MANILA - A reduction in cost and expenses as well as higher revenues allowed Ayala Land Inc. (ALI) to post a 23% increase in net income during the third quarter of the year.

In a statement, the real estate unit of Ayala Corp. reported that its net income rose to P1.256 billion in July to September this year from P1.021 billion in the same months last year as revenues grew 17% to P8.2 billion from P7 billion.

The company's cost and expenses dropped 8% to P6.591 billion from P7.169 billion.

"We maintained an upward trend in terms of revenues and earnings in the third quarter of this year, largely driven by improved margins and effective cost discipline," said Jaime Ysmael, ALI's Senior Vice President and Chief Finance Officer.

In the first 9 months, ALI's earnings fell 19.9% to P3.326 billion from P4.154 billion as revenues during the period dipped 6% to P22.56 billion from P24 billion. This was mostly due to the uncertain market conditions experienced in early 2009, a slight drop in real estate and hotel operation revenues, and the absence of capital gains from large transactions, the company said.

ALI's residential development revenues amounted to P10.5 billion in the first nine months, lower by just 2% compared to P10.8 billion in the same period last year. The company's middle-income brand Alveo posted a substantial growth in revenues while the affordable segment Avida performed steadily. Revenues of upscale brand Ayala Land Premier, however, declined as the recovery in demand in the second and third quarters was not able to fully offset the significant drop in the first quarter.

Total revenues from shopping centers rose by 3% to P3.32 billion, driven by the continued improvement in occupancy rates at Greenbelt 5 and Market! Market! malls.

Revenues from corporate business more than doubled to P1.33 billion in the first 9 months from P633 million in the same period last year. The growth was derived from the expansion of the business process outsourcing (BPO) office portfolio of ALI, and higher average BPO lease rates.

ALI is set to embark on 2 large developments soon. These include a 29.1-hectare central business district in Quezon City, and 7.5-hectare mixed-use project along Rizal Highway within the Subic Bay Freeport Zone.