MANILA - Filinvest Development Corp. (FDC), the holding firm of the Gotianun family, is planning to spend up to P12 billion for projects this year as it remains upbeat about revenues amid the bleak economic environment.

According to FDC President Josephine Gotianun-Yap, bulk or about 60 percent of the total budget would be appropriated for the company's real estate businesses, which include Filinvest Land Inc. (FLI) and Filinvest Alabang Inc.

"Real estate is really holding up because we're focused on the low and middle-income segments of the market," Gotianun-Yap told reporters at the sidelines of FDC's annual stockholders' meeting on Thursday.

On the other hand, 30 percent of FDC's capital expenditures would be allotted for its banking subsidiary, East West Banking Corp.

"Part of this we've already done, with the acquisition of Philam Savings Bank," she said.

In January, East West Bank announced its acquisition of Philam Savings Bank from the AIG Group. The company gained 9 more branches from the purchase, increasing its network to 89.

According to FDC Chairman Jonathan Gotianun, East West Bank is eyeing 100 branches by the end of the year.

Meanwhile, the remaining 10 percent of FDC's spending budget would go to Pacific Sugar Holdings, the holding firm's recently-acquired sugar venture. The company is planning to spend P800 million over three years to expand its sugar business in terms of refining and milling capacity.

"We see some reduction in production in the sugar industry as a whole because of weather concerns. But hopefully we'll be able to balance this by possible increases in prices due to the supply situation," Gotianun-Yap said.

FDC ended 2008 with a net income of P2.57 billion, a 23-percent drop from P3.34 billion it reported in 2007. Excluding extraordinary income, Gotianun-Yap said FDC posted a 109-percent rise in earnings next year to P2.32 billion from P1.11 billion.

"However, 2007's net income included P2.23 billion in extraordinary income, coming primarily from the sale of FLI shares during its follow-on offering in February 2007 while 2008's net income only included P251 million in extraordinary income arising from FLI's share buyback program," she explained.

FDC's net revenues amounted to P8.41 billion, with the real estate and development leasing business accounting for 56 percent or P4.68 billion.

The company's banking and financial services sector contributed P3.03 billion or 36 percent, while the remaining 8 percent or P697 million came from the company's sugar business.

Plans

Unlike other conglomerates that have been active in diversification, mergers and acquisitions, Gotianun-Yap said the Filinvest Group would focus on growing its current businesses.

"Currently, we keep our options open. There's nothing in particular right now," she said, when asked about the company's acquisition plans this year.

Early this week, FLI said it is joining the bidding to develop the 8.38-hectare North Bonifacio lots in Bonifacio Global City in Taguig, which are worth at least P2.7 billion.

In a disclosure to the local bourse on Tuesday, the property firm said it has submitted requirements to participate in the competitive challenge process to Bases Conversion and Development Authority (BCDA), which is in charge of privatizing the property.

Still, Gotianun-Yap said the company has yet to look into this venture more carefully. "We still need to study it, we're just getting there."

In April, competitor Megaworld Corp. had made a bid of P33.283.88 per square meter, which FLI and other bidders have to match or beat. BCDA, which scheduled the bidding next month, will award the project to the best bidder.