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By: Marvin Germo | March 30, 2018

GT Capital Arrives at 15 Billion Profit in 2017

GT Capital Holdings Inc., the esteemed holding firm of banking tycoon George Ty, saw a surge in its net income in 2017, going up to P15 billion – 29% higher than its P11.7 billion net income on the previous year.

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Group Effort!

According to GT Capital President Carmelo Maria Luza Bautista, the improved performances of partners AXA Philippines, Federal Land Inc., Metropolitan Bank and Trust Co. (Metrobank), Metro Pacific Investments Corp. (MPIC), Property Co. of Friends (Pro-Friends), and Toyota Motor Philippines Corp. (TMPC) are mainly to thank for the income hit.

Toyota Motor Philippines alone contributed an overall market share of 39% through growing its net income by 11% to P13.4 billion last year from P12.1 billion in 2016, along with a 19% increase of consolidated revenues which went up from P115.8 billion to P185.3 billion.

Meanwhile, the insurance company AXA Philippines’ net income bolstered by 42% from 1.7 billion in 2016 to P2.4 billion in 2017, while GT Cap’s real estate firms Federal Land and Property Co. of Friends booked a combined 5% growth in revenues.

Furthermore, due to an increase in loans and deposits, Metrobank was able to improve margins and acquire better operating leverage resulting to a 10% increase in its core net income last year, to end at P18.2 billion. Likewise, Metro Pacific reported a 17% rise in its earnings from P12.1 billion in 2016 to P14.1 billion, primarily because of traffic growth on all roads handled by Metro Pacific Tollways Corp.

Following all of this, GT Capital disclosed a 19% increase in its consolidated revenues from P202.1 billion in 2016 to P239.8 billion last year, and a 29% rise in its core net income to end at P15 billion in 2017 from P11.7 billion in the year prior.

Higher expectations this year

Because of the notable escalation in its net income last year, GT Capital Holdings’ share price went up by 0.52% or P6, finishing up at P1,169 apiece. Citing a sustained growth momentum in its wide range of businesses, the diversified conglomerate is expecting a higher net income increase this year.

“Our full-year 2017 results show encouraging growth momentum. GT Capital’s key sectors continue to be in the sweet spot, in line with our country’s stage of economic development, reaping demographic dividends,” Bautista said in a statement to the Philippine Stock Exchange.

Technical Analysis

Looking at the chart below, the stock is already oversold and has bounced from the 1,127 support level. This is a buy signal already for quick traders, as long as the stock stays above 1,127 the bounce will bring it to 1,290. For those who bought from the bounce from the support you can take profits if the stock fails to break 1,290. However if the stock breaks out of 1,290, hold on to your position and adjust your target price to 1,445.

This is all contingent on the stock holding above 1,127.

For position traders, the stock is still bearish and on a downtrend. There is no buy signal yet for the stock, it would be prudent to stay away first until we find any significant form of reversal.

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