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Cebu Landmasters sets P13B capex for 2023

Listed property developer Cebu Landmasters Inc. (CLI) on Wednesday revealed plans to spend P13 billion this year, mainly for the construction of projects which have already been launched and sold out in the past two years.

In a virtual briefing, CLI chief operating officer Jose Franco Soberano said the firm plans to hike its capital expenditure (capex) for the year from P10.960 billion in 2022, as it already spent some P2.735 billion in the first quarter.

The first-quarter capex was mainly for property development, with P1.989 billion or 72.7% going to its residential development, P483 million or 17.6% going to lot acquisition, and P255 million or 9.3% going to investment properties.

“The P13 billion goes into the construction of already launched projects and already sold out projects so across all the projects that we have already launched and sold out in some years, in fact, last year or two years ago, most of that investment will go there,” chief finance officer Beauregard Grant Cheng said.

Cheng said the spending program will be made through internally generated funds, and existing available facilities from its investors, but the firm is now looking at longer-term maturities.

“There’s an opportunity there for us to look at our debt and liability exposure, both current and maybe even up to 24 months, and see if we can push out those maturities to longer-term maturities,” he said.

“Why would I pay a higher rate on short-term maturities when I can actually get slightly lower rates at this point, given the spreads are just about the same, so we’re always on the lookout for those kinds of opportunities,” he added.

Cheng said the firm will be looking at liability management of equity opportunities should it push through with any fundraising for the year.

CLI reported a 10% growth in its net income to parent for the first quarter at P888 million, as it recorded a 33% growth in its consolidated revenue to P4.78 billion.

The company plans to start operations of three new hospitality projects for the year — lyf Cebu City in Base Line Center, Citadines Bacolod City, and The Pad Co-Living in Banilad High Street.

It also plans to expand its presence to locations in Southern Luzon to cover areas such as Camarines Sur, Naga, Bicol, and Lipa in Batangas.

CLI targets to complete over 46,008 square meters of gross leasable area from the commercial leasing business, along with 19 residential projects in the pipeline valued at P29.75 billion.

The developer last month said it is optimistic about sustaining double-digit earnings growth in 2023, but the guidance is set to be more conservative given the higher base recorded in the previous year. 

Shares in CLI were trading up P0.06 or 2.45% at P2.51 apiece as of 11:26 a.m. on Wednesday. —VAL, GMA Integrated News