PH Resorts eyes turnaround from negative equity this year

CEBU, Philippines — PH Resorts Group Holdings Inc. of Davao-based businessman Dennis Uy is looking to turn its negative equity position around later this year through the conversion of advances for future stock subscription into equity.

To resolve its negative equity position, PH Resorts said in a stock exchange filing that it plans to convert deposits and advances for future stock subscription to common stock by its parent entity, Udenna Corp.

The company is targeting additional equity through the conversion of approximately P4.09 billion by the end of the fourth quarter.

As of end-March, the company said it has advances for future stock subscription of P4.21 billion classified as liability in its consolidated statement of financial position.

PH Resorts is working toward an increase of its authorized capital stock to P15 billion from P8 billion, as previously approved by its board of directors and shareholders.

The application for increase will be presented for reapproval by the stockholders during the upcoming annual stockholders’ meeting of the company this week as the Securities and Exchange Commission requires that the application for increase be filed within six months from stockholders’ approval.

Once the application is approved, PH Resorts said P3.37 billion of advances for future stock subscription and P718 million of deposits for future stock subscription would be converted to equity.

As a result, it said the pro-forma equity as of March 31, 2025 would be positive P2.86 billion.

“Thus, the proposed conversion of advances for future stock subscription into equity represents a strengthening in the capital structure of that will sufficiently address the current negative equity position,” PH Resorts said.

“Hopefully, with the approval of the increase in authorized capital stock before year-end, PH Resorts expects to restore its positive equity position,” it said.

Through PH Travel and Leisure Holdings Corp., PH Resorts is engaged in real estate property development, including the management and operation of the activities conducted therein such as resorts, hotels and casinos, clubhouses and sports facilities.

It said construction development expenses combined with a number of key factors have led to a negative equity position of P229.6 million as of Dec. 31, 2024 and P503.7 million as of March 31, 2025.

In 2017, PH Resorts secured a provisional gaming license from the Philippine Amusement and Gaming Corp. for the Emerald Bay project, which is being planned to be an iconic and luxurious five-star integrated resort in Cebu and the premier entertainment destination in the Philippines outside of Entertainment City in Metro Manila.

Development of the Emerald Bay Resort, however, was suspended during the COVID-19 pandemic due to challenging environment and financial reasons.

PH Resorts earlier said it is working on a potential partnership deal with EEI Corp., saying that the parties have ongoing discussions to determine and finalize the terms of the agreements as of end April.

Udenna executed in December last year a memorandum of understanding with EEI concerning the Emerald Bay Resort and Casino project.

The agreement provides an avenue for a potential partnership between the company and EEI upon the execution of the definitive agreements as well as subject to the fulfillment of conditions precedent and regulatory approvals, if any.

It also paves the way for EEI to execute an agreement with PH Resorts and its subsidiaries to finance, construct and complete Emerald Bay.

PH Resorts was previously in talks with various investors such as the Okada Group’s Tiger Resort Leisure & Entertainment Inc., Enrique Razon’s Bloomberry and Apple One to aid in the development of the unfinished Emerald Bay Resort – all of which did not materialize.