FLI bonds obtain highest rating

MANILA, Philippines - Filinvest Land Inc.’s proposed issuance of up to P7 billion worth of seven and 10-year bonds obtained the highest rating from local credit watcher Philippine Rating Services Corp.

The issue was assigned a rating of PRS Aaa  which means that FLI’s  capacity to meet its financial commitment on the obligation is extremely strong.

PhilRatings took into account the sustained growth of FLI’s real estate and leasing operations which resulted in strong income generation and improved cash flows; its conservative debt position and high financial flexibility; its established brand name and track record.

Also considered were FLI’s focused strategy, with a geographically diverse portfolio and substantial land bank for future growth and favorable economic and industry conditions.

PhilRatings’ PRA Aaa rating for FLI’s outstanding bonds, with P4.5 billion due in November 2014, P3 billion due in 2016, P7 billion due in 2019, P4.3 billion due in 2020 and P2.7 billion due in 2023 were also all maintained.       

Owned by the Gotianun family, FLI is one of the leading property developers in the country. It has positioned itself solidly in the affordable and middle-income housing segments and is one of the largest mid-rise buildings developers in the Philippines.

Apart from  residential development, FLI also has leasing operations given its portfolio of office buildings and a retail mall.

The company has over 129 projects in 43 cities across the country with a landbank of 2,347 hectares as of the first half of 2014.

FLI sustained its growth in the first half of the year, posting a 24 percent jump in revenues to P7.8 billion. The real estate segment remained as FLI’s revenue driver, accounting for 79 percent of the group’s total sales during the six month period.

Despite its aggressive expansion initiatives, FLI’s debt to equity ratio and debt to capitalization ratio remained relatively conservative at 0.72x and 41.7 percent, respectively, as of the end of June this year.

 “The prospects for the real estate industry continue to remain strong, with demand remaining highly supportive given the existence of a substantial housing backlog, as well as the relatively low prevailing interest rate on home financing. These factors, together with the growing BPO industry and rising disposable incomes, bode well for the continued expansion plans of the company,” PhilRatings said.