Stock Commentary

Vista Land FY23 profit: P10.3-B (up 39%)

Merkado Barkada
Vista Land FY23 profit: P10.3-B (up 39%)

Vista Land and Lifescapes [VLL 1.54, up 0.7%; 0% avgVol] [link] posted an FY23 net income of P10.3 billion, up 39% from its FY22 net income of P7.4 billion. Revenues were up 18% to P35.2 billion, with real estate revenue up 19% to P15.2 billion and rental income was up 17% to P16.0 billion. VLL noted that these results were driven by sales in the “low and affordable” segment, and by the recovery of its malls assets through the increase in foot traffic and contributions from “newly opened commercial centers.”

MB bottom-line: VLL also noted a 14% drop in installment contract receivables to P606 million, which it attributed to “more buyers availing of bank financing” rather than financing through VLL’s in-house options. This is interesting to me as I think it shows how competitive the financing game has become, even in the “low income and affordable” segment. Banks used to casually discriminate against buyers in this segment in the pre-COVID era, leaving the developers with an easy layup of a margin builder through offering relatively expensive debt products to prospective buyers. While I don’t think that sideline is going away any time soon, it does seem that banks are becoming less and less apprehensive to deal with this segment and I think that’s a positive for buyers (cheaper rates) to have more options and a positive for banks (more clients) to expand their client base footprint.



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