AGI posts record-breaking P30-b net income in 2023

Alliance Global Group, Inc. (AGI), the holding company of tycoon Dr. Andrew L. Tan, achieved a record-breaking net income of P30.3-billion, up 20% year-on-year despite higher inflation, which pushed overall costs and expenses up during the period. Attributable net profit stood at a new high of P19.6-billion, reflecting a 21% increase from the year before.

Consolidated revenues hit an unprecedented level of P211.2-billion, reflecting a robust 15% growth from P183.6-billion the year before.

“2023 was a historic year for the Group as it delivered excellent performance across all of its businesses, led by its real estate, tourism and consumer segments. This was achieved even amid heightened competition in the domestic and global market, various macro challenges in some key markets, rising cost pressures and higher interest rates. Most of our businesses have forged results beyond pre-pandemic levels, even posting new highs in terms of sales, EBITDA, net profit, and all other operating metrics. Such strong performance has encouraged us to carry on with our aggressive business strategies and expansion plans across our diversified portfolio,” says Kevin L. Tan, chief executive officer, AGI.

AGI has varied interests spanning real estate developments through property giant Megaworld Corporation; spirits manufacturing through Emperador Inc.; leisure, entertainment, and hospitality through Travellers International Hotel Group, Inc.; quick service restaurants (QSR) through Golden Arches Development Corporation (GADC), popularly known as McDonald’s Philippines; and infrastructure development through Infracorp.

Premier township developer Megaworld registered a 17% increase in consolidated revenues to P69.7-billion in 2023 from P59.5-billion the year before. This was driven by the sustained 16% year-on-year growth in real estate sales, the sharp recovery in the revenues of Megaworld Lifestyle Malls by 54% and Megaworld Hotels by 46%, in addition to the 3% rise in rentals of Megaworld Premier Offices.

Supported by the stable growth in consumer spending and foot fall as the economy continues to recover, occupancy rates of Megaworld’s office spaces, malls, and Metro Manila hotels stood at 88%, 93%, and 67%, respectively.

Meanwhile, reservation sales surged anew to P139-billion, boosted by project launches during the year amounting to P73-billion.

Travellers International, the Group’s leisure and tourism arm and owner-operator of Newport World Resorts (NWR), also broke new records in 2023 with net revenues growing by 19% year-on-year to P31.9 billion. This was driven by the resurgence in tourism and meetings, incentives, conferences, and exhibition (MICE) activities, which allowed for a stellar 40% year-on-year increase in hotel and other revenues to P7.4 billion, while its gross gaming revenues went up by 7% to a new high of P34.2 billion.

Despite rising cost pressures, EBITDA over the same period went up by 8% year-on-year to P8.2 billion, its highest level since 2012. Net income also grew by a robust 89% to P2.0 billion from last year’s P1.1 billion.

Emperador, the biggest global brandy company and amongst the fastest-growing Scotch whisky manufacturers, reported a 5% increase in consolidated revenues of P65.6 billion from year-ago level of P62.8-billion. This was driven by the sustained improvement in international whisky sales as Whyte and Mackay’s single malt brands The Dalmore, Fettercairn, Jura, and Tamnavulin continue to make significant inroads in major markets like Asia (mainly China), North America, and travel retail.

Emperador Brandy has also maintained its dominance in the domestic brandy market. Attributable net income stood at P8.6-billion.

GADC also sustained its strong growth trajectory in 2023 across all operating levels, driven by the sustained improvement in consumer spending. A long-term partnership between AGI and the George Yang Group that holds the exclusive franchise to operate ‘McDonald’s’ restaurants in the Philippines, GADC reported a record level of sales revenue of P42.8-billion, an increase of another 24% from P34.4-billion the year before.  Systemwide sales also grew by 22%, backed by SSSG of 15% year-on-year.

Even with challenges brought about by higher raw material costs and operating expenses, the company registered attributable profit of P2.5 billion from P1.8-billion a year ago. McDonald’s Philippines closed the year with 740 stores throughout the country.

“For 2024, we look forward to the much-anticipated policy rate cuts as inflation begins to ease, improving the economic and business environment with the resurgence in consumer spending, as well as demand for housing, tourism and staycation activities.  Armed with our superior product offerings, AGI is well-positioned to take advantage of these enormous opportunities as they unfold,” adds Tan.