The Gokongwei-led conglomerate, JG Summit Holdings Inc., has earmarked $1-billion capital spending for this year with bulk of it to be used by its property arm Robinson’s Land Corp. (RLC).
This is considered by the firm as the highest capex it has allocated for a year.
Lance Gokongwei, president and chief operating officer of JG Summit, said during the company’s annual stockholders meeting that the firm has allocated a record capex of over $1 billion this year. Last year, the company spent $1 billion for capex.
Of the overall capex, RLC will get the biggest share of approximately 31 percent, or $320 million for the construction of four malls, two new office buildings and three new Go hotels and the completion of at least eight condominium buildings.
Cebu Air Inc., the group’s air transportation business, meanwhile, will get the next highest share of around $275 million from the conglomerate’s capex.
Moreover, Universal Robina Corp., JG Summit’s diversifying food and beverage business, will get a share of about $120 million, while for its petrochemical business, the group will spend around $300 million.
For Robinsons Bank Corp., the company’s banking arm, JG Summit has earmaked $18 million.
JG Summit recorded a lower profit in the first quarter of 2013 due to smaller mark-to-market gains and net foreign-exchange losses.
In a filing with the Philippine Stock Exchange, JG Summit earlier disclosed that its net income from equity holders of the parent slightly dropped to P4.86 billion from P4.91 billion for the first quarter of 2012.
The conglomerate, however, posted core earnings before tax of P7.46 billion for the first quarter of 2013, a 27.1-percent increase from the P5.87 billion recorded in the same period last year.
The group’s mark-to-market gain recognized during the first quarter of fiscal 2013 amounted to P248.78 million, a 64.6-percent drop from last year’s P703.15 million, as its financial assets become affected by the volatility of the international financial markets during the period.
JG Summit also recognized a net foreign exchange loss of P86.63 million, a complete turnaround from last year’s net foreign exchange gain of P805.98 million, mainly from the lower translated value of foreign currency-denominated net assets of its food business as a result of the continuous appreciation of the peso during the period.
Consolidated revenues of the company, however, climbed 8.4 percent from P35.46 billion to P38.43 billion from the strong performance of all business units, except for its petrochemical segment.