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Chairman’s Message
AGI Annual Stockholders’ Meeting ( June 20, 2019)

The year 2018 was another period of strong performance for Alliance Global Group, Inc. (AGI). Our subsidiaries broke barriers, set newest trends and surpassed expectations as we continue to disrupt the market and outperform the competition.

We recorded unprecedented level of consolidated revenues of P156.8 billion and a net income of P23.7 billion for the year. The strong performance of our subsidiaries has placed us once more at a business highpoint. This was achieved through our aggressive expansion strategies in the past five years with prudent financial management across our various business segments.

Megaworld Corporation, our property development arm, posted record earnings of P15.8 billion on revenues of P57.4 billion in 2018.

During the year, it has launched its biggest series of residential projects yet since it initially broke ground 30 years ago. Totaling P106 billion worth of development projects with over 11,200 residential units were made available to the market in Metro Manila, as well as in the northern and southern regions of the country.

New lifestyle malls were built within its townships, bringing to 700,000 square meters its total gross floor area of commercial spaces designed to provide a new level of retail experience to its customers. More office towers were also completed, beefing up gross leasable space to an aggregate of 1.1 million square meters.

Topping our list of office projects, we are very pleased to be the chosen firm of JP Morgan Chase Bank NA. to construct its build-to-suit global service center in the Philippines. This huge project brokered something more than just an edifice: the proffered trust proved most invaluable. Contracts akin to these should reinforce Megaworld’s foothold in the real estate industry.

As we align ourselves with the continued growth in the country’s tourism sector, our Group opened the doors of more new hotels in Metro Manila and in other key provincial cities. To-date, AGI – under the combined hotel portfolio of Megaworld and Travellers International Hotel Group, Inc.– currently offers a total of 5,175 rooms to our valued guests, bringing us closer to our target of 12,000 keys in three to five years.

The Hilton Hotel and Sheraton Hotel now tower within the Resorts World Manila complex and will soon be joined by other world-renowned brands such as Hotel Okura and the Ritz-Carlton Hotel. Iloilo City finally has its first international hotel on the unveiling of the Courtyard by Marriott in Iloilo Business Park. Our homegrown brands have also performed well, including our newly-launched Twin Lakes Hotel & Spa in Batangas. Aggregate revenues from our hotel operations have reached P5.0 billion in 2018.

Resorts World Manila, owned and operated by Travellers, still maintains its position as the country’s most expansive integrated leisure and entertainment resort. Travellers recorded P1.4 billion in net profit in 2018 as gross revenues reached P24.7 billion.

Gross gaming revenues rose by 17%, driven by the strong surge in VIP rolling volumes while its mass segment also recovered. The soft opening of the Grand Wing saw an upturn in property visitation which averaged at 28,500 per day while hotel occupancy rate stood at 79% across its various international hotel brands.

Emperador Inc. rides high on its brandy dominance in the global market and record-breaking feats in international whisky sales. In 2018, its consolidated revenues reached P47.1 billion while net profit amounted to P6.8 billion as we continued to expand our spirits portfolio in terms of product variation and market performance.

Whyte and Mackay maintains its remarkable growth, driven by its leading single malt brands The Dalmore and Jura. The Dalmore remains at the apex of the Scotch whisky single malt category as the brand attracted new consumers through both the Core Range and the Rare Expressions. Our other single malt whiskies Jura, Tamnavulin and Fettercairn have widened their market reach with numerous product launches. Our blended whisky, Shackleton, also continues to strengthen its market stature in the UK, US and Travel Retail, and sees Asia as a new region to conquer this year.

Bodegas Fundador prevails as one of the world leaders in the brandy segment. Its Fundador Supremo 18YO, a super-premium Brandy de Jerez, has earned recognition as the Best Grape Brandy at the Hong Kong International Wine & Spirit Competition. Our Domecq trademarks have also gained a firm commercial reach to South America, specifically Brazil and Colombia, and in the US.

Despite fierce competition among local brands, our flagship product Emperador Brandy maintains its nationwide market leadership, particularly in key metro cities. Emperador Light celebrated its success as it honors the resilience of the Filipinos with the “Galing ng Pilipino” ad campaign that cuts across different media platforms and complete with its original accompanying song, “Ating Tagumpay”. We successfully launched in the local market The Bar Premium Gin in Pink, Lime and Premium Dry variants which has become a certified party favorite among the young crowd. Slowly but surely, our spirits brands have captured the taste and patronage of strong drinks aficionados both here and overseas.

Our quick service restaurant business under Golden Arches Development Corporation has launched its first batch of NXTGEN stores in 2018, bringing innovations that will upgrade service and consumer dining experience to the next level. McDonald’s ended the year with 620 stores, effectively adding one store a week under its aggressive expansion program across the country. This, coupled with a healthy growth in same-store sales, have underpinned its improvement in revenues to P28.3 billion and profit to P1.6 billion during the year.

The youngest enterprise among our line-up of subsidiaries, Infracorp Development Inc., has succeeded to be granted original proponent status in both of its maiden projects. The Fort Bonifacio-Makati Skytrain, a 2-kilometer monorail which will link our Uptown Bonifacio township to Makati City, will immensely alleviate the everyday commute of the riding public.

Another project, the rehabilitation and upgrade of the Ninoy Aquino International Airport (NAIA), will help increase the capacity of NAIA in accommodating an estimated 47 million passengers in 2021 and about 65 million passengers by 2023.

Through a quarter of a century since our incorporation, AGI has built a proven track record of creating value over time and in delivering sustainable and profitable growth for its stakeholders. We continue atmosphere for all of our business segments.

AGI will always rely on the staunch dedication and unwavering support of all of our stakeholders for continued corporate advancement and in pursuit of nation-building. Once more I seek the same passion and your unrelenting commitment to spur our group to initiate and innovate more groundbreaking strategies for the fulfillment of our goals for 2019 and the years to come.