FLI’s P29-B bonds keep top rating

Date: July 12, 2017

Filinvest Land, Inc. (FLI), the property development arm of the Gotianun family, has retained the highest issue credit rating of PRS Aaa from Philippine Rating Services Corporation (PhilRatings) for its P29 billion outstanding bonds.

The bonds consist of P7.0 billion due in 2019, P4.3 billion due in 2020, P5.3 billion due in 2021, P7.0 billion due in 2022, P2.7 billion due in 2023, P1.7 billion due in 2024, and P1.0 billion due in 2025.

The outstanding amount remains after FLI paid a total of P8.0 billion which had matured, from a total issuance of P37.0 billion in the bond market since 2010.

Obligations rated PRS Aaa are of the highest quality with minimal credit risk. The obligor’s capacity to meet its financial commitment on the obligation is extremely strong.

Each of the ratings was also assigned an Outlook of Stable. An Outlook is an indication as to the possible direction of any rating change within a one-year period and serves as a further refinement to the assigned credit rating for the guidance of investors, regulators, and the general public.

A Stable Outlook is defined as: “The rating is likely to remain unchanged in the next twelve months.”

The assigned issue credit rating takes into account FLI’s strong income generation and positive cash flows leading to more than ample debt-servicing capacity.

PhilRatings also noted FLI’s established brand name and track record, with geographically diverse real estate products and substantial land bank for future expansion. (JAL)

Also taken into consideration is FLI’s sound growth strategies, focused on building a balanced mix of real estate sales and recurring income; and, the expected growth of the domestic economy, resulting in a positive outlook for the property industry.

Over the years, FLI has accumulated an extensive, well-positioned, low-cost land bank, which is expected to sustain several years of development and sales. As of end-March 2017, FLI had a total land bank of 2,390 hectares of raw land.

FLI’s diversification strategy is to have a 50-50 income mix from its recurring business and the company’s residential sales over the medium term. To this end, FLI plans to invest more on its recurring income business. The company’s goal is to reach 1 million sqm GLA by 2019.

Related news: Manila Bulletin

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