Philippine Rating Services Corporation (PhilRatings) has assigned its highest Issue Credit Rating of PRS Aaa to Filinvest Land Inc.’s planned bond issuance of up to P12 billion.
FLI is planning a P10 billion bond issuance, with an oversubscription option of up to P2 billion. The bonds were assigned a Stable Outlook which means the rating is likely to remain unchanged in the next 12 months.
PhilRatings also maintained the PRS Aaa Issue Credit Rating for each of the outstanding bonds of FLI, with a total amount of P35.4 billion. Each of the ratings was also assigned a stable outlook.
Obligations rated PRS Aaa are of the highest quality with minimal credit risk. The obligor’s capacity to meet its financial commitment on the obligation is extremely strong.
The assigned Issue Credit Ratings take into account FLI’s established brand name and track record, with geographically diverse real estate products and substantial land bank for future expansion.
It also considered FLI’s its sound growth strategies; its improved revenues and operating cash flow, supported by more than satisfactory liquidity and interest coverage; and the subdued economic growth.
As of June 30, 2023, FLI had a land bank of approximately 1,867 hectares of raw land, including approximately 201 hectares of land under joint venture agreements which are sufficient to sustain several years of real estate development and sales.
In 2023, FLI intends to retain its dominant position as the leader in medium-rise building (MRB) projects by launching three new projects nationwide and nine additional buildings of existing projects.
Aside from the MRBs, FLI has 12 horizontal residential projects in the pipeline.
For its leasing business, FLI intends to expand its offerings with emphasis on co-living spaces, as well as the industrial leasing business through warehouse and land lease space for logistics and e-commerce players.
In 2022, FLI registered revenues amounting to P19.9 billion, up by 12.4 percent from the previous year. Such growth was driven by the higher revenues generated from both real estate sales and rental-related services.
FLI’s reported net income, however, dropped by 18.2 percent to P3.5 billion due to the one-time tax benefit recognized as part of the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Law in 2021. Without the tax benefit, net income was up by 9.9 percent in 2022.
In the first half of 2023, revenues accelerated by 8.4 percent and its net income by 10 percent. The foregoing was supported by the continued improvement in the retail and commercial leasing business which jumped by 64 percent.