OFWs power Vista Land income higher by 42.8%

With the strong demand for its middle-income and affordable housing projects from overseas Filipino workers (OFWs), property firm Vista Land & Lifescapes Inc. reported a 42.8-percent jump in its core net income for the period January to September this year.

Ricardo Tan Jr., senior vice-president for finance and chief information officer of Vista Land, said the company’s consolidated core profit reached P2.29 billion compared with P1.6 billion a year ago mainly due to robust sales from property units C&P Homes and Communities Philippines.

Revenues from real estate sales increased 26.2 percent to P7.8 billion from P6.18 billion as the OFW market remained robust, with most of the demand coming from the booming Middle East and Europe markets. OFW sales account for slightly less than 60 percent of Vista Land’s total sales.

Flagship projects in Daang Hari in Cavite and Sta. Rosa, Laguna contributed over P3 billion in sales.

C&P Homes registered revenues of P2.63 billion or an increase of 76 percent while Communities Philippines reported a 55-percent growth in sales to P2.527 billion. 

In spite of a difficult business environment, sales take-up improved 10 percent to P13.326 billion.

“Demand has been pretty steady,” said Vista Land head for corporate planning Manuel Paolo Villar, adding there has only been a slight increase in cancellation orders amid a slowing economy.

Given its strong performance, Vista Land said it expects to meet its core net income and revenue targets of P3 billion and P10.5 billion, respectively, for 2008.

In light of tough business conditions, Vista Land is adopting a cautious stance with respect to the launch of new projects and acquisition of properties.

“We’re adopting a very cautious stance moving forward. We’re conserving cash, postponing land acquisitions and some project launches,” Tan said.

Vista Land president Benjamarie Serrano said the company has deferred plans to venture into tourism development, and postponed the construction of some projects in the provinces where growth is seen as minimal. She, however, emphasized that the company will still pursue them at a much later date.

Villar said ongoing developments across the globe have also forced Vista Land to cut down on its capital expenditure budget this year to P8.5 billion from the original P10 billion. The company has so far spent P6.7 billion.

As of end-September this year, Vista Land’s total consolidated assets stood at P47.965 billion compared with the 2007 year end level of P44.422 billion. Stockholders’ equity, on the other hand, was up four percent to P32.522 billion.

“We have a solid balance sheet. We continue to be highly liquid and have a lot of room to lever up,” Tan noted. Serrano said Vista Land has more than enough properties to sustain its revenue growth and build more projects. 

As of Sept. 30, 2008, the company had a landbank of 1,866.7 hectares, mostly located in Mega Manila.

Vista Land, the country’s largest homebuilder, has launched a total of 29 new projects so far in 2008, with an estimated value of about P23 billion.