JG Summit spending P35b in ’15
JG Summit Holdings Inc., the holding company of tycoon John Gokongwei, said Wednesday it plans to spend P35 billion this year to fund the expansion of its airline, real estate, food manufacturing and banking businesses.
JG Summit chief finance officer Bach Johann Sebastian said in an interview the 2015 capital spending was lower than the P50 billion earmarked in 2014, as the conglomerate had already completed the construction of the naphtha cracker facility in Batangas province.
“Its going to be around P35 billion this year, mainly for airline, property and Universal Robina Corp.,” Sebastian said.
The naphtha cracker facility recently started operations and is expected to start contributing around $800 million to $1 billion in annual revenues to JG Summit next year.
URC, the food manufacturing unit of JG Summit, earlier said it planned to spend P9 billion this year primarily to expand its domestic and international businesses.
The group’s property firm, Robinsons Land Corp. earmarked P17 billion for 2015 capital expenditures, as it plans to build new malls as well as office and residential projects.
JG Summit raised P8.8 billion through overnight placement of shares in January. It raised the amount from the sale of 145.65 million common shares via top-up offering at a price of P61 apiece.
Proceeds from the fund raising activity will be used to finance various projects, as the company plans to actively bid for the bundled airports the government may bid out under the public-private partnership scheme this year.
JG Summit has substantial business interests in food, agro-industrial and commodities, real estate and hotel, air transportation, banking and petrochemicals.
Its airline unit, Cebu Pacific Air, reported an P853-million profit in 2014, up from P511.95 million in 2013.
The conglomerate also holds an 8-percent interest in Philippine Long Distance Telephone Co. and 27.1-percent stake in power retailer Manila Electric Co.