Landco swings to profit

By Daxim Lucas Inquirer MANILA, Philippines--Property developer Landco Pacific Corp. reported Friday a sharp turnaround in financial results in the first half to a net income of P109 million from a restated net loss of P129 million in the same period last year, with increased sales and a change in its income recognition system. The real estate unit of Metro Pacific Investments Corp. said that it was bracing itself for possible fallout from the credit squeeze in the United States, where many of its clients are located. In a news briefing, Landco chief operating officer Francis Ceballos said the company had shifted to a “percentage of completion” income recognition system for its current financial year. Landco reported first-half sales of P1.01 billion, up 267 percent from P382 million in the same period in 2006. Ceballos said the solid performance was expected to continue in the second half of the year, as the country’s strong economic growth in the first half boosted confidence in the property market. But he said Landco was also keeping an eye on the US subprime credit crisis, especially on the effect it would have on liquidity in the world’s largest economy. “There are very real ‘cautions,’” he said. “There are very real red flags we can’t ignore.” He said a significant number of Landco’s buyers are US-based Filipinos who borrow from US banks to finance their property acquisitions in the Philippines. “A good deal of our buyers are Filipino-Americans, so anything that could happen [in the US] could affect us,” he said. As much as 60 percent of Landco’s sales in its township projects are made to overseas Filipinos or locals funded by foreign benefactors, and of this portion, that as much as 40 percent is sales made to clients in the US mainland, Ceballos said. Landco is also closely monitoring government efforts in line with its promise to focus on infrastructure spending, as facilitating travel to provincial areas surrounding Metro Manila -- where many of Landco’s projects are situated -- would make it easier for the company to sell properties, he added. With INQUIRER.net