A local credit-rating agency has issued its highest rating with a stable outlook on Ayala Corp.’s P10-billion retail bonds.
Proceeds of the issuance will be used to refinance Ayala’s outstanding bond issuance of P10 billion maturing on April 30, 2017.
This will be the second and last issuance of the company in relation to its three-year fixed-rate bonds program of up to P20 billion.
In July last year the company initially issued P10 billion in retail bonds due on July 7, 2023, as part of its fund-raising program.
The company also secured the same ratings for its other retail bonds, including the P10-billion retail bonds due on April 30, 2017; P10-billion paper due on May 12, 2021; and P10 billion debt due on May 11, 2027. Ayala’s rating is the highest credit rating assigned by a local rating firm, meaning the debt will of the highest quality with minimal credit risk or the company’s capacity to meet its financial commitment on the obligation is strong. Its outlook, on the other hand, is an indication as to the possible direction of any rating change within a one-year period, and serves as a further refinement to the assigned credit rating for the guidance of investors, regulator and the general public.
Ayala is one of the largest and most diversified conglomerates in the Philippines. Founded in 1834, Ayala has maintained dominant positions in various industries in the country. Ayala’s portfolio includes Ayala Land Inc., the country’s second largest property developer; Bank of the Philippine Islands, the country’s fourth largest lender; Globe Telecom Inc., second largest mobile phone operator; and Manila Water Corp., the concessionaire for the East Zone of Metro Manila.
The company also has interests in industrial technologies, power generation, transport infrastructure, international real estate, healthcare, and education. Ayala, in recent years, has taken on an aggressive growth strategy across its businesses to capitalize on a vibrant domestic economy.
The company booked P32.48 billion in net income in the first nine months of 2016, an 11 percent increase from the P29.21 billion recorded in the same period in 2015.
Following the attainment of its five-year plan of growing net income to P20 billion and return on equity (ROE) to 15 percent, Ayala said it is committed to increase its earnings capacity to P50 billion and to sustain an ROE of 15 percent over the next five years.