Andrew Tan remains bullish on business growth prospects

MANILA, Philippines - Property tycoon Andrew Tan remains bullish on the growth prospects of his real estate, gaming and liquor businesses, saying the onset of the pre-election period and a steadily increasing international tourist arrival in the country bodes well for the group.

In a chance interview, Tan said his businesses are expected to continue picking up in the second half of the year as the Philippines remains resilient with sound macroeconomic fundamentals.

Tan, valued to be worth $2.1 billion by Forbes Magazine, is making a strong push into the gaming/tourism industry via Travellers International Hotel Group, a joint venture with Malaysia’s Genting Group which operates flagship tourism estate Resorts World Manila.

Situated on an eight-hectare property in Pasay City, Resorts World features six-star hotels, gaming facilities, and a shopping mall.

His flagship firm Alliance Global Group Inc. has interests in property (Megaworld Corp., Empire East Holdings and Suntrust), beverage (Emperador Distillers Inc.), and fastfood (Golden Arches Development Corp. which holds the master franchise for global giant McDonalds.

Tan said foot traffic at Resorts World continues to rise amid a slowdown in the world’s largest gambling market, Macau. “We expect more tourists to come to our gaming complex especially in the second half,” he said.

He said the property business continues to be a major cash cow for the group as growing remittances from overseas Filipino workers and a low interest rate regime drive real estate sales.

“Outlook for the property sector is still quite bright. We are still bullish particularly on the residential and office segments of the market,” Tan said.

Megaworld, which pioneered the development of community townships that incorporate the live-work-play-learn concept, currently has 10 ongoing large-scale projects within Metro Manila, Iloilo and Cebu as well as several residential developments in the Makati central business district and San Juan.

It acquired a landbank of around 230 hectares located in key growth areas (55 hectares of land in Iloilo and 25 hectares in Cebu). Within Fort Bonifacio, the company has 7.1 hectares of the former Napolcom land near the international schools and 8.5 hectares at the North Central Business District.

As for its liquor business, Tan said Emperador Distillers has been doing “very, very well” and is seen to hit close to P20 billion in sales this year on increased patronage of its products and the acquisition of Diageo Philippines’ Sta. Rosa faciltiies.

Emperador Distillers produces Emperador, Generoso and Emperador Light brandies and a line of flavored alcoholic beverages called The Bar.

Diageo, on the other hand, is an international company whose brands include Smirnoff, Johnnie Walker, Baileys, Gordon’s Gin and Jose Cuervo.

In 2011, Emperador Distiller posted a net income of P17.35 billion, accounting for 26 percent of AGI’s consolidated bottomline.

AGI early this year said it expected to sustain its upward trajectory with net earnings seen to grow 20 percent this year.