Higher expenses pull down Filinvest profit in Q1

Crippled by higher expenses, Filinvest Development Corp., the holding company of business tycoon Andrew Gotianun, suffered a 42.5-percent drop in its net income for the first three months of the year to P73.61 million, from P128 million in the same period a year ago.

While total revenues slightly increased to P1.07 billion from P1.06 billion, cost and expenses increased by 7.55 percent to P945.89 million from P879.51 million during the period in review.

Real estate operations accounted for P728.92 million of total revenues, up by 1.08 percent from P721.15 million a year ago. Revenues from the financial and banking services, on the other hand, amounted to P343 million or a two-percent increase over last year because of higher trading income.

FDC’s consolidated sale of lots, condominiums and residential units increased by P88.8 million from P426.5 million, mainly because of higher sales booked by subsidiary Filinvest Land Inc. (FLI) and Filinvest Alabang Inc. (FAI)

Realized gross profit from prior year’s real estate sales, however, fell 26 percent as a result of the discontinuing of additional receivables in 2002 to accumulate cash for redemption of guaranteed convertible bonds.

Rentals, sales of club shares, interest and other income went down by 28 percent, primarily due to lower interests earned on temporary placements and installment contracts.

For its flagship FLI, its first quarter profit likewise declined to P104 million as against P141 million the same period a year ago. The drop was due to a decrease in realized gross profit in the first quarter of 2002 from P256 million to P205 million.

FLI vice-president Fely T. Ramos said the decline in gross profit was due to a non-recurring income amounting to P38 million relating to the sale of receivables in the first quarter to help finance the payment of the company’s convertible bonds which matured last year.

Real estate sales, however, grew by 45 percent, largely due to new products and affordable packages rolled out by the company, capturing the attention of the mass housing market.

During the first quarter, the company launched Ciudad de Calamba in Laguna, the development of Nusa Dua’s farm estate amenities and the new affordable Tree Series home models in middle-income and high-end projects.