CRISP assigns ‘AAA’ on ALI

MANILA, Philippines - Credit Rating and Investors Services Philippines, Inc (CRISP) assigns a ‘AAA’ issuer rating on Ayala Land Inc.  (ALI) with a stable outlook. 

ALI is currently offering a three-year, fixed rate “Ayala Land Homestarter Bond” in the aggregate principal amount of P3 billion, with the first tranche of P1 billion being issued Oct.31.

CRISP’s rating committee believes that the following ALI’s strengths support the assigned rating:

• Market leadership in a competitive real property development sector that is marked by its dominance in the development of high end subdivision lots and residential buildings and has successfully established an overall market presence that now extends to the middle income and affordable housing segments.  ALI’s market position is supported by its well known flagship projects that include the development of Makati as the country’s premier commercial and business district;

• Effective land banking strategy that gives ALI control of a sizable land in the country’s premier business districts and prime lots. ALI’s land bank portfolio includes 49 hectares of prime land in the Makati commercial and business district and 11.3 hectares in the Bonifacio Global City.

 As of Dec. 31, 2011, ALI has a combined land bank portfolio of 4,885 hectares of developable lots located throughout the country.

ALI’s recent acquisition of the Food Terminal Inc,  a 74-hectare property with close proximity to the two business districts,  is expected to boost its property development leadership and fulfill the need of the growing Philippine business sector’s expansion requirements; and

• Robust financial performance and high quality assets. During the last three years, Ayala Land experienced impressive annual growth in its core revenue averaging over 20 percent.

Total consolidated revenues in the first half of the current calendar year increased by about 18 percent compared to the same period in 2011.

Although ALI’s landbanking portfolio build up is expected to accelerate its financial leveraging activities in the next 5 years, ALI’s historically strong income generating capability and its portfolio of hiqh quality assets are expected to provide adequate coverage up to two times its leverage ratio.