By Honey Madrilejos-Reyes
Reporter
LISTED real-estate developer Filinvest Land Inc. (FLI) reported a 29-percent jump in net profit from January to September this year to P622 million from P482 million in the same period in 2005.
In a disclosure to the stock exchange Thursday, the Gotianun-controlled firm said the growth was driven by strong sales performance as shown by a 21-percent increase in gross profit. Higher equity in earnings of associate, Filinvest Alabang Inc. also contributed to this growth.
In addition, sales reservations as of October of this year have also increased by 23 percent.
Third-quarter profit was P326 million, FLI said, without giving details. That is the company's highest quarterly profit since at least 1999, according to Bloomberg data.
"We attribute this growth to FLI's marketing and sales strategies, the financing packages we offered and the overall growth in the Philippine economy," said its first vice president Fely Ramos.
Another factor was the lower interest rates offered under the Pag-IBIG housing loan program, which allowed minimum-wage earners, to avail themselves of FLI's products.
The increase in FLI's profit "will have a good impact on the stock's valuation moving forward, should the company maintain this pace," said James Lago, head of research at Westlink Global Equities Inc. "Rising profit will help offset the dilution impact of FLI's share sale on earnings."
On Wednesday, FLI appointed ATR Kim Eng Capital Partners Inc. to act as domestic lead underwriter for its proposed equity fundraising of up to 3.7 billion common shares.
The shares form part of the 6.21 billion primary and secondary shares, which it plans to sell to the public in the early part of 2007. These shares have been registered with the Securities and Exchange Commission (SEC) early this month.
Apart from selling up to 3.7 billion common shares by way of a primary offering, FLI would also offer up to 1.7 billion outstanding common shares by way of a secondary sale and up to 810 million unissued or outstanding common shares to cover any over allotments.
The company, however, has yet to indicate the offer price of the shares, but stated that the expected proceeds would be used to fund its estimated P2.1-billion capital expenditures for 2007 and repay a portion of its long-term debt.
On Thursday, FLI shares climbed for the first time in 11 days. It rose 1.25 percent, closing at P1.62.
In September, FLI acquired the ownership interest of Filinvest Alabang Inc. and Filinvest Asia Corp. in three major properties in Metro Manila—PBCom Tower, Festival Supermall and Northgate Cyberzone.
The acquisition has allowed FLI to diversify its revenue base. In addition to being among the leading affordable and middle income residential developers in the country, FLI now has retail and office businesses that is expected to provide recurring income for the company starting this quarter.
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