Alliance Global Group, Inc. (AGI) looks back at 2016 with pride. Successfully building on the record setting achievements of 2015, the major subsidiaries of the Group again delivered strongly in terms of financial results and brand positioning in both the local and international markets.
Our net profit amounted to P22.8 billion, up 5% from the previous year’s level of P21.7 billion, as consolidated revenues reached P139.7 billion. Net income to owners stood at P14.8 billion, reflecting a 6% year-on-year increase.
Megaworld Corporation broke its own record with net profit growth reported at 12% to P11.6 billion, excluding P82 million in non-recurring gains. Its stellar performance was achieved on the back of a sharp 15% rise in rental income to an all-time high of P10 billion (from P8.7 billion in 2015), while total residential revenues stood at P33.1 billion. The company also benefited from continued operational efficiencies which provided a boost in margins across all business segments.
Emperador Inc. recorded a healthy 11% growth in net profit to P7.7 billion, buoyed by an overall improvement in liquor margins. Consolidated revenues stood at P41 billion, with its high-margin brandy business contributing 72% of total, while its international whisky operations took the balance of 28%. Its flagship Emperador Brandy products maintained market leadership in the country, while Whyte and Mackay’s single malt branded products Dalmore and Jura made their way aggressively in various markets in Asia, Europe, the United States and Travel Retail.
Travellers International Hotel Group, Inc. maintained its profitable performance in 2016 with EBITDA rising by 4% to P6.4 billion despite a highly competitive environment. The country’s first integrated resort ended the year with a net profit of P3.4 billion on revenues of P27.5 billion. Gross gaming revenues amounted to P23.6 billion, supported by better win rate and increasing contribution from its non-VIP segment. Revenues from non-gaming activities (which include hotel, F&B, and other sources) grew by 10% to P3.8 billion, benefiting from the diversified offerings that set Travellers apart from the competition.
Golden Arches Development Corporation (GADC) recorded a 62% spike in 2016 net profit to P1.2 billion from P760 million a year before. Sales revenues grew 11% to P22.6 billion coming on the back of an aggressive store expansion program and a robust system-wide same-store sales growth of 7.4%.
Our performance in 2016 underscored our Group’s ongoing thrusts to identify and develop new products or ventures that could allow us to diversify risks and ensure a more sustainable growth over the long term. This is also aligned with our ultimate goal of providing our customers with a wide range of pleasant and unique experiences through our varied product offerings and services.
To illustrate, our Megaworld’s townships throughout the country serve our customers’ needs for community – from our much in-demand residential units to our well-located office buildings and lifestyle malls that have become major leisure attractions. Add to this, Megaworld has tourism estate development projects in popular destinations, such as Boracay Newcoast and Twin Lakes in Tagaytay, that offer unique experiences in a community setting.
Emperador raised the bar in the Philippine liquor market with its varied offerings from our mainstream Emperador Brandy Light products to our aspirational Andy Player Whisky and premium Fundador Brandy, as well as our luxury Dalmore Scotch whisky under Whyte and Mackay. This was made possible by our international acquisitions starting from our vineyard, bodegas and distilleries in Spain to our whisky facilities in Scotland, which transformed Emperador from a purely domestic company into one of the major players in the global spirits market.
Travellers continued to be aggressive with its expansion projects at Resorts World Manila which, once completed, should make it the largest integrated resort in the country with the most hotel offerings. The Marriott Grand Ballroom remains a popular venue for MICE (Meetings, Incentives, Conventions and Exhibitions) events and has been instrumental in the government’s global campaign to market the Philippines as a world-class tourism destination.
GADC’s McDonald’s has achieved increasing popularity among consumers despite tougher competition with the entry of new local and international players in the quick service restaurant business. Aside from keeping its core food offerings relevant, McDonald’s has invested heavily in new store openings in strategic and attractive locations. It closed the year with a total of 520 stores nationwide, with 44 new stores opened, including the ones in Abra, Ormoc, Tiongsan, Bogo, Dipolog and Bayombong.
We end 2016 with both an upbeat note and the recognition that the coming years will be more challenging for us all. As we strive to maintain leadership in the various fields where we do business, it is imperative that we nurture the spirit of innovation, hard work and focus that has sustained us through the years. I am both confident and grateful that you and all stakeholders of the AGI Team are one in seeing our overall vision come true.
Andrew L. Tan
Chairman and Chief Executive Officer
Alliance Global Group, Inc. and Megaworld Corporation