Alliance Global Group Inc., the holding company of billionaire Andrew Tan, reduced its 2020 capital expenditures by P37 billion to P42 billion from the original target of P79 billion as the group moves to preserve cash amid the pandemic.
AGI said in presentation during an analysts’ briefing this year’s capital spending would also be 33.3-percent lower than P63 billion it spent in 2019.
It said of the P42-billion programmed spending for this year, P35 billion was allotted for property unit Megaworld Corp. while P4 billion would go to Travellers International Hotel Group Inc.
Liquor unit Emperador Inc. and quick service restaurant operator Golden Arches Development Corp. would each spend P1 billion in 2020.
AGI said because of the pandemic, Megaworld would not launch any new township, office and hotel project this year and instead focus on completing existing office and hotel projects.
Megaworld’s office portfolio is expected to hit 1.42 million square meters this year while its lifestyle malls would end the year with 873,000 sqm of leasable area.
TIHGI will resume development activities in its second integrated resort and casino called Westside City in Paranque City.
Emperador is expecting sales to be supported by strong off-premise demand as local bars remain closed.
It also expects the resurgence in demand for luxury liquor products like The Dalmore in the international market.
It said that GADC, which holds exclusive franchise to operate McDonald’s in the Philippines, would cut back on company-owned store openings. It will increase the focus on safer, cleaner McDonald’s stores and look for opportunities to expand sales through online platforms and third-party delivery services.
From only 38 percent of stores which remained opened in mid-March, GADC now has 92 percent of its McDonald’s stores operating nationwide.
AGI reported a net profit of P3 billion attributed to owners, down 32 percent from P4.4 billion in the same period last year as consolidated revenues fell 7 percent to P38 billion from P41 billion.
AGI said it would accelerate its digitalization efforts across its businesses to help the group navigate the current business environment and provide customers with enhanced services under the “new normal”.