Vista Land hikes spending budget for 2012
MANILA, Philippines - Listed property developer Vista Land and Lifescapes Inc. is increasing its 2012 expansion budget by as much as 45 percent amid optimism that demand for its main horizontal and high-rise residential segments will remain robust.
In a chance interview with reporters on Friday, Vista Land chief financial officer Ricardo Tan estimated the builder’s 2012 spending program at P15 billion to P16 billion, versus P11 billion in 2011.
Tan added that a portion of the budget would be funded by a possible peso-denominated debt sale, but he said the decision has yet to be finalized.
“We can do bonds or we can do notes,” Tan said. “We will look [at fundraising] within the first half.”
The builder, controlled by the family of senator Manuel Villar Jr., sold $75 million worth of unsecured bonds last year and $100 million in 2010.
Vista Land’s optimism reflects the broader consensus among Philippine builders as demand for housing continues to outstrip to supply alongside recent growth-boosting measures such as consecutive interest-rate cuts by the central bank, seen to benefit the property sector.
Vista Land, which derives most of its earnings from the more resilient low-cost housing segment, is expected to maintain the pace of growth in 2011, Tan said on Friday.
The builder, which has yet to release earnings for 2011, was projecting net income to rise 13 percent to P3.4 billion on sales of P24 billion.
“We’re confident because we’re number one in the house and lot [ segment],” Tan said. “We’re happy with our performance in 2011 and we’re equally positive for our prospects in 2012.”
The builder said last month that it plans to launch P32 billion worth of residential subdivision projects this year, up 52 percent from 2011. It also plans to launch residential condominiums with a sales value of P10 billion this year, or higher by 70 percent from last year.
Tan said Vista Land will continue to focus on horizontal housing projects while vertical projects would stay at 10 percent to 15 percent in terms of revenue contributions.
Vista Land shares gained P3.83 per share on Friday, giving the developer a market value of P32.55 billion.