Ayala Land H1 profit falls 19% as property sales soften

Insider Spotlight

• Ayala Land’s first-half net income fell 19 percent to P11.5 billion from P14.2 billion a year earlier, reversing the 8-percent growth recorded in the first half of 2025
• Consolidated revenues declined 10 percent to P75 billion from P83.1 billion, with property development generating P41 billion
• Leasing and hospitality provided a bright spot, with revenues growing 9 percent to P25.2 billion, driven by a 28-percent surge in hospitality revenues
  
  
  
  

Ayala Land Inc. saw earnings growth lose momentum in the first half of 2026, with net income dropping 19 percent to P11.5 billion from P14.2 billion a year earlier as overall revenues contracted despite stronger recurring-income businesses.

Consolidated revenues fell 10 percent to P75 billion from P83.1 billion in the first half of 2025. The latest performance marks a reversal from the year-earlier period, when Ayala Land’s net income had grown 8 percent year on year.

Why it matters

The decline puts greater focus on Ayala Land’s push to expand recurring income as its property development business navigates a more challenging operating environment.

There were signs of sequential improvement. Second-quarter net income reached P6.1 billion, up 13 percent from the first quarter, on revenues of P37.5 billion.

Anna Ma. Margarita Bautista-Dy

CEO, Ayala Land

Driving the numbers

Property development revenues totaled P41 billion in the first half. Second-quarter revenues from the business were P20.6 billion, broadly unchanged from the preceding quarter.

Sales reservations reached P53.5 billion, while residential inventory improved to 15 months from 18 months at the end of the first quarter.

Recurring-income businesses performed better.

Leasing and hospitality revenues increased 9 percent year on year to P25.2 billion. Shopping center revenues rose 4 percent to P12 billion on higher occupancy, foot traffic and merchant sales.

Hospitality was the standout, with revenues surging 28 percent to P6.3 billion, helped by renovated facilities and New World Makati Hotel. Office revenues reached P6 billion, supported by healthy occupancy and contracted lease escalations.

Capital shift

Ayala Land is reinforcing that recurring-income strategy through AREIT Inc. Its board approved the infusion of four malls and three hotels worth P20 billion, which would raise AREIT’s assets under management to P179 billion.

Capital expenditures slipped 2 percent to P39.5 billion, but spending on leasing businesses climbed 17 percent to P13.2 billion.

What they're saying

“We are building a more resilient Ayala Land through disciplined capital allocation, a growing recurring income base, and a strong balance sheet,” Ayala Land CEO Anna Ma. Margarita Bautista-Dy said in a press statement. 

“Supported by our integrated estate model and diversified platforms, we are confident in Ayala Land’s ability to deliver sustainable growth and remain well positioned for the opportunities ahead,” she added.  

The bottom line

With net gearing at 0.8 times and interest coverage at 4.4 times, Ayala Land retains balance-sheet capacity to pursue its recurring-income expansion even as first-half earnings and revenues trail last year’s levels. —Vanessa Hidalgo| Ed: Corrie S. Narisma