Ayala Land, Inc.

Ayala Land reported Q1 2026 revenue of PHP 37.5 billion, down 14% year over year, and net income of PHP 5.4 billion, down 23%. Property development revenue was PHP 20.3 billion, down 27%, while residential revenue was PHP 17.4 billion and estate lot revenue was PHP 2.9 billion. Leasing and hospitality revenue grew 9% year over year, with shopping centers at PHP 5.8 billion (+2%), offices at PHP 3.0 billion (flat), hospitality at PHP 3.4 billion (+30%), and industrial real estate at PHP 0.4 billion (+23%). EBITDA/EBIT margin was 35%, GAE ratio was 7%, and net gearing was 0.81:1. Management said Q1 capex totaled PHP 23 billion and full-year capex was recalibrated to approximately PHP 50 billion from the original PHP 70 billion to PHP 80 billion plan; they also said minimal incremental debt is targeted for 2026. Forwardly, the company expects 190,000 square meters of additional mall GLA in 2026, another 70,000 square meters of office GLA this year, and 9,000 additional cold storage pallet positions in Cebu, while Mandarin Oriental is targeted for Q4 2026.

The CEO framed 2026 as a year of deliberate capital discipline, recurring-income expansion, and more cautious residential pacing. She said the Middle East conflict and weaker macro backdrop are making Ayala Land’s strengths more important: a strong balance sheet, quality assets, and a larger leasing/hospitality base that can smooth earnings and cash flow. Her tone was cautious but confident, emphasizing that the company is becoming “more balanced,” “more resilient,” and still in execution mode.

The CFO said Q1 revenue of PHP 37.5 billion and net income of PHP 5.4 billion were pressured by continuing headwinds in property development, partly offset by leasing and hospitality strength. He highlighted total expenses of PHP 29.2 billion, EBT of PHP 8.2 billion, EBIT margin of 35%, a GAE ratio of 7%, and net gearing of 0.81:1; he also noted borrowing cost at 5.5%, more than 80% of debt contracted long-term, and more than PHP 15 billion of PHP 25 billion of 2026 maturities already refinanced. Cash and cash equivalents were PHP 21 billion, assets were over PHP 1 trillion, and management said net debt should moderate by year-end as unit turnovers and recurring income improve cash generation.

Analysts focused mainly on residential weakness, the decision to cancel Katipunan and pause Laurean, mall and office leasing momentum, and whether the Middle East conflict and higher rates would change the outlook. Management said the residential revenue decline was driven mostly by lower new bookings rather than cancellations, and that cancellations were less than 8% of the impact; Laurean remains included in Q1 sales because it is paused, while Katipunan was taken out because it was canceled. On malls, management said sales growth exceeded rental revenue growth because of fixed-rent structures and added that flagship malls are up 12% year over year, with newer assets like One Ayala, Manila Bay, and Vermosa showing strong gains. On rates and demand, management said higher policy rates can pressure core buyers, but impact on mortgage rates is not perfectly transmitted and it is too early to call the full-year trend.