“The rating for Fort Bonifacio Development Corporation’s P330 million short-term commercial papers (STCPs) is PRS 3,†PhilRatings announced. A PRS 3 (Good Grade) rating is defined as: “Satisfactory capability for payment of debt instrument issue on both principal and interest. The effect of industry characteristics and market composition may be more pronounced. Variability in earnings and profitability may result in changes in debt protection measures…â€.
In assigning the rating, PhilRatings positively viewed the entry of Ayala Land, Inc. (ALI) and Greenfield Development Corporation, as investors in Bonifacio Land Corporation, shareholder of FBDC, positively. ALI’s proven track record as a developer and its solid financial standing augur well for FBDC. Upon the entry of the new investors, for example, ALI provided funds for FBDC’s on-going project, Bonifacio Ridge. Going forward, however, how FBDC will be made to fit into ALI’s over-all development plan, bears close watching. As the acquisition of shares in BLC has been quite recent, specific plans are still being firmed up.
Still, the property market continues to be weak and improving earnings and cash flows will remain to be a challenge for FBDC. Although the company has a strong capital base, it will have to manage its debt obligations in the short to medium-term with great resourcefulness.