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JG
Summit Holdings Inc., the holding company for all
businesses of the Gokongwei group, is allotting up to
P25 billion this year to fund the expansion of its
property and telecommunications subsidiaries.
The
programmed capital expenditure this year is a little
lower than the P27.6 billion it spent in 2006 as higher
spending for the company’s airline unit was registered
last year.
At the
sidelines of the company’s annual stockholders’ meeting
Thursday, president and chief operating officer Lance Y.
Gokongwei said from the capex around P11 billion will go
to Digital Telecommunications Phils. Inc., or Digitel,
to grow its network. This expansion covers the wireless
and landline aspects of the business.
Digitel
operates Sun Cellular, the third-largest mobile-phone
network in the Philippines.
Another
P8 billion, Gokongwei said, will go to Robinsons Land
Corp. for various property acquisitions and development
projects.
The
balance of the investment will go to the group’s other
businesses, like air transportation, food and
petrochemical.
Meanwhile, JG Summit is planning to refinance its
$300-million debt maturing in June 2008. The notes were
issued by JG Summit Philippines Ltd. and guaranteed by
JG Summit Holdings.
“It’s
about a year away so we are still assessing various
options of repaying and refinancing it,” Gokongwei said.
Gokongwei also said the company is bullish of national
and regional prospects for its businesses.
“In the
Philippines, we now have a macroeconomic environment
that is more conducive to investment and growth. With
the cost of capital at more competitive levels,
inflation in control and incomes rising, we see the
country as poised for a take-off that we believe is
achievable,” he said.
JG
Summit reported that net income in the first quarter
dropped to P1.74 billion versus P3.88 billion a year
earlier.
Last
year’s net profit from January to March was
significantly higher as the company booked P3.21 billion
in gains from the shares sale of its food and beverage
unit Universal Robina Corp.
Its
consolidated revenues in the same comparable period
declined 13.0 percent to P20.01 billion from P23.0
billion mainly due to a decline in interest income and
lower sales posted by its telecom and petrochemical
units. |
