Ayala Land keen on more bond offers to strengthen balance sheet

PROPERTY developer Ayala Land, Inc. (ALI) is eyeing more bond issuances that will maintain its balance sheet healthy to help it survive the coronavirus pandemic.

In a virtual ceremony to list its P6.25-billion bonds at the Philippine Dealing & Exchange Corp. (PDEx) on Tuesday, ALI Chief Finance Officer Augusto Cesar D. Bengzon said more bond offerings from ALI are being planned at the moment.

“A fortress-like balance sheet…, this is something that we obsess over at Ayala Land. And a robust capital structure is key to this obsession. So just a heads up to our underwriters—we have something in mind for our next listing,” Mr. Bengzon said.

He refused to provide more details to the media, opting to discuss plans with underwriters first, but he noted it is the order of ALI CEO Bernard Vincent O. Dy to “find ways to continue strengthening our balance sheet.”

The P6.25-billion fixed-rate bonds that ALI listed at PDEx on Tuesday marked the fifth tranche of its P50-billion bond program that started in 2019.

The bonds have a tenor of five years, which makes ALI the only corporation to tap the domestic capital market with a single tenor offering of five years during the quarantine.

“The overwhelming retail participation, in particular for this five-year paper, highlights the confidence of retail investors in ALI’s credit and long-term business prospects,” Mr. Bengzon said.

ALI engaged with BDO Capital & Investment Corp., BPI Capital Corp., China Bank Capital Corp., First Metro Investment Corp., and SB Capital Investment Corp. as joint lead underwriters and bookrunners for the offering.

Last June, ALI listed P10-billion bonds at PDEx, also under its P50-billion bond program, which made it the first company to do a bond listing during the lockdown.

ALI has found the local capital markets “remarkably resilient during this period of uncertainty,” Mr. Bengzon said, hence the confidence for bond issuances.

“The successful completion of this fundraising exercise contributes in no small measure towards the financial sustainability of the company… [We trust that it] will provide us with a strong foundation that will enable us to resume our growth trajectory in the near future,” Mr. Bengzon added.

In the first six months of 2020, ALI’s attributable net income dropped 70% to P4.52 billion. Its consolidated revenues were halved to P41.2 billion, linked to lower project bookings and mall closures during the lockdown.

Shares in ALI at the stock exchange shed 35 centavos or 1.17% to close at P29.45 each on Tuesday. — Denise A. Valdez

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Article and Photo originally posted by Business World last September 30, 2020 12:07am.