Robinsons Land net profit jumps 20% to P1.23B

An article published in The Philippine Star, August 7, 2006
By Zinnia B. Dela Peņa

Robinsons Land Corp. (RLC), the real estate unit of Gokongwei holding firm JG Summit Holdings, reported a 20 percent jump in its net income for the nine months ending June this year, mainly driven by the strong performance of all business units.

In a financial report, RLC said net profit amounted to P1.23 billion compared with P1.02 billion a year earlier. Revenues likewise grew 27 percent to P4.83 billion. RLC's fiscal year ends in September.

Frederick Go, executive vice-president and group general manager of RLC, said all four core business units of the company did well, with the commercial centers division accounting for bulk of total revenues while the buildings division recorded the biggest increase in profitability.

RLC's shopping centers, led by flagship stores Robinsons Galleria and Robinsons Place Manila, pumped in revenues of P2.35 billion. Recently-opened Robinsons Place Pioneer and the redeveloped Robinsons Place Novaliches also contributed to the increase.

Go said the company will continue to focus its efforts on improving tenant mix, enhancing mall facilities, and intensifying marketing efforts.

"The company will be expanding its retail presence all over the country, ensuring our continued growth. We have several metropolitan and provincial malls now in the pipeline and construction will commence within 2006. We will soon complete the renovation of the Galleria West Wing and are midway in the construction of the Manila mall expansion," Go said.

RLC's High-Rise Buildings Division, on the other hand, registered revenues of P1.45 billion or 79 percent higher than the previous level's P813.9 million. This was due to the recognition of realized revenues from its residential condominium projects as well as increased office rentals.

Go said the company's residential condominiums continue to be well received and are among the first choices of residential consumers. For this year, revenue growth primarily came from projects like One Gateway Place in Mandaluyong and One Adriatico Place in Manila.

He disclosed that RLC is now the country's biggest landlord of contact and business process centers, being the preferred landlord among major international and domestic contact centers and business process outsourcing (BPO) companies owing to the prime locations and superior technical design of its office buildings.

Enjoying almost full occupancy in all its office properties, which includes Robinsons Cybergate Center, RLC's rental income increased by 43 percent year-on-year.

RLC's Housing and Land Development Division contributed P368.81 million or an increase of 12 percent from the year earlier figure of P329.71 million, mainly due to Robinsons Highlands and Bloomfields, both in Davao; and Forest Parkhomes and Fernwood Parkhomes.

The Hotel Division, a major contributor to RLC's recurring revenues, recorded gross revenues of P657.86 million for the three quarters of its fiscal year, up 86 percent from P354.64 million. This was attributed to the opening of Crowne Plaza Galleria Manila, a five-star hotel located in the heart of Ortigas Center.

RLC said costs went up 15-percent to P1.7 billion, largely due to higher cost of realized sales of the high-rise buildings division. Hotel costs and expenses increased due to the opening of the Crowne Plaza Hotel.

General and administrative expense also increased by 17 percent mainly as a result of higher marketing and selling expenses on account of higher sales and revenues of the high-rise buildings division.

As of end-June 2006, RLC's total assets stood at P32.39 billion while stockholders' equity was at P14.02 billion. Cash dividends paid during the period amounted to P735 million.

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