Press Releases


March 2021

Ayala posts sequential profit growth in 4Q

4Q20 vs 3Q20 Highlights 

▪ The further easing of quarantine and mobility restrictions sustained Ayala’s quarter-on-quarter  growth. 

▪ Isolating the provisions recognized by various business units during the period and a partial reversal  of Manila Water’s remeasurement loss booked in the previous year, Ayala’s core net income grew 46  percent to ₱6.8 billion in the fourth quarter from the previous quarter primarily driven by:

  • Ayala Land, which posted better performance on higher residential and leasing revenues as  operations and construction activities progressed faster with the easing of mobility  restrictions.
  • Stronger results recorded by Manila Water and AC Industrials as well as the better valuation of AC Ventures international fund investments.

“Our sequential growth in the fourth quarter reflects a recovery in consumer confidence that has started  to show in the latter part of 2020. We expect this trajectory to continue and lead to a full economic revival by 2022 as mobility further improves and as the country executes on the vaccination rollout as planned,”  Ayala President and Chief Operating Officer Fernando Zobel de Ayala said. 

“This year, the Ayala group will continue to execute on its growth strategy and has allocated ₱196 billion  in capital spending. A continued push for private sector investments would help revitalize the economy,”  Mr. Zobel added. 

▪ Meanwhile, Ayala’s reported net income increased 69 percent on a quarter-on-quarter basis to ₱5.8 billion, including the effect of the partial reversal on Manila Water’s remeasurement loss and other  provisions.  

FY20 vs FY19 Highlights 

▪ Excluding the divestment gains from education and power booked in 2019, the impact of the  reclassification of Manila Water as asset held under PFRS 5 for both Y2019 and Y2020, and significant loan loss provisions for BPI, Ayala’s core net income declined 16 percent to ₱26 billion in 2020 as the  impact of mobility restrictions weighed down on its various business units.  

  • Ayala recognized a remeasurement loss of ₱18.1 billion in December 2019 as a result of the  reclassification of its investment in Manila Water as asset held under PFRS 5, the accounting  standard for assets held for sale. In 2020, it recognized a partial reversal of the said loss  provision in accordance with the accounting standard.       

▪ Its reported net income decreased 51 percent to ₱17.1 billion. 

▪ Ayala’s businesses recorded lower net profits due to the effects of the pandemic on business  operations. 

  • Ayala Land endured the severe impact of COVID-19 to it business operations in 2020 recording  a 74 percent drop in net income to ₱8.7 billion. 
  • BPI’s net income declined 26 percent to ₱21.4 billion on the back of ₱28 billion in loan loss  provisions it booked in anticipation of an increase in NPL levels. The provision was 5x higher  than the ₱5.6 billion allocated in the same period the previous year. 
  • Globe’s net income contracted 16 percent to ₱18.6 billion driven by a moderate decline in  gross service revenues, higher depreciation expenses from its continued network investments,  and higher non-operating expenses. 
  • AC Energy recorded a net income of ₱6.2 billion, a decline from its year-ago level of ₱24.5 billion, which included gains from the partial divestment of its thermal assets. 
  • AC Industrials narrowed its net loss to ₱1.8 billion in 2020 from ₱2.4 billion the previous year  mainly due to improved results of IMI and MT Group as well as lower parent impairment  provisions. 

Real Estate 

▪ Ayala Land endured the severe impact of COVID-19 to it business operations in 2020 recording a 43  percent decline in revenues to ₱96.3 billion and a 74 percent drop in net income to ₱8.7 billion. 

▪ Property development revenues were down 43 percent to ₱66.5 billion mainly due to limited construction activity resulting in lower bookings.  

  • Residential revenues dropped 40 percent to ₱56.1 billion.
  • Office for sale revenues declined 71 percent to ₱3.8 billion.
  • Commercial and industrial lots sales decreased 42 percent to ₱6.6 billion. 

▪ Residential sales reservations in 2020 reached ₱81.9 billion, 56 percent of the previous year’s level, despite the limited selling activity during the quarantine period.  

  • Fourth quarter sales reservations, which reached 58 percent of pre-COVID levels, totaled to  ₱21.1 billion as property demand was sustained on a quarter-on-quarter basis.  

▪ Commercial leasing revenues declined 44 percent to ₱21.9 billion because of restricted mall and hotel operations and closure of resorts.  

  • Shopping center leasing revenues went down 59 percent to ₱9.1 billion.
  • Office leasing income was sustained at ₱9.4 billion from ₱9.7 billion.
  • Hotels and resorts revenues decreased 56 percent to ₱3.4 billion.

▪ Capital expenditures reached ₱63.7 billion in 2020, and was mainly spent for the completion of  residential and commercial leasing assets. 

▪ Ayala Land has earmarked ₱88 billion in capital expenditures and is prepared to launch ₱100 billion worth of residential projects in 2021 as it prepares for a V-shaped recovery in the next two to three  years. 


▪ BPI’s net income decreased 26 percent to ₱21.4 billion in 2020 due to the ₱28 billion in loan loss provisions it booked in anticipation of an increase in non-performing loans. The provision is 5x larger  than the ₱5.6 billion allocated the previous year.  

▪ Total revenues increased 11 percent to ₱101.9 billion because of net interest income and non-interest  income growth.  

  • Net interest income was up 10 percent to ₱72.3 billion due to a 5.8 percent expansion in average asset base supported by a 14-basis point improvement in net interest margin, which stood at 3.49 percent.
  • Non-interest income rose 11 percent to ₱29.7 billion on the back of higher securities trading gains albeit tempered by fee-based income.

▪ Total loans declined five percent to ₱1.4 trillion primarily on soft corporate lending despite higher  mortgage and microfinance loan segments, up 6.6 percent and 5.7 percent, respectively.  

  • Total deposits grew one percent to ₱1.7 trillion with CASA deposits expanding 17 percent.
  • CASA ratio stood at 79.6 percent.

▪ Loan-to-deposit ratio ended at 82.0 percent.  

▪ NPL ratio and NPL coverage ratio stood at 2.68 percent and 115.2 percent, respectively.

▪ Operating expenses slightly decreased 0.4 percent to ₱48.1 billion because of lower premises and  various discretionary costs. 

  • Cost-to-income ratio stood at 47.2 percent, a 520-basis point improvement year on year.

▪ Total assets grew one percent to ₱2.2 trillion. Total equity amounted to ₱279.8 billion. 

  • Indicative common equity tier 1 ratio stood at 16.2 percent.
  • Indicative capital adequacy ratio stood at 17.1 percent.
  • Return on assets was 0.98 percent.
  • Return on equity was 7.7 percent.

▪ BPI’s early investments to bolster its digital infrastructure starting 2017, underscored by spending of  at least seven percent of revenues per year, has benefitted from the surge in demand for remote  banking amid the global health crisis. As of December 2020:  

  • Enrollments to its online platform grew 18 percent to 4.4 million from year ago levels.
  • Active users increased 41 percent to 2.7 million users from year ago levels.
  • Digital transactions in December accounted for 70 percent of total while branch transactions comprised only eight percent. These were 49 percent and 15 percent, respectively in the same period the previous year.


▪ Globe’s net income declined 16 percent to ₱18.6 billion in 2020 due to lower EBITDA and higher  depreciation charges and non-operating expenses.  

  • Higher non-operating expenses in the period was due to a one-time impairment loss amounting to ₱4.2 billion largely from the network change out covering the full sunset of the 3G assets and the existing copper infrastructure. This was partially offset by a ₱2.3 billion gain mostly from the deemed sale of Globe’s investment in Mynt following a third-part infusion by Bow Wave and loan revaluation.

▪ Globe’s core net income, which excludes the impact of non-recurring charges and foreign exchange  and mark-to-market changes, declined 13 percent to ₱19.5 billion. 

▪ Total service revenues dipped two percent to ₱146.4 billion on softness in the mobile segment as a  result of quarantine restrictions. Total data revenues accounted for 76 percent of Globe’s service  revenues compared to the year-ago level of 71 percent. 

▪ Growth in demand for data was evident in the upward momentum of Globe’s mobile and home  categories despite the softening in corporate due to the prevailing work-from-home setup. 

  • Mobile data revenues increased one percent to ₱72 billion.
  • Mobile data traffic jumped 48 percent to 2,517 petabytes.
  • Home broadband revenues surged 23 percent to ₱26.8 billion.
  • Home broadband subscriber base increased 88 percent to 3.8 million subscribers.
  • Corporate data revenue declined by three percent to ₱12.5 billion.

▪ Operating expenses including subsidies were flat at ₱73 billion.  

▪ EBITDA declined by three percent to ₱73.5 billion as a result of lower revenues, slightly dragging EBITDA margin to 50 percent from 51 percent the previous year. 

▪ GCash maintained its status as the country’s number one finance app throughout 2020. It has reached  record highs amidst the pandemic, with 33 million registered users or one in every three Filipinos.  Additionally, it has seen a 3.7x increase in active users as gross transaction value exceeded the ₱1  trillion mark in December. Owing to its success, Mynt has attracted US$175 million in fresh investment  capital from existing shareholders and Bow Wave in multiple tranches, with post-money valuation of  the final tranches at close to US$1 billion. 

▪ Globe’s CAPEX spend grew 18 percent to ₱60.3 billion, representing 41 percent of gross service  revenues and 82 percent of EBITDA. The company has allocated ₱70 billion for 2021 capital  expenditures. 

▪ Despite the impact of COVID-19, Globe accelerated its cell site buildout and upgrades, fiber-to-the home deployments, and 5G coverage. Globe was able to build close to 1,300 new cell sites or towers compared to 1,100 in the previous year. Also, the aggressive modernization of its existing network  infrastructure resulted in a total of 11,529 site upgrades to 4G/LTE this year, higher than the 10,135  in 2019. Moreover, Globe deployed 5G sites in Metro Manila and in select Visayas and Mindanao  cities, making 5G available in 1,045 areas in the country. These network improvements enhanced  Globe’s customer experience and the Filipino digital lifestyle, addressing the challenges of the new  normal.  


▪ The AC Energy group generated a net income of ₱6.2 billion in 2020, reflecting the group’s strong  performance despite the pandemic. This was a decline from ₱25.0 billion in the prior year, which  included gains from its partial divestment in AA Thermal. 

  • Net income contribution from its listed subsidiary, AC Energy Corporation or ACEN, reversed to ₱2.8 billion from a net loss in the previous year on the back of higher contracted capacity and improved plant availability. ACEN now accounts for half of the group’s net income.
  • Equity earnings from international assets increased 68 percent to ₱2.5 billion, supported by full-year operations of the company’s solar assets in Vietnam.
  • Other income declined to ₱448 million because of the absence of significant divestment gains booked in the prior year. Other income in 2020 includes earnings from the legacy coal assets offset by bond interest expense and parent overhead.

▪ The AC Energy group has expanded its geographical reach and currently operates in five markets,  with the recent start of construction of its first project in Australia.  

  • ACEN has 990MW of attributable capacity in the Philippines, 45 percent of which are  renewable. It aims to expand its portfolio with recently announced joint ventures with Solar Philippines and Citicore.
  • The group has approximately 1,400MW of attributable capacity offshore, all of which are renewable.
  • AC Energy has more than 600MW of renewable energy capacity in Vietnam. The expansion of the Ninh Thuan solar project has recently started operations, adding 75MWdc of operating capacity to the portfolio.
  • Marking AC Energy’s first investment in Australia, the group recently announced the start of construction of the first phase of the New England Solar Farm in Uralla, New South Wales, with 521.5MWdc of gross capacity.
  • Indonesia and India have 180MW and 170MW in attributable capacity, respectively.

▪ In January, ACEN completed its stock rights offering, bringing Ayala’s effective stake in ACEN to 70  percent. 

▪ In February, ACEN announced a follow-on offering at a price range of ₱6.00 to ₱8.20 per share and submitted a registration statement with the SEC for up to 2,430,248,617 common shares (primary and secondary shares with over-allotment). 


▪ Manila Water’s net income decreased 18 percent to ₱4.5 billion in 2020 due to a one-off recognition  for additional estimates for probable losses and lower contributions from domestic subsidiaries due  to the impact of COVID-19. Excluding one-offs, core net income declined 22 percent to ₱5.8 billion.  

  • The parent company, which houses the East Zone Concession, saw net profits decline seven percent to ₱4.7 billion driven by the recognition of impairment loss in Manila Water Total Solutions, lower costs and expenses despite higher provisioning for estimated credit losses, and higher depreciation expenses.

▪ Revenues slightly decreased two percent to ₱21.1 billion as improved billed volume in the East Zone  was dragged by lower supervision fees from Estate Water.  

▪ EBITDA decreased six percent to ₱11.9 billion despite OPEX improvement as the recognition of net  foreign exchange losses and provisions for probable losses weighed down on profitability.  

▪ EBITDA margin stood at 57 percent.  

▪ In December 2020, Manila Water’s consortium with French water distributor Saur Group and Saudi’s  Miahona Company inked a seven-year agreement with the Kingdom of Saudi Arabia’s state-run water agency National Water Company to manage the delivery of water and wastewater services, billing  and collection, customer service, and the integration and transformation of its human capital in the  North West Cluster served by NWC. This initiative is among the first of the country’s plan to privatize  its water infrastructure sector. 

▪ Last February, Ayala, through its wholly owned subsidiary Philwater and the Razon group through  Trident Water executed a share purchase agreement equivalent to the latter’s acquisition of a 39.1  percent voting stake and 8.2 percent economic stake in Manila Water. 

Industrial Technologies 

▪ AC Industrials narrowed its net loss to ₱1.8 billion in 2020 from ₱2.4 billion the previous year mainly  due to improved results of IMI and MT Group as well as lower parent impairment provisions. Its Philippine automotive business remained challenged due to the negative effects of the health crisis. 

▪ IMI registered a net loss of US$3.5 million in 2020 compared to the US$7.8 million net loss it incurred  in the same period the previous year. The improvement was mainly on the back of sound cost  management including materials cost, factory overhead, and non-operating expenses.  

  • Revenues decreased nine percent to US$1.1 billion in 2020 but was trended up since the height of quarantine restrictions and surpassed pre-COVID levels in the fourth quarter. Topline  increased 11 percent to US$347 million on a quarter-on-quarter basis.
  • Gross profit margin improved by 30 basis points to 8.5 percent in 2020 due to lower materials cost leading to an appreciation of contribution margin. Quarter-on-quarter, it grew by 70 basis points to 10.3 percent.

▪ AC Industrial’s MT CCON narrowed its net loss to EUR10.2 million from EUR10.4 million in the same  period the previous year on the back of margin improvement from cost optimization initiatives.  

▪ AC Motors incurred a net loss of ₱886 million as demand in the local automotive space softened due  to the health crisis.  

Balance Sheet Highlights 

▪ Parent level cash stood at ₱19.9 billion. 

▪ Net debt stood at ₱104.7 billion.  

▪ Parent net debt-to-equity ratio stood at 80 percent. 

▪ Group net debt-to-equity stood at 65 percent.

▪ Loan-to-value ratio, the ratio of its parent net debt (excluding the fixed-for-life perpetuals which have  no maturity) to the total value of its assets, was at 9.2 percent.  

▪ Parent blended cost of debt at 4.5 percent ending December 2020 with average remaining life of 17.4 years. 

▪ Consolidated capital expenditure reached ₱152 billion in 2020. 

▪ Parent-only CAPEX spending stood at ₱12.1 billion, which went mostly to the newer businesses of  Ayala.  

▪ For 2021, Ayala has programmed approximately ₱196 billion in group CAPEX, of which ₱11.5 billion  has been earmarked under the parent to support the emerging businesses in its portfolio.