Ayala Land Reports 19% Drop in First-Half Net Income as Revenue Declines to P75 Billion
Key Takeaways
- •Ayala Land's first-half 2026 net income declined 19% year-over-year to P11.5 billion, while revenue fell 9.75% to P75 billion.
- •Leasing and hospitality revenue grew 9% to P25.2 billion, with hospitality surging 28% driven by renovated properties and the addition of New World Makati Hotel.
- •ALI's board approved a P20 billion asset infusion into AREIT, Inc., transferring four malls and three hotels to raise the REIT's assets under management to P179 billion.
- •The company's residential inventory improved to 15 months from 18 months in the first quarter, with nearly 6,000 units turned over across 40 ongoing projects.
- •ALI maintained a conservative financial position with a net gearing ratio of 0.8 times and an interest coverage ratio of 4.4 times.
Ayala Land, Inc. (ALI), the Philippines' largest property developer by market capitalization, reported a 19% decline in net income to P11.5 billion for the first half of 2026, down from P14.2 billion in the same period a year earlier. Revenue fell 9.75% to P75 billion from P83.1 billion.
For the second quarter alone, net income stood at P6.1 billion on revenue of P37.5 billion.
"We are building a more resilient Ayala Land through disciplined capital allocation, a growing recurring income base, and a strong balance sheet," ALI President and Chief Executive Officer Anna Ma. Margarita Bautista-Dy said at a media briefing on Monday.
"Supported by our integrated estate model and diversified platforms, we are confident in Ayala Land's ability to deliver sustainable growth and remain well positioned for the opportunities ahead," she added.
Property Development
Property development revenue reached P41 billion in the first six months, including P20.6 billion generated in the second quarter. Sales reservations totaled P53.5 billion during the period.
ALI said it is on track for deliveries across 40 projects, with close to 6,000 residential units turned over to date. The company's residential inventory improved to 15 months from 18 months in the first quarter.
Leasing and Hospitality
Leasing and hospitality revenue rose 9% to P25.2 billion in the first half, supported by growth across all asset classes. The recurring income segment has become an increasingly important contributor as ALI diversifies beyond cyclical property development revenues.
Shopping center revenue increased 4% to P12 billion, driven by improved occupancy, higher foot traffic, increased merchant sales, and initial contributions from completed mall reinvention projects.
Hospitality revenue climbed 28% to P6.3 billion, attributed to the performance of renovated properties and the addition of New World Makati Hotel.
Office revenue reached P6 billion, supported by occupancy levels and lease escalations.
Industrial real estate revenue rose 15% to P879 million, mainly due to strong occupancy across dry warehouse and cold storage facilities.
AREIT Expansion
ALI said it continues to expand AREIT, Inc., its real estate investment trust (REIT) and the first REIT listed on the Philippine Stock Exchange following its 2020 debut. The company's board approved the transfer of four malls and three hotels to AREIT through an asset infusion valued at P20 billion.
The transaction is expected to raise AREIT's assets under management to P179 billion and expand its portfolio across malls, offices, hotels, and industrial properties. ALI said proceeds will be used to fund its pipeline of leasing and hospitality projects. The infusion continues a capital recycling strategy through the REIT vehicle, allowing ALI to redeploy funds from mature income-generating assets into new development.
Financial Position
Capital expenditures totaled P39.5 billion in the first half, down 2% from a year earlier. ALI ended the period with a net gearing ratio of 0.8 times, supported by strong liquidity and an interest coverage ratio of 4.4 times.
ALI shares fell 1.6% to P16 apiece at the local bourse on Monday.
— Alexandria Grace C. Magno
