in 2019, the COVID-19 pandemic brought an unexpected pause to our 2020 plans. Our immediate response was to work closely with the public and private sectors to mobilize resources towards the primary concern of health care, testing and community assistance to avert the crisis.”

“We then shifted our gears in our business operations and quickly adjusted and innovated to adapt to the circumstances. The results underscore our belief that the company stands on solid foundations and strong business fundamentals and that we can weather the challenges posed by this crisis,” said Gotianun-Yap.

EastWest Bank delivered a net income contribution to the group of P6.5 billion in 2020, 4 percent higher than the P6.2 billon in 2019, driven by higher trading gains and higher margins.

FDC’s real estate business composed of listed subsidiary, Filinvest Land, Inc. (FLI), and Filinvest Alabang, Inc. (FAI) contributed P6.0 billion in net income to the group in 2020, lower by 29 percent from the previous year.

This is because the residential segment was affected by lower sales take-up, completion delays and the grace period granted to the homebuyers during the strict lockdown period which delayed real estate sales recognition.

It also reported a 51 percent slowdown in sale of lots, condominium and residential units to P10.5 billion.

The power subsidiary, FDC Utilities, Inc. (FDCUI), registered a 23 percent decline in net income to P1.9 billion in 2020 from P2.5 in 2019. Revenues declined by 17 percent to P8.5 billion as volume contracted by 24 percent following lower demand from its customers especially during the second quarter.

Its hotel operation under Filinvest Hospitality Corporation (FHC) was the most affected by the pandemic in the group. Hotel operations posted a revenue decline of 63 percent to P1.2 billion in 2020 as occupancy rates dropped across the properties, leading to a net loss of P731 million.