PH Resorts Group Holdings Inc., the hotel and casino business unit of Davao tycoon Dennis A. Uy, continues to hold “strategic investor discussions with several parties” for partnerships in, or acquisition of, its integrated resorts while raising funds to meet its obligations.
In a disclosure to the Philippine Stock Exchange (PSE), the firm said discussions with these potential investors are ongoing while their due diligence is also ongoing and in various stages of completion.
The group has an ongoing construction project, the Emerald Bay hotel and casino in Mactan Island, Lapu-Lapu, Cebu, which will benefit from a seven-year exclusivity period in Lapu-Lapu City upon completion.
Through Donatela Hotel Panglao Corporation (DHPC), the group is also engaged in the operation of a resort in Panglao Island, Bohol which started commercial operations in 2018.
For the nine months ended Sept. 30, 2024 and 2023, the group reported a net loss of P392.9 million and P2.2 billion, respectively, primarily due to pre-development expenses, resulting in a deficit of P7.22 billion and P4.81 billion as of Sept. 30, 2024 and 2023, respectively.
“The Group’s current liabilities exceeded its current assets by P12.55 billion and P4.15 billion as at September 30, 2024 and December 31, 2023, respectively, and the Group has negative operating cash flows of P127.8 million and P41.7 million for the nine months ended September 30, 2024 and 2023, respectively,” the firm said.
It noted that “these conditions indicate that a material uncertainty exists that may cast significant doubt on the Group’s ability to continue as a going concern and, therefore, that the Group may not be able to realize its assets and discharge its liabilities in the normal course of business.”
However, it added that “management believes that considering the progress of the steps undertaken to date, these financing and capital raising plans are feasible and will generate sufficient cash flows to enable the Group to meet its obligations when they fall due and address the Group’s liquidity requirements to support its operations and the completion of its projects.”
PH Resorts said its ultimate parent, Uy’s Udenna Corporation, has continued to cover operating expenses and maintenance of the group’s properties and has demonstrated that it has the ability and willingness to support the group in its financial obligations.
The group also has ongoing discussions with Land Bank of the Philippines to further extend the principal and interest payments that are due from DHPC.
Outstanding loan balance as of Sept. 30, 2024 amounted to P975 million. Udenna provided a letter of financial support to ensure repayment to Landbank by DHPC or PH Travel.
The group also received a letter of financial support from Udenna stating that it shall extend its full and continuing support for PH Resorts with regard to the P1 billion deposit from Bloomberry Resorts Corporation “until such time that the Group is in the position to repay this amount without impairing its liquidity position.”
On May 6, 2022, PH Travel signed a term sheet with Bloomberry which planned to invest in the group’s Mactan and Clark casino projects and the Razon-led Bloomberry made a P1 billion deposit.
Bloomberry later decided not to push through with the acquisition and the parties agreed to settle the P1 billion deposit through execution of certain transactions before the end of 2024.