RLC expects profit recovery

MANILA, Philippines - Robinsons Land Corp. (RLC), the property firm of tycoon John Gokongwei, expects its profits to recover in the second half of its fiscal year that will end in September.

The listed property firm is looking to tap the debt markets in the next few months to fund the continuous expansion of its shopping malls and office space, its top executive said.

“I’m very optimistic and positive about the second half of the fiscal year for RLC,” said RLC president and CEO Frederick Go.

“Obviously, we had some challenges in the first half of the year but those are one-off like Typhoon Haiyan and the fire at the department store,” Go said.

The Gokongwei family’s property development arm recorded a 13-percent decline in earnings to P1.03 billion in the fourth quarter of 2013 from P1.18 billion a year ago.

RLC incurred losses from Typhoon Yolanda and a mall fire that negatively affected the operations of Robinsons Place Tacloban and Robinsons Galleria, respectively.

Non-recurring losses in the first quarter will likely be offset by the property boom.

“The market looks good. Demand is strong across-the-board: for retail, office, condominium units and hotel rooms,” Go said.

New office buildings and the opening of new shopping malls will also boost the company’s rental revenues, he said.

With the opening of Robinsons Place Antipolo and Robinsons Place Las Piñas late this year, RLC will end 2014 with 39 shopping centers.

RLC is jacking up its capital spending by a fifth to P16 billion in fiscal year 2014 to fasttrack the construction of malls, office buildings and hotels.

Go said RLC will tap the debt market in the next 60-90 days to fund around half of the capital expenditures.

“The bulk (of the proceeds) is going to the malls and office buildings. Hotels are smaller part of the pie,” Go said.