Conglomerate Ayala Corp. set a P65-billion core net income target for 2026, up by 58.5 percent from P41 billion recorded in 2023.
Ayala said in a recent investor presentation it is betting on the continued growth of core business, while its non-core units are also expected to generate positive contributions to the bottomline.
The conglomerate said it would also scale up its younger businesses including AC Health and ACMobility even as it continues to “exit or reconfigure businesses with limited ability to scale and are profitability drags.”
The group allocated P284 billion for 2024 capital expenditures, up 14 percent from last year’s level, driven by higher spending from property arm Ayala Land Inc. (ALI) and power generation unit AC Energy.
ALI is increasing its capital expenditures by 16 percent to fund mall and estate developments, while AC Energy will raise its spending by 27 percent to expand renewable buildout capacity and transmission assets.
Capital spending of Globe Telecom will decline 23 percent this year.
AC Health said it would also have higher capital spending this year on investments in St. Joseph Drug and expansion and upgrade of clinics and hospitals.
Ayala will spend P13 billion at the parent this year, flat against last year’s level.
Ayala said core net income, which excludes one-off items, increased 48 percent in 2023 to P41 billion on the back of the strong performance of its banking and real estate units. It already exceeded the group’s pre-pandemic high.
Reported net income also grew 39 percent to P38.1 billion.
The conglomerate said it planned to complete its $1-billion diversification this year. It seeks to raise up to $400 million from the planned divestment of its 35-percent stake in Light Rail Manila Corp. (LRMC), the operator of LRT Line 1 and remaining stake in Manila Water Co. Inc.
The conglomerate intends to use the proceeds from the divestment to fund the expansion of its core businesses and scale up its emerging businesses.