Aboitiz earmarks P73 billion capex in 2020
To help keep the economy moving amid uncertainties over Coronavirus Disease 2019 (COVID-19) and as part of its goal to support the government, Aboitiz Equity Ventures, Inc. together with its partners, is earmarking P73 billion in capital expenditures (capex) in 2020.
“The COVID-19 crisis created a lot of uncertainty but we believe the Philippine economy can be shielded from further disruptions if the government and private sector focus on areas of collaboration,” according to AEV President and Chief Executive Officer Sabin M. Aboitiz.
The capex is a 37% increase from the P53 billion it spent in 2019.
“The Aboitiz Group will deliver on our commitment to being the best-in-class in our industries. Learning from the challenges we have been experiencing in the past year, we will continue to adhere to global standards of operational excellence,” Aboitiz said.
“We see our businesses very resilient during these times. We provide stable and affordable power to support economic activity; We provide access to capital to entrepreneurs; We participate in government infrastructure projects to help generate jobs and spur economic activity; We provide feeds to farmers and fishermen which they need to grow their livestock,” Aboitiz noted.
Of the total capex amount, P41 billion was allocated for Aboitiz Power Corporation (AboitizPower) — a 17% increase from the P35 billion utilized in 2019. About 80% of the capex will be used for the completion of GNPower Dinginin Power Plants as well as other new businesses.
The infrastructure arm Aboitiz InfraCapital, Inc. set aside majority of its P16 billion capex allotment for the construction of its water businesses and its foray into airports and common tower businesses. In 2019, Apo Agua spent P3 billion. Once online, the Davao bulk water project will supply 300 million liters of water per day to the Davao City Water District for the benefit of over a million Davaoenos. Meanwhile, Republic Cement anticipates a 9% business growth this year with cement prices remaining stable.
Aboitiz Land is expected to utilize P11 billion mainly for its land banking efforts as it continues to grow its property developments in various parts of the country.
Aboitiz noted that the balance will be used for the provisions of the remaining Strategic Business Units. Pilmico Food Group has allocated nearly P3 billion for new businesses, expansion/upgrades, and operating expenses, while Union Bank of the Philippines will sustain its investment efforts in its digital and branch transformation endeavors and allot around P2 billion for expansion/upgrades and operating expenses.
The Aboitiz Group has a business continuity plan in place to mitigate the impact of the COVID-19 crisis and has adopted travel, quarantine, and hygiene measures based on the guidelines set by the Department of Health and World Health Organization.