Aboitiz group cuts 2020 capex

MANILA, Philippines — The Aboitiz Group  expects its infrastructure, power and land units to be affected by the coronavirus disease 2019 or COVID-19 pandemic.

As a result, Aboitiz Equity Ventures is allocating  P47 billion for capital expenditure in 2020, down by a third from the original allocation of  P73 billion.

“The new capex moves back some spending, considering the impact on the group’s and country’s future growth. Most of the capex reductions were from the infrastructure, power, and land units. These mostly covered operating, maintenance, and expansion costs,” it said.

For infrastructure, the group’s Aboitiz InfraCapital Inc. reiterated its support to the government’s  Build Build Build program.

The infrastructure business unit is closely reviewing the impact of COVID-19 on its projects, especially in the airport sector.

For power, Aboitiz Power Corp.’s power generation and power distribution facilities continue to operate 24/7 nationwide, delivering much-needed energy to areas under enhanced community quarantine.

AboitizPower president and CEO Emmanuel Rubio said that while the country’s total demand for power has dipped since the start of the quarantine, this is expected to gradually increase again when the quarantine is lifted.

“We also expect a gradual increase in demand as we adjust to the gradual easing of the quarantine,” Rubio said.

Aboitiz Land Inc. continues to prepare for an expected upswing in commercial real estate demand with its continuous planning of integrated townships such as LIMA Estate in Lipa City, Batangas.

According to the blueprint, Aboitiz Land plans to develop commercial buildings and sell commercial lots in its upcoming business district.

Fresh demand for new distribution centers and warehouse-type logistics facilities, especially as e-commerce booms.

In all, AboitizLand expects the local real estate market to be resilient mainly because there is still growing yet unmet demand for housing.

But the whole group is reviewing its business units, carefully weighing opportunities and embracing an agile strategy in the execution of its 2020 plans.

Aboitiz Group president and CEO Sabin Aboitiz has assured stakeholders that the group is fully equipped and prepared to guarantee the continuity of all business transactions.

“Most of our businesses are in industries that are vital to keeping the economy running. Filipinos need electricity, food products, and money, for example. And for our other businesses, we have been prudent in capital expenditure spending so this should not be much of a problem,” Aboitiz said.