GT Capital confident of overcoming difficult business environment

MANILA, Philippines — GT Capital, the listed conglomerate of the Ty Group, is optimistic it can weather the economic fallout from the coronavirus disease 2019 or COVID-19 as it embraces the “new normal.”

GT Capital vice chairman Alfred Ty said the company is doing what it can for its stakeholders as it looks forward to a brighter 2021.

“All our businesses will try to address concerns related to COVID-19,” Ty said in an interview with The STAR after the company’s virtual annual shareholders meeting on Friday.

He said all businesses under the group are working within the new normal framework with each subsidiary studying the impact of COVID-19 on the business and moving forward within such framework.

“In terms of the potential impact of COVID-19, we have conducted stress-testing on our core businesses and conclude that even under the worse set of assumptions, the component companies would have sufficient internal resources and balance sheet strength to withstand the negative impact of the pandemic without having to rely on parent support. These stress tests, of course, have to be re-visited periodically and the assumptions re-validated by actual data in the coming months ahead,” Ty said.

He said that given the uncertainties, GT Capital’s priorities for the second half would focus on the consolidation of resources, effective cost management and cash preservation.

“New project launches that were scheduled this year are now put on hold, and all non-essential capital spending will be deferred until we see the recovery in the macro-economic environment and consumer confidence,” Ty said.

The banking arm Metropolitan Bank & Trust Co., for instance, continues, while the property arm Federal Land has put on hold some construction projects because of the Luzon-wide enhanced community quarantine.

“The important thing is that we’re financially sound and now we’re doing what we can,” Ty said.

GTCAP’s subsidiaries are Federal Land, Toyota Motor Philippines Corp., Toyota Manila Bay Corp. and GT Capital Auto Dealership Holding Inc.

The company also has significant shareholdings in Metrobank, Metro Pacific Investments Corp., Philippine AXA Life Insurance Corp., Toyota Financial Services Philippines Corp., and Sumisho Motor Finance Corp.

Moving forward, Ty said the company is preparing for a better business environment in the fourth quarter or in 2021.

“We’re getting ready for a better environment in the fourth quarter and we look forward to a brighter 2021. There’s light at the end of the tunnel,” he said.

GT Capital reported a core net income of P2.8 billion in January to March from P3.3 billion during the same period last year, while the conglomerates consolidated net income reached P2.5 billion from P3.4 billion in the first quarter of 2019