Category: News

In a disclosure made today to the Securities and Exchange Commission, Philippine Stock Exchange, and Philippine Dealing and Exchange Corporation, Ayala Corporation said that GNPower Kauswagan Ltd. Co., a limited partnership owned by AC Energy Holdings, Inc., a fully-owned subsidiary of Ayala Corporation, the Philippine Investment Alliance for Infrastructure (PINAI) Fund, and Power Partners Ltd. Co., has signed definitive documentation for the financing to commence the phased construction of a 4 x 135MW coal-fired power plant in Kauswagan, Lanao del Norte.

The total project cost will be funded by both debt and equity. The debt will be financed by a syndicate of domestic banks with additional debt from international banks.

The plant will help alleviate the tight power supply situation in Mindanao. Construction of the plant is scheduled to start in early 2015.

A copy of the disclosure signed by Ayala’s group head for corporate strategy and development Paolo F. Borromeo may be found on the PSE Edge Portal.

The first toll road project bid out under the Aquino administration’s public private partnership program is set to open within the first quarter of 2015.

Formerly known as the Daang Hari-SLEX Connector Road, the Muntinlupa Cavite Expressway or MCX, is scheduled to complete construction in the next 3-4 months. The road will connect Muntinlupa City to Cavite via Bacoor.

Construction went on high gear in February 2014 when access to the interchange was obtained. As of November, construction is estimated to be over 60% complete and is expected to ramp up to 80% by year-end.

Ayala invested around P2.2 billion in the project and will operate and maintain the road for 30 years.

The toll rate for the 4-kilometer, four lane road is set at P17 for Class 1 vehicles and P34 for Class 2 vehicles. MCX is expected to relieve traffic congestion along the Daang Hari Road and Commerce Avenue and give commuters from Molino and Bacoor Cavite faster and easier access to the South Luzon Expressway.

Ayala Corporation’s consolidated net income during the first 9 months of the year expanded by 35% to a total of P14.1 billion. Robust growth from core businesses, particularly Ayala Land, Globe Telecom and Manila Water, contributed to the expansion in consolidated net income. The healthy performance across these business units helped counterbalance lower equity earnings from the Bank of the Philippine Islands (BPI), which had generated sizeable gains from securities trading during the prior year. International businesses also helped improve earnings, given the gain from the divestment of Stream Global Services, Inc. and substantial growth in income from Integrated Microelectronics, Inc. (IMI). Total equity earnings for the first 9 months amounted to P18.8 billion, representing a 35% increase from the same period last year. Without the impact of accelerated depreciation from its telecom unit’s network transformation initiative during the previous year, Ayala’s core net income grew 15%.

Ayala Corporation President and Chief Operating Officer Fernando Zobel de Ayala stated that “The strong economic environment has allowed our operating subsidiaries to show significant growth, particularly in the real estate, telecommunications, manufacturing and water services sectors.”

Real estate unit, Ayala Land, expanded net income by 25%

Ayala Land continued to expand, with net income increasing by 25% to reach P10.8 billion. Revenues were up by 20%, due to robust performance across all business segments.

Healthy growth of the property development, commercial leasing and services businesses helped raise real estate revenues by 21% to approximately P66.6 billion. Residential revenues grew by 40% to P40 billion, primarily due to increased bookings and construction progress for ongoing projects. Residential sales take-up and bookings remain solid, with increases of 18% and 15%, respectively. Gross construction services also expanded at a healthy pace of 25% to close to P20 billion.

Growth in commercial leasing of 17% was achieved due to the contribution of new shopping centers and offices, and improved occupancy of all hotels and resorts. Shopping center revenues rose 9% to P8.3 billion, office revenues grew by 19% to P3.1 billion and hotels and resorts were up by 37% to P4 billion.

Margins improved across most product lines, contributing to a wider overall EBIT margin of 31% from 29% a year ago. Capital expenditures for project completion and land acquisition amounted to P59 billion, which is in line with target.

Globe Telecom performed robustly across key services and increased revenues by 8%

Globe Telecom grew across all key services for the first nine months of 2014, generating increased gross service revenues of P72.7 billion and representing a rise of 8% from the prior year. Mobile revenues of P57.6 billion, which rose by 6% on the strength of both postpaid and prepaid subscriber growth, remain strong with Globe’s mobile subscriber base now totalling 42.9 million. Revenues from postpaid subscribers went up by 11% while growth for prepaid subscribers was 4%.

For the third quarter of 2014, mobile data revenues also expanded by 30% to P4 billion. In spite of the continued expansion in mobile data revenues, core services have remained resilient. Voice revenues rose by 5% to P8.5 billion whereas SMS revenues also grew by 3% to P7.3 billion.

Broadband and fixed line data services have also sustained their advancement over the first 9 months of 2014, with both businesses increasing revenues by 16% to P9 billion and P4 billion, respectively. Likewise, total EBITDA improved by 5% year-on-year to P29.8 billion, with strong revenue growth offsetting the increase in subsidies and operating expenses, and 3Q14 EBITDA margin widening to 43%. Core NIAT was also up by 22% compared to the previous year to P11.6 billion due to higher EBITDA, lower overall depreciation and non-operating expenses, which offset higher provisions for income taxes.

Manila Water reported solid results, with revenues and income higher by 6%

Manila Water continued to perform well, with consolidated revenues increasing by 6% to P12.2 billion as a result of steady expansion in the East Zone and escalating contribution from subsidiaries. A 4% increase in billed volume boosted East Zone revenues, with the growth of residential customers from the expansion areas of Marikina, Pasig and Rizal, as well as increased business from commercial and industrial customers as key drivers.

Outside of the East Zone, the ramp up of Kenh Dong Water in Vietnam, Laguna Water and growth in domestic concessions also contributed to the growth in billed volume. As a result, earnings contribution from new businesses account for 12% of total net income.

Overall, while consolidated cost of services and operating expenses rose by 15% to P3.8 billion due to higher direct costs and overhead costs, EBITDA improved by 3% from last year to P8.8 billion and yielded a 72% EBITDA margin. Net income also grew by 6% to P4.5 billion.

Banking arm, BPI, generated P12.8B in net income and 15% growth in net interest income

Continued outperformance by Ayala’s core businesses helped compensate for BPI’s results. BPI reported net income of P12.8 billion or a decline of 19% from net income during the same period last year, which included significant gains from securities trading. Net interest income grew 15% to P25.7 billion due to the bank’s strong loan growth and improving deposit mix. Net loans climbed 28% to P702 billion versus the previous year, whereas deposits increased 17% to reach more than P1 trillion. Non-interest income was P14.8 billion, which is 17% lower than that of the previous year largely due to reduction in income related to securities and foreign exchange trading. However, excluding securities and foreign exchange trading, non-interest income was up by 7% to P12.7 billion.

Because of the bank’s continued investment in technology and headcount expansion, operating expenses increased by 13%. Cost to income ratio as of 2014 Q3 stands at 53%. Asset quality and capitalization ratios remain robust with a 90-day NPL ratio of 1.8%, Basel III Capital Adequacy Ratio (CAR) of 15.7% and CET 1 ratio of 14.9%.

International and new businesses continue to ramp up

According to Mr. Zobel de Ayala, “Aside from our core businesses, our international and new businesses are gaining momentum. Our international businesses contributed positively to earnings this year, while our investments in the power and transport infrastructure sectors will contribute significantly to group earnings in the next few years.”

IMI maintained its positive trajectory with revenues increasing by 19% to P28.8 billion for the first 9 months of 2014 and corresponding net income surging four-fold to P930 million. Strong demand in telecommunications infrastructure, automotive electronics and storage devices contributed to IMI’s robust performance. Group-wide margins also increased by 270 basis points to 11.2% as a result of operational savings, direct material procurement and continued shift to high value products. In BPO, the P1.8 billion net gain from the divestment of Stream Global Services, Inc. booked earlier during the year contributed to the improvement in LiveIt’s earnings.

Ayala’s energy unit, AC Energy Holdings, Inc., is moving towards completion of projects. The first phase of its 2x135MW project under its joint venture company with the Phinma group, South Luzon Thermal Energy Corp., is expected to start operations in the first quarter of 2015. It has also recently finished its wind projects in Ilocos. The 19-MW expansion of its wind farm in Bangui, Ilocos Norte, was concluded last October 10 and has been delivering power to the grid. It also completed its 81MW wind farm in Pagudpud, Ilocos Norte last November 11 and has likewise begun operations.

In transport infrastructure, the company, through its wholly-owned subsidiary, AC Infrastructure Holdings, Inc., together with the Metro Pacific Group, recently signed the Concession Agreement for the 35-year LRT Line 1 concession. The consortium expects to complete certain requirements prior to taking over the existing rail line some time the second half of 2015. Ayala also expects to operate by the first quarter of 2015 its first PPP project, the Daang Hari-South Luzon Expressway Link Road Project, a 4-kilometer toll road linking the Daang Hari road to the South Luzon Expressway. To date, Ayala Corporation has committed over US$ 600 million in equity in both power and transport infrastructure projects.

As of the end of the period, Ayala has P74 billion in consolidated cash with a parent company net debt to equity ratio of 0.44 to 1. On November 5, 2014, the company issued 27 million Preferred Class “B” Series 2 shares amounting to P13.5 billion with an over subscription of P3.5 billion from the base offer. Proceeds of the issue will be utilized to refinance certain peso denominated debt obligations of the parent company.
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Ayala Corporation’s fully owned energy unit, AC Energy Holdings, Inc. (AC Energy) announced that it recently completed several power generation projects which, combined, add a total of 235 megawatts (MW) to the Luzon grid. These projects utilize both renewable and conventional power sources.

AC Energy, under its investee company, Northwind Power Development Corp., completed its 19-MW wind expansion project in Bangui, Ilocos Norte last October 10, 2014. It has since been operational and has been successfully delivering power to the grid. This expansion increases Northwind’s capacity to a total of 52MW. Following the completion of this expansion phase, the Department of Energy issued a Certificate of Endorsement for Feed-in-Tariff for Northwind’s 19-MW expansion.

Barely a month after, the Ayala-led power unit, through its affiliate North Luzon Renewable Energy Corp. (NLREC), completed another 81-MW wind farm in Pagudpud, Ilocos Norte last November 11, 2014. This wind project, which consists of 27 turbines supplied by German manufacturer Siemens, has likewise since been operational. The project is awaiting the issuance of a Certificate of Endorsement for Feed-in-Tariff from the Department of Energy. Combined, Northwind and NLREC put Ayala’s total wind power capacity at 133MW.

In addition to its wind projects, the company, in partnership with Trans-Asia Oil and Development Corp., is also reaching the final stages of completion of the first of two 135-MW CFB Coal-fired power plant units in Calaca, Batangas. The company expects to begin commercial operations of the plant by the first quarter of 2015. The second 135-MW unit is likewise planned for completion and operation by the end of 2015.

AC Energy President & CEO, Mr. Eric Francia said, “We believe the completion and operation of our two wind projects as well as the completion of our project in Calaca come very timely as these will significantly help meet the country’s immediate demand for power.” Mr. Francia added, “Ayala has always recognized the need to build both base load power and develop renewable energy sources. We continue to work on a pipeline of power projects to meet our goal of assembling around 1,000 MW in generating capacity over the next few years.”

Over the past three years Ayala has invested approximately US$500 million in equity in developing various power generating projects.

Ayala Corporation, one of the oldest and largest business groups in the Philippines, was awarded the 19th Annual IMD-Lombard Odier Global Family Business Award at the 25th Summit of the Family Business Network International (FBN-I) held October 16 in Dubai.

Given by IMD, a top-ranked global business school based in Switzerland, and Lombard Odier, one of the most respected private banks in Europe, this prize is regarded as the most prestigious recognition for successful family businesses. It recognizes the way in which multi generational families separately manage the interests of their families and businesses, combining tradition and innovation while demonstrating a clear commitment to the social and civic responsibilities of their community.

“The Ayala story is close to two centuries old, and is both fascinating and impressive,” said IMD president Dominique Turpin. “Over seven generations, this company has provided numerous lessons for other family businesses to learn from, in particular the importance of long-term vision, a broader social awareness and an ability to adapt. I warmly congratulate Ayala on winning this year’s award.”

Said Thierry Lombard, FBN-I chairman and managing partner of the Lombard Odier Group, also a seventh-generation family firm: “This award highlights the vital contribution that family businesses like Ayala make to the global economy. We want to recognize an outstanding company operating according to the very best practices and offering inspiration to its peers. Ayala’s exceptional standards show just what family businesses are capable of.”

Established in 1834 by two enterprising individuals and built by seven generations of its founding families, Ayala is a widely diversified and publicly listed conglomerate. It has leadership positions in a broad range of sectors: property development (Ayala Land), financial services (Bank of the Philippine Islands), telecommunications (Globe Telecom), electronics manufacturing services (Integrated Micro-Electronics, Inc.), water infrastructure (Manila Water), automotive distribution (Ayala Automotive) and business process outsourcing (LiveIt Investments). It also has new investments in traditional and renewable sources of power (AC Energy Holdings), transportation infrastructure (AC Infrastructure Holdings), and the for-profit education sector.

Fernando Zobel de Ayala, together with several sisters and their spouses were present in Dubai to receive the award. In a joint statement on behalf of the family, Jaime Augusto and Fernando Zobel de Ayala thanked the organizers, “We are absolutely delighted and honored to be the recipients of the IMD-Lombard Odier Global Family Business Award for 2014. As we celebrate our 180th anniversary this year, we share this award with the many generations of exceptional executives, board members, and family members that have led the company over the years.”

Previous winners include world-class companies such as LEGO, S.C. Johnson, Hermès, Barilla, Yazaki Corporation, Merck, Odebrecht, Firmenich and Bel Group.

IDEA’YALA, an inspiring new competition created by Ayala Malls and co-founded by Paloma U. Zobel, is inviting young individuals in the Philippines to develop design concepts that will define the “mall of the future”—one that is sustainable, market inclusive, and with the potential to address social and environmental concerns.

The competition, launched September 9 at the Glorietta Activity Center, invites the youth to imagine innovative mall experiences that challenge established business or market assumptions, and turn them into viable entrepreneurial and design solutions. These could be in the form of mall enhancements such as new concepts for retail, dining, and entertainment, or ideas for sustainable mall development that Ayala Malls can then implement.

Paloma U. Zobel, who graduated from Parsons School of Design and worked in product development at Estee Lauder and Tom Ford, is one of the ideators and mentors, as are Ayala Corporation corporate strategy associates Mariana Zobel and Jaime Urquijo Zobel, TBWA|SantiagoMangada Puno’s Chief Creative Officer Melvin Mangada, and Manila Music Festival co-founder Katrina Razon.

Youth innovators who will share their experiences at IDEA’YALA workshops are Robi Domingo, Gretchen Ho, Dan Matutina, Tal de Guzman, Ann Enriquez, and Louie Poco.

The panel of judges will be led by Ayala Corporation chairman emeritus Jaime Zobel de Ayala as well as Ayala Land executives Junie Jalandoni and Rowena Tomeldan.

For more information, visit http://ideayala.ayalamalls.com.ph.

Ayala Corporation and the University of the Philippines School of Economics (UPSE) held the second of a series of quarterly economic forums on August 29 with Citigroup Managing Director Dr. Johanna Dee Chua delivering a lecture on challenges to the Philippine financial sector.

Entitled “The Philippines: Will Financial Stability Be At Risk?,” Dee Chua’s keynote address focused on the evolving role of central banks and the prospects of local and regional banking sectors. The Hong Kong-based economist also expressed confidence that the Philippine economy would continue growing over the medium term.

Monetary Board Member Dr. Felipe M. Medalla and Antonio C. Moncupa, Jr., President and CEO of EastWest Bank, served as discussants.

For his part, Medalla said he expects the Philippine economy to expand from between five to six percent annually unless more reforms are introduced and institutionalized, which would result in even higher growth.

UPSE Dean Ramon L. Clarete and Ayala Corporation Chairman and CEO Jaime Augusto Zobel de Ayala were in attendance together with ranking executives from Ayala group companies and university students. Also present were former Finance Secretary Margarito B. Teves and National Scientist Dr. Raul V. Fabella.

The Ayala-UPSE Economic Forum seeks to educate the public and inform policy makers of research findings on the Philippine economy. In November last year, Ayala and UPSE – through their respective non-profit organizations, Ayala Foundation and UPecon Foundation – renewed their commitment to conduct the quarterly economic forums until 2016. This builds on an earlier partnership from 2008 to 2011 that resulted in 12 public lectures conducted by UPSE professors on poverty, growth and development, food security, labor, education, international monetary system, housing, and politics and institutions.

On its 180th year, Ayala continues to partner with academic institutions to further issue-based discourse and share with the public relevant information on the potentials of the Philippine economy.

Ayala Corporation was named among the top Philippine firms by Alpha Southeast Asia in its 4th Annual Institutional Investor Corporate Awards ceremony held on August 30 at Shangri-la Makati.

The Hong Kong-based publication catering to global investors cited Ayala as having the strongest adherence to Corporate Governance, best Strategic Corporate Social Responsibility, and best Annual Report. The awards are based on tallied votes among 477 investors, pension funds, hedge funds, equity and fixed income brokers and analysts with investment interests in the Southeast Asian region. In 2012, Ayala was also recognized by the magazine for the same accomplishments.

Ayala General Counsel Solomon M. Hermosura accepted the award from Siddiq Bazarwala, Alpha’s publisher.

Other Ayala group companies cited were Globe for its consistent dividend policy, BPI Family Savings Bank, and BPI Capital Corporation.

Ayala Corporation chairman and CEO Jaime Augusto Zobel de Ayala received the 2014 Ramon V. del Rosario, Sr. (RVR) Award for Nation Building conferred by the Junior Chamber International (JCI) Manila and the Asian Institute of Management (AIM) RVR Center for Social Responsibility.

The award, named for JCI Manila’s founding president and founding trustee of AIM, is given to individuals who exemplify outstanding corporate citizenship and commitment to nation building. Previous recipients are Senen Bacani, founder of the first large-scale banana plantation in Muslim Mindanao, Jesus Tambunting, founder of SME-focused Plantersbank, Lopez group chairman Oscar Lopez, SGV founder and philanthropist Washington Z. Sycip, and former Senator and Trade Minister Vicente T. Paterno.

Phinma president Ramon del Rosario, Jr. noted Mr. Zobel’s stewardship of the Ayala group into new areas of infrastructure, education, and energy as well as his personal involvement in numerous social causes such as in entrepreneurship, education, and the environment. He said: “By and large, he is a well-rounded man who has the interest of the nation at heart and this is reflected in the way he runs his enterprises. He is very young and a great example for the younger generation.”

Del Rosario was not part of the panel of judges for this year’s RVR Award, but he is a member of Ayala’s board of directors. “This has given me good opportunity to watch them closely,” he said. “They run their businesses with the highest levels of ethics and good governance. They always rank among the top as a company and as a group.”

For 180 years, Ayala’s investments have spurred the growth of Philippine industries as well as local and national economy. Commitment to nation building remains a core value of the company. Its subsidiaries continue to innovate in products and services to serve broader markets and create shared value with its publics. BPI and Globe created a mobile phone-based bank to deliver financial services to more Filipinos. Ayala Land’s property developments spur economic activity in communities and create local jobs and businesses. Manila Water’s Tubig Para Sa Barangay and Kabuhayan Para Sa Barangay programs are designed to enable and empower urban poor clusters.

Recent investments in power generation and bids in toll roads and light rail transit seek to provide much needed infrastructure. A new foray in the for-profit education sector offers affordable private school education as a way to help build the competitiveness of the country’s future workforce.

Mr. Zobel was honored at a program held August 18 at the Philamlife Tower Club. The event was attended by about 180 members of the academe and private sector, including the management and boards of the Ayala group.

Said Mr. Zobel: “The country would benefit if we, all of us in the private sector, worked hard at allocating resources to providing innovative solutions to the key challenges to inclusive growth in our communities, and compliment our local and national governments in these efforts.

“We, as businesses, need to collaborate and work across sectors to define where we can carve out unique strengths and capabilities that will allow us to thrive in an increasingly interconnected and interdependent world. All of this becomes next to impossible without an educated, progressive society that can work efficiently, live comfortably in safety and peace, and create wealth across all spectrums of our country to keep the cycle of progress alive.”

View the image gallery here.

Ayala Corporation’s net income in the first half of the year reached P9.8 billion, 34% higher than same period last year. The strong growth was driven by the solid performance of its core businesses, particularly Ayala Land, Globe Telecom, and Manila Water. Equity earnings from Globe, which quadrupled year-on-year, more than offset the decline in the contribution of banking unit, Bank of the Philippine Islands (BPI), which registered lower trading gains in the first half of this year. The substantial improvement in equity earnings from international businesses also boosted earnings in the first semester, which included a P1.8 billion net gain from the sale of Stream Global Services, Inc. by LiveIt. Altogether, these put total equity earnings in the first half of the year at P12.8 billion, up 35% versus the same period last year.

Ayala’s core business units largely outperformed first half last year’s earnings.

Ayala Land’s net income in the first semester grew by 25% to P7.1 billion as the positive momentum in the real estate sector continued. Real estate revenues grew by 24% to nearly P43 billion as its residential, commercial leasing, and construction businesses posted strong double-digit growth. Residential revenues grew by 40% to P24.3 billion on new bookings and completion of existing residential projects. Residential sales take-up remained strong, hitting an all-time high of P48.5 billion in the second quarter, registering an 11% growth year-on-year. Residential bookings also grew by 7% year-on-year to P31.6 billion. Shopping center revenues rose by 10% to P5.5 billion, while Office Leasing was up 31% to P2.1 billion. The opening of new gross leasable areas, full year operations of new offices, and higher average rent largely fuelled the 22% growth of its Commercial Leasing business. Ayala Land’s growing Hotels and Resorts portfolio also contributed as it registered a 48% increase in revenues. Strong revenues coupled with stable gross margins across nearly all its business lines pushed net earnings during the period. Ayala Land continued to launch new projects in the second quarter, bringing to market new offerings in retail, offices, hotels and even healthcare. The company spent a total of P32.9 billion in capex as of the end of the first half of this year as it continued to execute and expand its pipeline of projects.

Globe Telecom continued to sustain momentum as it achieved record-level revenues of P47.7 billion in the first half of the year, 7% higher than the P44.5 billion recorded in the same period last year. The robust revenue expansion was fuelled by the solid growth of all business segments as its mobile and broadband subscriber base expanded. By the end of the first half of the year Globe’s mobile subscriber base reached 42.7 million, a solid 18% growth compared to 36.1 million a year ago. Globe’s mobile segment posted revenues of P37.8 billion, 5% higher than last year due to the strong contribution from both postpaid and prepaid segments. Globe postpaid continued to lead as revenues rose by 11%, while prepaid revenues rose by 2%. Globe continued to reinvest its gains in acquiring and retaining high quality subscribers and in the expansion of its data network. This pushed subsidy and operating expenses, including interconnection charges 12% higher year-on-year, resulting in an EBITDA of P19.1 billion, 1% higher than prior year. Substantially lower depreciation charges, as the accelerated depreciation from the network transformation program tapered, as well as lower replacement cost drove the 385% growth in net income to P6.8 billion in the first half of the year.
Ayala’s water unit, Manila Water, also reported solid earnings growth on the back of a 6% growth in consolidated revenues. The strong top-line expansion was driven by a 16% growth in consolidated billed volume. This was mainly due to the East zone, which increased by 3%, while billed volume growth from new business also registered strong double-digit growth. Consolidated cost and expenses rose by 11%, mainly as a result of higher power and utility costs. Notwithstanding this, EBITDA grew by 5% to P6 billion and consequently, net income was 8% higher to P3.2 billion by the end of the first half. New businesses continued to contribute, accounting for 12% of Manila Water’s consolidated net income.

The strong performance of these core businesses offset the 33% decline in BPI’s net income which was reported at P8 billion in the first half of 2014. This was mainly due to the 32% decline in the bank’s non-interest income as a result of the sharp contraction in trading gains during the period. The bank’s core banking business, however, remained solid as net interest income in the first half increased by 15% relative to the same period in 2013. Total deposits exceeded P1 trillion for the first time, representing a 30% increase over the prior year. Loan growth remained robust, registering a 23% expansion during the period due to a larger average asset base. Net interest margins also improved quarter-on-quarter to 3.1% in the second quarter of the year versus 3.0% in the first quarter. Non-interest income expectedly declined to P9.2 billion, reflecting its reduced reliance on securities trading. Operating expenses rose by 10% as the bank continued to invest in its infrastructure and as it positions itself for future growth. Notwithstanding the increase in its loan portfolio, asset quality continued to improve with gross 90-day NPL ratio down to 1.85% from 2.05% a year ago. The bank’s performance as of the first half of the year translates to a return-on-equity of 12.9%.

Ayala’s international businesses saw significant improvement, contributing to the strong gains during the period. Integrated Microelectronics, Inc. (IMI) posted a five-fold improvement in net income in the first half of the year to US$11.3 million as consolidated revenues rose by 23% to US$431 million. Increased demand from customers in the telecom, automotive electronics, and storage device markets helped lift revenues and earnings. In the meantime, its business process outsourcing unit, LiveIt, posted a net income in the first half of 2014 largely due to the P1.8 billion net gain from the divestment of Stream Global Services, Inc. which was booked in the first quarter of this year.

Ayala Corporation President & Chief Operating Officer, Mr. Fernando Zobel de Ayala noted, “We are very pleased to see our core businesses continuing their strong earnings momentum. This attests to the strength of the broader business environment in the country. We remain optimistic that this momentum can continue given the government’s ongoing reforms and the efforts to push for vital infrastructure projects that can unleash development opportunities and address critical bottlenecks.”

Ayala has recently made significant investments in the power and transport infrastructure sectors and has allotted P24 billion in capex for projects in this space this year. It recently won the LRT 1 bid, together with the Metro Pacific group, and was the highest complying bidder, together with the Aboitiz group, for the Cavite-Laguna Expressway project. Since 2012, the company set out to invest a total of US$1 billion in energy and infrastructure projects through 2016. It has so far committed equity of close to US$500 million in various power and transport infrastructure projects. As of the end of the period Ayala had roughly P38 billion in cash with parent company net debt to equity ratio of 0.44 to 1.

The above press statement pertains to the disclosure submitted today to the SEC, PSE, and PDEx by Ayala Chief Finance Officer Delfin Gonzalez, Jr.