C&P reports P718-M loss in 9 months

C&P Homes Inc., the medium-and low-cost housing development arm of the Villar family, slumped further in the red with a P718-million loss in the first nine months this year. The company lost P561 million in the same period last year.

The real estate firm said its losses ballooned in spite of the positive results in its operations and the net cash generated from its activities as higher interest charges and foreign exchange losses of P1.06 billion impacted heavily on its bottomline.

C&P Homes Inc. has been pursuing a debt restructuring program with its creditors since 1999 after falling victim to the real estate slump buffeted by the regional financial crisis, the peso devaluation, higher interest rates and more rigid terms of the government’s shelter program which dried up funding for socialized and low-cost housing projects.

It has an estimated debt stock that includes a $150-million floating rate note, a P3-billion long term commercial paper issue and P5 billion owed to various banks.

In nine months this year, C&P reported sales of P1.619 billion, down 13 percent from the previous year as credit availability for low cost housing remained tight during the period.

It said aside from the decrease in sales volume, the decrease in income was also due primarily to the increase in costs as the percentage of selling, marketing, administrative and general expenses over the real estate sales rose to 38 percent, from 31 percent last year.

"Sales volumes have been substantially reduced on account of, among others, selective credit granting policies, restricted availability of credit and temporary slowdown of real estate development," C&P said.

To address the slack in sales especially in the low cost segment, the company said it is adopting strategies to intensify its marketing efforts in the middle income segment through the opening of several projects carrying the Crown Asia brand and offering attractive in-house financing terms to homebuyers.

Last June, Ayala Land Inc. (ALI) took an 11.6-percent stake in C&P as refund for an earlier deposit on a failed land sale three years ago with the latter’s parent firm Fine Properties Inc.