Interim report
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CR03676-2025 SECURITIES AND EXCHANGE COMMISSION SEC FORM 20-IS INFORMATION STATEMENT PURSUANT TO SECTION 17.1(b) OF THE SECURITIES REGULATION CODE 1. Check the appropriate box: Preliminary Information Statement Definitive Information Statement 2. Name of Registrant as specified in its charter VISTA LAND & LIFESCAPES, INC. 3. Province, country or other jurisdiction of incorporation or organization Philippines 4. SEC Identification Number CS200703145 5. BIR Tax Identification Code 006-652-678-000 6. Address of principal office Lower Ground Floor, Building B, Evia Lifestyle Center, Vista City, Daanghari, Almanza II, Las Piñas City Postal Code 1747 7. Registrant's telephone number, including area code (632) 8874-5758 / (632) 8872-6947 / (632) 3226-355 8. Date, time and place of the meeting of security holders June 25, 2025, 10:00 a.m. (via Remote Communication) 9. Approximate date on which the Information Statement is first to be sent or given to security holders Jun 3, 2025 10. In case of Proxy Solicitations: Name of Person Filing the Statement/Solicitor N/A Address and Telephone No. N/A 11. Securities registered pursuant to Sections 8 and 12 of the Code or Sections 4 and 8 of the RSA (information on number of shares and amount of debt is applicable only to corporate registrants): Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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No Yes Title of Each Class Number of Shares of Common Stock Outstanding and Amount of Debt Outstanding Common Stock 12,698,007,676 Preferred Stock Series 2A 14,337,040 Preferred Stock Series 2B 15,662,960 Vista Land Retail Bonds issued in 2017 5,000,000,000 Vista Land Retail Bonds issued in 2018 3,500,000,000 Vista Land Retail Bonds issued in 2019 10,000,000,000 Vista Land Retail Bonds issued in 2023 6,000,000,000 13. Are any or all of registrant's securities listed on a Stock Exchange? If yes, state the name of such stock exchange and the classes of securities listed therein: Common shares, Preferred Series 2 shares The Exchange does not warrant and holds no responsibility for the veracity of the facts and representations contained in all corporate disclosures, including financial reports. All data contained herein are prepared and submitted by the disclosing party to the Exchange, and are disseminated solely for purposes of information. Any questions on the data contained herein should be addressed directly to the Corporate Information Officer of the disclosing party. Vista Land & Lifescapes, Inc. VLL PSE Disclosure Form 17-5 - Information Statement for Annual or Special Stockholders' Meeting References: SRC Rule 20 and Section 17.10 of the Revised Disclosure Rules Date of Stockholders' Meeting Jun 25, 2025 Type (Annual or Special) Annual Time 10:00AM Venue via Remote Communication Record Date Jun 2, 2025 Inclusive Dates of Closing of Stock Transfer Books Start Date N/A End date N/A Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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Other Relevant Information - Filed on behalf by: Name Gillian Guarina Designation Investor Relations Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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COVER SHEET C S 2 0 0 7 0 3 1 4 5 S.E.C. Registration Number V I S T A L A N D & L I F E S C A P E S , I N C . (Registrant’s Full Name) L O W E R G R O U N D F L O O R , B U I L D I N G B , E V I A L I F E S T Y L E C E N T E R , V I S T A C I T Y , D A A N G H A R I , A L M A N Z A (Business Address: No. Street/City/Province) Brian N. Edang 3226-3552 ext. 0088 Contact Person Registrant Telephone Number 1 2 3 1 20-IS Preliminary Information Statement 0 6 1 6 Month Day FORM TYPE Month Day Calendar Year Annual Meeting Secondary License Type, If Applicable Dept. Requiring this Doc. Amended Articles Number/Section Total Amount of Borrowings Total No. of Stockholders Domestic Foreign ---------------------------------------------------------------------------------------------------------- To be accomplished by SEC Personnel concerned File Number LCU Document I.D. Cashier Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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C E R T I F I C A T I O N Vista Land & Lifescapes, Inc. (the “Company”) hereby certifies that , except for Ms. Camille A. Villar, none of the directors and officers and the nominees for election of directors of the Company named in the Information Statement for the Annual Meeting of its shareho lders for the year 2025 works in the government as of the date hereof. Ms. Villar is currently a duly elected Congresswoman, representing Las Piñas City. She is not disqualified from being, and does not require any consent or approval to serve as, a director of the Company on account of her said position. Issued this May 19, 2025. Vista Land & Lifescapes, Inc. By: Gemma M. Santos Corporate Secretary Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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NOTICE OF ANNUAL MEETING OF STOCKHOLDERS Notice is hereby given that the annual meeting of stockholders of VISTA LAND & LIFESCAPES, INC. (the “Company” or “VLL”) for the year 2025 will be held online on June 25, 2025, Wednesday at 10:00 a.m. with the proceedings livestreamed and voting conducted in absentia through the Company’s secure voting online facility which may be accessed through: https://apps.vistaland.com.ph/VSRV/registration. The following shall be the agenda of the meeting: 1. Call to Order 2. Certification of Notice and Quorum 3. Approval of the minutes of the last Annual Meeting of Stockholders held on June 1 8, 2024 4. Presentation of the President’s Report, Management Report and Audited Financial Statements for the year 2024 5. Ratification of all acts and resolutions of the Board of Directors and Management from the date of the last annual stockholders’ meeting until the date of this meeting. 6. Election of the members of the Board of Directors, including the Independent Directors, for the year 2025 7. Appointment of External Auditors 8. Adjournment Minutes of the 2024 Annual Meeting of Stockholders is available at the website of the Company, https://www.vistaland.com.ph/assets/stockinformation/disclosures/ef785d9696/VLL -AGM-Minutes-of- Meeting-2024-07.12.2024-revised.pdf. Electronic copies of the Information Statement and Management Report with respect to the 2025 Annual Meeting of Stockholders of the Company, as well as the 2024 Annual Report (SEC Form 17A) and Quarterly Report for period ended 31 March 2025 (SEC Form 17Q) of the Company, are available on the Company’s website (www.vistaland.com.ph) and PSE Edge (https://edge.pse.com.ph). The Board of Directors has fixed the close of business on June 2 , 202 5, as the record date for the determination of stockholders entitled to notice of and to vote at the Annual Stockholders’ Meeting. For the convenience of the Company’s stockholders, the Company will dispense with the physical attendance of stockholders at the meeting and will allow attendance only by remote communication, and voting only in absentia or by appointing the Chairman of the meeting as their proxy. Stockholders who intend to participate in the meeting via remote communication and to exercise their vote in absentia must notify the Corporate Secretary by registering through the https://apps.vistaland.com.ph/VSRV/registration on or before June 18, 2025. All information submitted will be subject to verification and validation by the Corporate Secretary. Stockholders who intend to appoint the Chairman of the Meeting as their proxy should submit duly accomplished proxy forms on or before June 18, 2025 at the Office of the Corporate Secretary at UGF Worldwide Corporate Center, Shaw Blvd., Mandaluyong City and/or by email to ir@vistaland.com.ph. The procedures for participating in the meeting through remote communication and for casting of votes in absentia are set forth in the Information Statement. GEMMA M. SANTOS Corporate Secretary Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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3 Annex “A” AGENDA DETAILS AND RATIONALE 1. Certification of Notice and Quorum The Corporate Secretary, Atty. Gemma M. Santos, will certify that copies of the Notice of Meeting were duly published in the business section of two (2) newspapers of general circulation, and will certify the number of shares represented in the meeting, for the purpose of determining the existence of quorum to validly transact business. Pursuant to Sections 23 and 57 of the Revised Corporation Code and SEC Memorandum Circular No. 6, Series of 2020, the Corporation has set up a designated web address which may be accessed by the stockholders to participate and vote in absentia on the agenda items presented for resolution at the meeting. A stockholder who votes in absentia as well as a stockholder participating by remote communication shall be deemed present for purposes of quorum. The following are the rules and procedures for the conduct of the meeting: (i) Stockholders may attend the meeting remotely by registering through the https://apps.vistaland.com.ph/VSRV/registration. Stockholders may send their questions or comments prior to the meeting by e-mail at ir@vistaland.com.ph. The Website shall include a mechanism by which questions may be posted live during the meeting. The Company will endeavor to answer the questions in the course of the meeting, or separately through the Company’s Investor Relations Office. (ii) Each of the Agenda items which will be presented for resolution will be shown on the screen during the live streaming as the same is taken up at the meeting. (iii) Stockholders must notify the Company of their intention to participate in the meeting by remote communication to be included in determining quorum, together with the stockholders who voted in absentia and by proxy. (iv) Voting shall only be allowed for stockholders registered in the Company’s Electronic Voting in Absentia System or through the Chairman of the meeting as proxy. (v) All the items in the Agenda for the approval by the stockholders will need the affirmative vote of stockholders representing at least a majority of the issued and outstanding voting stock represented at the meeting. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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4 (vi) Election of directors will be by plurality of votes and every stockholder will be entitled to cumulate his votes. (vii) The Company’s stock transfer agent and Corporate Secretary will tabulate and validate all votes received. 2. Approval of the minutes of the last Annual Meeting of Stockholders held on June 18, 2024 The minutes of the last Annual Meeting of Stockholders held on June 18, 2024 will be presented for approval by the stockholders, in keeping with Section 49(a) of the Revised Corporation Code. A copy of such minutes has been uploaded on the Company’s website immediately after the Annual Meeting of Stockholders for the year 2024. https://www.vistaland.com.ph/assets/stockinformation/disclosures/ef785d9696/VLL-AGM-Minutes-of-Meeting-2024-07.12.2024-revised.pdf 3. President’s Report, Management Report and Audited Financial Statements as of and for the year ended December 31, 2024 The audited financial statements (“AFS”) of the Company as of and for the year ended December 31, 2024 (as audited by SyCip, Gorres, Velayo & Co.), a copy of which is incorporated in the Preliminary Information Statement for this meeting, will be presented for approval by the stockholders. The President and CEO of the Company, Mr. Manuel Paolo A. Villar, will deliver a report to the stockholders on the Company’s performance for the year 2024 (which will include highlights from the AFS) and the outlook for 2025. The Board and Management of the Company believe it in keeping with the Company’s thrust to at all times observe best corporate governance practices, that the results of operations and financial condition of the Company be presented and explained to the shareholders. Any comment from the shareholders, and their approval or disapproval of these reports, will provide guidance to the Board and Management in their running of the business and affairs of the Company. 4. Ratification of all acts and resolutions of the Board of Directors and Management from the date of the last annual stockholders’ meeting until the date of this meeting Ratification by the stockholders will be sought for all the acts and resolutions of the Board of Directors and all the acts of Management taken or adopted from the date of the last annual stockholders’ meeting until the date of this meeting. A brief summary of these resolutions and actions is set forth in the Preliminary Information Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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5 Statement for this meeting. Copies of the minutes of the meetings of the Board of Directors are available for inspection by any shareholder at the offices of the Company during business hours. The Board and Management of the Company believe it is in keeping with the Company’s thrust to at all times observe best corporate governance practices, that ratification of their acts and resolutions be requested from the shareholders in this annual meeting. Such ratification will be a confirmation that the shareholders approve the manner that the Board and Management run the business and affairs of the Company. 5. Election of the members of the Board of Directors, including the Independent Directors, for the year 2025 The Corporate Secretary will present the names of the persons who have been duly nominated for election as Directors of the Company in accordance with the By-Laws and Revised Manual on Corporate Governance of the Company and applicable laws and regulations. The voting procedure is set forth in the Preliminary Information Statement for this meeting. 6. Appointment of External Auditors The Audit Committee is endorsing to the stockholders the re-appointment of SyCip, Gorres, Velayo & Co. as external auditor of the Company for the fiscal year 2025. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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6 PROXY Stockholders who would like to be represented thereat by a proxy may choose to execute and send a proxy form to the Office of the Corporate Secretary (Atty. Gemma M. Santos) at UGF Worldwide Corporate Center, Shaw Blvd., Mandaluyong City, on or before June 18, 2025. A sample proxy form is provided below. Stockholders may likewise email a copy of the accomplished proxy form to gmsantos@picazolaw.com or to ir@vistaland.com.ph. The undersigned stockholder of VISTA LAND & LIFESCAPES, INC. (the “Company”) hereby appoints the Chairman of the meeting, as attorney-in-fact or proxy, with power of substitution, to represent and vote ______________ shares registered in his/her/its name as proxy of the undersigned stockholder, at the Annual Stockholders’ Meeting of the Company on June 25, 2025 at 10:00 a.m. and at any adjournment thereof for the purpose of acting on the following matters: 1. Approval of the minutes of the last Annual Meeting of Stockholders held on June 18, 2024 q Yes q No q Abstain 2. Noting of the President’s Report and Management Report and Approval of the Audited Financial Statements for the year 2024 q Yes q No q Abstain 3. Ratification of all acts and resolutions of the Board of Directors and Management from the date of the last annual stockholders’ meeting until the date of this meeting q Yes q No q Abstain 4. Election of the members of the Board of Directors, including the Independent Directors, for the year 2025 No. of Votes Manuel B. Villar Manuel Paolo A. Villar Cynthia J. Javarez Camille A. Villar Frances Rosalie T. Coloma Justina F. Callangan Cherrylyn P. Caoile 5. Re-appointment of SyCip Gorres Velayo & Co. as external auditor q Yes q No q Abstain Printed Name and Signature of the Stockholder Date This proxy should be received by the Corporate Secretary on or before June 18, 2025, the deadline for submission of proxies. This proxy when properly executed will be voted in the manner as directed herein by the stockholder(s). If no direction is made, this proxy will be voted for the election of all nominees and for the approval of the matters stated above and for such other matters as may properly come before the meeting in the manner described in the Information Statement. A stockholder giving a proxy has the power to revoke it at any time before the right granted is exercised. Notarization of this proxy is not required. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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7 SECURITIES AND EXCHANGE COMMISSION SEC FORM 20-IS INFORMATION STATEMENT PURSUANT TO SECTION 20 OF THE SECURITIES REGULATION CODE 1. Check the appropriate box: [x] Preliminary Information Statement [x] Definitive Information Statement 2. Name of Registrant as specified in its charter: VISTA LAND & LIFESCAPES, INC. 3. Philippines Province, country or other jurisdiction of incorporation or organization 4. SEC Identification Number CS200703145 5. BIR Tax Identification Code 006-652-678-000 6. Lower Ground Floor, Building B, Evia Lifestyle Center, Vista City, Daanghari, Almanza II, Las Piñas City 1747 Address of principal office Postal Code 7. (632) 8874-5758 / (632) 8872-6947 / (632) 3226-3552 Registrant’s telephone number, including area code 8. Date, time and place of the meeting of security holders June 25, 2025, 10:00 a.m. (via Remote Communication) 9. Approximate date on which the Information Statement is first to be sent or given to security holders June 3, 2025 Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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8 10. Securities registered pursuant to Sections 8 and 12 of the Code or Sections 4 and 8 of the RSA: Title of Each Class Number of Shares of Common Stock Outstanding and Amount of Debt Outstanding Common Shares (net of treasury shares as of April 30, 2025) Preferred Shares • Series 2A • Series 2B Vista Land Retail Bonds issued in 2017 Vista Land Retail Bonds issued in 2018 Vista Land Retail Bonds issued in 2019 Vista Land Retail Bonds issued in 2023 12,698,007,676 Shares 14,337,040 Shares 15,662,960 Shares P 5,000,000,000.00 P 3,500,000,000.00 P 10,000,000,000.00 P 6,000,000,000.00 11. Are any or all of registrant's securities listed in a Stock Exchange? Yes x No _______ Philippine Stock Exchange Common shares, Preferred Series 2 shares WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE REQUESTED NOT TO SEND US A PROXY Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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9 PART I INFORMATION STATEMENT GENERAL INFORMATION Date, time and place of meeting of security holders. Date: June 25, 2025 Time: 10:00 a.m. Place: N/A (via remote communication) The corporate mailing address of the principal office of the Company is Lower Ground Floor, Building B, Evia Lifestyle Center, Vista City, Daanghari, Almanza II, Las Piñas City. This Information Statement may be accessed by the Company’s stockholders beginning June 3, 2025 at the Company’s website www.vistaland.com.ph. Dissenters' Right of Appraisal Under Sections 41 and 80, Title X, of the Revised Corporation Code of the Philippines (“Corporation Code”), any stockholder of the Company shall have the right to dissent and demand payment of the fair value of his shares only in the following instances, as provided by the Corporation Code: (1) In case any amendment to the articles of incorporation has the effect of changing or restricting the rights of any stockholder or class of shares, or of authorizing preferences in any respect superior to those outstanding shares of any class, or of extending or shortening the term of corporate existence; (2) In case of sale, lease, exchange, transfer, mortgage, pledge or other disposition of all or substantially all of the corporate property and assets; (3) In case of merger or consolidation; and (4) In case of investment of corporate funds for any purpose other than the primary purpose of the Company. The appraisal right, when available, may be exercised by any stockholder who shall have voted against the proposed corporate action, by making a written demand on the Corporation within thirty (30) days after the date on which the vote was taken, for payment of the fair value of his shares provided, that failure to make the demand within such period shall be deemed a waiver of the appraisal right. A stockholder must have voted against the proposed corporate action in order to avail himself of the appraisal right. If the proposed corporate action is implemented or effected, the Corporation shall pay to such stockholder upon surrender of his certificate(s) of stock representing his shares, the fair value thereof as of the day prior to the date on which the vote was taken, excluding any appreciation or depreciation in anticipation of such corporate action. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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10 If within a period of sixty (60) days from the date the corporate action was approved by the stockholders, the withdrawing stockholder and the corporation cannot agree on the fair value of the shares, it shall be determined and appraised by three (3) disinterested persons, one of whom shall be named by the stockholder, another by the Corporation and the third by the two thus chosen. The findings of the majority of appraisers shall be final, and their award shall be paid by the Corporation within thirty (30) days after such award is made: provided, that no payment shall be made to any dissenting stockholder unless the Corporation has unrestricted retained earnings in its books to cover such payment; and provided further, that upon payment by the Corporation of the agreed or awarded price, the stockholder shall forthwith transfer his shares to the Corporation. None of the matters that are proposed to be taken up during the meeting gives a dissenter a right of appraisal. Interest of Certain Persons in or Opposition to Matters to be Acted Upon None of the officers or directors, or any nominee for election as director, or any of their associates has any substantial interest, direct or indirect, in any of the matters to be acted upon in the stockholders’ meeting. No director has informed the Company in writing that he intends to oppose any action to be taken at the meeting. CONTROL AND COMPENSATION INFORMATION Voting Securities and Principal Holders Thereof (a) Number of shares outstanding as of April 30, 2025: Common : 12,698,007,676 Series 1 Preferred : 3,300,000,000 (b) Record Date : June 2, 2025 Each common and each Series 1 preferred share of stock of the Company is entitled to one (1) vote. Pursuant to Article II, Section 7 of the Company’s By-Laws, every holder of voting stock may vote during all meetings, including the Annual Stockholders’ Meeting, either in person or by proxy executed in writing by the stockholder or his duly authorized attorney-in-fact. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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11 Stockholders entitled to vote are also entitled to cumulative voting in the election of directors. Section 23 of the Corporation Code provides, in part, that: “….in stock corporations, every stockholder entitled to vote shall have the right to vote in person or by proxy the number of shares of stock standing, at the time fixed in the by-laws, in his own name on the stock books of the Corporation, or where the by-laws are silent, at the time of the election; and said stockholder may vote such number of shares for as many persons as there are directors to be elected, or he may cumulate said shares and give one candidate as many votes as the number of directors to be elected multiplied by the number of his shares shall equal, or he may distribute them on the same principle among as many candidates as he shall see fit….” For this year’s meeting, the Board of Directors had adopted a resolution to allow stockholders entitled to notice of, and to attend the meeting, to exercise their right to vote in absentia. Equity Ownership of Foreign and Local Shareholders Foreign and local security ownership as of April 30, 2025: Class Foreign Filipino Total Outstanding shares Shares Percent of Total Class/Total Outstanding Shares Shares Percent of Total Class/Total Outstanding Shares Voting shares Common 1,256,928,044 9.90% 11,437,338,632 90.10% 12,698,007,676 7.84% 71.38% Series 1 Preferred 0 0.00% 3,300,000,000 100.00% 3,300,000,000 0.00% 20.59% Non voting shares Series 2A Preferred 90,600 0.63% 14,246,440 99.37% 14,337,040 0.00% 0.09% Series 2B Preferred 278,000 1.77% 15,384,960 98.23% 15,662,960 0.00% 0.10% Total 1,257,296,644 14,770,711,032 16,028,007,676 Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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12 Security Ownership of Certain Beneficial Owners and Management Security ownership of certain record and beneficial owners of more than 5.0% of the Company’s voting securities as of April 30, 2025: Title of Class of Securities Name/Address of Record Owners and Relationship with Us Name of Beneficial Owner /Relationship with Record Owner Citizenship No. of shares held % of Ownership1 Common Fine Properties, Inc LGF, Bldg B, Evia Lifestyle Center, Daang Hari, Almanza Dos, Las Piñas City Shareholder Fine Properties, Inc./ Record Owner is also beneficial Owner2 Filipino 5,786,945,661 36.17% Common PCD Nominee Corporation 6764 Ayala Avenue, Legazpi Village, Makati City Shareholder Fine Properties, Inc./ Record Owner is not the beneficial Owner2 Filipino 1,338,599,797 8.37% Series 1 Preferred Fine Properties, Inc LGF, Bldg B, Evia Lifestyle Center, Daang Hari, Almanza Dos,Las Piñas City Shareholder Fine Properties, Inc./ Record Owner is also beneficial Owner2 Filipino 3,300,000,000 20.63% Common PCD Nominee Corporation 6764 Ayala Avenue, Legazpi Village, Makati City Shareholder Record Owner is not the beneficial Owner4 Filipino 2,221,388,453 13.89% Common PCD Nominee Corporation 6764 Ayala Avenue, Legazpi Village, Makati City Shareholder Record Owner is not the beneficial Owner4 Non-Filipino 1,256,893,819 7.86% Common Althorp Holdings, Inc. 3L Starmall Las Pinas, CV Starr Ave., Pamplona, Las Pinas City Shareholder Fine Properties, Inc./Record Owner is not the beneficial Owner3 Filipino 1,235,292,469 7.72% 1 Based on the total issued and outstanding voting capital stocks as of April 30, 2025 of 15,998,007,676 shares (common and preferred series 1). 2 Mr. Manuel B. Villar, Jr. and his spouse are the controlling shareholders of Fine Properties, Inc. The right to vote the shares held by Fine Properties, Inc. has in the past been, and in this annual meeting is expected to be, exercised by either Mr. Villar or Ms. Cynthia J. Javarez. 3 Fine Properties Inc. is the controlling shareholder of Althorp Holdings, Inc. Mr. Manuel B. Villar, Jr. and his spouse are the controlling shareholders of Fine Properties, Inc. The right to vote the shares held by Fine Properties, Inc. has in the past been, and in this annual meeting is expected to be, exercised by either Mr. Villar or Ms. Cynthia J. Javarez. 4 PCD Nominee Corporation is the registered owner of shares beneficially owned by participants in the Philippine Depository & Trust Corporation, a private company organized to implement an automated book entry system of handling securities transactions in the Philippines (PCD). Under the PCD procedures, when an issuer of a PCD-eligible issue will hold a stockholders’ meeting, the PCD shall execute a pro-forma proxy in favor of its participants for the total number of shares in their respective principal securities account as well as for the total number of shares in their client securities account. For the shares held in the principal securities account, the participant concerned is appointed as proxy with full voting rights and powers as registered owner of such shares. For the shares held in the client securities account, the participant concerned is appointed as proxy, with the obligation to constitute a sub-proxy in favor of its clients with full voting and other rights for the number of shares beneficially owned by such clients. Except as indicated above, as of Record Date, the Company is not aware of any investor beneficially owning shares lodged with the PCD which comprise more than five percent (5%) of the Company’s total outstanding capital stock. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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13 Security ownership of management as of April 30, 2025: Title of Class Name of beneficial owner Amount Nature Citizenship Percent of Class1 of beneficial ownership Common Manuel B. Villar, Jr. 293,969,986 Indirect2 Filipino 1.84% 9,113,046,142 Indirect3 Filipino 56.96% Preferred Manuel B. Villar, Jr. 3,300,000,000 Indirect4 Filipino 20.63% Common Manuel Paolo A. Villar 200,000 Direct Filipino 0.00% 222,596,324 Indirect2 Filipino 1.39% Common Camille A. Villar 1,000 Direct Filipino 0.00% Common Cynthia J. Javarez 160 Direct Filipino 0.00% Common Frances Rosalie T. Coloma 4,815 Direct Filipino 0.00% Common Justina F. Callangan 75 Direct Filipino 0.00% Common Cherrylyn P. Caoile 1,000 Indirect2 Filipino 0.00% Common Jerylle Luz C. Quismundo 3,865 Direct Filipino 0.00% Common Brian N. Edang - N/A Filipino 0.00% Common Gemma M. Santos 1,000 Direct Filipino 0.00% Common Ma. Nalen SJ. Rosero - N/A Filipino 0.00% Common Lorelyn D. Mercado 100 Direct Filipino 0.00% Common Leamor S. Harlea - N/A Filipino 0.00% TOTAL 12,929,824,467 80.82 % 1Based on the total outstanding, issued and subscribed shares of 15,998,007,676 (common and preferred series 1) as of April 30, 2025. 2Shares lodged under PCD Nominee Corporation (Filipino) 3 Includes 7,125,545,458 shares held thru Fine Properties, Inc., 1,235,292,469 shares held thru Althorp Holdings, Inc. and 752, 208,215 shares held thru Manuela Corp. 4 Shares held thru Fine Properties, Inc. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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14 Except as indicated in the above table, the above named officers have no indirect beneficial ownership in the Company. Except as aforementioned, no other officers of the Company holds directly or indirectly, shares in the Company. Voting Trust Holders of 5.0% or More As of April 30, 2025, there were no persons holding more than 5.0% of a class of shares under a voting trust or similar agreement. Changes in Control The Company is not aware of any voting trust agreements or any other similar agreements which may result in a change in control of the Company. No change in control of the Company has occurred since the beginning of its last fiscal year. Directors and Executive Officers of the Registrant Term of Office Each director holds office until the annual meeting of stockholders held next after his election and his successor shall have been elected and qualified, except in case of death, resignation, disqualification or removal from office. The term of office of the officers is coterminous with that of directors that elected or appointed them. Background Information The following are the names, ages and citizenship of the incumbent directors/independent directors of the Company as of April 30, 2025: Name Age Position Citizenship Period served Manuel B. Villar, Jr. 75 Chairman of the Board Filipino 2013 to present Manuel Paolo A. Villar 48 Vice Chairman of the Board, President and Chief Executive Officer Filipino 2007 to present Camille A. Villar 40 Director, Managing Director of Vista Land Commercial Division Filipino 2014 to present Cynthia J. Javarez 61 Director, Treasurer and Chief Risk Officer Filipino 2007 to present Frances Rosalie T. Coloma 62 Director Filipino 2015 to present Justina F. Callangan 72 Independent Director Filipino 2021 to present Cherrylyn P. Caoile 50 Independent Director Filipino 2023 to present Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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15 The following are the names, ages and citizenship of the Company’s executive officers in addition to its executive and independent directors listed above as of April 30, 2025. Name Age Position Citizenship Jerylle Luz C. Quismundo 61 Chief Operating Officer Filipino Brian N. Edang 46 Chief Financial Officer and Head, Investor Relations Filipino Gemma M. Santos 62 Corporate Secretary Filipino Ma. Nalen SJ Rosero 54 Chief Legal Counsel, Chief Information Officer and Compliance Officer, Asst. Corp. Secretary Filipino Lorelyn D. Mercado 55 Controller Filipino Leamor S. Harlea 49 Chief Audit Executive Filipino The following states the business experience of the incumbent directors and officers of the Company for the last five (5) years: Manuel B. Villar, Jr. Chairman of the Board. Mr. Villar was Senator of the Philippines from 2001 to June 2013. He served as Senate President from 2006 to 2008. He also served as a Congressman from 1992 to 2001 and as Speaker of the House of Representatives from 1998 to 2000. A Certified Public Accountant, Mr. Villar graduated from the University of the Philippines in 1970 with the degree of Bachelor of Science in Business Administration and in 1973 with the degree of Master’s in Business Administration. He founded Camella Homes in the early 1970s and successfully managed said company over the years, to become the largest homebuilder in the Philippines now known as the Vista Land Group. Mr. Villar is also the Chairman of the Board of Vistamalls, Inc. (formerly Starmalls, Inc.), AllHome Corp., AllValue Holdings Corp., AllDay Marts, Inc. and Villar Land Holdings Corp. (formerly Golden MV Holdings, Inc.).He is a member of the following organizations: Makati Business Club, Manila Golf Club, Management Association of the Philippines, Financial Executive Institute of the Philippines (FINEX), Philippine Institute of Certified Public Accountants, and the Villar Social Institute for Poverty Alleviation and Governance (SIPAG). Manuel Paolo A. Villar. Vice Chairman of the Board and President & Chief Executive Officer. Mr. Villar graduated from the Wharton School of the University of Pennsylvania, Philadelphia, USA with a Bachelor of Science in Economics and Bachelor of Applied Science in 1999. He was an Analyst for McKinsey &Co. in the United States from 1999 to 2001. He joined the Vista Land Group in 2001 as Head of Corporate Planning then became the Chief Financial Officer of the Company in 2008. He was elected President and Chief Executive Officer of the Company in July 2011 and President of Vistamalls, Inc. (formerly Starmalls, Inc.) in June 2019. In addition, he is the CEO and Chairman of St. Augustine Gold and Copper Limited and Chairman of TVI Resources Development Philippines, Inc., Camella Homes, Inc., Communities Philippines, Inc., Crown Asia Properties, Inc., Brittany Corporation, Vista Residences, Inc., VistaREIT, Inc., and Powersource Phils Development Corp. Mr. Villar is also the majority shareholder of Prime Asset Ventures, Inc., and director of Fine Properties, Inc, AllHome Corp. and AllDay Marts, Inc. Camille A. Villar. Managing Director, Vista Land Commercial Division. Ms. Villar graduated from Ateneo de Manila University with a degree in Bachelor of Science in Management. She took Management in Business Administration, Global Executive MBA Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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16 Program in Instituto de Estudios Superiores de la Eprese (IESE) Business School, Barcelona, Spain. She joined the Corporate Communications Group of Brittany in 2007 until she assumed the position of Managing Director of Vista Land Commercial. She is a Director of Vistamalls, Inc. (formerly Starmalls, Inc.) and Villar Land Holdings Corp. (formerly Golden MV Holdings, Inc.). She is also the Concurrent President of All Value Holdings Corp., the Vice Chairman of AllHome Corp. and a director of AllDay Marts, Inc. Ms. Villar is currently a Congresswoman, representing Las Pinas City. Cynthia J. Javarez. Director, Treasurer, and Chief Risk Officer. Ms. Javarez graduated from the University of the East with a degree in Bachelor of Science in Business Administration major in Accounting. She is a Certified Public Accountant. She completed a Management Development Program at the Asian Institute of Management in 2006. Ms. Javarez was previously the Chief Financial Officer of Polar Property Holdings Corp. until 2011 and the Tax & Audit Head in the MB Villar Group of Companies until 2007. She was the Controller and Chief Financial Officer of Vista Land since 2013 until she became Chief Operating Officer from November 2018 to June 2022. She was the President of Camella Homes, Inc., Communities Philippines, Inc., Crown Asia Properties, Inc., Brittany Corporation and Vista Residences, Inc. until 2021. She is currently the Chairperson of the Board of Prime Asset Ventures, Inc. and is the President of Fine Properties, Inc. Frances Rosalie T. Coloma. Director. Ms. Coloma graduated cum laude from the University of the Philippines with a degree of Bachelor of Science in Business Administration and Accountancy. She is a Certified Public Accountant. She is a Director of Vista Land and Lifescapes, Inc., and Golden Bria Holdings, Inc., Ms. Coloma was the Chief Financial Officer and Chief Information Officer of Villar Land Holdings Corp. (formerly Golden MV Holdings, Inc.) from 2016 to 2019. She was also the Chief Financial Officer of Starmalls, Inc. from 2012 to 2016. Prior to becoming the Chief Operating Officer of AllHome Corp., she served as the President and Chief Executive Officer of AllDay Marts Inc. Justina F. Callangan, Independent Director. Atty. Callangan graduated cum laude from the University of the East with the degree of Bachelor of Arts in Political Science in 1973, and from San Sebastian College with the degree of Bachelor of Laws in 1980. She was a Political Science Instructor of the University of the East from 1974 to 1981 and became an Assistant Professor in Taxation and Business Laws from 1981 until her retirement from the university in 1995. Atty. Callangan started her career in the Securities and Exchange Commission as Analyst II in 1982 and held various positions with the Commission until she became Director of the Corporation Finance Department (now the Corporate Governance and Finance Department) from February 2001 to October 2017. She was also an Assistant Vice President of the Legal Department of the Urban Bank from November 1995 to November 2000. From November 2018 to December 2019, Atty. Callangan served as consultant in the Listings Department of the Philippine Stock Exchange. She was elected in August 2020 as Director representing the Public Sector in the Securities Investors Protection Fund, Inc. Currently, she is an Independent Director of ORIX Metro Leasing and Finance Corporation, Panasonic Manufacturing Philippines Corp. and AIB Money Market Fund, a SEC-registered mutual fund. She is also a Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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17 consultant to ASA Philippines Foundation, Inc. and to Divina Law Office since 2018. Atty. Callangan is a Mandatory Continuing Legal Education (MCLE) Lecturer on various SEC matters in both the UP-Law Center Institute for the Administration of Justice and Center for Global Best Practices. Cherrylyn P. Caoile, Independent Director. Atty. Caoile obtained her Bachelor of Science in Legal Management from the De La Salle University and earned the degree of Juris Doctor in Ateneo de Manila School of Law. She worked in Picazo Buyco Tan Fider & Santos in 1998, where she became a partner in 2009 until 2019. She served as an Assistant Professor in Commercial Law Department for De La Salle University – College of Business & Economics from 2003 to 2005. Ms. Caoile was recently the legal consultant of House of Representatives, Committee on Economic Affairs. She is currently the Chairman of the Board of Taipan Security Services, Inc. and currently the Independent Director of Vista Land & Lifescapes, Inc., Vistamalls, Inc., and VProperty, Inc. She was formerly the Director of MJC Investment Corporation, Narra Wellness Resorts, Inc., and PALI Investments, Inc. She was appointed as the Corporate Secretary of MetroPac Water Investments, Inc. and was formerly the Assistant Corporate Secretary of Smart Communications, Inc., Paymaya Philippines, Inc, and MPCALA Holdings, Inc. Atty. Caoile possesses all the qualifications and none of the disqualifications of an Independent Director under SRC Rule 38 since election as such. Jerylle Luz C. Quismundo, Chief Operating Officer. Ms. Quismundo graduated cum laude with a degree in Bachelor of Science in Business Economics from the University of the Philippines Diliman in 1983. She finished her Master in Business Administration from the same university in 1989. She has held various positions under the M.B. Villar Group of Companies since1989 and is the incumbent President of various Vista Land and Lifescapes, Inc. subsidiaries including Brittany Corporation, Camella Homes, Inc. Vista Residences, Inc., and Crown Asia Properties, Inc. Brian N. Edang. Chief Financial Officer and Head, Investor Relations. Mr. Edang is a Certified Public Accountant. He graduated cum laude with a Bachelor of Science in Accountancy from the University of St. La Salle - Bacolod. He is currently the Treasurer and Director of the following companies: Vista Residences, Inc., Brittany Corporation, Crown Asia Properties, Inc., Communities Philippines, Inc., and Camella Homes, Inc. Prior to joining the group, he was with SGV & Co. (EY Philippines) as an external auditor from 1999 to 2004. He is the Head Investor Relations of Vista Land from 2007 up to present and the Chief Financial Officer of the Company since November 2018. Mr. Edang is a member of the Philippine Institute of Certified Public Accountants (PICPA) and the Financial Executives Institute of the Philippines (FINEX). He is also currently serving as a director of VistaREIT, Inc. Gemma M. Santos. Corporate Secretary. Atty. Santos graduated cum laude with the degree of Bachelor of Arts, Major in History from the University of the Philippines in 1981, and with the degree of Bachelor of Laws also from the University of the Philippines in 1985. She is Of Counsel of Picazo Buyco Tan Fider & Santos Law Offices. She is also the Corporate Secretary of Golden MV Holdings, Inc. (formerly Golden Bria Holdings, Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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18 Inc.) and VistaREIT, Inc. and a director of Philippine Associated Smelting and Refining Corporation (PASAR), Fine Properties, Inc., and Bulakan Water Co., Inc., and Chairman of the Board of the Bulacan Water District. Ma. Nalen S.J. Rosero. Chief Legal Counsel, Chief Information Officer and Compliance Officer. Atty. Rosero graduated Salutatorian from the San Beda College of Law in 1997. She was an Associate of the Litigation Group of the ACCRA Law Offices from 1997 to 2000. She is currently the Chief Legal Counsel, Chief Information Officer, and Chief Compliance Officer of Vista Land & Lifescapes, Inc. She is also the Corporate Secretary and Director of the following companies: Household Development Corporation, Brittany Corporation, Crown Asia Properties, Vista Residences, Inc., Communities Philippines, Inc., Camella Homes, Inc., Mandalay Resources, Inc., Prima Casa Land & Houses, Inc., Vista Leisure Club, Inc., and Brittany Estates Corporation. She is also currently serving as the Chief Compliance Officer and Assistant Corporate Secretary of VistaREIT, Inc. She is also the Corporate Secretary of Vistamalls, Inc. (formerly Starmalls, Inc.). Lorelyn D. Mercado. Controller. Ms. Mercado graduated from the University of Batangas with a degree in Bachelor of Science in Business Administration-Accounting. She took Master in Business Administration at the De La Salle University. She used to be the Chief Accountant of Vista Residences, Inc. and Adelfa Properties, Inc., She is currently the Chief Accountant of Vista Land &Lifescapes, Inc. and its subsidiaries, and a Director in Vista Residences, Inc., Brittany Corporation, Crown Asia Properties, Inc., and Camella Homes, Inc. Leamor S. Harlea. Chief Audit Executive. Ms. Harlea is a Certified Public Accountant. She holds a Bachelor of Science in Accountancy from Philippine Christian University-Manila. She is currently serving as the Chief Audit Executive at Vista Land & Lifescapes, Inc. Ms. Harlea is also a member of the Philippine Institute of Public Accountants (PICPA), Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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19 Attys. Justina F. Callangan and Cherrylyn P. Caoile are the nominees for election as independent directors of the Company. Their respective business experience for the last five (5) years are as set forth above. Board Meeting Attendance Legend : (A) Absent, (P) Present, (-) Not applicable All of the incumbent Directors named above have a one-year term of office and all have been nominated for re-election to the Board of Directors. The By-Laws of the Company conforms with SRC Rule 38, as amended, with regard to the nomination of independent directors of the Company. Article III, Sections 2-A and 3 of the Company’s By-Laws provide as follows: “Section 2-A. Independent Directors – The Corporation shall have at least two (2) independent directors or at least twenty percent (20%) of the entire Board membership, whichever is lesser. The independent directors shall have all the qualifications and none of the disqualifications set forth in Section 38 of the Securities Regulation Code and its Implementing Rules and Regulations, as the same may be amended from time to time. Section 3. Election and Term - The Board of Directors shall be elected during each regular meeting of stockholders and shall hold office for one (1) year and until their successors are elected and qualified. A nomination committee is hereby created which may be organized from time to time upon determination of the Board of Directors. The nomination committee shall be composed of at least three (3) members, one of whom shall be an independent director. The nomination committee shall have the following functions: (A) formulate screening policies to enable the committee to effectively review the qualification of the nominees for independent directors; and (B) conduct nominations for independent directors prior to the stockholders’ meeting in accordance with the procedures set forth in Rule 38 of the Amended Implementing Rules and Regulations of the Securities Regulation Code, as the same may be amended from time to time.” Name of Director Jan 5 Apr 11 Apr 22 May 7 May 20 May 24 Jun 18 Jul 11 Aug 13 Nov 14 Manuel B. Villar, Jr. P P P P P P P P P P Manuel Paolo A. Villar P P P P P P P P P P Cynthia J. Javarez P P P P P P P P P P Camille A. Villar P P P P P P P P P P Frances Rosalie T. Coloma P P P P P P P P P P Justina F. Callangan P P P P P P P P P P Cherrylyn P. Caoile P P P P P P P P P P Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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20 On the other hand, SRC Rule 38, as amended, provides in part as follows: “8. Nomination and Election of Independent Director/s The following rules shall be applicable to all covered companies: A. The Nomination Committee (the "Committee") shall have at least three (3) members, one of whom is an independent director. It shall promulgate the guidelines or criteria to govern the conduct of the nomination. The same shall be properly disclosed in the Registrant's information or proxy statement or such other reports required to be submitted to the Commission. B. Nomination of independent director/s shall be conducted by the Committee prior to a stockholders' meeting. All recommendations shall be signed by the nominating stockholders together with the acceptance and conformity by the would-be nominees. C. The Committee shall pre-screen the qualifications and prepare a final list of all candidates and put in place screening policies and parameters to enable it to effectively review the qualifications of the nominees for independent director/s. D. After the nomination, the Committee shall prepare a Final List of Candidates which shall contain all the information about all the nominees for independent directors, as required under Part IV (A) and (C) of Annex "C" of SRC Rule 12, which list, shall be made available to the Commission and to all stockholders through the filing and distribution of the Information Statement, in accordance with SRC Rule 20, or in such other reports the Registrant is required to submit to the Commission. The name of the person or group of persons who recommended the nomination of the independent director shall be identified in such report including any relationship with the nominee. E. Only nominees whose names appear on the Final List of Candidates shall be eligible for election as Independent Director/s. No other nominations shall be entertained after the Final List of Candidates shall have been prepared. No further nominations shall be entertained or allowed on the floor during the actual annual stockholders'/memberships' meeting.” The Company has complied with the guidelines on the nomination and election of independent directors set forth in Rule 38 of the Amended Implementing Rules and Regulations of the Securities Regulation Code. The nominated independent directors, namely, Atty. Cherrylyn P. Caoile and Atty. Justina F. Callangan, were duly nominated by Ms. Solita Aragon Albaniel, a registered shareholder of the Company who is not a director, officer or substantial shareholder of the Company and who is not related to either of the said nominees. The Nominations Committee of the Company is composed of Mr. Manuel B. Villar, Jr., Chairman, and Ms. Frances Rosalie T. Coloma and Atty. Justina F. Callangan, members. Directors elected during the annual meeting of stockholders will hold office for one year until their successors are duly elected and qualified. A director who was elected to fill any vacancy holds office only for the unexpired term of his predecessor. No Director has resigned or declined to stand for re-election to the Board of Directors since the date of the last annual stockholders’ meeting due to disagreement with the Company on any matter relating to the Company’s operations, policies or practices. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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21 The Company has no other significant employee other than its Executive Officers. Mr. Manuel Paolo A. Villar and Ms. Camille A. Villar, who are both officers of the Company, are siblings and children of Mr. Manuel B. Villar, Jr., the Chairman of the Board. Except for the aforesaid relationship, none of the Company’s incumbent Directors or Executive Officers or the nominees for election as directors is related to the others by consanguinity or affinity within the fourth civil degree. Except as otherwise disclosed in the Annual Report of the Company (SEC Form 17-A) for the year ended December 31, 2024, the Company has not had any transaction (self-dealing or other related party transaction) during the last two (2) years in which any Director or Executive Officer or any of their immediate family members or any of the nominees for election as independent director had a direct or indirect interest. None of the aforementioned Directors or Executive Officers or any of the nominees for election as independent director is or has been involved in any criminal or bankruptcy proceeding, or is or has been subject to any judgment of a competent court barring or otherwise limiting his involvement in any type of business, or has been found to have violated any securities laws during the past five (5) years and up to the latest date. As of date, there is no formal appraisal or assessment process in respect of Board performance, although attendance by directors in board meetings are strictly monitored. Board Committees Pursuant to the Company’s Revised Manual, the Board created each of the following Board Committees and appointed Board members thereto. Nomination Committee (NC) The NC shall have at least three (3) members, one (1) of whom shall be an independent director, to review and evaluate the qualifications of all persons nominated to the Board and other appointments that require Board approval, and to assess the effectiveness of the Board’s processes and procedures in the election or replacement of directors. The members of NC are Manuel B. Villar, Jr., Chairman, Cynthia J. Javarez and Atty. Justina Callangan, members. NC 2024 Meeting Attendance Report Name Designation Meetings Attended Percentage Manuel B. Villar, Jr. Chairman 2/2 100.00% Cynthia J. Javarez Member 2/2 100.00% Justina F. Callangan Member 2/2 100.00% Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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22 Compensation and Remuneration Committee (RC) The RC Committee shall be composed of at least three (3) members, one of whom shall be an independent director, to establish a formal and transparent procedure for developing a policy on remuneration of directors and officers to ensure that their compensation is consistent with the Corporation’s culture, strategy and the business environment in which it operates. The members of RC are Manuel Paolo A. Villar, Chairman, Camille A. Villar and Atty. Cherrylyn P. Caoile, members. RC 2024 Meeting Attendance Report Name Designation Meetings Attended Percentage Manuel Paolo A. Villar Chairman 0/0 - Camille A. Villar Member 0/0 - Cherrylyn P. Caoile Member 0/0 - Audit Committee (AC) The Board established an AC to enhance its oversight capability over the Corporation’s financial reporting, internal control system, internal and external audit processes, and compliance with applicable laws and regulations. The Audit Committee shall be composed of at least three (3) appropriately qualified non-executive directors, the majority of whom, including the Chairman, should be independent. The members of the AC are Atty. Cherrylyn P. Caoile, Chairman, Atty. Justina F. Callangan and Frances Rosalie T. Coloma, members. AC 2024 Meeting Attendance Report Name Designation Meetings Attended Percentage Cherrylyn P. Caoile Chairman 2/2 100.00% Justina F. Callangan Member 2/2 100.00% Frances Rosalie T. Coloma Member 2/2 100.00% Corporate Governance Committee (GC) The GC is tasked to assist the Board in the performance of its corporate governance responsibilities. It shall be composed of at least three (3) members, with qualifications as may be prescribed by the Board of Directors taking into consideration the requirements under SEC Memorandum Circular No. 19, series of 2016 re Code of Corporate Governance for Publicly-Listed Companies (“CG Code for PLCs”). The members of GC are Atty. Justina F. Callangan, Chairman, Atty. Cherrylyn P. Caoile and Manuel B. Villar, Jr., members. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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23 GC 2024 Meeting Attendance Report Name Designation Meetings Attended Percentage Justina F. Callangan Chairman 2/2 100.00% Cherrylyn P. Caoile Member 2/2 100.00% Manuel B. Villar, Jr. Member 2/2 100.00% Board Risk Oversight Committee (BROC) The BROC is responsible for the oversight of the Corporation’s Enterprise Risk Management system to ensure its functionality and effectiveness. The BROC shall be composed of at least three (3) members, with qualifications as may be prescribed by the Board of Directors taking into consideration the requirements under the CG Code for PLCs. The members of BROC are Atty. Cherrylyn P. Caoile, Chairman, Atty. Justina F. Callangan and Cynthia J. Javarez., members BROC 2024 Meeting Attendance Report Name Designation Meetings Attended Percentage Cherrylyn P. Caoile Chairman 1/1 100.00% Justina F. Callangan Member 1/1 100.00% Cynthia J. Javarez Member 1/1 100.00% Related Party Transactions Committee (RPTC) The RPTC is tasked with reviewing all material related party transactions of the Corporation and should be composed of at least three (3) directors, with qualifications as may be prescribed by the Board of Directors taking into consideration the requirements under the CG Code for PLCs. The members of BROC are Atty. Justina F. Callangan, Chairman, Atty. Cherrylyn P. Caoile and Frances Rosalie T. Coloma., members RPTC 2024 Meeting Attendance Report Name Designation Meetings Attended Percentage Justina F. Callangan Chairman 2/2 100.00% Cherrylyn P. Caoile Member 2/2 100.00% Frances Rosalie T. Coloma Member 2/2 100.00% Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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24 Compensation of Directors and Executive Officers A. Executive Compensation The compensation for its executive officers for the years 2023 and 2024 (actual) and 2025 (projected) are shown below: Names Position Year Salary Bonus Others Manuel Paolo A. Villar Jerylle Luz C. Quismundo Brian N. Edang Ma. Nalen S.J. Rosero Lorelyn D. Mercado Aggregate executive compensation for above named officers Aggregate executive compensation of all other officers and directors, unnamed President & CEO Chief Operating Officer CFO & Head IR Chief Legal Counsel/ CIO Controller Actual 2023 Actual 2024 Projected 2025 Actual 2023 Actual 2024 Projected 2025 ₱57.9M ₱60.5M ₱61.4M ₱161.6M ₱157.0M ₱168.8M ₱8.9M ₱9.2M ₱9.3M ₱24.9M ₱13.1M ₱24.9M None None None None None None B. Compensation of Directors Standard arrangements Other than payment of reasonable per diem of P=125,000 per non-executive director for every meeting, there are no standard arrangements pursuant to which directors of the Company are compensated, or are to be compensated, directly or indirectly by the Company or the Company’s subsidiaries, for any services provided as a director for 2023 and 2024. In 2024, the Directors of the Company received remuneration as follows: Director Total Remuneration in 2023 Manuel B. Villar, Jr. N/A Manuel Paolo A. Villar N/A Cynthia J. Javarez N/A Camille A. Villar N/A Frances Rosalie T. Coloma N/A Justina F. Callangan P 937,500 Cherrylyn P. Caolile P 937,500 Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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25 Other arrangements There are no other arrangements pursuant to which any director of the Company was compensated, or is to be compensated, directly or indirectly by the Company or the Company’s subsidiaries, during 2023 or 2024 for any service provided as a director. Employment contract between the company and executive officers There are no special employment contracts between the Company and the named executive officers. Warrants and options held by the executive officers and directors There are no outstanding warrants or options held by the Company’s CEO, the named executive officers, and all officers and directors as a group. Significant employee While the Company values the contribution of each of its executive and non-executive employees, the Company believes there is no non-executive employee that the resignation or loss of whom would have a material adverse impact on the business of the Company. Other than standard employment contracts, there are no special arrangements with non-executive employees of the Company. Certain relationships and related transactions As of April 30, 2025, the Villar Family and Companies held 75.84% of the total issued and outstanding common share capital of the Company and 80.67% of the total issued and outstanding common and preferred share capital of the Company. The Company and its subsidiaries, in their ordinary course of business, engage in transactions with the Villar Family Companies and their respective subsidiaries. The Company’s policy with respect to related-party transactions is to ensure that these transactions are entered into on terms at least comparable to those available from unrelated third parties. The transactions with related parties for the year ended December 31, 2024 are discussed in the Company’s 2024 Audited Financial Statements attached as Annex “C” to this Information Statement. Please see Note 29, pages 88 to 93 of the Notes to the Financial Statements accompanying the Company’s 2024 Audited Financial Statements where the (a) business purpose of the arrangement; (b) identification of the related parties transacting business with the Company and nature of the relationship; and (c) any ongoing contractual or other commitments as a result of the arrangement, are stated. The transaction price for Related Party Transactions (“RPT”) are as negotiated and on an arm’s length basis. All material RPT with a transaction value that reaches ten percent (10%) of the Company’s total assets are subject to the review and approved for Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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26 fairness by the RPTC. Independent Public Accountants The auditing firm of SGV & Co. is being recommended for election as external auditor for the current year. Representatives of the said firm are expected to be present at the annual stockholders’ meeting and will have the opportunity to make a statement if they desire to do so, and are expected to be available to respond to appropriate questions. In 2024, the Company’s auditors did not perform any substantial non-audit services for the Company. Changes in and Disagreement with Accountants on Accounting and Financial Disclosure Since the incorporation of the Company in 2007, there was no instance where the Company’s public accountants resigned or indicated that they decline to stand for re-election or were dismissed nor was there any instance where the Company had any disagreement with its public accountants on any accounting or financial disclosure issue. The 2024 audit of the Company is in compliance with paragraph (3)(b)(iv) of SRC Rule 68, as Amended, which provides that the external auditor should be rotated, or the handling partner changed, every five (5) years or earlier. For Changes in Accounting Policies, refer to Note 3 - Changes in Accounting Policies discussion on the Consolidated Financial Statements as of and for the years ended December 31, 2022, 2023, and 2024 included in this report. Audit Committee’s Approval Policies and Procedures In relation to the audit of the Company’s annual financial statements, the Company's Revised Corporate Governance Manual provides that the audit committee shall, among other activities, (i) evaluate significant issues reported by the external auditors in relation to the adequacy, efficiency and effectiveness of policies, controls, processes and activities of the Company; (ii) ensure that other non-audit work provided by the external auditors are not in conflict with their functions as external auditors; and (iii) ensure the compliance of the Company with acceptable auditing and accounting standards and regulations. The Audit Committee of the Company is composed of Atty. Cherrylyn P. Caoile, Chairman, and Atty. Justina F. Callangan and Ms. Frances Rosalie T. Coloma, members. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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27 External Audit and Audit-Related Fees The following table sets out the aggregate fees billed for each of the last two years for professional services rendered by SGV & Co. 2023 2024 (In P Thousands) Audit and Audit-Related Fees: Fees for services that are normally provided by the external auditor in connection with statutory and regulatory filings or engagements P 37,744 P 44,861 All other fees – – Total P 37,744 P 44,861 SGV & Co. does not have any direct or indirect interest in the Company Tax Fees Except as provided above, the Company did not pay any tax fees and other fees to its external auditors. OTHER MATTERS Action with Respect to Reports The following reports will be submitted for approval by the stockholders: 1. Minutes of the last Annual Meeting of Stockholders held on June 18, 2024, covering the following matters: (i) approval of the President’s Report and the Annual Report for the year 2023; (ii) approval and adoption of the Audited Financial Statements for the year ended 31 December 2023; (iii) ratification of all acts of the Board of Directors and Management since the annual stockholders’ meeting held in June 2023; (iv) election of the directors and independent directors of the Company for the ensuing fiscal year; and (v) appointment of the external auditor of the Company for the fiscal year 2024. Minutes of the 2024 Annual Meeting of Stockholders is available at the website of the Company, www.vistaland.com.ph. The minutes contain the following information: (a) A description of the voting and vote tabulation procedures used in the meeting; (b) A description of the opportunity given to stockholders or members to ask questions and a record of the questions asked and answers given; (c) The matters discussed and resolutions reached; (d) A record of the voting results for each agenda item; and (e) A list of the directors, officers and the percentage of outstanding and voting shares of stockholders who attended and participated in the meeting. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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28 2. Audited Financial Statements for the year 2024. Other Proposed Actions 1. Ratification of all acts and resolutions of the Board of Directors and Management from the date of the last annual stockholders’ meeting until the date of this meeting as set forth in the minutes of the meetings of the Board of Directors held during the same period and in the disclosures that have been duly filed with the SEC and the PSE. These minutes cover various resolutions of the Board, including declaration of cash dividends, approval of 2024 Audited Financial Statements, appointment of officers, issuance of dollar and corporate notes, opening of bank accounts and appointment of authorized signatories for various transactions in the normal course of business of the Company. 2. Appointment of External Auditors. Voting Procedures Manner of voting In all items for approval, except in the election of directors, each share of stock entitles its registered owner to one vote. For the purpose of electing directors, a stockholder may vote such number of his shares for as many persons as there are directors to be elected or he may cumulate said shares and give one candidate as many votes as the number of directors to be elected multiplied by the number of his shares shall equal, or he may distribute them in the same principle among as many candidates as he shall see fit. For this year’s meeting, the Board of Directors had adopted a resolution to allow stockholders entitled to notice of, and to attend the meeting, to exercise their right to vote in absentia. Stockholders as of Record Date who have successfully registered their intention to participate in the annual meeting via remote communication and to vote in absentia, duly verified and validated by the Company shall be provided with unique log-in credentials to securely access the voting portal. A stockholder voting electronically in absentia shall be deemed present for purposes of quorum. Stockholders and proxy holders can cast their votes on specific matters for approval, including the election of directors. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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29 Voting requirements (a) With respect to the election of directors, candidates who received the highest number of votes shall be declared elected. (b) With respect to the adoption of the Audited Financial Statements for the year ended 31 December 2024, and the approval or ratification of the other actions set forth under the heading “Other Proposed Actions” above, the vote of majority of the outstanding capital stock entitled to vote and represented in the meeting is required to approve such matters. Method of counting votes The Corporate Secretary will be responsible for counting votes based on the number of shares entitled to vote owned by the stockholders who are participating in the meeting by remote communication and are voting in absentia or represented by proxies. All votes received shall be tabulated by the Office of the Corporate Secretary with the assistance of the Company’s stock transfer agent. The Corporate Secretary shall report the results of voting during the meeting. The detailed instructions for participation through remote communication are set forth in Annex “A” to the Notice of Meeting (Agenda Details and Rationale) hereof. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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30 UPON THE WRITTEN REQUEST OF A STOCKHOLDER, THE COMPANY UNDERTAKES TO FURNISH SAID STOCKHOLDER A COPY OF SEC FORM 17-A AND QUARTERLY REPORT FOR THE PERIOD ENDED 31 MARCH 2025 (SEC FORM 17-Q) FREE OF CHARGE, EXCEPT FOR EXHIBITS ATTACHED THERETO WHICH SHALL BE CHARGED AT COST. ANY WRITTEN REQUEST FOR A COPY OF SEC FORM 17-A AND SEC FORM 17-Q SHALL BE ADDRESSED AS FOLLOWS: Vista Land & Lifescapes, Inc. Lower Ground Floor, Building B, Evia Lifestyle Center, Vista City, Daanghari, Almanza, Las Piñas City, Philippines Attention: Brian N. Edang Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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31 PART II MANAGEMENT REPORT I. FINANCIAL STATEMENTS The Consolidated Financial Statements of the Company as of and for the year ended December 31, 2024 are incorporated herein in the accompanying Index to Financial Statements and Supplementary Schedules. II. INFORMATION ON INDEPENDENT ACCOUNTANT SGV & Co., independent certified public accountants, audited the Company's consolidated financial statements without qualification as of and for the years ended December 31, 2022, 2023, and 2024, included in this report. SGV & Co. has acted as the Company's external auditors since 2008 and as Camella Homes, Inc.’s external auditors since 1994. Michael Sabado is the current audit partner for the Company and the other subsidiaries. Mr. Sabado replaced Ms. Cyril Valencia, the previous audit parner signing for the reporting periods for the years 2017 to 2023. The Company has not had any disagreements on accounting and financial disclosures with its current external auditors for the same periods or any subsequent interim period. SGV & Co. has neither shareholdings in the Company nor any right, whether legally enforceable or not, to nominate persons or to subscribe for the securities in the Company. SGV & Co. will not receive any direct or indirect interest in the Company or in any securities thereof (including options, warrants or rights thereto) pursuant to or in connection with the Offer. The foregoing is in accordance with the Code of Ethics for Professional Accountants in the Philippines set by the Board of Accountancy and approved by the Professional Regulation Commission. In relation to the audit of the Company's annual financial statements, the Company's Revised Corporate Governance Manual provides that the audit committee shall, among other activities (i) evaluate significant issues reported by the external auditors in relation to the adequacy, efficiency and effectiveness of policies, controls, processes and activities of the Company; (ii) ensure that other non-audit work provided by the external auditors are not in conflict with their functions as external auditors; and (iii) ensure the compliance of the Company with acceptable auditing and accounting standards and regulations. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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32 The following table sets out the aggregate fees billed for each of the last two years for professional services rendered by SGV & Co. 2023 2024 (In P Thousands) Audit and Audit-Related Fees: Fees for services that are normally provided by the external auditor in connection with statutory and regulatory filings or engagements P 37,744 P 44,861 All other fees – – Total P 37,744 P 44,861 SGV & Co. does not have any direct or indirect interest in the Company III. MANAGEMENT’S DISCUSSION AND ANALYSIS REVIEW OF YEAR END 2024 VS YEAR END 2023 Change In Php Millions 2024 2023 Value %age REVENUE Real estate 16,634.0 15,228.5 1,405.5 9.2% Rental income 16,330.2 16,021.4 308.8 1.9% Interest income from installment contracts receivable 276.7 606.3 (329.6) (54.4)% Parking, hotel, mall administrative and processing fees, and others 1,687.1 2,104.9 (417.8) (19.8)% 34,928.0 33,961.1 966.9 2.8% COSTS AND EXPENSES Costs of real estate sales 4,801.8 6,112.0 (1,310.2) (21.4)% Operating expenses 10,408.1 11,596.2 (1,188.1) (10.2)% 15,209.9 17,708.2 (2,498.3) (14.1)% OTHER INCOME (EXPENSES) Gain from insurance proceeds - 1,841.2 (1,841.2) (100)% Interest income from investments and other income 1,756.3 1,202.3 554.0 46.1% Interest and other financing Charges (9,826.9) (5,685.6) (4,141.3) 72.8% (8,070.6) (2,642.2) (5,428.5) 205.5% INCOME BEFORE INCOME TAX 11,647.5 13,610.8 (1,963.3) (14.4)% PROVISION FOR INCOME TAX 2,279.0 3,318.6 (1,039.6) (31.3)% NET INCOME 9,368.5 10,292.2 (923.7) (9.0)% Revenues Real Estate The Company recorded revenue from real estate sales amounting to ₱16,634.0 million for the year ended December 31, 2024, an increase of 9.2% from ₱15,228.5 million last year. This was primarily attributable to the increase in the overall completion rate of sold inventories of its business units specifically in the affordable segment. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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33 • Real estate revenue of Brittany increased by 67.1% to ₱1,626.3 million for 2024 from ₱973.1 million last year. This increase was principally attributable to the increase in the number of sold homes completed or under construction in the Mega Manila area in the high-end housing segment. • Real estate revenue of Crown Asia increased by 65.8% to ₱930.8 million for 2024 from ₱561.5 million in 2023. This increase was principally attributable to the increase in the number of sold homes completed or under construction in the Mega Manila area in the upper middle-income housing segment during the year. • Real estate revenue from Vista Residences increased by 43.2% to ₱4,508.2 million for 2024 from ₱3,147.4 million for 2023. This was principally attributable to the increase in number of sold condominium units completed or under construction during the period. Vista Residences is the business unit of Vista Land that develops and sells vertical projects across the Philippines. • Real estate revenue of Communities Philippines decreased by 1.3% to ₱5,984.7 million for 2024 from ₱6,060.5 million for 2023. This decrease was principally attributable to the decrease in the number of sold homes completed or under construction outside the Mega Manila area in the low and affordable housing segment during the period. • Real estate revenue of Camella decreased by 20.1% to ₱3,584.0 million for 2024 from ₱4,485.9 million for 2023. This decrease was principally attributable to the decrease in the number of sold homes completed or under construction in the Mega Manila area in the low and affordable housing segment during the period. Rental income Rental income increased by 1.9% from ₱16,021.4 million for the year ended December 31, 2024 to ₱16,330.2 million for the year ended December 31, 2024. The increase was primarily attributable to the increase in rates for the year. Interest income from installment contract receivable and investments Interest income increased by 12.4% from ₱1,808.6 million for the year ended 31 December 2023 to ₱2,033.0 million for the year ended 31 December 2024. The increase was primarily attributable to the higher interest received for the year from the investments at amortized costs at 46.1% increase to ₱1,756.3 million which was offset by the significant decrease in interest income from installment contracts receivable which posted a decrease of 54.4% to ₱276.7 million as majority of the Company’s buyer is availing of mortgage financing. Parking, hotel, mall administrative and processing fees and others Income from parking, hotel, mall administrative and processing fees and others decreased by 19.8% from ₱2,104.9 million for the year ended December 31, 2024 to ₱1,687.1 for the year ended December 31, 2024. The decrease was primarily attributable to the significant decrease in forfeitures for the year. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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34 Costs and Expenses Cost and expenses decreased by 14.1% to ₱15,209.9 million for the year ended December 31, 2024 from ₱17,708.2 million for the year ended December 31, 2024. • Cost of real estate sales decreased by 21.4% from ₱6,112.0 million for the year ended December 31, 2024 to ₱4,801.8 million for the year ended December 31, 202$ primarily due to the various cost saving initiatives as well as cleanup of remaining set up of estimated land development cost of completed projects. • Operating expenses decreased by 10.2% from ₱11,596.2 million for the year ended December 31, 2024 to ₱10,408.1 million for the year ended December 31, 2024 primarily due to the following: o a decrease in provision for impairment losses on receivables from ₱848.0 million for the year ended December 31, 2024 to ₱298.7 million for the year ended December 31, 2024 due to lower provisioning for the year. o a decrease in occupancy costs from ₱1,116.5 million for the year ended 31 December 2023 to ₱805.2 million for the year ended 31 December 2024 due to the decreased in security and other occupancy related expenses of our malls. o a decrease in repairs and maintenance from ₱1,296.9 million for the year ended 31 December 2023 to ₱1,075.9 million for the year ended 31 December 2024 due to lower repairs and maintenance of various projects. Gain from insurance proceeds The Company recognized a gain from insurance proceed amounting to ₱1,841.2 million for the year ended 31 December 2023 and none for the year ended 31 December 2024. Interest and other financing charges Interest and other financing charges increased by 72.8% from ₱5,685.6 million for the year ended December 31, 2024 to ₱9,826.9 million for the year ended December 31, 2024. The increase was primarily attributable the lower capitalization rate for the year as the company fully adopted the new accounting standards for Borrowing costs. Provision for Income Tax Provision for income tax decreased by 31.3% from ₱3,318.6 million for the year ended December 31, 2024 to ₱2,279.0 million for the year ended December 31, 2024 primarily due to a lower taxable base for the year. Net Income Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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35 As a result of the foregoing, the Company’s core net income increased by 10.9% to ₱9,368.5 million for the year ended December 31, 2024 from ₱8,451.0 million (net of gain from insurance proceeds amounting to ₱1,841.2) for the year ended December 31, 2024. For the year ended December 31, 2024, except as discussed in Note 36 – Other Matters of the 2024 Financial Statements on the impact of the COVID-19 pandemic, there were no other seasonal aspects that had a material effect on the financial condition or results of operations of the Company. Neither were there any trends, events or uncertainties that have had or that are reasonably expected to have a material impact on the net sales or revenues or income from continuing operations. The Company is not aware of events that will cause a material change in the relationship between the costs and revenues. There are no significant elements of income or loss that did not arise from the Company’s continuing operations. FINANCIAL CONDITION Change In Php millions 2024 2023 Amount % ASSETS Current Assets Cash and cash equivalents 3,592.1 10,692.2 (7,100.1) (66.4) Short-term cash investments - 7.3 (7.3) (100) Current portion of: Receivables 73,982.9 52,211.6 21,771.3 41.7 Cost to obtain contract 481.2 308.6 172.6 55.9 Investments at amortized cost 13,639.7 18,425.1 (4,785.4) (26.0) Real estate inventories 57,012.0 63,771.2 (6,759.2) (10.6) Other current assets 5,900.2 6,447.9 (547.7) (8.5) Total Current Assets 154,608.1 151,864.0 2,744.1 1.8 Noncurrent Assets Investments at amortized cost 28,364.3 20,784.3 7,580.0 36.5 Investments at fair value through other comprehensive income 172.2 132.2 40.0 30.3 Receivables - net of current portion 47,331.1 31,191.5 16,139.6 51.7 Cost to obtain contract - net of current portion 244.1 202.1 42.0 20.8 Project development costs 2,091.6 1,396.3 695.3 49.8 Advances 6,256.9 7,559.4 (1,302.5) (17.2) Investment in joint venture 499.1 499.4 (0.3) (0.1) Property and equipment 2,052.7 2,636.2 (583.5) (22.1) Investment properties 134,752.5 124,656.1 10,096.4 8.1 Goodwill 147.3 147.3 - 0.0 Pension assets 322.4 290.8 31.6 10.9 Deferred tax assets – net 6.1 105.7 (99.6) (94.2) Other noncurrent assets 1,090.9 936.0 154.9 16.5 Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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36 Change In Php millions 2024 2023 Amount % Total Noncurrent Assets 223,331.1 190,537.1 32,794.0 17.2 377,939.2 342,401.1 35,538.1 10.4 LIABILITIES AND EQUITY Current Liabilities Accounts and other payables 31,444.9 20,517.4 10,927.5 53.3 Security deposits and unearned rental income 1,711.9 2,013.0 (301.1) (15.0) Income tax payable 133.2 112.5 20.7 18.4 Dividends payable 476.5 298.0 178.5 59.9 Current portion of: Contract liabilities 1,922.6 1,588.3 334.3 21.0 Lease liabilities 421.4 388.9 32.5 8.4 Notes payable 27,787.0 28,005.3 (218.3) (0.8) Bank loans 18,236.0 25,874.2 (7,638.2) (29.5) Loans payables 3,497.8 3,176.0 321.8 10.1 Total Current Liabilities 85,631.4 81,973.6 3,657.8 4.5 Noncurrent Liabilities Contract liabilities- net of current portion 222.2 437.0 (214.8) (49.2) Notes payable - net of current portion 79,642.8 80,143.4 (500.6) (0.6) Bank loans - net of current portion 37,400.1 27,308.8 10,091.3 37.0 Loans payable - net of current portion 15,984.9 4,267.7 11,717.2 274.6 Lease liabilities - net of current portion 5,014.7 5,051.3 (36.6) (0.7) Deferred tax liabilities - net 15,434.2 8,201.4 7,232.8 88.2 Other noncurrent liabilities 2,521.0 2,156.4 364.6 16.9 Total Noncurrent Liabilities 156,220.0 127,566.2 28,653.8 22.5 Total Liabilities 241,851.3 209,539.8 32,311.5 15.4 Equity Attributable to equity holders of the Parent Company Common stock 13,114.1 13,114.1 - 0.0 Preferred stock 36.0 33.0 3 9.1 Additional paid-in capital 33,627.2 30,684.7 2,942.5 9.6 Treasury shares (7,740.3) (7,740.3) - 0.0 (Forward) Retained earnings 85,204.1 86,227.5 (1,023.4) (1.2) Other comprehensive income 1,026.4 905.8 120.6 13.3 125,266.6 123,223.9 2,042.7 1.7 Non-controlling interest 10,821.3 9,637.5 1,183.8 12.3 Total Equity 136,087.8 132,861.4 3,226.4 2.4 377,939.2 342,401.1 35,538.1 10.4 Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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37 As of December 31, 2024 vs. December 31, 2023 Total assets as of December 31, 2024 were ₱379,162.3 million compared to ₱342,401.2 million as of December 31, 2023, or a 10.4% increase. This was due to the following: • Cash and cash equivalents including short term and long-term cash investments, and investments at amortized costs decreased by 8.6% from ₱49,908.9 million as of December 31, 2023 to ₱45,596.1 million as of December 31, 2024 due primarily to debt servicing for the year. • Investments at fair value through other comprehensive income increased by 30.3% from ₱132.2 million as of December 31, 2023 to ₱172.2 million as of December 31, 2024 due to the increase in fair value for the year. • Receivables increased by 45.5% from ₱83,403.1 million as of December 31, 2023 to ₱121,314.0 million as of December 31, 2024 due primarily to the full adoption of PFRS 15, higher recorded sales, increase in accrued rental income for the year. • Real estate inventories including raw land for residential development and construction materials decreased by 10.6% from ₱63,771.2 million as of December 31, 2023 to ₱57,012.0 million as of December 31, 2024 due primarily increase in project launches and reversal of capitalized interest for the year. • Project development costs increased by 49.8% from ₱1,396.3 million as of December 31, 2023 to ₱2,091.6 million as of December 31, 2024 due to increase in advances for project developments. • Advances to a related parties decreased by 17.2% from ₱7,559.4 million as of December 31, 2023 to ₱6,256.9 million as of December 31, 2024 due to settlements for the year. • Property and equipment decreased by 22.1% to ₱2,052.7 million as of December 31, 2024 from ₱2,636.2 million as of December 31, 2023 due to disposals and depreciation for the year. • Investment properties increased by 8.1% to ₱134,752.5 million as of December 31, 2024 from ₱124,656.1 million as of December 31, 2023 due to capitalized interest for the year. • Pension assets increased by 10.9% to ₱322.4 million as of December 31, 2024 from ₱290.8 million as of December 31, 2023 as a result of actuarial adjustment for the company’s retirement program. Total liabilities as of December 31, 2024 were ₱241,859.4 million compared to ₱209,539.6 million as of December 31, 2023, or a 15.4% increase. This was due to the following: Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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38 • Accounts and other payables increased by 53.3% to ₱31,444.9 million as of December 31, 2024 from ₱20,517.4 million as of December 31, 2023 due to increase in accounts payable to contractors and suppliers as construction activities increased during the year. • Security deposits and unearned rental income decreased by 8.4% to ₱1,711.9 million as of December 31, 2024 from ₱2,013.0 million as of December 31, 2023 due to the shift of balances from current to non-current. • Income tax payable increased by 18.4% from ₱112.5 million as of December 31, 2023 to ₱133.2 million as of December 31, 2024 due to the current provision less creditable withholding tax for the year. • Dividend payable increased by 59.9% from ₱298.0 million as of December 31, 2023 to ₱476.5 as of December 31, 2024 due primarily to the declaration of dividends for the year. • Bank loans including non-current portion increased by 4.6% from ₱53,183.0 million as of December 31, 2023 to ₱55,636.1 million as of December 31, 2024 due to proceeds for the year. • Loans payable including non-current portion increased by 161.7% from ₱7,443.7 million as of December 31, 2023 to ₱19,482.7 million as of December 31, 2024 due to availment of Contract to sell financing during the year. • Contract liabilities including non-current portion increased by 5.9% from ₱2,025.3 million as of December 31, 2023 to ₱2,144.8 million as of December 31, 2024 due to set up during the year. • Deferred tax liabilities – net increased by 90.6% from ₱8,095.7 million as of December 31, 2023 to ₱15,428.1 million as of December 31, 2024 due to the additional deferred tax liabilities recognized for the year as part of the full adoption of PFRS 15. • Other noncurrent liabilities increased by 16.9% from ₱2,156.4 million as of December 31, 2023 to ₱2,521.0 million as of December 31, 20233 due primarily to the increase in the [liabilities for purchased land and retention payable]. Total stockholder’s equity increased by 2.4% from ₱132,861.4 million as of December 31, 2023 to ₱136,087.8 million as of December 31, 2024 due primarily to the issuance of preferred shares, net income recorded reduced by the retained earnings impact of the adoption of new accounting standards for the year ended December 31, 2024 and increase in non-controlling interest. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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39 Considered as the top five key performance indicators of the Company as shown below: Key Performance Indicators 12/31/2024 12/31/2023 Current ratio (a) 1.81:1 1.85:1 Liability-to-equity ratio (b) 1.78:1 1.58:1 Interest expense/Income before Interest expense (c) 45.8% 29.5% Return on assets (d) 2.5% 3.0% Return on equity (e) 6.9% 7.7% Notes: (a) Current Ratio: This ratio is obtained by dividing the Current Assets of the Company by its Current liabilities. This ratio is used as a test of the Company’s liquidity. (b) Liability-to-equity ratio: This ratio is obtained by dividing the Company’s Total Liabilities by its Total Equity. The ratio reveals the proportion of liability and equity a company is using to finance its business. It also measures a company’s borrowing capacity. (c) Interest expense/Income before interest expense: This ratio is obtained by dividing interest expense for the period by its income before interest expense. This ratio shows whether a company is earning enough profits before interest to pay its interest cost comfortably (d) Return on assets: This ratio is obtained by dividing the Company’s net income by its total assets. This measures the Company’s earnings in relation to all of the resources it had at its disposal. (e) Return on equity: This ratio is obtained by dividing the Company’s net income by its total equity. This measures the rate of return on the ownership interest of the Company’s stockholders. Because there are various calculation methods for the performance indicators above, the Company’s presentation of such may not be comparable to similarly titled measures used by other companies. Current ratio as of December 31, 2024 decreased from that of December 31, 2023 due primarily to the higher increase in current liabilities versus the increase in current assets. Liability-to-equity ratio increased due to the increase in tota liablities. Interest expense as a percentage of income before interest expense increased in the year ended December 31, 2024 compared to the ratio for the year ended December 31, 2023 due to the higher interest expense for the year. Return on asset and return on equity decreased for the year ended December 31, 2024 compared to that on December 31, 2023 due to the higher increase in the total assets and equity for the year. Material Changes to the Company’s Balance Sheet as of December 31, 2024 compared to December 31, 2023 (increase/decrease of 5% or more) Cash and cash equivalents including short term and long-term cash investments, and investments at amortized costs decreased by 8.6% from ₱49,908.9 million as of December 31, 2023 to ₱45,596.1 million as of December 31, 2024 due primarily to debt servicing for the year. Investments at fair value through other comprehensive income increased by 30.3% from ₱132.2 million as of December 31, 2023 to ₱172.2 million as of December 31, 2024 due to the increase in fair value for the year. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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40 Receivables increased by 45.5% from ₱83,403.1 million as of December 31, 2023 to ₱121,314.0 million as of December 31, 2024 due primarily to the full adoption of PFRS 15, higher recorded sales, increase in accrued rental income for the year. Real estate inventories including raw land for residential development and construction materials decreased by 10.6% from ₱63,771.2 million as of December 31, 2023 to ₱57,012.0 million as of December 31, 2024 due primarily increase in project launches and reversal of capitalized interest for the year. Project development costs increased by 49.8% from ₱1,396.3 million as of December 31, 2023 to ₱2,091.6 million as of December 31, 2024 due to increase in advances for project developments. Advances to a related parties decreased by 17.2% from ₱7,559.4 million as of December 31, 2023 to ₱6,256.9 million as of December 31, 2024 due to settlements for the year. Property and equipment decreased by 22.1% to ₱2,052.7 million as of December 31, 2024 from ₱2,636.2 million as of December 31, 2023 due to disposals and depreciation for the year. Investment properties increased by 8.1% to ₱134,752.5 million as of December 31, 2024 from ₱124,656.1 million as of December 31, 2023 due to capitalized interest for the year. Pension assets increased by 10.9% to ₱322.4 million as of December 31, 2024 from ₱290.8 million as of December 31, 2023 as a result of actuarial adjustment for the company’s retirement program. Accounts and other payables increased by 53.3% to ₱31,444.9 million as of December 31, 2024 from ₱20,517.4 million as of December 31, 2023 due to increase in accounts payable to contractors and suppliers as construction activities increased during the year. Security deposits and unearned rental income decreased by 8.4% to ₱1,711.9 million as of December 31, 2024 from ₱2,013.0 million as of December 31, 2023 due to the shift of balances from current to non-current. Income tax payable increased by 18.4% from ₱112.5 million as of December 31, 2023 to ₱133.2 million as of December 31, 2024 due to the current provision less creditable withholding tax for the year. Dividend payable increased by 59.9% from ₱298.0 million as of December 31, 2023 to ₱476.5 as of December 31, 2024 due primarily to the declaration of dividends for the year. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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41 Bank loans including non-current portion increased by 4.6% from ₱53,183.0 million as of December 31, 2023 to ₱55,636.1 million as of December 31, 2024 due to proceeds for the year. Loans payable including non-current portion increased by 161.7% from ₱7,443.7 million as of December 31, 2023 to ₱19,482.7 million as of December 31, 2024 due to availment of Contract to sell financing during the year. Contract liabilities including non-current portion increased by 5.9% from ₱2,025.3 million as of December 31, 2023 to ₱2,144.8 million as of December 31, 2024 due to set up during the year. Deferred tax liabilities – net increased by 90.6% from ₱8,095.7 million as of December 31, 2023 to ₱15,428.1 million as of December 31, 2024 due to the additional deferred tax liabilities recognized for the year as part of the full adoption of PFRS 15. Other noncurrent liabilities increased by 16.9% from ₱2,156.4 million as of December 31, 2023 to ₱2,521.0 million as of December 31, 20233 due primarily to the increase in the liabilities for purchased land and retention payable. Material Changes to the Company’s Statement of Income for the year ended December 31, 2024 compared to the year ended December 31, 2023 (increase/decrease of 5%or more) The Company recorded revenue from real estate sales amounting to ₱16,634.0 million for the year ended December 31, 2024, an increase of 9.2% from ₱15,228.5 million last year. This was primarily attributable to the increase in the overall completion rate of sold inventories of its business units specifically in the affordable segment. Rental income increased by 2% from ₱16,021.4 million for the year ended December 31, 2024 to ₱16,330.2 million for the year ended December 31, 2024. The increase was primarily attributable to the increase in rates for the year. Interest income increased by 12.4% from ₱1,808.6 million for the year ended 31 December 2023 to ₱2,033.0 million for the year ended 31 December 2024. The increase was primarily attributable to the higher interest received for the year from the investments at amortized costs at 46.1% increase to ₱1,756.3 million which was offset by the significant decrease in interest income from installment contracts receivable which posted a decrease of 54.4% to ₱276.7 million as majority of the Company’s buyer is availing of mortgage financing. Income from parking, hotel, mall administrative and processing fees and others increased by 19.8% from ₱2,104.9 million for the year ended December 31, 2024 Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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42 to ₱1,687.1 for the year ended December 31, 2024. The decrease was primarily attributable to the significant decrease in forfeitures for the year. Cost of real estate sales decreased by 21.4% from ₱6,112.0 million for the year ended December 31, 2024 to ₱10,408.1 million for the year ended December 31, 202$ primarily due to the various cost saving initiatives as well as cleanup of remaining set up of estimated land development cost of completed projects. Operating expenses decreased by 10.2% from ₱11,596.2 million for the year ended December 31, 2024 to ₱10,408.1 million for the year ended December 31, 2024 primarily due to the following: (a) a decrease in provision for impairment losses on receivables from ₱848.0 million for the year ended December 31, 2024 to ₱298.7 million for the year ended December 31, 2024 due to lower provisioning for the year, (b) a decrease in occupancy costs from ₱1,116.5 million for the year ended 31 December 2023 to ₱805.2 million for the year ended 31 December 2024 due to the decreased in security and other occupancy related expenses of our malls and (c) a decrease in repairs and maintenance from ₱1,296.9 million for the year ended 31 December 2023 to ₱1,075.9 million for the year ended 31 December 2024 due to lower repairs and maintenance of various projects. The Company recognized a gain from insurance proceed amounting to ₱1,841.2 million for the year ended 31 December 2023 and none for the year ended 31 December 2024. Interest and other financing charges increased by 72.8% from ₱5,685.6 million for the year ended December 31, 2024 to ₱9,826.9 million for the year ended December 31, 2024. The increase was primarily attributable the lower capitalization rate for the year as the company fully adopted the new accounting standards for Borrowing costs. Provision for income tax decreased by 31.3% from ₱3,318.6 million for the year ended December 31, 2024 to ₱2,279.0 million for the year ended December 31, 2024 primarily due to a lower taxable base for the year. The Company’s core net income increased by 10.9% to ₱9,368.5 million for the year ended December 31, 2024 from ₱8,451.0 million (net of gain from insurance proceeds amounting to ₱1,841.2) for the year ended December 31, 2024. For the year ended December 31, 2024, except as discussed in Note 36 – Other Matters of the 2023 Financial Statements on the impact of the COVID-19 pandemic, there were no other seasonal aspects that had a material effect on the financial condition or results of operations of the Company. Neither were there any trends, events or uncertainties that have had or that are reasonably expected to have a material impact on the net sales or revenues or income from continuing operations. The Company is not aware of events that will cause a material change in the relationship between the costs and revenues. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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43 There are no significant elements of income or loss that did not arise from the Company’s continuing operations. REVIEW OF YEAR END 2023 VS YEAR END 2022 Change In Php Millions 2023 2022 Value %age REVENUE Real estate 15,228.5 12,789.9 2,438.6 19.1% Rental income 16,021.4 13,742.3 2,279.2 16.6% Interest income from installment contracts receivable 606.3 701.3 (95.0) (13.5)% Parking, hotel, mall administrative and processing fees, and others 2,104.9 1,607.3 497.5 31.0% 33,961.1 28,840.8 5,120.3 17.8% COSTS AND EXPENSES Costs of real estate sales 6,112.0 5,543.0 569.0 10.3% Operating expenses 11,596.2 9,647.4 1,948.8 20.2% 17,708.2 15,190.4 2,517.8 16.6% OTHER INCOME (EXPENSES) Gain from insurance proceeds 1,841.2 - 1,841.2 - Interest income from investments and other income 1,202.3 981.2 221.1 22.5% Interest and other financing Charges (5,685.6) (5,217.9) (467.7) 9.0% (2,642.2) (4,236.7) 1,594.5 -37.6% INCOME BEFORE INCOME TAX 13,610.8 9,413.8 4,197.0 44.6% PROVISION FOR INCOME TAX 3,318.6 2,021.1 1,297.5 64.2% NET INCOME 10,292.2 7,392.6 2,899.4 39.2% Revenues Real Estate The Company recorded revenue from real estate sales amounting to ₱15,228.5 million for the year ended December 31, 2023, an increase of 19.1% from ₱12,789.9 million last year. This was primarily attributable to the increase in the overall completion rate of sold inventories of its business units specifically in the affordable segment. • Real estate revenue of Camella increased by 58.2% to ₱4,485.9 million for 2023 from ₱2,836.0 million for 2022. This increase was principally attributable to the increase in the number of sold homes completed or under construction in the Mega Manila area in the low and affordable housing segment during the period. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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44 • Real estate revenue from Vista Residences increased by 25.6% to ₱3,147.4 million for 2023 from ₱2,505.9 million for 2022. This was principally attributable to the increase in number of sold condominium units completed or under construction during the period. Vista Residences is the business unit of Vista Land that develops and sells vertical projects across the Philippines. • Real estate revenue of Communities Philippines increased by 8.5% to ₱5,587.2 million for 2023 from ₱6,060.5 million for 2022. This increase was principally attributable to the increase in the number of sold homes completed or under construction outside the Mega Manila area in the low and affordable housing segment during the period. • Real estate revenue of Crown Asia increased by 9.3% to ₱561.5 million for 2023 from ₱513.8 million in 2022. This increase was principally attributable to the increase in the number of sold homes completed or under construction in the Mega Manila area in the upper middle-income housing segment during the year. • Real estate revenue of Brittany decreased by 27.8% to ₱973.1 million for 2023 from ₱1,347.0 million last year. This increase was principally attributable to the decrease in the number of sold homes completed or under construction in the Mega Manila area in the high-end housing segment. Rental income Rental income increased by 16.6% from ₱13,742.3 million for the year ended December 31, 2022 to ₱16,021.4 million for the year ended December 31, 2023. The increase was primarily attributable to the recovery of the malls, increase foot traffic and the contribution of newly opened commercial centers. Interest income from installment contract receivable and investments Interest income from installment contract receivable and investments increased by 7.5% from ₱1,682.5 million for the year ended December 31, 2022 to ₱1,808.6 million for the year ended December 31, 2023. The increased was primarily attributable to the increase in interest income from investments of 22.5% to ₱1,202.3 million offset by the decrease in interest income from installment contract receivables of 13.5% to ₱606.3 million for the year ended December 31, 2023 as more buyers are availing of bank financing. Parking, hotel, mall administrative and processing fees and others Income from parking, hotel, mall administrative and processing fees and others increased by 31.0% from ₱1,607.3 million for the year ended December 31, 2022 to ₱2,104.9 for the year ended December 31, 2023. The increase was primarily attributable to the increase mall related administrative and processing fees, parking, hotel operations as well as forfeitures. Costs and Expenses Cost and expenses increased by 16.6% to ₱17,708.2 million for the year ended December 31, 2023 from ₱15,190.4 million for the year ended December 31, 2022. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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45 • Cost of real estate sales increased by 10.3% from ₱5,543.0 million for the year ended December 31, 2022 to ₱6,112.0 million for the year ended December 31, 2023 primarily due to the increase in the overall recorded sales of Vista Land’s business units offset by cost savings from various cost saving initiatives implemented. • Operating expenses increased by 20.2% from ₱9,647.4 million for the year ended December 31, 2022 to ₱11,596.2 million for the year ended December 31, 2021 primarily due to the following: o an increase in provision for impairment losses on receivables from ₱21.7 million for the year ended December 31, 2023 to ₱848.0 million for the year ended December 31, 2022 due to provisioning for the year. Allowance for impairment losses on receivables remained at 1.2% of the total receivables. o an increase in occupancy costs from ₱765.6 million for the year ended 31 December 2022 to ₱1,116.5 million for the year ended 31 December 2023 due to the increased in security and other occupancy related expenses of our malls. o an increase in depreciation and amortization from ₱2,638.8 million for the year ended 31 December 2022 to ₱2,889.0 million for the year ended 31 December 2023 due to the higher depreciation for the year. Gain from insurance proceeds The Company recognized a gain from insurance proceed amounting to ₱1,841.2 million for the year ended 31 December 2023. Interest and other financing charges Interest and other financing charges increased by 9.0% from ₱5,217.9 million for the year ended December 31, 2022 to ₱5,685.6 million for the year ended December 31, 2023. The increase was primarily attributable the lower capitalization rate for the year. Provision for Income Tax Provision for income tax increased by 64.2% from ₱2,021.1 million for the year ended December 31, 2022 to ₱3,318.6 million for the year ended December 31, 2023 primarily due to a higher taxable base for the year. Net Income As a result of the foregoing, the Company’s net income increased by 39.2% to ₱10,292.2 million for the year ended December 31, 2023 from ₱7,392.6 million for the year ended December 31, 2022. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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46 For the year ended December 31, 2023, except as discussed in Note 36 – Other Matters of the 2023 Financial Statements on the impact of the COVID-19 pandemic, there were no other seasonal aspects that had a material effect on the financial condition or results of operations of the Company. Neither were there any trends, events or uncertainties that have had or that are reasonably expected to have a material impact on the net sales or revenues or income from continuing operations. The Company is not aware of events that will cause a material change in the relationship between the costs and revenues. There are no significant elements of income or loss that did not arise from the Company’s continuing operations. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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47 FINANCIAL CONDITION Change In Php millions 2023 2022 Amount % ASSETS Current Assets Cash and cash equivalents 10,692.2 15,070.2 (4,378.0) (29.1) Short-term cash investments 7.3 47.3 (40.0) (84.6) Current portion of: Receivables 52,211.6 53,234.5 (1,022.9) (1.9) Cost to obtain contract 308.6 385.6 (77.0) (20.0) Investments at amortized cost 18,425.1 9,440.4 8,984.7 95.2 Real estate inventories 63,771.2 53,533.9 10,237.3 19.1 Other current assets 6,447.9 5,724.8 723.1 12.6 Total Current Assets 151,864.0 137,436.8 14,427.2 10.5 Noncurrent Assets Investments at amortized cost 20,784.3 32,059.1 (11,274.8) (35.2) Investments at fair value through other comprehensive income 132.2 117.2 15.0 12.8 Receivables - net of current portion 31,191.5 21,166.1 10,025.4 47.4 Cost to obtain contract - net of current portion 202.1 354.5 (152.4) (43.0) Project development costs 1,396.3 1,269.2 127.1 10.0 Advances 7,559.4 7,042.3 517.1 7.3 Investment in joint venture 499.4 468.1 31.3 6.7 Property and equipment 2,636.2 2,301.1 335.1 14.6 Investment properties 124,656.1 118,343.6 6,312.5 5.3 Goodwill 147.3 147.3 - 0.0 Pension assets 290.8 320.7 (29.9) (9.3) Deferred tax assets - net 105.7 111.5 (5.8) (5.2) Other noncurrent assets 936.0 1,076.8 (140.8) (13.1) Total Noncurrent Assets 190,537.1 184,777.3 5,759.8 3.1 342,401.1 322,214.1 20,187.0 6.3 LIABILITIES AND EQUITY Current Liabilities Accounts and other payables 20,517.4 15,890.5 4,626.9 29.1 Security deposits and unearned rental income 2,013.0 1,856.5 156.5 8.4 Income tax payable 112.5 127.1 (14.6) (11.5) Dividends payable 298.0 96.0 202.0 210.4 Current portion of: Contract liabilities 1,588.3 1,085.1 503.2 46.4 Lease liabilities 388.9 368.5 20.4 5.5 Notes payable 28,005.3 12,745.8 15,259.5 119.7 Bank loans 25,874.2 11,561.6 14,312.6 123.8 Loans payables 3,176.0 3,767.3 (591.3) (15.7) Total Current Liabilities 81,973.6 47,498.4 34,475.2 72.6 Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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48 Change In Php millions 2023 2022 Amount % Noncurrent Liabilities Contract liabilities- net of current portion 437.0 1,058.5 (621.5) (58.7) Notes payable - net of current portion 80,143.4 89,702.4 (9,559.0) (10.7) Bank loans - net of current portion 27,308.8 44,385.3 (17,076.5) (38.5) Loans payable - net of current portion 4,267.7 1,567.4 2,700.3 172.3 Lease liabilities - net of current portion 5,051.3 5,065.6 (14.3) (0.3) Deferred tax liabilities - net 8,201.4 6,107.4 2,094.0 34.3 Other noncurrent liabilities 2,156.4 3,179.0 (1,022.6) (32.2) Total Noncurrent Liabilities 127,566.2 151,065.6 (23,499.3) (15.6) Total Liabilities 209,539.8 198,563.9 10,975.9 5.5 Equity Attributable to equity holders of the Parent Company Common stock 13,114.1 13,114.1 - 0.0% Preferred stock 33.0 33.0 - 0.0% Additional paid-in capital 30,684.7 30,684.7 29.3 0.1% Treasury shares (7,740.3) (7,740.3) - 0.0% (Forward) Retained earnings 86,227.5 78,311.1 6,127.9 10.1 Other comprehensive income 905.8 798.9 192.5 13.4 123,223.9 115,201.6 8,022.3 7.0 Non-controlling interest 9,637.5 8,448.6 1,188.9 14.1 Total Equity 132,861.4 123,650.2 9,211.2 7.4 342,401.1 322,214.1 20,187.0 6.3 As of December 31, 2023 vs. December 31, 2022 Total assets as of December 31, 2023 were ₱342,401.2 million compared to ₱322,214.2 million as of December 31, 2022, or a 6.3% increase. This was due to the following: • Cash and cash equivalents including short term and long-term cash investments, and investments at amortized costs decreased by 11.6% from ₱56,617.0 million as of December 31, 2022 to ₱50,063.4 million as of December 31, 2023 due primarily to debt servicing for the year. • Investments at fair value through other comprehensive income increased by 12.8% from ₱117.2 million as of December 31, 2022 to ₱132.2 million as of December 31, 2023 due to the increase in fair value. • Receivables increased by 12.1% from ₱74,400.6 million as of December 31, 2022 to ₱83,403.1 million as of December 31, 2023 due primarily to the increase in accrued rental receivables. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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49 • Real estate inventories including raw land for residential development and construction materials increased by 19.1% from ₱53,533.9 million as of December 31, 2022 to ₱63,771.2 million as of December 31, 2023 due to increase in project launches for the year. • Project development costs increased by 10.0% from ₱1,269.2 million as of December 31, 2022 to ₱1,396.3 million as of December 31, 2023 due to increase in advances for project developments. • Advances to a related parties increased by 7.3% from ₱7,042.3 million as of December 31, 2022 to ₱7,559.4 million as of December 31, 2023 due to advances for the year. • Investment in joint venture increased by 6.7% to ₱499.4 million as of December 31, 2023 from ₱468.1 million as of December 31, 2022 due to share in equity earnings during the year. • Property and equipment increased by 14.6% to ₱2,636.2 million as of December 31, 2023 from ₱2,301.1 million as of December 31, 2022 due to additions of buildings, equipment and other fixed assets during the year. • Investment properties increased by 5.3% to ₱124,656.1 million as of December 31, 2023 from ₱118,343.6 million as of December 31, 2022 due to additions during the year. • Pension assets decreased by 9.3% to ₱290.8 million as of December 31, 2023 from ₱320.7 million as of December 31, 2022 as a result of actuarial adjustment for the company’s retirement program. • Other assets, including cost to obtain increased by 4.7% to ₱7,894.6 million as of December 31, 2023 from ₱7,541.7 million as of December 31, 2022 due to increase in input vat and other prepaid expenses. Total liabilities as of December 31, 2023 were ₱209,539.6 million compared to ₱198,563.9 million as of December 31, 2022, or a 5.5% increase. This was due to the following: • Accounts and other payables increased by 29.1% to ₱20,517.4 million as of December 31, 2023 from ₱15,890.5 million as of December 31, 2022 due to increase in accounts payable to contractors and suppliers as construction activities increased during the year. • Security deposits and unearned rental income increased by 8.4% to ₱2,013.0 million as of December 31, 2023 from ₱1,856.5 million as of December 31, 2022 due to renewal of lease contract and new tenants of our commercial segment. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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50 • Income tax payable decreased by 11.5% from ₱127.1 million as of December 31, 2022 to ₱112.5 million as of December 31, 2023 due a higher taxable base for the year. • Dividend payable increased by 210.4% from ₱96.0 million as of December 31, 2022 to ₱298.0 as of December 31, 2023 due primarily to the declaration of dividends in October. • Notes payable including non-current portion increased by 5.6% from ₱102,448.2 million as of December 31, 2022 to ₱108,148.8 million as of December 31, 2023 due to the issuance of corporate notes during the year.. • Loans payable including non-current portion increased by 39.5% from ₱5,334.6 million as of December 31, 2022 to ₱7,443.7 million as of December 31, 2023 due to availment of Contract to sell financing during the year. • Contract liabilities including non-current portion decreased by 5.5% from ₱2,143.6 million as of December 31, 2022 to ₱2,025.4 million as of December 31, 2023 due to settlements during the year. • Deferred tax liabilities – net increased by 35.0% from ₱5,995.9 million as of December 31, 2022 to ₱8,095.7 million as of December 31, 2023 due to the additional deferred tax liabilities recognized for the year. • Other noncurrent liabilities decreased by 32.2% from ₱3,179.0 million as of December 31, 2022 to ₱2,156.4 million as of December 31, 20223 due primarily to the decrease in the liabilities for purchased land and retention payable Total stockholder’s equity increased by 7.4% from ₱123,650.2 million as of December 31, 2022 to ₱132,861.4 million as of December 31, 2023 due to the net income recorded for the year ended December 31, 2023 and increase in non-controlling interest. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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51 Considered as the top five key performance indicators of the Company as shown below: Key Performance Indicators 12/31/2023 12/31/2022 Current ratio (a) 1.85:1 2.89:1 Liability-to-equity ratio (b) 1.58:1 1.61:1 Interest expense/Income before Interest expense (c) 29.5% 35.7% Return on assets (d) 3.0% 2.3% Return on equity (e) 7.7% 6.0% Notes: (a) Current Ratio: This ratio is obtained by dividing the Current Assets of the Company by its Current liabilities. This ratio is used as a test of the Company’s liquidity. (b) Liability-to-equity ratio: This ratio is obtained by dividing the Company’s Total Liabilities by its Total Equity. The ratio reveals the proportion of liability and equity a company is using to finance its business. It also measures a company’s borrowing capacity. (c) Interest expense/Income before interest expense: This ratio is obtained by dividing interest expense for the period by its income before interest expense. This ratio shows whether a company is earning enough profits before interest to pay its interest cost comfortably (d) Return on assets: This ratio is obtained by dividing the Company’s net income by its total assets. This measures the Company’s earnings in relation to all of the resources it had at its disposal. (e) Return on equity: This ratio is obtained by dividing the Company’s net income by its total equity. This measures the rate of return on the ownership interest of the Company’s stockholders. Because there are various calculation methods for the performance indicators above, the Company’s presentation of such may not be comparable to similarly titled measures used by other companies. Current ratio as of December 31, 2023 decreased from that of December 31, 2022 due primarily to the increase in current liabilities. Liability-to-equity ratio decreased due to the increase in equity. Interest expense as a percentage of income before interest expense decreased in the year ended December 31, 2023 compared to the ratio for the year ended December 31, 2022 due to the higher interest income for the year. Return on asset and return on equity increased for the year ended December 31, 2023 compared to that on December 31, 2022 due to the higher net income recorded in the year 2023. Material Changes to the Company’s Balance Sheet as of December 31, 2023 compared to December 31, 2022 (increase/decrease of 5% or more) Cash and cash equivalents including short term and long-term cash investments, and investments at amortized costs decreased by 11.6% from ₱56,617.0 million as of December 31, 2022 to ₱50,063.4 million as of December 31, 2023 due primarily to debt servicing for the year. Investments at fair value through other comprehensive income increased by 12.8% from ₱117.2 million as of December 31, 2022 to ₱132.2 million as of December 31, 2023 due to the increase in fair value. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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52 Receivables increased by 12.1% from ₱74,400.6 million as of December 31, 2022 to ₱83,403.1 million as of December 31, 2023 due primarily to the increase in accrued rental receivables. Real estate inventories including raw land for residential development and construction materials increased by 19.1% from ₱53,533.9 million as of December 31, 2022 to ₱63,771.2 million as of December 31, 2023 due to increase in project launches for the year. Project development costs increased by 10.0% from ₱1,269.2 million as of December 31, 2022 to ₱1,396.3 million as of December 31, 2023 due to increase in advances for project developments. Advances to a related parties increased by 7.3% from ₱7,042.3 million as of December 31, 2022 to ₱7,559.4 million as of December 31, 2023 due to advances for the year. Investment in joint venture increased by 6.7% to ₱499.4 million as of December 31, 2023 from ₱468.1 million as of December 31, 2022 due to share in equity earnings during the year. Property and equipment increased by 14.6% to ₱2,636.2 million as of December 31, 2023 from ₱2,301.1 million as of December 31, 2022 due to additions of buildings, equipment and other fixed assets during the year. Investment properties increased by 5.3% to ₱124,656.1 million as of December 31, 2023 from ₱118,343.6 million as of December 31, 2022 due to additions during the year. Pension assets decreased by 9.3% to ₱290.8 million as of December 31, 2023 from ₱320.7 million as of December 31, 2022 as a result of actuarial adjustment for the company’s retirement program. Accounts and other payables increased by 29.1% to ₱20,517.4 million as of December 31, 2023 from ₱15,890.5 million as of December 31, 2022 due to increase in accounts payable to contractors and suppliers as construction activities increased during the year. Security deposits and unearned rental income increased by 8.4% to ₱2,013.0 million as of December 31, 2023 from ₱1,856.5million as of December 31, 2022 due to renewal of lease contract and new tenants of our commercial segment. Income tax payable decreased by 11.5% from ₱127.1 million as of December 31, 2022 to ₱112.5 million as of December 31, 2023 due a higher taxable base for the year. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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53 Dividend payable increased by 210.4% from ₱96.0 million as of December 31, 2022 to ₱298.0 as of December 31, 2023 due primarily to the declaration of dividends in October. Notes payable including non-current portion increased by 5.6% from ₱102,448.2 million as of December 31, 2022 to ₱108,148.8 million as of December 31, 2023 due to the issuance of corporate notes during the year. Loans payable including non-current portion increased by 39.5% from ₱5,334.6 million as of December 31, 2022 to ₱7,443.7 million as of December 31, 2023 due to availment of Contract to sell financing during the year. Contract liabilities including non-current portion decreased by 5.5% from ₱2,143.6 million as of December 31, 2022 to ₱2,025.4 million as of December 31, 2023 due to settlements during the year. Deferred tax liabilities – net increased by 35.0% from ₱5,995.9 million as of December 31, 2022 to ₱8,095.7 million as of December 31, 2023 due to the additional deferred tax liabilities recognized for the year. Other noncurrent liabilities decreased by 32.2% from ₱3,179.0 million as of December 31, 2022 to ₱2,156.4 million as of December 31, 20223 due primarily to the decrease in the liabilities for purchased land and retention payable Material Changes to the Company’s Statement of Income for the year ended December 31, 2023 compared to the year ended December 31, 2022 (increase/decrease of 5%or more) The Company recorded revenue from real estate sales amounting to ₱15,228.5 million for the year ended December 31, 2023, an increase of 19.1% from ₱12,789.9 million last year. This was primarily attributable to the increase in the overall completion rate of sold inventories of its business units specifically in the affordable segment. Rental income increased by 16.6% from ₱13,742.3 million for the year ended December 31, 2022 to ₱16,021.4 million for the year ended December 31, 2023. The increase was primarily attributable to the recovery of the malls, increase foot traffic and the contribution of newly opened commercial centers. Interest income from installment contract receivable and investments increased by 7.5% from ₱1,682.5 million for the year ended December 31, 2022 to ₱1,808.6 million for the year ended December 31, 2023. The increased was primarily attributable to the increase in interest income from investments of 22.5% to ₱1,202.3 million offset by the decrease in interest income from installment contract receivables of 13.5% to ₱606.3 million for the year ended December 31, 2023 as more buyers are availing of bank financing. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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54 Income from parking, hotel, mall administrative and processing fees and others increased by 31.0% from ₱1,607.3 million for the year ended December 31, 2022 to ₱2,104.9 for the year ended December 31, 2023. The increase was primarily attributable to the increase mall related administrative and processing fees, parking, hotel operations as well as forfeitures. Cost of real estate sales increased by 10.3% from ₱5,543.0 million for the year ended December 31, 2022 to ₱6,112.0 million for the year ended December 31, 2023 primarily due to the increase in the overall recorded sales of Vista Land’s business units offset by cost savings from various cost saving initiatives implemented. Operating expenses increased by 20.2% from ₱9,647.4 million for the year ended December 31, 2022 to ₱11,596.2 million for the year ended December 31, 2021 primarily due to (a) the increase in provision for impairment losses on receivables from ₱21.7 million for the year ended December 31, 2023 to ₱848.0 million for the year ended December 31, 2022 due to provisioning for the year. Allowance for impairment losses on receivables remained at 1.2% of the total receivables, (b) an increase in occupancy costs from ₱765.6 million for the year ended 31 December 2022 to ₱1,116.5 million for the year ended 31 December 2023 due to the increased in security and other occupancy related expenses of our malls and (c) an increase in depreciation and amortization from ₱2,638.8 million for the year ended 31 December 2022 to ₱2,889.0 million for the year ended 31 December 2023 due to the higher depreciation for the year. The Company recognized a gain from insurance proceed amounting to ₱1,841.2 million for the year ended 31 December 2023. Interest and other financing charges increased by 9.0% from ₱5,217.9 million for the year ended December 31, 2022 to ₱5,685.6 million for the year ended December 31, 2023. The increase was primarily attributable the lower capitalization rate for the year. Provision for income tax increased by 64.2% from ₱2,021.1 million for the year ended December 31, 2022 to ₱3,318.6 million for the year ended December 31, 2023 primarily due to a higher taxable base for the year. The Company’s net income increased by 39.2% to ₱10,292.2 million for the year ended December 31, 2023 from ₱7,392.6 million for the year ended December 31, 2022. For the year ended December 31, 2023, except as discussed in Note 36 – Other Matters of the 2023 Financial Statements on the impact of the COVID-19 pandemic, there were no other seasonal aspects that had a material effect on the financial condition or results of operations of the Company. Neither were there Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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55 any trends, events or uncertainties that have had or that are reasonably expected to have a material impact on the net sales or revenues or income from continuing operations. The Company is not aware of events that will cause a material change in the relationship between the costs and revenues. There are no significant elements of income or loss that did not arise from the Company’s continuing operations. REVIEW OF YEAR END 2022 VS YEAR END 2021 Change 2022 2021 Value %age REVENUE Real estate 12,789.9 17,397.9 (4,608.1) (26.5)% Rental income 13,742.3 9,312.7 4,429.5 47.6% Interest income from installment contracts receivable 701.3 774.4 (73.1) (9.4)% Parking, hotel, mall administrative and processing fees, and others 1,607.3 2,146.9 (539.5) 25.1% 28,840.8 29,631.9 (791.1) (2.7)% COSTS AND EXPENSES Costs of real estate sales 5,543.0 8,533.4 (2,990.4) (35.0)% Operating expenses 9,647.4 9,407.8 239.6 2.5% 15,190.4 17,941.2 (2,750.8) (15.3)% OTHER INCOME (EXPENSES) Interest income from investments and other income 981.2 1,549.4 (568.2) (36.7)% Interest and other financing Charges (5,217.9) (4,315.3) (902.6) 20.9% (4,236.7) (2,765.9) (1,470.8) 53.2% INCOME BEFORE INCOME TAX 9,413.7 8,924.9 488.9 5.5% PROVISION FOR INCOME TAX 2,021.1 1,957.6 63.5 3.2% NET INCOME 7,392.7 6,967.2 425.5 6.1% Revenues Real Estate The Company recorded revenue from real estate sales amounting to ₱12,789.9 million for the year ended December 31, 2022, a decrease of 26.5% from ₱17,397.9 million last year. This was primarily attributable to the decrease in the overall completion rate of sold inventories of its business units specifically in the affordable segment as a result various factors such as (a) the impact of the extended payment terms granted to buyers during the pandemic specifically in the affordable segment. (b) the implementation of the Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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56 community quarantine that slowed down construction activities in certain areas (c) the rainy season in the 2nd half of the year. The Company uses the Percentage of Completion method of revenue recognition where revenue is recognized in reference to the stages of development of the properties: • Real estate revenue of Brittany increased by 167.0% to ₱1,347.0 million for 2022 from ₱504.4 million last year. This increase was principally attributable to the increase in the number of sold homes completed or under construction in the Mega Manila area in the high-end housing segment. • Real estate revenue of Crown Asia increased by 8.4% to ₱513.8 million for 2022 from ₱474.1 million in 2021. This increase was principally attributable to the increase in the number of sold homes completed or under construction in the Mega Manila area in the upper middle-income housing segment during the year. • Real estate revenue from Vista Residences was flat at ₱2,505.9 million for 2022 from ₱2,512.1 million for 2021. This was principally attributable to the number of sold condominium units completed or under construction during the period. Vista Residences is the business unit of Vista Land that develops and sells vertical projects across the Philippines. • Real estate revenue of Communities Philippines decreased by 16.7% to ₱5,587.2 million for 2022 from ₱6,709.9 million for 2021. This decrease was principally attributable to the decrease in the number of sold homes completed or under construction outside the Mega Manila area in the low and affordable housing segment during the period as a result of the various lockdown measures implemented in the provincial areas. • Real estate revenue of Camella decreased by 60.6% to ₱2,836.0 million for 2022 from ₱7,197.5 million for 2021. This decrease was principally attributable to the decrease in the number of sold homes completed or under construction in the Mega Manila area in the low and affordable housing segment during the period. Rental income Rental income increased by 47.6% from ₱9,312.7 million for the year ended December 31, 2021 to ₱13,724.3 million for the year ended December 31, 2022. The increase was primarily attributable to the recovery of the malls, increase foot traffic and the contribution of newly opened commercial centers. Interest income from installment contract receivable and investments Interest income from installment contract receivable and investments decreased by 27.6% from ₱2,323.9 million for the year ended December 31, 2021 to ₱1,682.5 million for the year ended December 31, 2022. The decrease was primarily attributable to the decrease in both the interest income from investments of 36.7% to ₱981.2 million for the year ended December 31, 2022 due to settlement of dollar liabilities using our dollar investments and interest income from installment contract receivables of 9.4% to ₱701.3 Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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57 million for the year ended December 31, 2022 as more buyers are availing of bank financing. Parking, hotel, mall administrative and processing fees and others Income from parking, hotel, mall administrative and processing fees and others decreased by 25.1% from ₱2,146.9 million for the year ended December 31, 2021 to ₱1,607.3 for the year ended December 31, 2022. The decrease was primarily attributable to the mall administrative and processing fees as well as loan processing fees from banks. Parking fees and hotel revenues posted increases for the year. Costs and Expenses Cost and expenses decreased by 15.3% to ₱15,190.4 million for the year ended December 31, 2022 from ₱17,941.2 million for the year ended December 31, 2021. • Cost of real estate sales decreased by 35.0% from ₱8,533.4 million for the year ended December 31, 2021 to ₱5,543.0 million for the year ended December 31, 2022 primarily due to the decrease in the overall recorded sales of Vista Land’s business units specifically the provincial projects. The decrease was also due to cost efficiencies realized during the year as the decline in costs was significantly higher than the decline in real estate revenues. • Operating expenses decreased by 2.5% from ₱9,407.8 million for the year ended December 31, 2021 to ₱9,647.4 million for the year ended December 31, 2022 primarily due to the following: o a decrease in commission expenses from ₱829.7 million for the year ended December 31, 2021 to ₱606.1 million in the year ended December 31, 2022 due to decrease in real estate sales for the year and the shift to digital marketing. o a decrease in provision from impairment losses on receivables and investments from ₱443.3 million for the year ended December 31, 2021 to ₱21.7 million for the year ended December 31, 2022 due to the reduced probability of impairment for receivables and investments as situation are returning to normalcy. Interest and other financing charges Interest and other financing charges increased by 20.9% from ₱4,315.3 million for the year ended December 31, 2021 to ₱5,217.9 million for the year ended December 31, 2022. The decrease was primarily attributable decrease in interest bearing debt for the year and the lower capitalization rate for interest expense. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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58 Provision for Income Tax Provision for income tax increased by 3.2% from ₱1,957.6 million for the year ended December 31, 2021 to ₱2,021.1 million for the year ended December 31, 2022 primarily due to a higher taxable base for the year coming from the higher contribution of the commercial segment compared to prior year. Net Income As a result of the foregoing, the Company’s net income increased by 6.1% to ₱7,392.7 million for the year ended December 31, 2022 from ₱6,967.2 million for the year ended December 31, 2021. Core net income on the other hand increased by 10% to ₱7,667.9 million excluding loss of fire recorded at ₱275.2 million net of tax. For the year ended December 31, 2022, except as discussed in Note 36 – Other Matters of the 2022 Financial Statements on the impact of the COVID-19 pandemic, there were no other seasonal aspects that had a material effect on the financial condition or results of operations of the Company. Neither were there any trends, events or uncertainties that have had or that are reasonably expected to have a material impact on the net sales or revenues or income from continuing operations. The Company is not aware of events that will cause a material change in the relationship between the costs and revenues. There are no significant elements of income or loss that did not arise from the Company’s continuing operations. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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59 FINANCIAL CONDITION Change In Php Millions 2022 2021 Amount % ASSETS Current Assets Cash and cash equivalents 15,070.2 11,856.7 3,213.5 27.1 Short-term cash investments 47.3 336.0 (288.7) (85.9) Investments at amortized cost 9,440.4 15,751.5 (6,311.1) (40.1) Current portion of: Receivables 53,234.5 50,916.7 2,317.8 4.6 Cost to obtain contract 385.6 448.2 (62.5) (14.0) Real estate inventories 53,533.9 49,596.9 3,937.0 7.9 Other current assets 5,724.8 5,587.2 137.5 2.5 Total Current Assets 137,436.8 134,493.2 2,943.6 2.2 Noncurrent Assets Investments at amortized cost 32,059.1 34,065.9 (2,006.9) (5.9) Investments at fair value through other comprehensive income 117.2 124.5 (7.3) (5.9) Receivables - net of current portion 21,166.1 20,316.7 849.4 4.2 Cost to obtain contract - net of current portion 354.5 450.5 (96.0) (21.3) Project development costs 1,269.2 1,274.1 (4.9) (0.4) Investment in joint venture 468.1 458.8 9.3 2.0 Property and equipment 2,301.1 2,316.9 (15.8) (0.7) Investment properties 118,343.6 112,991.8 5,351.8 4.7 Goodwill 147.3 147.3 - 0.0 Pension assets 320.7 283.0 37.7 13.3 Deferred tax assets - net 111.5 48.4 63.1 130.4 Other noncurrent assets 1,076.8 930.5 146.3 15.7 Total Noncurrent Assets 184,777.3 179,493.4 5,283.9 2.9 322,214.1 313,986.6 8,227.5 2.6 LIABILITIES AND EQUITY Current Liabilities Accounts and other payables 15,890.5 15,221.4 669.1 4.4 Security deposits and unearned rental income 1,856.5 1,729.3 127.2 7.4 Income tax payable 127.1 49.7 77.4 155.7 Dividends payable 96.0 15.9 80.1 503.8 Current portion of: Contract liabilities 1,085.1 1,234.6 (149.5) (12.1) Notes payable 12,745.8 24,170.7 (11,424.9) (47.3) Bank loans 11,561.6 8,067.3 3,494.2 43.3 Loans payables 3,767.3 3,460.1 307.1 8.9 Lease liabilities 368.5 348.2 20.3 5.8 Total Current Liabilities 47,498.4 54,297.3 (6,798.9) (12.5) Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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60 Change In Php Millions 2022 2021 Amount % Noncurrent Liabilities Contract liabilities- net of current portion 1,058.5 566.8 491.7 86.8 Notes payable - net of current portion 89,702.4 83,759.5 5,942.9 7.1 Bank loans - net of current portion 44,385.3 48,925.0 (4,539.7) (9.3) Loans payable - net of current portion 1,567.4 319.4 1,248.0 390.7 Lease liabilities - net of current portion 5,065.6 5,087.6 (22.0) (0.4) Deferred tax liabilities - net 6,107.4 4,982.7 1,124.7 22.6 Other noncurrent liabilities 3,179.0 3,521.4 (342.4) (9.7) Total Noncurrent Liabilities 151,065.5 147,162.4 3,903.1 2.7 Total Liabilities 198,563.9 201,459.7 (2,895.8) (1.4) Equity Attributable to equity holders of the Parent Company Common stock 13,114.1 13,114.1 - 0.0% Preferred stock 33.0 33.0 - 0.0% Additional paid-in capital 30,684.7 30,655.4 29.3 0.1% Treasury shares (7,740.3) (7,740.3) - 0.0% (Forward) Retained earnings 78,311.1 72,539.6 5,771.5 8.0% Other comprehensive income 798.9 778.1 20.8 2.7% 115,201.6 109,379.9 5,821.7 5.3% Non-controlling interest 8,448.6 3,146.7 5,301.6 168.5% Total Equity 123,650.2 112,526.9 11,123.3 9.9% 322,214.1 313,986.6 8,227.5 2.6% As of December 31, 2022 vs. December 31, 2021 Total assets as of December 31, 2022 were ₱322,492.1 million compared to ₱313,986.6 million as of December 31, 2021, or a 2.6% increase. This was due to the following: • Cash and cash equivalents including short term and long-term cash investments, and investments at amortized costs decreased by 8.7% from ₱62,0101.1 million as of December 31, 2021 to ₱56,617.0 million as of December 31, 2022 due primarily to decrease in investments at amortized costs as this was used for payment of dollar bond that matured during the year. • Investments at fair value through other comprehensive income decreased by 5.9% from ₱124.5 million as of December 31, 2021 to ₱117.2 million as of December 31, 2022 due to the disposal during the year. • Real estate inventories including raw land for residential development and construction materials increased by 7.9% from ₱49,596.9 million as of December Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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61 31, 2021 to ₱53,533.9 million as of December 31, 2022 due to increase in project launches for the year. • Advances to a related parties increased by 15.7% from ₱6,085.2 million as of December 31, 2021 to ₱7,042.3 million as of December 31, 2022 due to advances for the year. • Pension assets increased by 13.3% to ₱320.7million as of December 31, 2022 from ₱283.0 million as of December 31, 2021 as a result of actuarial adjustment for the company’s retirement program. Total liabilities as of December 31, 2022 were ₱198,563.9 million compared to ₱201,459.7 million as of December 31, 2021, or a 1.4% decrease. This was due to the following: • Security deposits and unearned rental income increased by 7.4% to ₱1,856.5 million as of December 31, 2022 from ₱1,729.3 million as of December 31, 2021 due to renewal of lease contract and new tenants of our commercial segment. • Income tax payable increased by 155.7% from ₱49.7 million as of December 31, 2021 to ₱127.1 million as of December 31, 2022 due primarily to the higher taxable income for the year coming from the commercial segment. • Dividend payable increased by 503.8% from ₱15.9 million as of December 31, 2021 to ₱96.0 as of December 31, 2022 due primarily to the remaining dividends for the year. • Notes payable including non-current portion decreased by 5.1% from ₱107,930.2 million as of December 31, 2021 to ₱102,448.2 million as of December 31, 2022 due primarily to the settlement of USD370.5 million dollar bond in June offset by the corporate note issuance in December. • Loans payable including non-current portion increased by 41.1% from ₱3,779.5 million as of December 31, 2021 to ₱5,334.6 million as of December 31, 2022 due to availment of Contract to sell financing during the year. • Contract liabilities including non-current portion increased by 19.0% from ₱1,801.5 million as of December 31, 2021 to ₱2,143.6 million as of December 31, 2022 due to advance payments from buyers of residential properties under construction. • Deferred tax liabilities – net increased by 21.5% from ₱4,934.3 million as of December 31, 2020 to ₱5,995.9 million as of December 31, 2022 due to the additional deferred tax liabilities recognized for the year. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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62 • Other noncurrent liabilities decreased by 9.7% from ₱3,521.4 million as of December 31, 2021 to ₱3,179.0 million as of December 31, 2022 due primarily to the decrease in the liabilities for purchased land. Total stockholder’s equity increased by 9.9% from ₱112,526.9 million as of December 31, 2021 to ₱123,650.2 million as of December 31, 2022 due to the net income recorded for the year ended December 31, 2021 and increase in non-controlling interest coming from the proceeds from the offering of Vista REIT. Considered as the top five key performance indicators of the Company as shown below: Key Performance Indicators 12/31/2022 12/31/2021 Current ratio (a) 2.89:1 2.48:1 Liability-to-equity ratio (b) 1.61:1 1.79:1 Interest expense/Income before Interest expense (c) 35.7% 32.6% Return on assets (d) 2.3% 2.2% Return on equity (e) 6.0% 6.2% Notes: (a) Current Ratio: This ratio is obtained by dividing the Current Assets of the Company by its Current liabilities. This ratio is used as a test of the Company’s liquidity. (b) Liability-to-equity ratio: This ratio is obtained by dividing the Company’s Total Liabilities by its Total Equity. The ratio reveals the proportion of liability and equity a company is using to finance its business. It also measures a company’s borrowing capacity. (c) Interest expense/Income before interest expense: This ratio is obtained by dividing interest expense for the period by its income before interest expense. This ratio shows whether a company is earning enough profits before interest to pay its interest cost comfortably (d) Return on assets: This ratio is obtained by dividing the Company’s net income by its total assets. This measures the Company’s earnings in relation to all of the resources it had at its disposal. (e) Return on equity: This ratio is obtained by dividing the Company’s net income by its total equity. This measures the rate of return on the ownership interest of the Company’s stockholders. Because there are various calculation methods for the performance indicators above, the Company’s presentation of such may not be comparable to similarly titled measures used by other companies. Current ratio as of December 31, 2022 increased from that of December 31, 2021 due primarily to the increase in the current assets with the corresponding decrease in current liabilities. Liability-to-equity ratio decreased due to the decrease in the interest bearing debt of the Group. Interest expense as a percentage of income before interest expense increased in the year ended December 31, 2022 compared to the ratio for the year ended December 31, 2021 due to the higher interest expense for the year. Return on asset slightly higher for the year ended December 31, 2022 compared to that on December 31, 2021. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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63 Return on equity was flat for the year ended December 31, 2022 compared to that on December 31, 2021. Material Changes to the Company’s Balance Sheet as of December 31, 2022 compared to December 31, 2021 (increase/decrease of 5% or more) Cash and cash equivalents including short term and long-term cash investments, and investments at amortized costs decreased by 8.7% from ₱62,0101.1 million as of December 31, 2021 to ₱56,617.0 million as of December 31, 2022 due primarily to decrease in investments at amortized costs as this was used for payment of dollar bond that matured during the year. Investments at fair value through other comprehensive income decreased by 5.9% from ₱124.5 million as of December 31, 2021 to ₱117.2 million as of December 31, 2022 due to the disposal during the year. Real estate inventories including raw land for residential development and construction materials increased by 7.9% from ₱49,596.9 million as of December 31, 2021 to ₱53,533.9 million as of December 31, 2022 due to increase in project launches for the year. Advances to a related parties increased by 15.7% from ₱6,085.2 million as of December 31, 2021 to ₱7,042.3 million as of December 31, 2022 due to advances for the year. Pension assets increased by 13.3% to ₱320.7 million as of December 31, 2022 from ₱283.0 million as of December 31, 2021 as a result of actuarial adjustment for the company’s retirement program. Security deposits and unearned rental income increased by 7.4% to ₱1,856.5 million as of December 31, 2022 from ₱1,729.3 million as of December 31, 2021 due to renewal of lease contract and new tenants of our commercial segment. Income tax payable increased by 155.7% from ₱49.7 million as of December 31, 2021 to ₱127.1 million as of December 31, 2022 due primarily to the higher taxable income for the year coming from the commercial segment. Dividend payable increased by 503.8% from ₱15.9 million as of December 31, 2021 to ₱96.0 as of December 31, 2022 due primarily to the remaining dividends for the year. Notes payable including non-current portion decreased by 5.1% from ₱107,930.2 million as of December 31, 2021 to ₱102,448.2 million as of December 31, 2022 due primarily to the settlement of USD370.5 million dollar bond in June offset by the corporate note issuance in December. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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64 Loans payable including non-current portion increased by 41.1% from ₱3,779.5 million as of December 31, 2021 to ₱5,334.6 million as of December 31, 2022 due to availment of Contract to sell financing during the year. Contract liabilities including non-current portion increased by 19.0% from ₱1,801.5 million as of December 31, 2021 to ₱2,143.6 million as of December 31, 2022 due to advance payments from buyers of residential properties under construction. Deferred tax liabilities – net increased by 21.5% from ₱4,934.3 million as of December 31, 2020 to ₱5,995.9 million as of December 31, 2022 due to the additional deferred tax liabilities recognized for the year. Other noncurrent liabilities decreased by 9.7% from ₱3,521.4 million as of December 31, 2021 to ₱3,179.0 million as of December 31, 2022 due primarily to the decrease in the liabilities for purchased land. Material Changes to the Company’s Statement of Income for the year ended December 31, 2022 compared to the year ended December 31, 2021 (increase/decrease of 5%or more) The Company recorded revenue from real estate sales amounting to ₱12,789.9 million for the year ended December 31, 2022, a decrease of 26.5% from ₱17,397.9 million last year. This was primarily attributable to the decrease in the overall completion rate of sold inventories of its business units specifically in the affordable segment as a result various factors such as (a) the impact of the extended payment terms granted to buyers during the pandemic specifically in the affordable segment. (b) the implementation of the community quarantine that slowed down construction activities in certain areas (c) the rainy season in the 2nd half of the year. The Company uses the Percentage of Completion method of revenue recognition where revenue is recognized in reference to the stages of development of the properties: Rental income increased by 47.6% from ₱9,312.7 million for the year ended December 31, 2021 to ₱13,724.3 million for the year ended December 31, 2022. The increase was primarily attributable to the recovery of the malls, increase foot traffic and the contribution of newly opened commercial centers. Interest income from installment contract receivable and investments decreased by 27.6% from ₱2,323.9 million for the year ended December 31, 2021 to ₱1,682.5 million for the year ended December 31, 2022. The decrease was primarily attributable to the decrease in both the interest income from investments of 36.7% to ₱981.2 million for the year ended December 31, 2022 due to settlement of dollar liabilities using our dollar investments and interest income from installment contract Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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65 receivables of 9.4% to ₱701.3 million for the year ended December 31, 2022 as more buyers are availing of bank financing. Income from parking, hotel, mall administrative and processing fees and others decreased by 25.1% from ₱2,146.9 million for the year ended December 31, 2021 to ₱1,607.3 for the year ended December 31, 2022. The decrease was primarily attributable to the mall administrative and processing fees as well as loan processing fees from banks. Parking fees and hotel revenues posted increases for the year. Cost of real estate sales decreased by 35.0% from ₱8,533.4 million for the year ended December 31, 2021 to ₱5,543.0 million for the year ended December 31, 2022 primarily due to the decrease in the overall recorded sales of Vista Land’s business units specifically the provincial projects. The decrease was also due to cost efficiencies realized during the year as the decline in costs was significantly higher than the decline in real estate revenues. Operating expenses decreased by 2.5% from ₱9,407.8 million for the year ended December 31, 2021 to ₱9,647.4 million for the year ended December 31, 2022 primarily due to the i) decrease in commission expenses from ₱829.7 million for the year ended December 31, 2021 to ₱606.1 million in the year ended December 31, 2022 due to decrease in real estate sales for the year and the shift to digital marketing and ii) a decrease in provision from impairment losses on receivables and investments from ₱443.3 million for the year ended December 31, 2021 to ₱21.7 million for the year ended December 31, 2022 due to the reduced probability of impairment for receivables and investments as situation are returning to normalcy. Interest and other financing charges increased by 20.9% from ₱4,315.3 million for the year ended December 31, 2021 to ₱5,217.9 million for the year ended December 31, 2022. The decrease was primarily attributable decrease in interest bearing debt for the year and the lower capitalization rate for interest expense. Provision for income tax increased by 3.2% from ₱1,957.6 million for the year ended December 31, 2021 to ₱2,021.1 million for the year ended December 31, 2022 primarily due to a higher taxable base for the year coming from the higher contribution of the commercial segment compared to prior year. The Company’s net income increased by 6.1% to ₱7,392.7 million for the year ended December 31, 2022 from ₱6,967.2 million for the year ended December 31, 2021. Core net income on the other hand increased by 10% to ₱7,667.9 million excluding loss of fire recorded at ₱275.2 million net of tax. For the year ended December 31, 2022, except as discussed in Note 36 – Other Matters of the 2022 Financial Statements on the impact of the COVID-19 pandemic, there were no other seasonal aspects that had a material effect on the Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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66 financial condition or results of operations of the Company. Neither were there any trends, events or uncertainties that have had or that are reasonably expected to have a material impact on the net sales or revenues or income from continuing operations. The Company is not aware of events that will cause a material change in the relationship between the costs and revenues. There are no significant elements of income or loss that did not arise from the Company’s continuing operations. Other Information i. Any known trends or any known demands, commitments, events or uncertainties that will result in or that will have a material impact on the company’s liquidity. – None. ii. Events that will trigger direct or contingent financial obligation that is material to the company, including any default or acceleration of an obligation. – None. iii. All material off-balance sheet transactions, arrangements, obligations (including contingent obligations), and other relationships of the company with unconsolidated entities or other persons created during the reporting period. – None. Capital Expenditures The table below sets out the Company's capital expenditures in 2022, 2023 and 2024. Expenditure (in P millions) 2022 (actual) 22,516.3 2023 (actual) 27,115.1 2024 (actual) 28,932.9 The Company has historically sourced funding for capital expenditures through internally-generated funds and long-term borrowings. Components of the Company's capital expenditures for 2022, 2023 and 2024 are summarized below: For the years ended December 31, 2022 2023 2024 (in P millions) Land acquisition/Advances to joint venture partners 1,353.8 683.8 594.0 Land development 5,539.3 7,197.4 8,021.5 Construction 15,623.3 19,234.0 20,317.4 Total 22,516.3 27,115.1 28,932.9 Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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67 IV. NATURE AND SCOPE OF BUSINESS Vista Land & Lifescapes, Inc. (Vista Land) is one of the leading integrated property developers in the Philippines and the largest homebuilder in the country overall. The Company believes that it is one of the few leading integrated property developers in the Philippines that is focused on the mass market. For the years ended December 31, 2022, 2023 and 2024, the Company recorded consolidated revenues from real estate sales of ₱12,789.88 million, ₱15,228.48 million and ₱16,634.01 million, respectively.Vista Land provides a wide range of residential products to its customers across all income segments and has recently expanded into the retail mall and BPO segments via the acquisition of Vistamalls. Since it commenced operations in 1977, Vista Land has built over 500,000 homes. The Company has various horizontal and vertical projects in 147 cities and municipalities across 49 provinces in the country in various stages of development and level of sales. For its leasing portfolio, it has a company-wide occupancy of 87%. Vista Land’s primary business has historically been the development and sale of horizontal real estate projects, which comprise residential lots and units in the affordable, upper mid-cost and high-end housing segments. In addition, Vista Land develops and sells vertical residential projects, including low- to high-rise condominium developments. Approximately 52% of real estate revenues are house and lot sales while the remaining 48% are sales of condominium units as of December 31, 2024.For the same period, the Company believes that it has the largest market share in the “house and lot” segment among the top seven listed real estate developers. The Company harnesses over 40 years of professional expertise in residential real estate development and believes it has established a nationwide presence, superior brand recognition and proven track record in homebuilding. Its projects include master-planned developments and stand-alone residential subdivisions which offer lots, house and lots and condominium units to customers in the affordable, upper mid-cost and high-end market segments. The Company has developed numerous “themed” housing and land development projects inspired by Mediterranean, Swiss, Italian, American, Caribbean and American Southern architecture and design. The Company believes that strict attention to detail in the execution of these themed communities helps to distinguish it from other companies. The Company currently owns 88.34% of the outstanding common capital stock of Vistamalls. Vistamalls is a major developer, owner and operator of retail malls that target mass market retail consumers in the Philippines and is widely recognized as an early mover in this market segment, focusing on establishing operating malls in densely populated areas underserved by similar retail malls and located in close proximity to transport hubs and key infrastructure. It also develops and operates BPO commercial centers. The Company operates its residential and commercial property development business through six distinct business units. Camella Homes, Communities Philippines, Crown Asia, Brittany, and Vista Residences are focused on residential property development, while Vistamalls is involved in commercial property development. Briefly, these business units may be distinguished as follows: Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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68 • Camella Homes, Inc. (Camella Homes). For over 40 years, Camella Homes has serviced the affordable housing segment (houses priced from ₱3.0 million to ₱12.0 million) in the Mega Manila area. It markets its houses primarily under the “Camella” brand. According to the 2024 Philippine Survey and Research Center (“PSRC”) “MANA 2024” Study, Camella was acknowledged as the most preferred brand overall in the Philippine housing market, with a brand awareness rate of 88%. As of December 31, 2024, Camella Homes recorded ₱3,584.0 million in real estate revenues, representing 21.5% of the Company’s total real estate revenues; • Communities Philippines, Inc. (Communities Philippines). Communities Philippines and its subsidiaries offer residential properties outside the Mega Manila area under the “Camella” and “Crown Asia” brands. In the last five years, majority of Communities Philippines’ new projects were launched under the “Camella” brand, the Company’s affordable housing brand. The Company believes that Communities Philippines and its subsidiaries have the widest coverage of developments in the regions outside Mega Manila by any homebuilder in the Philippines and utilizes mostly Camella Homes’ expertise and designs to offer houses in areas outside of the Mega Manila area that it believes are on par, in terms of quality, with the developments in the Mega Manila area. As of December 31, 2024, Communities Philippines and its subsidiaries recorded ₱5,984.7 million in real estate revenues, representing 36.0% of the Company’s total real estate revenues; • Crown Asia Properties, Inc. (Crown Asia). Crown Asia caters to the upper mid-cost housing segment in Mega Manila, primarily offering houses priced between ₱6.0 million and ₱35.0 million. As of December 31, 2024, Crown Asia recorded ₱930.8 million in real estate revenues, representing 5.6% of the Company’s total real estate revenues; • Brittany Corporation (Brittany). Brittany caters to the high-end market segment in Mega Manila, offering luxury houses in master-planned communities, priced at ₱10.0 million to ₱100.0 million. As of December 31, 2024, Brittany recorded ₱1,626.3 million in real estate revenues, representing 9.8% of the Company’s total real estate revenues; • Vista Residences, Inc. (Vista Residences). Vista Residences offers vertical residential projects in the Mega Manila area in the low to upper mid-cost segments. Vertical home projects generally involve longer project development periods as well as some facilities, amenities and other specifications not often found in horizontal homes. As of December 31, 2024, Vista Residences recorded ₱4,508.2 million in real estate revenues, representing 27.1% of the Company’s total real estate revenues; and • Vistamalls, Inc. (formerly, Starmalls, Inc.) (Vistamalls). Vistamalls is a major developer, owner and operator of retail malls that target mass market retail consumers in the Philippines and develops and operates BPO commercial centers. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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69 • VLL International, Inc. VLL International, Inc. was incorporated in Cayman Islands. The functional currency of VLL International, Inc. is the US Dollar. The Company has no sale or revenues and net income contributed by foreign sales for 2022, 2023, and 2024. V. MARKET FOR REGISTRANT’S COMMON EQUITY AND RELATED STOCKHOLDERS MATTERS Market Information The Company’s common shares are listed with the Philippine Stock Exchange. The Company was listed on June 25, 2007. Data on the quarterly stock price movement of Vista Land for the years 2025, 2024, 2023, and 2022: 2025 2024 2023 2022 Quarter High Low Close High Low Close High Low Close High Low Close 1st 1.70 1.48 1.70 1.81 1.57 1.59 2.01 1.62 1.71 3.53 2.57 2.61 2nd 1.62 1.46 1.48 1.78 1.65 1.70 2.84 1.92 1.98 3rd 1.61 1.42 1.6 1.70 1.56 1.64 2.26 1.60 1.60 4th 1.79 1.47 1.48 1.73 1.57 1.68 1.73 1.39 1.65 The market capitalization of VLL as of December 31, 2024 based on the closing price of ₱1.48/share on December 27, 2024, the last trading date for the fourth quarter of 2024, was approximately ₱18.79 billion. As of May 19, 2025, VLL’s market capitalization stood at P[x] billion based on the P[X]/share closing price. Common There are approximately 922 holders of common equity security of the Company as of April 30, 2025 (based on the number of accounts registered with the Stock Transfer Agent). The following are the top 20 holders of the common securities of the Company: Name No. of Shares Percentage1 1 FINE PROPERTIES, INC.2 7,125,545,458 56.12% 2 PCD NOMINEE CORPORATION ( FILIPINO ) 2,221,388,453 17.49% 3 PCD NOMINEE CORPORATION (FOREIGN) 1,256,893,819 9.90% 4 ALTHORP HOLDINGS, INC3 1,235,292,469 9.73% 5 MANUELA CORPORATION 4 752,208,215 5.92% 6 MANUEL B. VILLAR, JR. 4 293,969,986 2.32% 7 MANUEL PAOLO A. VILLAR 5 222,796,324 1.75% 8 JOHN T. LAO 2,853,000 0.02% 9 SULFICIO TAGUD JR. &/OR ESTER TAGUD 401,000 0.00% 10 ACRIS CORPORATION 300,000 0.00% 11 CHRISTIAN A. AGUILAR 290,617 0.00% Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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70 Name No. of Shares Percentage1 12 BENJAMARIE THERESE N. SERRANO 200,000 0.00% 13 MARIBETH TOLENTINO 200,000 0.00% 14 CHERYL JOYCE YOUNG 200,000 0.00% 15 LUCIO W. YAN &/OR CLARA Y. YAN 150,000 0.00% 16 MAXIMO S. UY &/OR LIM HUE HUA 120,000 0.00% 17 LUCIO WONG YAN 100,000 0.00% 18 ALBERTO MENDOZA &/OR OR JEANIE MENDOZA 94,635 0.00% 19 LUCIANO H. TAN 50,000 0.00% 20 VICENTE DE VERA 47,000 0.00% TOTAL 13,112,993,976 103.27% OTHER STOCKHOLDERS 1,142,400 0.01% TREASURY SHARES (416,128,700) -3.28% TOTAL OUTSTANDING, ISSUED AND SUBSCRIBED 12,698,007,676 100.00% 1based on the total outstanding, issued and subscribed shares of 12,698,007,676 as of April 30, 2025 2 Includes 1,338,599,797 lodged under PCD Nominee Corp. (Filipino) 3Includes 10,983,363 shares owned by ML&H Corporation which have been merged with Althorp Holdings, Inc. and 1,224,309,106 lodged under PCD Nominee Corp. (Filipino) 4Lodged under PCD Nominee Corp. (Filipino) 5Includes 222,596,324 lodged under PCD Nominee Corp. (Filipino) Series 1 Preferred Shares Stockholder’s Name No. of Preferred Shares Percentage (of Preferred Shares) 1 FINE PROPERTIES, INC. 3,300,000,000 100.00% Total outstanding, issued and subscribed 3,300,000,000 100.00% Series 2A Preferred Shares Stockholder’s Name No. of Preferred Shares Percentage (of Preferred Shares) PCD NOMINEE CORPORATION ( FILIPINO ) 14,246,650 99.37% 1 PCD NOMINEE CORPORATION (FOREIGN) 90,390 0.63% Total outstanding, issued and subscribed 14,337,040 100.00% Series 2B Preferred Shares Stockholder’s Name No. of Preferred Shares Percentage (of Preferred Shares) PCD NOMINEE CORPORATION ( FILIPINO ) 15,383,740 98.22% 1 PCD NOMINEE CORPORATION (FOREIGN) 279,220 1.78% Total outstanding, issued and subscribed 15,662,960 100.00% Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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71 Dividends ₱0.1120 per share Regular Cash Dividend Declaration Date: November 14, 2024 Record date: November 28, 2024 Payment date: December 12, 2024 ₱0.0620 per share Regular Cash Dividend Declaration Date: September 29, 2023 Record date: October 16, 2023 Payment date: October 31, 2023 ₱0.0292 per share Regular Cash Dividend Declaration Date: September 30, 2022 Record date: October 14, 2022 Payment date: October 28, 2022 Dividend Policy The Company's Board is authorized to declare dividends. A cash dividend declaration does not require any further approval from the Company's shareholders. A stock dividend declaration requires the further approval of shareholders representing not less than two-thirds of the Company's outstanding capital stock. Dividends may be declared only from unrestricted retained earnings. In relation to foreign shareholders, dividends payable may not be remitted using foreign exchange sourced from the Philippine banking system unless the investment was first registered with the Bangko Sentral ng Pilipinas. The Company is allowed under Philippine laws to declare property and stock dividends, subject to certain requirements. Record Date Pursuant to existing Philippine SEC rules, cash dividends declared by a company must have a record date not less than 10 nor more than 30 days from the date the cash dividends are declared. With respect to stock dividends, the record date is to be not less than 10 or more than 30 days from the date of shareholder approval, provided however, that the set record date is not to be less than 10 trading days from receipt by the PSE of the notice of declaration of stock dividend. In the event that a stock dividend is declared in connection with an increase in authorized capital stock, the corresponding record date is to be fixed by the Philippine SEC. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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72 Dividends The Company declares dividends to shareholders of record, which are paid from the Company's unrestricted retained earnings. On September 28, 2018, the Board approved the amendment of the Company’s Dividend Policy from an annual cash dividend payment ratio for its Shares of approximately 20% of its consolidated net income from the preceding fiscal year to a minimum of 20% of its consolidated net income from the preceding fiscal year, subject to the requirements of the applicable laws and regulations and the absence of circumstances which may restrict the payment of such dividends. Circumstances which could restrict the payment of cash dividends include, but are not limited to, when the Company undertakes major projects and developments requiring substantial cash expenditures or when it is restricted from paying cash dividends by its loan covenants. The Company's Board, may, at any time, modify such dividend payout ratio depending upon the results of operations and future projects and plans of the Company. Recent Sale of Unregistered Securities On January 30, 2024, the Company’s wholly-owned subsidiary, VLL International, Inc. (“VLLI”), has executed a Subscription Agreement with DBS Bank Ltd., and The Hongkong and Shanghai Banking Corporation Ltd., as Managers, for the offer, sale and issuance of U.S.$300,000,000 8.875% Senior Guaranteed Notes due 2029 pursuant to the Issuer’s U.S.$2,000,000,000 Medium Term Note (“MTN”) Programme. On July 29, 2024, VLLI has completed the issuance of USD300 million 9.375 per cent senior guaranteed notes due 2029. These were issued under VLLI’s USD2 billion MTN Programme. On August 6, 2024, VLLI has completed the issuance of USD50 million at 9.375 per cent senior guaranteed notes due 2029 (to be consolidated and form a single series with the USD300 million 9.375 per cent senior guaranteed notes due 2029 issued on 29 July 2024). On April 4, 2023, the Parent Company (the Issuer) entered into a Corporate Notes Facility Agreement for the issuance of a long-term corporate notes consisting of Three-Year Corporate Notes due 2026 amounting to P=6,000.00 million at a fixed rate of 7.61% per annum, payable on maturity date. On April 14, 2023, an additional issuance of Corporate Notes was made in the amount of P=4,000.00 million due 2026, at a fixed interest of 7.63% per annum, payable on maturity date. On Deceber 28, 2022, the Company entered into a Corporate Notes Facility Agreement for the issuance of a long-term corporate notes consisting of Three-Year Corporate Note Facility due 2025 amounting of up to PHP 12.0 billion. The Group made an initial drawdown of PHP8.6 billion at a fixed rate of 7.9314% per annum. On January 31, 2023, an additional issuance of Corporate Notes was made in the amount of P=2,900.00 million due 2025, at a fixed interest of 7.26% per annum, payable on maturity date. On March 28, 2022, the Company has obtained a Five-Year Corporate Note Facility amounting to PHP 6.0 billion. The Group made an initial drawdown of PHP 4.0 billion at Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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73 a fixed rate of 6.6416% per annum. On June 1, 2022, an additional issuance of Corporate Notes was made in the amount of PHP 2.0 billion due 2027, at a fixed interest of 6.6416% per annum. The proceeds of the corporate notes facility were utilized to refinance existing or maturing obligations of the Group and for other general corporate purposes. Stock Options None. VI. COMPLIANCE WITH LEADING PRACTICE ON CORPORATE GOVERNANCE On May 31, 2017, the Company’s Board has adopted its Revised Manual on Corporate Governance. The Company’s Manual on Corporate Governance describes the terms and conditions by which the Company intends to conduct sound corporate governance practices that are consistent with the relevant laws and regulations of the Republic of the Philippines, and which seek to enhance business transparency and build shareholder value. Ultimate responsibility and oversight of the Company’s adherence to superior corporate governance practices rests with the Board of Directors. As a policy matter, the Board will hold regular meetings, at which any number of relevant corporate governance issues may be raised for discussion. Practical oversight of the Company’s corporate governance standards is exercised through the Board’s Corporate Governance Committee. The Company is committed to building a solid reputation for sound corporate governance practices, including a clear understanding by its Directors of the Company’s strategic objectives, structures to ensure that such objectives are realized, systems to ensure the effective management of risks and the systems to ensure the Company’s obligations are identified and discharged in all aspects of its business. As of the date of this report, there are no known material deviations from the Company’s Revised Manual of Corporate Governance. The Company is taking further steps to enhance adherence to principles and practices of good corporate governance. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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74 PART III SIGNATURE PAGE Pursuant to the requirements of the Securities Regulation Code, the issuer has duly caused this report to be signed on behalf by the undersigned hereunto duly authorized. After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this report is true, complete and correct. This report is signed in the City of Mandaluyong on the 19 th day of May 2025 VISTA LAND & LIFESCAPES, INC. By: BRIAN N. EDANG CFO & Head Investor Relations Date: May 19, 2025 Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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*SGVFS197678* C O V E R S H E E T for AUDITED FINANCIAL STATEMENTS SEC Registration Number C S 2 0 0 7 0 3 1 4 5 C O M P A N Y N A M E V I S T A L A N D & L I F E S C A P E S , I N C . A N D S U B S I D I A R I E S PRINCIPAL OFFICE ( No. / Street / Barangay / City / Town / Province ) L O W E R G R O U N D F L O O R , B U I L D I N G B , E V I A L I F E S T Y L E C E N T E R , V I S T A C I T Y , D A A N G H A R I , A L M A N Z A I I , L A S P I Ñ A S C I T Y Form Type Department requiring the report Secondary License Type, If Applicable A A C F S S E C N A C O M P A N Y I N F O R M A T I O N Company’s Email Address Company’s Telephone Number Mobile Number irg@vistaland.com.ph 3226 3552 N/A No. of Stockholders Annual Meeting (Month / Day) Fiscal Year (Month / Day) 930 6/15 12/31 CONTACT PERSON INFORMATION The designated contact person MUST be an Officer of the Corporation Name of Contact Person Email Address Telephone Number/s Mobile Number Brian N. Edang brian_edang@ vistaland.com.ph 3226-3552/ 8874-5758 0917-857-6513 CONTACT PERSON’s ADDRESS Lower Ground Floor, Building B, EVIA Lifestyle Center, Vista City, Daanghari, Almanza II, Las Piñas City NOTE 1 : In case of death, resignation or cessation of office of the officer designated as contact person, such incident shall be reported to the Commission within thirty (30) calendar days from the occurrence thereof with information and complete contact details of the new contact person designated. 2 : All Boxes must be properly and completely filled-up. Failure to do so shall cause the delay in updating the corporation’s records with the Commission and/or non-receipt of Notice of Deficiencies. Further, non-receipt of Notice of Deficiencies shall not excuse the corporation from liability for its deficiencies. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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*SGVFS197678* INDEPENDENT AUDITOR’S REPORT The Stockholders and the Board of Directors Vista Land & Lifescapes, Inc. Lower Ground Floor, Building B EVIA Lifestyle Center, Vista City Daanghari, Almanza II, Las Piñas City Opinion We have audited the consolidated financial statements of Vista Land and Lifescapes, Inc. and its subsidiaries (the Group), which comprise the consolidated statements of financial position as at December 31, 2024 and 2023, and the consolidated statements of comprehensive income, consolidated statements of changes in equity and consolidated statements of cash flows for each of the three years in the period ended December 31, 2024, and notes to the consolidated financial statements, including material accounting policy information. In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as at December 31, 2024 and 2023, and its consolidated financial performance and its consolidated cash flows for each of the three years in the period ended December 31, 2024 in accordance with Philippine Financial Reporting Standards (PFRS) Accounting Standards. Basis for Opinion We conducted our audits in accordance with Philippine Standards on Auditing (PSAs). Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Group in accordance with the Code of Ethics for Professional Accountants in the Philippines (Code of Ethics) together with the ethical requirements that are relevant to our audit of the consolidated financial statements in the Philippines, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Key Audit Matters Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. For each matter below, our description of how our audit addressed the matter is provided in that context. We have fulfilled the responsibilities described in the Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements section of our report, including in relation to these matters. Accordingly, our audit included the performance of procedures designed to respond to our assessment of the risks of material misstatement of the consolidated financial statements. The results of our audit procedures, including the procedures performed to address the matters below, provide the basis for our audit opinion on the accompanying consolidated financial statements. Real Estate Revenue Recognition The Group’s revenue recognition process, policies and procedures are significant to our audit because these involve application of significant judgment and estimation in the following areas: (1) assessment of the probability that the entity will collect the consideration from the buyer; (2) determination of the transaction price; (3) application of the input method as the measure of progress in determining real estate revenue; and (4) estimation of the total project cost. SyCip Gorres Velayo & Co. 6760 Ayala Avenue 1226 Makati City Philippines Tel: (632) 8891 0307 Fax: (632) 8819 0872 sgv.ph A member firm of Ernst & Young Global Limited Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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*SGVFS197678* - 2 - In evaluating whether collectability of the amount of consideration is probable, the Group considers the significance of the buyer’s initial payments in relation to the total contract price (or buyer’s equity). Collectability is also assessed by considering factors such as payment history of the buyer. Management regularly evaluates the historical sales cancellations and back-outs, if it would still support its current threshold of buyer’s equity before commencing revenue recognition. Effective January 1, 2024, the Group adopted Philippine Interpretations Committee (PIC) Q&A 2018-12-D (as amended by PIC Q&A 2020-04) in assessing if the transaction price includes significant financing component; and PIC Q&A 2018-12-E on the treatment of land in the measurement of progress. The Group applied the modified retrospective in its initial adoption. In measuring the progress of its performance obligation over time, the Group uses input method. Under this method, progress is measured based on actual costs incurred relative to the estimated total project cost. In the estimation of total project cost, the Group requires technical determination by the Group’s specialists (project engineers) to estimate all the inputs involved in the construction and development of the projects to include materials, labor and other costs directly related in the construction of the projects. The disclosures related to the real estate revenue are included in Note 7 to the consolidated financial statements. Audit Response For the buyer’s equity, we evaluated management’s basis of the buyer’s equity by comparing this to the historical analysis of sales cancellations from buyers with accumulated payments above the collection threshold. We traced the analysis to supporting documents such as official receipts and buyer’s subsidiary ledger. For the determination of the transaction price, we obtained an understanding of the Group’s process in implementing PIC Q&A 2018-12-D (as amended by PIC Q&A 2020-04), including the determination of the population of contracts with customers related to real estate sale, the selection of the transition approach and election of available practical expedient. We obtained the financing component calculation of the management which includes an analysis whether the financing component of the Group’s contract with customers is significant. We selected sample contracts from the sales contract database and traced these selected contracts to the calculation prepared by management. For selected contracts, we traced the underlying data and assumptions used in the financing component calculation such as contract price, cash discount, payment scheme, payment amortization table and percentage of completion to the contract provision and projected percentage of completion schedule. We also recomputed the financing component for each sample selected. For the application of the input method in determining real estate revenue, we obtained an understanding of the Group’s processes for determining the percentage-of-completion (POC) which excludes land, including the cost accumulation process, and for determining and updating of total estimated costs, and performed tests of the relevant controls on these processes. We assessed the competence, capabilities and objectivity of the project engineers by reference to their qualifications, experience and reporting responsibilities. For selected projects, we traced the accumulated incurred costs to the supporting documents such as construction contracts, subsequent billings, and other documents evidencing receipt of materials and services from contractors. For the estimation of total project costs, we obtained an understanding of the Group’s budgeting and project close-out process and, on a sampling basis, performed test of details (price and quantity) for the inputs for each of the major project development workstream. We also performed test of subsequent changes to the budget by tracing to relevant documents such as approved memorandum on budget revision and performed inquiries with the project engineers to understand the basis of the revisions to the budget. We performed a look-back analysis for fully completed projects in current year. We visited selected project sites, made relevant inquiries with project engineers and correlated our observations with the reported project accomplishment. We performed test computation of the POC calculation of management. We performed test computation of the transition adjustments and evaluated the relevant disclosures made on the initial adoption of the above PIC Q&As. A member firm of Ernst & Young Global Limited Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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*SGVFS197678* - 3 - Provision for Expected Credit Losses The Group applies simplified approach in calculating expected credit loss (ECL) of rental receivables. Allowance for credit losses and the provision for credit losses as of and for the year ended December 31, 2024 amounted to P=1,310.54 million and P =300.15 million, respectively. The use of ECL model is significant to our audit as it involves the exercise of significant management judgment. Key areas of judgment include segmenting the Group’s credit risk exposures; defining default; determining assumptions to be used in the ECL model such as timing and amounts of expected net recoveries from defaulted accounts; and impact of any financial support and credit enhancements extended by any party; and incorporating forward-looking information (called overlays) in calculating ECL. The disclosures related to the allowance for credit loss using ECL model are included in Note 5 to the consolidated financial statements. Audit Response We obtained an understanding of the methodologies and models used for the Group’s different credit exposures and assessed whether these considered the requirements of PFRS 9 to reflect an unbiased and probability-weighted outcome, the time value of money, and the best available forward-looking information. We (a) assessed the Group’s segmentation of its credit risk exposures based on homogeneity of credit risk characteristics; (b) assessed the methodology used in applying the ECL model by evaluating the key inputs, assumption and formula used; (c) tested the definition of default against historical analysis of accounts and credit risk management policies and practices in place; (d) tested historical loss rates by inspecting historical recoveries and write-offs, and the effects of any financial support and credit enhancements provided by any party; (e) compared the classification of outstanding exposures to their corresponding aging buckets; (f) evaluated the forward-looking information used for overlay through statistical test and corroboration using publicly available information and our understanding of the Group’s receivable portfolios and the related industry of tenants and; (g) tested the effective interest rate, or an approximation thereof, used in discounting the expected loss. Further, we compared the data used in the ECL models, such as the historical aging analysis and default and recovery data, to the financial reporting systems. We recalculated impairment provisions on a sample basis and evaluated the disclosures made in the consolidated financial statements on allowance for credit losses using the ECL model. Other Information Management is responsible for the other information. The other information comprises the information included in the SEC Form 20-IS (Definitive Information Statement), SEC Form 17-A and Annual Report for the year ended December 31, 2024 but does not include the consolidated financial statements and our auditor’s report thereon. The SEC Form 20-IS, SEC Form 17-A and Annual Report for the year ended December 31, 2024 are expected to be made available to us after the date of this auditor’s report. Our opinion on the consolidated financial statements does not cover the other information and we will not express any form of assurance conclusion thereon. In connection with our audits of the consolidated financial statements, our responsibility is to read the other information identified above when it becomes available and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in the audits, or otherwise appears to be materially misstated. Responsibilities of Management and Those Charged with Governance for the Consolidated Financial Statements Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with PFRS Accounting Standards, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error. A member firm of Ernst & Young Global Limited Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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*SGVFS197678* - 4 - In preparing the consolidated financial statements, management is responsible for assessing the Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so. Those charged with governance are responsible for overseeing the Group’s financial reporting process. Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with PSAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements. As part of an audit in accordance with PSAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also: Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management. Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Group to cease to continue as a going concern. Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation. Plan and perform the group audit to obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group as a basis for forming an opinion on the consolidated financial statements. We are responsible for the direction, supervision and review of the audit work performed for purposes of the group audit. We remain solely responsible for our audit opinion. A member firm of Ernst & Young Global Limited Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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*SGVFS197678* VISTA LAND & LIFESCAPES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF FINANCIAL POSITION December 31 2024 2023 ASSETS Current Assets Cash and cash equivalents (Notes 9, 31 and 32) P =3,592,121,276 P=10,692,152,140 Short-term cash investments (Notes 10, 31 and 32) − 7,322,177 Current portion of: Receivables (Notes 11, 29, 31 and 32) 73,982,898,552 52,211,635,311 Cost to obtain contract (Note 7) 481,200,601 308,625,135 Current portion of investments at amortized cost (Notes 10, 31, 32) 13,639,730,398 18,425,130,586 Real estate inventories (Note 12) 57,011,995,452 63,771,221,098 Other current assets (Note 13) 5,900,152,836 6,447,935,058 Total Current Assets 154,608,099,115 151,864,021,505 Noncurrent Assets Investments at amortized cost - net of current portion (Notes 10, 31 and 32) 28,364,259,673 20,784,286,643 Investments at fair value through other comprehensive income (Notes 10, 31 and 32) 172,158,380 132,158,380 Net current portion of: Receivables (Notes 11, 29, 31 and 32) 47,331,081,668 31,191,466,002 Cost to obtain contract (Note 7) 244,118,320 202,050,708 Project development costs (Notes 16 and 29) 2,091,629,813 1,396,265,766 Advances to a related party (Note 29) 6,256,899,721 7,559,440,240 Investment in joint venture (Note 17) 499,064,280 499,448,049 Property and equipment (Note 15) 2,052,675,396 2,636,151,061 Investment properties (Note 14) 134,752,483,275 124,656,130,738 Goodwill (Note 8) 147,272,020 147,272,020 Pension assets - net (Note 26) 322,385,012 290,759,057 Deferred tax assets - net (Notes 6 and 27) 6,148,373 105,709,673 Other noncurrent assets (Note 17) 1,090,893,538 935,988,879 Total Noncurrent Assets 223,331,069,469 190,537,127,216 P =377,939,168,584 P=342,401,148,721 LIABILITIES AND EQUITY Current Liabilities Accounts and other payables (Notes 18, 31 and 32) P =31,444,875,608 P=20,517,350,873 Security deposits and advance rent (Note 19) 1,711,900,103 2,013,043,768 Income tax payable 133,222,551 112,479,900 Dividends payable (Notes 23, 29, 31 and 32) 476,520,540 298,016,044 Current portion of: Contract liabilities (Note 7) 1,922,638,461 1,588,321,684 Notes payable (Notes 21, 31 and 32) 27,787,034,267 28,005,337,553 Bank loans (Notes 20, 31 and 32) 18,236,007,959 25,874,160,220 Loans payable (Notes 20, 31 and 32) 3,497,817,361 3,176,026,696 Lease liabilities (Notes 28, 29 and 32) 421,351,897 388,872,997 Total Current Liabilities 85,631,368,747 81,973,609,735 (Forward) Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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*SGVFS197678* - 2 - December 31 2024 2023 Noncurrent Liabilities Contract liabilities - net of current portion (Note 7) P =222,227,234 P=437,048,986 Notes payable - net of current portion (Notes 21, 31 and 32) 79,642,758,953 80,143,444,086 Bank loans - net of current portion (Notes 20, 31 and 32) 37,400,116,008 27,308,807,975 Loans payable - net of current portion (Notes 20, 31 and 32) 15,984,947,240 4,267,696,654 Lease liabilities - net of current portion (Notes 28, 29 and 32) 5,014,696,216 5,051,347,045 Deferred tax liabilities - net (Notes 6 and 27) 15,434,222,515 8,201,432,357 Other noncurrent liabilities (Notes 22, 31 and 32) 2,521,011,110 2,156,400,155 Total Noncurrent Liabilities 156,219,979,276 127,566,177,258 Total Liabilities 241,851,348,023 209,539,786,993 Equity (Note 23) Attributable to equity holders of the Parent Company Preferred stock 36,000,000 33,000,000 Common stock 13,114,136,376 13,114,136,376 Additional paid-in capital 33,627,217,132 30,684,713,292 Retained earnings 85,203,113,081 86,226,517,112 Other comprehensive income (Notes 10 and 26) 1,026,361,693 905,783,398 Treasury shares (7,740,264,387) (7,740,264,387) 125,266,563,895 123,223,885,791 Noncontrolling interest (Note 30) 10,821,256,666 9,637,475,937 Total Equity 136,087,820,561 132,861,361,728 P =377,939,168,584 P=342,401,148,721 See accompanying Notes to Consolidated Financial Statements. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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*SGVFS197678* VISTA LAND & LIFESCAPES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME Years Ended December 31 2024 2023 2022 REVENUE Real estate (Notes 6 and 7) P =16,634,014,186 P=15,228,483,509 P=12,789,877,721 Rental income (Notes 6, 14 and 34) 16,330,220,676 16,021,430,433 13,742,258,197 Interest income from real estate sales (Notes 6, 11 and 25) 276,695,395 606,298,284 701,342,313 Parking, hotel, mall administrative and processing fees, and others (Notes 6 and 25) 1,687,123,971 2,104,880,739 1,607,345,055 34,928,054,228 33,961,092,965 28,840,823,286 COSTS AND EXPENSES Costs of real estate sales (Notes 6, 12, and 24) 4,801,807,537 6,112,020,965 5,542,966,656 Operating expenses (Notes 6 and 24) 10,408,136,376 11,596,161,423 9,647,400,878 15,209,943,913 17,708,182,388 15,190,367,534 OTHER INCOME (EXPENSES) Proceeds from insurance claims (Note 24) – 1,841,156,398 ‒ Interest income from investments and other income (Notes 6, 9, 10, 13 and 25) 1,756,284,139 1,202,284,056 981,195,770 Interest and other financing charges (Notes 6, 20, 21, 25 and 28) (9,826,893,091) (5,685,639,657) (5,217,887,075) (8,070,608,952) (2,642,199,203) (4,236,691,305) INCOME BEFORE INCOME TAX 11,647,501,363 13,610,711,374 9,413,764,447 PROVISION FOR INCOME TAX (Note 27) 2,279,017,408 3,318,646,232 2,021,114,107 NET INCOME P =9,368,483,955 P=10,292,065,142 P=7,392,650,340 NET INCOME ATTRIBUTABLE TO: Equity holders of the Parent Company P =7,653,265,137 P=8,656,053,138 P=6,119,908,898 Noncontrolling interest 1,715,218,818 1,636,012,004 1,272,741,442 NET INCOME P =9,368,483,955 P=10,292,065,142 P=7,392,650,340 BASIC/DILUTED EARNINGS PER SHARE (Note 30) P =0.641 P=0.725 P=0.512 (Forward) Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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*SGVFS197678* - 2 - Years Ended December 31 2024 2023 2022 NET INCOME P =9,368,483,955 P=10,292,065,142 P=7,392,650,340 OTHER COMPREHENSIVE INCOME Other comprehensive gain (loss) to be reclassified to profit or loss in subsequent periods: Cumulative translation adjustments (Note 32) 36,783,105 111,391,632 (18,488,017) Other comprehensive income (loss) not to be reclassified to profit or loss in subsequent periods: Changes in fair value on equity investments at fair value through other comprehensive income (Note 10) 40,000,000 15,000,000 22,000,000 Remeasurement gain (loss) on defined benefit obligation (Note 26) 59,146,820 (25,324,691) 26,102,958 Income tax effect (Note 27) (14,786,705) 6,331,173 (6,525,739) 121,143,220 107,398,114 23,089,202 TOTAL COMPREHENSIVE INCOME P =9,489,627,175 P=10,399,463,256 P=7,415,739,542 TOTAL COMPREHENSIVE INCOME ATTRIBUTABLE TO: Equity holders of the Parent Company P =7,773,843,434 P=8,762,922,199 P=6,140,749,468 Noncontrolling interest 1,715,783,741 1,636,541,057 1,274,990,074 P =9,489,627,175 P=10,399,463,256 P=7,415,739,542 See accompanying Notes to Consolidated Financial Statements. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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*SGVFS197678* VISTA LAND & LIFESCAPES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY Capital Stock (Note 23) Additional Paid-in Capital (Note 23) Retained Earnings (Notes 3 and 23) Other Comprehensive Income Treasury Shares (Note 23) Noncontrolling Interest (Notes 23 and 30) Total Remeasurement Gains on Retirement Obligation (Notes 23, 26 and 27) Cumulative Translation Adjustments (Notes 23 and 32) Other Comprehensive Income (Notes 10 and 23)Preferred Stock Common Stock Balances as at January 1, 2024, as previously stated P =33,000,000 P =13,114,136,376 P =30,684,713,292 P =86,226,517,112 P =589,559,094 (P =132,513,261) P =448,737,565 (P =7,740,264,387) P =9,637,475,937 P =132,861,361,728 Impact of adoption of PFRS 15 covered by PIC Q&A 2018-12-D and E and IFRIC Agenda Decision on Over Time Transfer of Constructed Goods under PAS 23, Borrowing Cost for real estate industry (Note 3) − − − (7,338,739,628) − − − − − (7,338,739,628) Balances as at January 1, 2024, as restated 33,000,000 13,114,136,376 30,684,713,292 78,887,777,484 589,559,094 (132,513,261) 448,737,565 (7,740,264,387) 9,637,475,937 125,522,622,100 Net income − − − 7,653,265,137 − − − − 1,715,218,818 9,368,483,955 Other comprehensive income − − − 43,795,190 36,783,105 40,000,000 − 564,925 121,143,220 Total comprehensive income for the year − − − 7,653,265,137 43,795,190 36,783,105 40,000,000 − 1,715,783,742 9,489,627,175 Cash dividend declared − − − (1,337,929,540) − − − − (532,003,014) (1,869,932,554) Issuance of shares 3,000,000 − 2,942,503,840 − − − − − − 2,945,503,840 Balances as at December 31, 2024 P =36,000,000 P =13,114,136,376 P =33,627,217,132 P =85,203,113,081 P =633,354,284 (P =95,730,189) P =488,737,565 (P =7,740,264,387)P =10,821,256,666 P =136,087,820,561 Balances as at January 1, 2023 P=33,000,000 P=13,114,136,376 P=30,684,713,292 P=78,311,116,523 P=609,081,665 (P=243,904,893) P=433,737,565 (P=7,740,264,387) P=8,448,577,034 123,650,193,175 Net income − − − 8,656,053,138 − − − − 1,636,012,004 10,292,065,142 Other comprehensive income − − − − (19,522,571) 111,391,632 15,000,000 − 529,053 107,398,114 Total comprehensive income (loss) for the year − − − 8,656,053,138 (19,522,571) 111,391,632 15,000,000 − 1,636,541,057 10,399,463,256 Cash dividend declared − − − (740,652,549) − − − − (447,642,154) (1,188,294,703) Balances as at December 31, 2023 P=33,000,000 P=13,114,136,376 P=30,684,713,292 P=86,226,517,112 P=589,559,094 (P=132,513,261) P=448,737,565 (P=7,740,264,387) P=9,637,475,937 P=132,861,361,728 Balances as at January 1, 2022 P=33,000,000 P=13,114,136,376 P=30,655,429,349 P=72,539,569,939 P=591,753,078 (P=225,416,876) P=411,737,565 (P=7,740,264,387) P=3,146,983,827 P=112,526,928,871 Net income − − − 6,119,908,898 − − − − 1,272,741,442 7,392,650,340 Other comprehensive income − − − − 17,328,587 (18,488,017) 22,000,000 − 2,248,632 23,089,202 Total comprehensive income (loss) for the year − − − 6,119,908,898 17,328,587 (18,488,017) 22,000,000 − 1,274,990,074 7,415,739,542 Increase in noncontrolling interest (Note 23) − − 29,283,943 − − − − − 4,197,400,031 4,226,683,974 Cash dividend declared − − − (348,362,314) − − − − (170,796,898) (519,159,212) Balances as at December 31, 2022 P=33,000,000 P=13,114,136,376 P=30,684,713,292 P=78,311,116,523 P=609,081,665 (P=243,904,893) P=433,737,565 (P=7,740,264,387) P=8,448,577,034 P=123,650,193,175 See accompanying Notes to Consolidated Financial Statements. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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*SGVFS197678* VISTA LAND & LIFESCAPES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS Years Ended December 31 2024 2023 2022 CASH FLOWS FROM OPERATING ACTIVITIES Income before income tax 11,647,501,363 P=13,610,711,374 P=9,413,764,447 Adjustments for: Interest and other financing charges (Note 25) 9,826,893,091 5,685,639,657 5,217,887,075 Depreciation and amortization (Notes 14, 15, 17 and 24) 2,640,295,868 2,889,023,944 2,638,853,067 Loss on asset retirement (Notes 14 and 24) − 164,649,301 − Retirement expense, net of payments (Note 26) 27,133,501 20,647,941 49,730,787 Unrealized foreign exchange loss 69,079,314 8,148,500 4,492,975 Loss from fire, net of claims (Notes 14, 15 and 24) − − 366,965,591 Share in equity earnings from investment in joint venture (Note 17) (49,096,796) (31,374,260) (9,301,990) Interest income from investments and other income (Note 25) (1,756,284,139) (1,202,284,056) (981,195,770) Proceeds from insurance claims (Note 24) − (1,841,156,398) − Operating income before working capital changes 22,405,522,202 19,304,006,003 16,701,196,182 Decrease (increase) in: Receivables (Note 33) (20,835,649,340) (12,052,122,445) (3,266,159,674) Real estate inventories (excluding capitalized borrowing costs) (3,839,535,639) (6,641,841,141) (2,087,951,696) Other current assets and cost to obtain contract 34,416,278 (310,088,204) (1,535,795) Increase (decrease) in: Accounts and other payables 10,617,811,326 4,543,573,958 (119,888,697) Contract liabilities (409,510,806) (118,231,131) 342,131,111 Security deposits and advance rent 335,903,616 115,934,564 45,769,229 Other noncurrent liabilities 333,395,117 (807,697,955) (45,803,311) Plan assets contributions (Note 26) − (16,020,000) (61,374,100) Net cash flows generated from operations 8,642,352,754 4,017,513,649 11,506,383,249 Income tax paid (including creditable withholding taxes) (864,205,694) (1,230,214,533) (886,982,696) Net cash flows provided by (used in) operating activities 7,778,147,060 2,787,299,116 10,619,400,553 CASH FLOWS FROM INVESTING ACTIVITIES Proceeds from: Maturity of investments at amortized cost (Note 10) 71,277,840,030 20,043,068,703 24,898,766,326 Insurance claims (Note 24) − 1,841,156,398 620,000,000 Short-term cash investments (Note 10) − 39,955,925 288,741,543 Interest received 1,803,487,981 1,256,264,386 1,080,150,454 Deductions from (Additions to): Advances to a related party (Note 33) 1,302,540,519 (517,163,906) (957,087,103) Restricted cash 168,699,903 (35,147,846) (105,669,636) Investment in joint venture 49,480,566 − − Short-term cash investments (Note 10) 7,322,177 − − Investments at amortized cost (Note 10) (72,929,964,617) (17,958,242,982) (12,921,556,055) Investment properties (excluding capitalized borrowing costs) (Notes 14 and 33) 8,395,035,669) (3,680,168,116) (5,002,075,927) Project development costs (695,364,047) (127,104,819) 4,891,917 Property and equipment (Notes 15 and 33) (120,768,757) (670,779,503) (154,666,117) Other noncurrent assets (61,882,100) (68,248,368) (75,965,633) Net cash flows provided by (used in) investing activities (7,593,644,014) 123,589,872 7,675,529,769 (Forward) Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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*SGVFS197678* - 2 - Years Ended December 31 2024 2023 2022 CASH FLOWS FROM FINANCING ACTIVITIES (Note 33) Proceeds from: Notes payable (Note 21) P=26,265,750,000 P=18,900,000,000 P=14,600,000,000 Bank loans (Note 20) 12,128,978,053 11,820,592,370 22,272,518,258 Loans payable (Note 20) 6,138,492,767 3,963,399,970 4,715,767,761 Issuance of shares (net of issuance costs) (Note 23) 2,945,503,840 − − Increase in noncontrolling interest (Note 23) − ‒ 4,226,683,974 Payments of: Notes payable (Note 21) (28,286,174,934) (12,816,674,933) (23,876,278,143) Interest and other financing charges (including capitalized borrowing cost) (Notes 12 and 14) (11,917,664,260) (11,343,917,313) (9,716,182,535) Bank loans (Note 20) (9,696,973,247) (14,593,149,597) (23,324,728,434) Loans payable (Note 20) (2,713,629,867) (1,854,295,772) (3,160,659,623) Dividends (Note 23) (1,691,428,058) (986,303,240) (438,991,085) Lease liabilities (Note 28) (388,308,890) (370,444,459) (375,018,792) Net cash flows provided by (used in) financing activities (7,215,454,596) (7,280,792,974) (15,076,888,619) EFFECTS OF CHANGE IN EXCHANGE RATES ON CASH AND CASH EQUIVALENTS (69,079,314) (8,148,500) (4,492,975) NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (7,100,030,864) (4,378,052,486) 3,213,548,728 CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR 10,692,152,140 15,070,204,626 11,856,655,898 CASH AND CASH EQUIVALENTS AT END OF YEAR (Note 9) P=3,592,121,276 P=10,692,152,140 P=15,070,204,626 See accompanying Notes to Consolidated Financial Statements. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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*SGVFS197678* VISTA LAND & LIFESCAPES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 1. Corporate Information Vista Land & Lifescapes, Inc. (the Parent Company or VLLI) was incorporated in the Republic of the Philippines and registered with the Philippine Securities and Exchange Commission (SEC) on February 28, 2007. The Parent Company’s registered office address is at Lower Ground Floor, Building B, EVIA Lifestyle Center, Vista City, Daanghari, Almanza II, Las Piñas City. The Parent Company is a publicly-listed investment holding company which is 65.84% owned by Fine Properties, Inc., (Ultimate Parent Company), as of December 31, 2024 and 2023 and the rest by the public. The Parent Company is the holding company of the Vista Group (the Group) which is engaged in real estate activities. The Group has six (6) wholly-owned subsidiaries, namely: Brittany Corporation (BC), Crown Asia Properties, Inc. (CAPI), Vista Residences, Inc. (VRI), Camella Homes, Inc. (CHI), Communities Philippines, Inc. (CPI) and VLL International Inc. (VII), and an 88.34% owned subsidiary, Vistamalls, Inc. (formerly Starmalls, Inc.) The Group is divided into horizontal, vertical and commercial and others segment. The Group caters to the development and sale of residential house and lot and residential condominium through its horizontal and vertical projects, respectively. Its commercial and others segment focuses on the development, leasing and management of shopping malls and commercial centers all over the Philippines and hotel operations. Vista REIT Transaction On August 7, 2020, the Board of Directors (BOD) of VLLI approved the incorporation of Vista One, Inc. (VOI), to be the vehicle for the Group’s Real Estate Investment Trust (REIT) registration under Republic Act 9856 (The REIT Act of 2009). VOI was incorporated in the Republic of the Philippines and was registered with the SEC on August 24, 2020, primarily to own, manage, operate and engage in the leasing of income-generating real properties such as office buildings, shopping centers, hotels, resorts, residential buildings, condominium buildings, among others and to hold for investment or otherwise, real estate of all kinds. In compliance with applicable regulatory requirements of the SEC for companies seeking registration of their securities, VOI entered into and implemented the REIT Formation Transactions as follows: Amendment of the Articles of Incorporation and By-Laws of VOI On February 7, 2022, at least a majority of the BOD and the stockholders owning at least two- thirds (2/3) of the outstanding capital stock of VOI approved to increase its authorized capital stock to P = 15,000,000,000 divided into 15,000,000,000 shares with par value of P =1.00 per share. The increase in VOI’s authorized capital stock from P =2,000,000,000 divided into 2,000,000,000 shares with par value of P =1.00 per share to P =15,000,000,000 divided into 15,000,000,000 shares with par value of P =1.00 per share was approved by the SEC on March 14, 2022. On March 16, 2022, the BOD approved various amendments to the Articles of Incorporation and By- Laws of VOI including, among others, the following: (a) change in the corporate name to “VISTAREIT, INC.”; (b) change in primary purpose to engage in the business of a real estate investment trust under Republic Act No. 9856 (the REIT Law), including the Revised Implementing Rules and Regulations of the REIT Law); (c) requirement to have independent directors in the Board; and (d) other amendments in connection with the initial public offering of VOI as a REIT entity. Such amendments were approved by the SEC on April 18, 2022. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 2 - *SGVFS197678* Execution of Property-for-Share Swap Agreement and Deed of Assignment of Leases between the Sponsors and VOI On February 7, 2022, VOI entered into various Deeds of Assignment and Subscription Agreements with each of Manuela Corporation (MC), Masterpiece Asia Properties, Inc. (MAPI), Vista Residences, Inc. (VRI), Crown Asia Properties, Inc. (CAPI) and Communities Pampanga, Inc. (CPAM) collectively referred to as the Sponsors, for the assignment, transfer, and conveyance by the Sponsors to VOI of 10 community malls and two office buildings with an aggregate gross lease area of 256,403.95 sqm (collectively, the Assigned Properties) and fair value of P =35,952,992,730 in exchange for the issuance by VOI to the Sponsors out of the increase in authorized capital stock described hereinabove of an aggregate of 6,990,000,000 common shares at an issue price of P =1.50 per share, or an aggregate issue or subscription price of P =10,485,000,000 (the Property-for-Share Swap). The Assigned Properties consists of Vista Mall Las Piñas (Main), Starmall Las Piñas (Annex), Starmall San Jose Del Monte (SJDM), Vista Mall Pampanga, SOMO – A Vista Mall, Vista Mall Antipolo, Vista Mall General Trias, Vista Mall Tanza, Starmall Talisay – Cebu, Vista Mall Imus, Vista Hub Molino and commercial and office units and parking lots in Vista Hub BGC. On March 14, 2022, the SEC issued the confirmation of the valuation of the Property-for-Share Swap. The requisite Certificate Authorizing Registrations authorizing the transfer of legal title to the Assigned Properties from the Sponsors to VOI were issued by the Bureau of Internal Revenue (BIR) on April 25 to 29 and May 2, 2022. On March 16, 2022, pursuant to the Deeds of Assignment and Subscription Agreements for the transfer, assignment and conveyance in favor of VOI of all of the Sponsors’ rights, title and interests in the Assigned Properties in exchange for VOI’s common shares, VOI and the Sponsors entered into a Deed of Assignment of Leases assigning all of the Sponsors’ rights and interests in and to the Contracts of Lease over portions of the Assigned Properties leased out to various entities (the “Leases”) effective upon the issuance of VOI’s common shares in the name of the Sponsors. Amendment of the Articles of Incorporation and By-Laws of Communities Palawan, Inc. On February 16, 2022, at least a majority of the BOD and the stockholders owning at least two- thirds (2/3) of the outstanding capital stock of Communities Palawan, Inc. approved to increase its authorized capital stock to P =500,000,000 divided into 500,000,000 shares with par value of P =1.00 per share. The increase in Communities Palawan, Inc.’s authorized capital stock from P =50,000,000 divided into 500,000 shares with par value of P =100.00 per share to P =500,000,000 divided into 500,000,000 shares with par value of P =1.00 per share was approved by the SEC on April 18, 2022. On February 16, 2022, the BOD approved the following amendments to the Articles of Incorporation and By-Laws of Communities Palawan, Inc.: (a) change in the corporate name to “VFUND MANAGEMENT, INC.”; (b) change in primary and secondary purpose to engage in the business of providing fund management services to REIT companies, as provided under Republic Act No. 9856; (c) requirement to have independent directors in the Board; and (d) amending the corporate term to perpetual existence. Such amendments were approved by the SEC on April 18, 2022. The above amendments are pursuant to the Proposed Initial Public Offering of a REIT by VistaREIT, Inc. (VistaREIT) after Communities Palawan, Inc. and VistaREIT entered into a Fund Management Agreement on March 18, 2022 for Communities Palawan, Inc. to act as the Fund Manager to VistaREIT, to perform the functions required thereof as stated in the REIT Law and the regulations of the relevant government entities, which includes, in exchange for a fund management fee as agreed by the parties, execution of investment strategies and overseeing and coordinating Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 3 - *SGVFS197678* property acquisition, property management, leasing, operational and financial reporting, appraisals, audits, market review, accounting and reporting procedures, as well as financing and asset deposition plans. On June 15, 2022, VistaREIT was publicly listed in the Philippine Stock Exchange. With the listing, VLLI’s effective ownership in VistaREIT as of December 31, 2022 was reduced to 60.09% from 98.94% as of December 31, 2021. As of December 31, 2024 and 2023, VistaREIT is 32.96% owned by Masterpiece Asia Properties, Inc., 17.40% owned by VRI, 5.92% owned by Manuela Corporation, 4.86% by Communities Pampanga, Inc., 3.49% owned by CAPI and 35.37% owned by the public (see Notes 23 and 30). 2. Basis of Preparation and Statement of Compliance Basis of Preparation The accompanying consolidated financial statements of the Group have been prepared on a historical cost basis, except for the financial assets measured at fair value through other comprehensive income which have been measured at fair value. The consolidated financial statements are presented in Philippine Peso (P =) which is the functional and presentation currency of the Parent Company, and all amounts are rounded to the nearest Philippine Peso unless otherwise indicated. The consolidated financial statements provide comparative information in respect of the previous period. Statement of Compliance The consolidated financial statements of the Group have been prepared in accordance with the Philippine Financial Reporting Standards (PFRS) Accounting Standards. Basis of Consolidation The consolidated financial statements comprise the financial statements of the Parent Company and its subsidiaries as of December 31, 2024 and 2023, and for each of the three years in the period ended December 31, 2024. An investee is included in the consolidation at the point when control is achieved. Control is achieved when the Group is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. Specifically, the Group controls an investee if and only if the Group has: Power over the investee (i.e., existing rights that give it the current ability to direct the relevant activities of the investee) Exposure, or rights, to variable returns from its involvement with the investee, and The ability to use its power over the investee to affect its returns Generally, there is a presumption that a majority of voting rights result in control. To support this presumption and when the Group has less than a majority of the voting or similar rights of an investee, the Group considers all relevant facts and circumstances in assessing whether it has power over an investee, including: The contractual arrangement with the other vote holders of the investee Rights arising from other contractual arrangements The Group’s voting rights and potential voting rights Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 4 - *SGVFS197678* The Group re-assesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control. Consolidation of a subsidiary begins when the Group obtains control over the subsidiary and ceases when the Group loses control of the subsidiary. Assets, liabilities, income and expenses of a subsidiary acquired or disposed of during the year are included or excluded in the consolidated financial statements from the date the Group gains control or until the date the Group ceases to control the subsidiary. Profit or loss and each component of other comprehensive income (OCI) are attributed to the equity holders of the Parent Company and to the noncontrolling interests (NCI), even if this results in the NCI having a deficit balance. The consolidated financial statements are prepared for the same reporting period as the Parent Company, using uniform accounting policies for like transactions and other events in similar circumstances. All intra-group assets and liabilities, equity, income, expenses and cash flows relating to transactions between members of the Group are eliminated in full on consolidation. The Parent and the subsidiaries are all domiciled and incorporated in the Philippines and are in the business of real estate development, leasing of commercial centers and buildings and hotel and resorts operation, except for VII and C&P International Limited. The latter are incorporated in Grand Cayman Island and domiciled in Hong Kong and operates as holding companies. The consolidated financial statements include the financial statements of the Parent Company and the following subsidiaries. The voting rights held by the Group in these subsidiaries are in proportion of their ownership interest. Percentage of Ownership 2024 2023 2022 BC 100.00% 100.00% 100.00% Balmoral Resources Corporation* 36.93 36.93 36.93 CAPI 100.00 100.00 100.00 Balmoral Resources Corporation* 16.93 16.93 16.93 VistaREIT, Inc.** 3.49 3.49 3.49 VRI 100.00 100.00 100.00 Vista Leisure Club Corporation (VLCC) 100.00 100.00 100.00 Vista Hospitality Management Corp. 100.00 100.00 100.00 Malay Resorts Holdings, Inc. (MRHI) 100.00 100.00 100.00 Mella Hotel, Inc. 100.00 100.00 100.00 Balmoral Resources Corporation* 37.22 37.22 37.22 Vproperty Management, Inc. 100.00 100.00 100.00 VistaREIT, Inc.** 17.40 17.40 17.40 Spaces Property Leasing and Services, Inc. 100.00 100.00 100.00 CHI 100.00 100.00 100.00 Household Development Corporation (HDC) 100.00 100.00 100.00 Brittany Estates Corporation*** − 100.00 100.00 Balmoral Resources Corporation* 8.92 8.92 8.92 Mandalay Resources Corp. 100.00 100.00 100.00 C&P International Limited 100.00 100.00 100.00 Camella Sales Specialists, Inc. 100.00 100.00 100.00 Vista Towers, Inc. 100.00 100.00 100.00 Prima Casa Land & Houses, Inc. (PCLHI) 100.00 100.00 100.00 CPI 100.00 100.00 100.00 Communities Batangas, Inc. 100.00 100.00 100.00 Communities Bulacan, Inc. 100.00 100.00 100.00 Communities Cebu, Inc. 100.00 100.00 100.00 Communities Cagayan, Inc. 100.00 100.00 100.00 (Forward) Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 5 - *SGVFS197678* Percentage of Ownership 2024 2023 2022 Communities Davao, Inc. 100.00 100.00 100.00 Communities General Santos, Inc. 100.00 100.00 100.00 Communities Isabela, Inc. 100.00 100.00 100.00 Communities Leyte, Inc. 100.00 100.00 100.00 Communities Naga, Inc. 100.00 100.00 100.00 Communities Iloilo, Inc. 100.00 100.00 100.00 Communities Negros, Inc. 100.00 100.00 100.00 Communities Pampanga, Inc. 100.00 100.00 100.00 VistaREIT, Inc.** 4.86 4.86 4.86 Communities Pangasinan, Inc. 100.00 100.00 100.00 Communities Tarlac, Inc. 100.00 100.00 100.00 Communities Zamboanga, Inc. 100.00 100.00 100.00 Communities Ilocos, Inc. 100.00 100.00 100.00 Communities Bohol, Inc. 100.00 100.00 100.00 Communities Quezon, Inc. 100.00 100.00 100.00 Vfund Management, Inc. (formerly Communities Palawan, Inc.) 100.00 100.00 100.00 Communities Palawan, Inc. 100.00 100.00 ‒ Communities Panay, Inc. 100.00 100.00 100.00 VII 100.00 100.00 100.00 Vistamalls, Inc. 88.34 88.34 88.34 Manuela Corporation (MC) 99.85 99.85 99.85 VistaREIT, Inc.** 5.92 5.92 5.92 Masterpiece Asia Properties, Inc. (MAPI) 100.00 100.00 100.00 VistaREIT, Inc.** 32.96 32.96 32.96 *The Group effectively owns 100% of Balmoral Resources Corporation through Brittany, CAPI, VRI and HDC. **The Group effectively owns 60.09% of VistaREIT, Inc. (formerly Vista One, Inc.) through MC, MAPI, Communities Pampanga, Inc., CAPI and VRI and the rest are owned by individual shareholders, as of December 31, 2024, 2023 and 2022. ***In 2024, the Group deconsolidated and sold 100% of Brittany Estates Corporation. Noncontrolling Interests Noncontrolling interests represent the portion of profit or loss and net assets not owned, directly or indirectly, by the Group. Any losses applicable to the noncontrolling interests are allocated against the interests of the noncontrolling interest even if this results to the noncontrolling interest having a deficit balance. The acquisition of an additional ownership interest in a subsidiary without a change of control is accounted for as an equity transaction. Any excess or deficit of consideration paid over the carrying amount of the noncontrolling interest is recognized in equity of the parent in transactions where the noncontrolling interest are acquired or sold without loss of control. A change in the ownership interest of a subsidiary, without loss of control, is accounted for as an equity transaction and recognized as “Additional paid-in-capital” in the consolidated statement of changes in equity. If the Group losses control over a subsidiary if: Derecognizes the assets (including goodwill) and liabilities of the subsidiary, the carrying amount of any non-controlling interest and the cumulative translation differences recorded in equity. Recognizes the fair value of the consideration received, the fair value of any investment retained and any surplus or deficit in profit or loss. Reclassifies the parent’s share of components previously recognized in other comprehensive income to profit or loss or retained earnings, as appropriate. As at December 31, 2024, 2023 and 2022, the percentage of noncontrolling interests pertain to (i) VistaREIT at 39.91% and (ii) Vistamalls, Inc. and its subsidiaries at 11.66%. The voting rights held by the noncontrolling interests are in proportion of their ownership interest. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 6 - *SGVFS197678* 3. Changes in Accounting Policies New Standards, Interpretations and Amendments The accounting policies adopted are consistent with those of the previous financial year, except for the adoption of amended standards effective in 2024. The Group has not early adopted any standard, interpretation or amendment that has been issued but is not yet effective. Unless otherwise indicated, adoption of these new standards did not have an impact on the consolidated financial statements of the Group. Amendments to PAS 1, Classification of Liabilities as Current or Non-current Amendments to PFRS 16, Lease Liability in a Sale and Leaseback Amendments to PAS 7 and PFRS 7, Disclosures: Supplier Finance Arrangements Amendments to PAS 21, Lack of exchangeability Adoption in 2024 of Certain Provisions of PIC Q&A 2018-12, PFRS 15 Implementation Issues Affecting the Real Estate Industry (as amended by PIC Q&As 2020-02 and 2020-04) On February 14, 2018, the PIC issued PIC Q&A 2018-12 which provides guidance on some PFRS 15 implementation issues affecting the real estate industry. On October 25, 2018 and February 08, 2019, the SEC issued SEC MC No. 14-2018 and SEC MC No. 3-2019, respectively, providing relief to the real estate industry by deferring the application of certain provisions of this PIC Q&A for a period of three years until December 31, 2020. On December 15, 2020, the Philippine SEC issued SEC MC No. 34-2020 which further extended the deferral of certain provisions of this PIC Q&A until December 31, 2023. The PIC Q&A provisions covered by the SEC deferral that the Group availed until December 31, 2023 follows: a. Exclusion of land in the determination of percentage-of-completion (POC) discussed in PIC Q&A No. 2018-12-E b. Accounting for significant financing component discussed in PIC Q&A No. 2018-12-D c. Implementation of International Financial Reporting Standards Interpretations Committee (IFRIC) Agenda Decision on Over Time Transfer of Constructed Goods under Philippine Accounting Standards (PAS) 23, Borrowing Cost, for Real Estate industry The Group adopted the above changes using modified retroactive approach effective January 1, 2024 and its impact (total impact) in the opening retained earnings as follows: Increase (Decrease) Exclusion of land in the determination of POC (P=630,381,445) Significant financing component 3,977,282,207 Adoption of IFRIC Agenda Decision on Over Time Transfer of Constructed Goods PAS 23, Borrowing Cost (10,685,640,390) (P=7,338,739,628) Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 7 - *SGVFS197678* January 1, 2024 As previously stated Increase (Decrease) As restated Amounts in Thousands Assets Current Assets Current portion of: Receivables P =52,211,635 P =6,403,215 P =58,614,850 Cost to obtain contract 308,625 55,070 363,695 Real estate inventories 63,771,221 (9,950,087) 53,821,134 Noncurrent Asset Receivables - net of current portion 31,191,466 2,688,269 33,879,735 Investment in joint venture 499,448 (49,481) 449,967 P =147,982,395 (P =853,014) P =147,129,381 Liabilities Current Liability Current portion of contract liabilities P =1,588,322 P =191,497 P =1,779,819 Noncurrent Liabilities Contract liabilities - net of current portion 437,049 337,509 774,558 Deferred tax liabilities - net 8,201,432 5,956,720 14,158,152 10,226,803 6,485,726 16,712,529 Equity Retained Earnings 86,226,517 (7,338,740) 78,887,777 P =96,453,320 (P =853,014) P =95,600,306 Nature of Adjustments Increase (Decrease) Borrowing Cost Exclusion of Land in POC Significant Financing Component Total Adjustments Amounts in Thousands Assets Current Assets Current portion of: Receivables P =− (P =1,093,723) P =7,496,938 P =6,403,215 Cost to obtain contract − 55,070 − 55,070 Real estate inventories (10,792,562) 842,475 − (9,950,087) Noncurrent Asset Receivables - net of current portion − − 2,688,269 2,688,269 Investment in joint venture − − (49,481) (49,481) (P =10,792,562) (P =196,178) P =10,135,726 (P =853,014) Liabilities Current Liability Current portion of contract liabilities P =− P =145,145 P =46,352 P =191,497 Noncurrent Liabilities Contract liabilities - net of current portion − 337,509 − 337,509 Deferred tax liabilities - net (106,922) (48,450) 6,112,092 5,956,720 (106,922) 434,204 6,158,444 6,485,726 Equity Retained earnings (10,685,640) (630,382) 3,977,282 (7,338,740) (P =10,792,562) (P =196,178) P =10,135,726 (P =853,014) Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 8 - *SGVFS197678* Standards Issued but not yet Effective Pronouncements issued but not yet effective are listed below. Unless otherwise indicated, the Group does not expect that the future adoption of the said pronouncements will have a significant impact on its consolidated financial statements. The Group intends to adopt the following pronouncements when they become effective. Effective beginning on or after January 1, 2025 PFRS 17, Insurance Contracts Amendments to PAS 21, Lack of exchangeability Effective beginning on or after January 1, 2026 Amendments to PFRS 9 and PFRS 7, Classification and Measurement of Financial Instruments Annual Improvements to PFRS Accounting Standards—Volume 11 Amendments to PFRS 1, Hedge Accounting by a First-time Adopter Amendments to PFRS 7, Gain or Loss on Derecognition Amendments to PFRS 9, Lessee Derecognition of Lease Liabilities and Transaction Price Amendments to PFRS 10, Determination of a ‘De Facto Agent’ Amendments to PAS 7, Cost Method Effective beginning on or after January 1, 2027 PFRS 18, Presentation and Disclosure in Financial Statements PFRS 19, Subsidiaries without Public Accountability Deferred effectivity Amendments to PFRS 10, Consolidated Financial Statements, and PAS 28, Sale or Contribution of Assets between an Investor and its Associate or Joint Venture 4. Summary of Material Accounting Policies Fair Value Measurement Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either: In the principal market for the asset or liability, or In the absence of a principal market, in the most advantageous market for the asset or liability. The principal or the most advantageous market must be accessible to the Group. The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 9 - *SGVFS197678* A fair value measurement of a nonfinancial asset takes into account a market participant’s ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use. The Group uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs. All assets and liabilities for which fair value is measured or disclosed in the consolidated financial statements are categorized within the fair value hierarchy based on the lowest level input that is significant to the fair value measurement as a whole: Level 1 – Quoted (unadjusted) market prices in active markets for identical assets or liabilities Level 2 – Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable Level 3 – Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable For assets and liabilities that are recognized in the consolidated financial statements at fair value on a recurring basis, the Group determines whether transfers have occurred between Levels in the hierarchy by re-assessing categorization (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period. Financial Instruments Financial assets Initial recognition and measurement Financial assets are classified, at initial recognition, as subsequently measured at amortized cost and fair value through other comprehensive income (OCI). The classification of financial assets at initial recognition depends on the financial asset’s contractual cash flow characteristics and the Group’s business model for managing them. For a financial asset to be classified and measured at amortized cost or fair value through OCI, it needs to give rise to cash flows that are ‘solely payments of principal and interest (SPPI)’ on the principal amount outstanding. This assessment is referred to as the SPPI test and is performed at an instrument level. The Group’s business model for managing financial assets refers to how it manages its financial assets in order to generate cash flows. The business model determines whether cash flows will result from collecting contractual cash flows, selling the financial assets, or both. Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the market place (regular way trades) are recognized on the trade date, i.e., the date that the Group commits to purchase or sell the asset. Subsequent measurement For purposes of subsequent measurement, financial assets are classified in two categories as follows: Financial assets at amortized cost (debt instruments) Financial assets designated at fair value through OCI with no recycling of cumulative gains and losses upon derecognition (equity instruments) Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 10 - *SGVFS197678* Financial assets at amortized cost (debt instruments) The Group measures financial assets at amortized cost if both of the following conditions are met: The financial asset is held within a business model with the objective to hold financial assets in order to collect contractual cash flows; and The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. Financial assets at amortized cost are subsequently measured using the effective interest (EIR) method and are subject to impairment. Gains and losses are recognized in profit or loss when the asset is derecognized, modified or impaired. The Group’s financial assets at amortized cost includes cash and cash equivalents, short-term cash investments, receivables (except for advances to contractors, suppliers and brokers), and restricted cash under “Other current assets” and “Other noncurrent assets”, and investments at amortized cost. Financial assets designated at fair value through OCI (equity instruments) Upon initial recognition, the Group can elect to classify irrevocably its equity investments as equity instruments designated at fair value through OCI when they meet the definition of equity under PAS 32, Financial Instruments: Presentation, and are not held for trading. The classification is determined on an instrument-by-instrument basis. Gains and losses on these financial assets are never recycled to profit or loss. Dividends are recognized as other income in the consolidated statement of comprehensive income when the right of payment has been established, except when the Group benefits from such proceeds as a recovery of part of the cost of the financial asset, in which case, such gains are recorded in OCI. Equity instruments designated at fair value through OCI are not subject to impairment assessment. The Group’s equity instruments classified as financial assets designated at fair value through OCI include investments in golf club shares and preferred shares of utility companies. Impairment of Financial Assets The Group recognizes expected credit losses (ECL) for: debt instruments that are measured at amortized cost and fair value through OCI; loan commitments; and financial guarantee contracts. No ECL is recognized on equity investments. ECLs are measured in a way that reflects the following: an unbiased and probability-weighted amount that is determined by evaluating a range of possible outcomes; the time value of money; and reasonable and supportable information that is available without undue cost or effort at the reporting date about past events, current conditions and forecasts of future economic conditions. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 11 - *SGVFS197678* An impairment analysis is performed at each reporting date using a provision matrix to measure ECLs. The provision rates are based on days past due for groupings of various customer segments with similar loss patterns. The calculation reflects the probability-weighted outcome and reasonable and supportable information that is available at the reporting date about past events, current conditions and forecasts of future economic conditions. The provision matrix is initially based on the Group’s historical observed default rates. The Group will calibrate the matrix to adjust the historical credit loss experience with forward-looking information. At every reporting date, the historical observed default rates are updated and changes in the forward-looking estimates are analyzed. The Group considers a financial asset in default when contractual payments are 120 days past due. However, in certain cases, the Group may also consider a financial asset to be in default when internal or external information indicates that the Group is unlikely to receive the outstanding contractual amounts in full. Financial assets are written off either partially or in their entirety only when the Group has stopped pursuing the recovery. If the amount to be written off is greater than the accumulated loss allowance, the difference is first treated as an addition to the allowance that is then applied against the gross carrying amount. Any subsequent recoveries are credited to impairment loss. For cash in banks, short-term cash investments, restricted cash, and investment in amortized cost, the Group applies the low credit risk simplification. The probability of default and loss given defaults are publicly available and are considered to be low credit risk investments. It is the Group’s policy to measure ECLs on such instruments on a 12-month basis. However, when there has been a significant increase in credit risk since origination, the allowance will be based on the lifetime ECL. The Group uses the ratings from the external credit rating agencies to determine whether the instrument has significantly increased in credit risk and to estimate ECLs. The simplified approach is applied to installment contracts receivable. The Group has established a vintage analysis for installment contracts receivable that is based on historical credit loss experience, adjusted for forward-looking factors (i.e., bank lending rate, inflation rate or gross domestic product (GDP) growth rate) specific to the debtors and the economic environment. The simplified approach is also used in calculating the Group’s ECL for lease receivables and receivables from related parties. Under the simplified approach, the Group does not track changes in credit risk, but instead recognizes a loss allowance based on lifetime ECLs at each reporting date. The Group has established a provision matrix for lease receivables and receivables from related parties that is based on its historical credit loss experience and incorporating forward-looking information (called overlays) specific to the debtors and economic environment. Financial liabilities Initial recognition and measurement The financial liabilities of the Company consisting of accounts and other payables, dividends payable, notes payable, bank loans, loans payable, lease liabilities and other noncurrent liabilities (except for deferred output tax, security deposits and advance rent) are classified, at initial recognition, as loans and borrowings and payables, as appropriate. All financial liabilities are recognized initially at fair value and, in the case of loans and borrowings and payables, net of directly attributable transaction costs. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 12 - *SGVFS197678* Subsequent measurement Loans and borrowings This is the category most relevant to the Group. After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortized cost using the EIR method. Gains and losses are recognized in profit or loss when the liabilities are derecognized as well as through the EIR amortization process. Amortized cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortization is included as finance costs in the consolidated statements of comprehensive income. This category generally applies to accounts and other payables, dividends payable, notes payable, bank loans, loans payable, lease liabilities and other noncurrent liabilities (except for deferred output tax, security deposits and advance rent) presented in the consolidated statement of financial position. Derecognition of Financial Assets and Financial Liabilities Financial asset A financial asset (or, where applicable, a part of a group of financial assets) is derecognized when, and only when: (a) the right to receive cash flows from the assets expires; (b) the Group retains the right to receive cash flows from the asset, but has assumed an obligation to pay them in full without material delay to a third-party under a “pass-through” arrangement; or (c) the Group has transferred its right to receive cash flows from the asset and either: (i) has transferred substantially all the risks and rewards of the asset, or (ii) has neither transferred nor retained the risks and rewards of the asset but has transferred control of the asset. Where the Group has transferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement, and has neither transferred nor retained substantially all the risks and rewards of the asset nor transferred control of the asset, the asset is recognized to the extent of the Group’s continuing involvement in the asset. Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that the Group could be required to repay. Modification of financial assets The Group derecognizes a financial asset when the terms and conditions have been renegotiated to the extent that, substantially, it becomes a new asset, with the difference between its carrying amount and the fair value of the new asset recognized as a derecognition gain or loss in the consolidated profit or loss, to the extent that an impairment loss has not already been recorded. When the contractual cash flows of a financial asset are renegotiated or otherwise modified and the renegotiation or modification does not result in the derecognition of that financial asset, the Group recalculates the gross carrying amount of the financial asset as the present value of the renegotiated or modified contractual cash flows discounted at the original EIR (or credit-adjusted EIR for purchased or originated credit-impaired financial assets) and recognizes a modification gain or loss in the profit or loss. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 13 - *SGVFS197678* Financial liability A financial liability (or a part of a financial liability) is derecognized when the obligation under the liability is discharged, cancelled or has expired. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as a derecognition of the original liability and the recognition of a new liability, and the difference in the respective carrying amounts is recognized in profit or loss. Real Estate Inventories Real estate inventories consist of subdivision land, residential house, and condominium units for sale and development. These are properties acquired or being constructed for sale in the ordinary course of business rather than to be held for rental or capital appreciation. These are held as inventory and are measured at the lower of cost and net realizable value (NRV). Cost includes: Acquisition cost of subdivision land; Amounts paid to contractors for construction and development of subdivision land, residential houses and lots and condominium units; and Upon adoption of IFRIC Agenda Decision on Over Time Transfer of Constructed Goods under Philippine Accounting Standards (PAS) 23, Borrowing Cost, for Real Estate industry in 2024, the borrowing costs previously capitalized to inventories amounting P =10,792.72 million (net of tax) have been derecognized (see Notes 3 and 12). NRV is the estimated selling price in the ordinary course of business, based on market prices at the reporting date, less costs to complete and the estimated costs of sale. The carrying amount of real estate inventories is reduced through the use of an allowance account and the amount of loss is charged to profit or loss. The cost of real estate inventory recognized in profit or loss is determined with reference to the specific costs incurred on the property sold and an allocation of any non-specific costs. The total costs are allocated pro-rata based on the relative size of the property sold. The Group applies the approach presented in PIC Q&A No. 2020-05 and accounts for repossession as a modification of the contract and reverses the previously recognized revenues and related cost of real estate sales recognized. Construction Materials and Supplies Construction materials and supplies are valued at the lower of cost or NRV. Cost is determined using the moving average basis. NRV is the estimated selling price, less estimated costs to dispose, if any. Based on physical inspection and evaluation, an allowance for inventory losses is provided for slow- moving, obsolete and defective materials and supplies. When inventories are issued, used, sold, disposed or otherwise, the cost and related allowance is removed from the account, and the difference is charged to profit and loss. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 14 - *SGVFS197678* Project Development Costs Project development costs consist of advances for socialized housing credits and advances in joint operations. These are carried at cost less any accumulated impairment. Advances for socialized housing credits Advances for socialized housing credits pertain to advances made to a related party in relation to the Group’s purchase of socialized housing credits in compliance with the requirements of Republic Act No. 7279 (Urban Development and Housing Act of 1992). Upon receipt of socialized housing credits, the advances is reclassified to “Real estate inventories” and is recognized in profit or loss with reference to the specific costs incurred on the property sold. Advances on joint operations Advances on joint operations pertain to costs incurred on various on-going projects under a joint venture agreements and memorandum of agreements entered into by the Group with individuals, private companies and entities under common control for the development of real estate projects. A joint operation is a joint arrangement whereby the parties that have joint control of the arrangement have right to the assets, and obligations for the liabilities, relating to the arrangement. The Group recognizes in relation to its interest in a joint operation its assets, including its share of any assets held jointly; liabilities, including its share of any liabilities incurred jointly; revenue from the sale of its share to the output arising from the joint operation; share of the revenue from the sale of the output by the joint operation; and expenses, including its share of any expenses incurred jointly. Investment Properties Investment properties comprise of completed property and property under construction or re-development that are held to earn rentals or for capital appreciation. Investment properties, except for land, are carried at cost less accumulated depreciation and amortization and any impairment in value. Land is carried at cost less any impairment in value. The initial cost of investment properties consists of its purchase price, including import duties, taxes and any directly attributable costs of bringing the asset to its working condition and location for its intended use and capitalized borrowing cost. Investment properties also include right-of-use assets primarily involving land where commercial buildings are located. The Group recognizes right-of-use assets at the commencement date of the lease (i.e., the date the underlying asset is available for use). Right-of-use assets are measured at cost, less any accumulated depreciation and impairment losses, and adjusted for any remeasurement of lease liabilities. The initial cost of right-of-use assets includes the amount of lease liabilities recognized, initial direct costs incurred, lease payments made at or before the commencement date less any lease incentives received. Unless the Group is reasonably certain to obtain ownership of the leased asset at the end of the lease term, the recognized right-of-use assets are depreciated on a straight-line basis over the shorter of their estimated useful life and lease term. Right-of-use assets are subject for impairment. Construction-in-progress (CIP) is stated at cost. This includes cost of construction and other direct costs. CIP is not depreciated until such time as the relevant assets are completed and put into operational use. Construction-in-progress are carried at cost and transferred to the related investment property account when the construction and related activities to prepare the property for its intended use are complete, and the property is ready for occupation. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 15 - *SGVFS197678* Expenditures incurred after the investment property has been put in operation, such as repairs and maintenance costs, are normally charged against income in the period in which the costs are incurred. Depreciation and amortization commence once the investment properties are available for use and computed using the straight-line method over the estimated useful lives (EUL) of the assets, regardless of utilization. The EUL and the depreciation and amortization method are reviewed periodically to ensure that the period and method of depreciation and amortization are consistent with the expected pattern of economic benefits from items of investment properties. Years Buildings and building improvements 10 to 40 years or lease term, whichever is shorter Right-of-use assets 11 to 30 years Investment properties are derecognized when either these have been disposed of or when the investment property is permanently withdrawn from use and no future economic benefit is expected from its disposal. Any gain or loss on the retirement or disposal of an investment property is recognized in profit or loss in the year of retirement or disposal. Transfers are made to investment property when there is a change in use, evidenced by ending of owner-occupation, commencement of an operating lease to another party or ending of construction or development. Transfers are made from investment property when, and only when, there is a change in use, evidenced by commencement of owner-occupation or commencement of development with a view to sale. Transfers between investment property, owner-occupied property and inventories do not change the carrying amount of the property transferred and do not change the cost of the property for measurement or for disclosure purposes. Property and Equipment Property and equipment, except for land, are carried at cost less accumulated depreciation and any impairment in value. Land is carried at cost less any impairment value at initial recognition and subsequently. The initial cost of property and equipment consists of its purchase price, including import duties, taxes and any directly attributable costs of bringing the asset to its working condition and location for its intended use. Expenditures incurred after property and equipment have been put into operation are capitalized as part of property and equipment only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the items can be measured reliably. All other repairs and maintenance are charged against operations as incurred. Depreciation commences once the property and equipment are available for use and is calculated on a the straight-line basis over the EUL life of property and equipment as follows: Years Building and building improvements 10 to 40 Hotel building 30 Transportation equipment 2 to 5 Office furniture, fixtures and equipment 2 to 5 Construction equipment 2 to 5 Other fixed assets 1 to 5 Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 16 - *SGVFS197678* The EUL and depreciation method are reviewed annually to ensure that the period and method of depreciation are consistent with the expected pattern of economic benefits from items of property and equipment. When property and equipment are retired or otherwise disposed of, the cost of the related accumulated depreciation and accumulated provision for impairment losses, if any, are removed from the accounts and any resulting gain or loss is credited to or charged against current operations. Fully depreciated and amortized property and equipment are retained in the accounts until they are no longer in use. No further depreciation is charged against current operations. Deposits Deposits consist of deposits for real estate purchases and deposits to utility companies which will either be applied or recouped against future billings or refunded upon completion of the real estate projects less any unpaid billings. Such deposits are necessary for the continuing construction and development of real estate projects of the Group. These are carried at cost less any impairment in value. Impairment of Nonfinancial Assets The Group assesses as at reporting date whether there is an indication that nonfinancial assets may be impaired. If any such indication exists, or when annual impairment testing for an asset is required, the Group makes an estimate of the asset’s recoverable amount. An asset’s recoverable amount is calculated as the higher of the asset’s or cash-generating unit’s fair value less costs to sell and its value in use and is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those assets or groups of assets. Where the carrying amount of an asset exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessment of the time value of money and the risks specific to the asset. Impairment losses of continuing operations are recognized in profit or loss in those expense categories consistent with the function of the impaired asset. An assessment is made at each financial reporting date as to whether there is an indication that previously recognized impairment losses may no longer exist or may have decreased. If such indication exists, the recoverable amount is estimated. A previously recognized impairment loss is reversed only if there has been a change in the estimates used to determine the asset’s recoverable amount since the last impairment loss was recognized. If that is the case, the carrying amount of the asset is increased to its recoverable amount. That increased amount cannot exceed the carrying amount that would have been determined, net of depreciation and amortization, had no impairment loss been recognized for the asset in prior years. Such reversal is recognized in profit or loss unless the asset is carried at revalued amount, in which case the reversal is treated as revaluation increase in OCI. After such reversal, the depreciation and amortization charge is adjusted in future periods to allocate the asset’s revised carrying amount, less any residual value, on a systematic basis over its remaining useful life. Security Deposits Security deposits represent deposits required by lease agreements. These can be recovered upon termination of the lease agreement through refund or application to unpaid rent and/or other charges. These also include deposits of homeowners for their extension, fence construction and landscaping works which will be refunded after considering any charges. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 17 - *SGVFS197678* Advance Rent Advance rent includes three-month advance rental paid by lessee as required under lease contract. These will be applied to the first or last three months rental depending on the contract terms of the related lease contract. These also include overpayments made by lessee against its monthly billings which will applied to future billings. Equity Capital stock is measured at par value for all shares subscribed, issued and outstanding. When the shares are sold at a premium, the difference between the proceeds and the par value is credited to “Additional paid-in capital” account. Direct costs incurred related to equity issuance are chargeable to “Additional paid-in capital” account. If additional paid-in capital is not sufficient, the excess is charged against retained earnings. When the Group issues more than one class of stock, a separate account is maintained for each class of stock and the number of shares issued. Retained earnings represent accumulated earnings of the Group less dividends declared. It includes the accumulated equity in undistributed earnings of consolidated subsidiaries which are not available for dividends until declared by the subsidiaries. Own equity instruments which are reacquired (treasury shares) are recognized at cost and deducted from equity. No gain or loss is recognized in profit or loss on the purchase, sale, issue or cancellation of the Group’s own equity instruments. Any difference between the carrying amount and the consideration, if reissued, is recognized in additional paid-in capital. Voting rights related to treasury shares are nullified for the Group and no dividends are allocated to them respectively. When the shares are retired, the capital stock account is reduced by its par value and the excess of cost over par value upon retirement is debited to additional paid-in capital to the extent of the specific or average additional paid-in capital when the shares were issued and to retained earnings for the remaining balance. The retained earnings is restricted to payments of dividends to the extent of the cost of treasury shares. Business Combinations and Goodwill Business combinations are accounted for using the acquisition method. The cost of an acquisition is measured as the aggregate of the consideration transferred, measured at acquisition date fair value and the amount of any NCI in the acquiree. For each business combination, the acquirer measures the NCI in the acquiree either at fair value or at the proportionate share of the acquiree’s identifiable net assets. Acquisition costs incurred are expensed and included in operating expenses. When the Group acquires a business, it assesses the financial assets and liabilities assumed for appropriate classification and designation in accordance with the contractual terms, economic circumstances and pertinent conditions as at the acquisition date. This includes the separation of embedded derivatives in host contracts by the acquiree. Goodwill is initially measured at cost being the excess of the aggregate of the consideration transferred and the amount recognized for NCI and any previous interest held over the net identifiable assets acquired and liabilities assumed. If the consideration is lower than the fair value of the net assets of the subsidiary acquired, the difference is recognized in consolidated statement of income. After initial recognition, goodwill is measured at cost less any accumulated impairment losses. For the purpose of impairment testing, goodwill acquired in a business combination is, from the acquisition date, allocated to each of the Group’s cash-generating units that are expected to benefit from the combination, irrespective of whether other assets or liabilities of the acquiree are assigned to those units. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 18 - *SGVFS197678* Where goodwill forms part of a cash-generating unit and part of the operation within that unit is disposed of, the goodwill associated with the operation disposed of is included in the carrying amount of the operation when determining the gain or loss on disposal of the operation. Goodwill disposed of in this circumstance is measured based on the relative values of the operation disposed of and the portion of the cash-generating unit retained. Revenue and Cost Recognition for Real Estate Sales Revenue from Contract with Customers The Group primarily derives its real estate revenue from the sale of developed horizontal and vertical real estate projects. Revenue from contracts with customers is recognized when control of the goods or services are transferred to the customer at an amount that reflects the consideration to which the Group expects to be entitled in exchange for those goods or services. The Group has generally concluded that it is the principal in its revenue arrangements, except for the provisioning of water and electricity services in its mall retail spaces and office leasing activities, wherein it is acting as agent. The disclosures of significant accounting judgments and estimates relating to revenue from contracts with customers are provided in Note 5. Real estate sales The Group derives its real estate revenue from sale of developed house and lot and condominium units. Revenue from the sale of these real estate project is spread over time across the course of the construction since the Group’s performance does not create an asset with an alternative use and the Group has an enforceable right for performance completed to date. Starting January 1, 2024, in determining the transaction price, the Group considers whether the selling price of the real estate property includes significant financing component. In measuring the progress of performance obligation over time, the Group uses input method. Input method recognizes revenue on the basis of the entity’s efforts or inputs to the satisfaction of a performance obligation. Progress is measured based on actual resources consumed such as materials, labor hours expended and actual overhead incurred relative to the total expected inputs to the satisfaction of that performance obligation. The Group uses the cost accumulated by the accounting department to determine the actual resources used. Input method excludes the effects of any inputs that do not depict the entity’s performance in transferring control of goods or services to the customer. Estimated development costs of the real estate project include costs of land, land development, house construction costs, building costs, professional fees, depreciation of equipment directly used in the construction, payments for permits and licenses. Revisions in estimated development costs brought about by increases in projected costs in excess of the original budgeted amounts, form part of total project costs on a prospective basis and is allocated between costs of sales and real estate inventories. Any excess of progress of work over the right to an amount of consideration that is unconditional, recognized as installment contracts receivable, is included in the “Receivables” account in the asset section of the consolidated statement of financial position. Any excess of collections over the total of recognized installment contracts receivable are included in the “Contract liabilities” account in the liabilities section of the consolidated statement of financial position. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 19 - *SGVFS197678* Other income is recognized if buyers forfeit their reservation fees and partial payments when not proceeding with the contract. The income recognized is net of any amount required to be returned to the buyers. Costs of real estate sales The Group recognizes costs relating to satisfied performance obligations as these are incurred. These include costs of land, land development costs, building costs, professional fees, depreciation, permits and licenses and capitalized borrowing costs prior pre-selling activities. These costs are allocated to the saleable area, with the portion allocable to the sold area being recognized as costs of real estate sales while the portion allocable to the unsold area being recognized as part of real estate inventories. In addition, the Group recognizes cost as an asset only when it gives rise to resources that will be used in satisfying performance obligations in the future and that are expected to be recovered. Contract Balances Installment Contracts Receivable An installment contracts receivable represents the Group’s right to an amount of consideration that is unconditional (i.e., only the passage of time is required before payment of the consideration is due). It also includes the difference between the consideration received from the customer and the transferred goods or services to a customer. Contract liabilities A contract liability is the obligation to transfer goods or services to a customer for which the Group has received consideration (or an amount of consideration is due) from the customer. If a customer pays consideration before the Group transfers goods or services to the customer, a contract liability is recognized when the payment is made, or the payment is due (whichever is earlier). Contract liabilities are recognized as revenue when the Group performs under the contract. The contract liabilities also include payments received by the Group from customers for which revenue recognition has not yet commenced. Cost to obtain contract The incremental costs of obtaining a contract with a customer are recognized as an asset if the Group expects to recover them. The Group has determined that commissions paid to brokers and marketing agents on the sale of pre-completed real estate units are deferred when recovery is reasonably expected and are charged to expense in the period in which the related revenue is recognized as earned. Commission expense is included in the “Operating expenses” account in the consolidated statement of comprehensive income. Costs incurred prior to obtaining contract with customer are not capitalized but are expensed as incurred. Amortization, derecognition and impairment of capitalized costs to obtain a contract The Group amortizes capitalized costs to obtain a contract to cost of sales over the expected construction period using percentage of completion following the pattern of real estate revenue recognition. The amortization is included within operating expenses. Capitalized costs to obtain a contract is derecognized either when it is disposed of or when no further economic benefits are expected to flow from its use or disposal. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 20 - *SGVFS197678* At each reporting date, the Group determines whether there is an indication that cost to obtain a contract maybe impaired. If such indication exists, the Group makes an estimate by comparing the carrying amount of the assets to the remaining amount of consideration that the Group expects to receive less the costs that relate to providing services under the relevant contract. In determining the estimated amount of consideration, the Group uses the same principles as it does to determine the contract transaction price, except that any constraints used to reduce the transaction price will be removed for the impairment test. Where the relevant costs or specific performance obligations are demonstrating marginal profitability or other indicators of impairment, judgment is required in ascertaining whether or not the future economic benefits from these contracts are sufficient to recover these assets. In performing this impairment assessment, management is required to make an assessment of the costs to complete the contract. The ability to accurately forecast such costs involves estimates around cost savings to be achieved over time, anticipated profitability of the contract, as well as future performance against any contract-specific performance indicators that could trigger variable consideration, or service credits. Where a contract is anticipated to make a loss, these judgements are also relevant in determining whether or not an onerous contract provision is required and how this is to be measured. Rental Income The Group earns revenue from acting as a lessor in operating leases which do not transfer substantially all of the risks and rewards incidental to the ownership of the investment properties. Rental income from leased properties is accounted for on a straight-line basis over the lease term and is included in the revenue in the consolidated statement of comprehensive income due to its operating nature, except for contingent rental income which is recognized when it arises. Lease incentives that are paid or payable to the lessee are deducted from lease payments. Accordingly, tenant lease incentives are recognized as a reduction of rental income on a straight-line basis over the term of the lease. The lease term is the non-cancellable period of the lease together with any further term for which the tenant has the option to continue the lease, where, at the inception of the lease, the Group is reasonably certain that the tenant will exercise the option. For more information on the judgment involved, refer to Note 5. The tenant lease incentives are considered in the calculation of “Rental receivable” in the line item “Receivables” in the consolidated statement of financial position. Amounts received from tenants to terminate leases or to compensate for dilapidations are recognized in the consolidated statement of comprehensive income when the right to receive them arises. The contracts for commercial and office spaces leased out by the Group to its tenants include the rights to charge for the electricity usage, water usage, air-conditioning charges and CUSA like maintenance janitorial and security services. For the electricity and water usage, the Group determined that it is acting as an agent because the promise of the Group to the tenants is to arrange for the electricity and water supply to be provided by a utility company. The utility and service companies, and not the Group, are primarily responsible for the provisioning of the utilities while the Group administers the leased spaces and coordinates with the utility and service companies to ensure that tenants have access to these utilities. For the provision of CUSA and air-conditioning of the buildings, the Group acts as a principal because it retains the right to direct the service provider of air-conditioning, maintenance, janitorial and security to the leased premises. The right to the services mentioned never transfers to the tenant and the Group has the discretion on how to price the CUSA and air-conditioning charges. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 21 - *SGVFS197678* In respect of the revenue component, these services represent a series of daily services that are individually satisfied over time because the tenants simultaneously receive and consume the benefits provided by the Group. The Group applies the time elapsed method to measure progress. The consideration charged to tenants for these services is based on a fixed amount as agreed with the tenants. The Group arranges for third parties to provide certain of these services to its tenants. The Group concluded that it acts as a principal in relation to these services as it controls the specified services before transferring them to the customer. Therefore, the Group records revenue on a gross basis. For more information, please refer to Note 5. Interest Income Interest is recognized using the effective interest method, i.e., the rate, that exactly discounts estimated future cash receipts through the expected life of the financial instrument to the net carrying amount of the financial asset. Prior 2024, interest income from real estate sales and unearned discount are recognized as income over the terms of the financial assets at amortized cost using the effective interest method and are shown as deduction for the financial assets. Starting 2024, upon adoption of PIC Q&A 2018-12-D, the unearned discount previously shown as deduction for the financial assets are derecognized and charged against beginning retained earnings (see Note 3). Significant financing component are recognized as income over the terms of the contract using effective interest method and are shown as part of interest income from real estate sales under revenue. Other Revenue Other revenue is recognized when earned. Proceeds from Insurance Claims Proceeds received from insurance claims are recognized when it is virtually certain that an inflow of economic benefit will flow to the Group, and this is recorded as “Proceeds from insurance claims” in the 2023 consolidated statement of comprehensive income. Loss from damages, which is equivalent to the carrying values of the assets, is recognized when the event occurred. Pension Cost Defined benefit plan The net defined benefit liability or asset is the aggregate of the present value of the defined benefit obligation at the end of the reporting period reduced by the fair value of plan assets, adjusted for any effect of limiting a net defined benefit asset to the asset ceiling. The asset ceiling is the present value of any economic benefits available in the form of refunds from the plan or reductions in future contributions to the plan. The cost of providing benefits under the defined benefit plans is actuarially determined using the projected unit credit (PUC) method. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 22 - *SGVFS197678* Defined benefit costs comprise the following: (a) service cost; (b) net interest on the net defined benefit liability or asset; and (c) remeasurements of net defined benefit liability or asset. Service costs which include current service costs, past service costs and gains or losses on non- routine settlements are recognized as expense in profit or loss. Past service costs are recognized when plan amendment or curtailment occurs. Net interest on the net defined benefit liability or asset is the change during the period in the net defined benefit liability or asset that arises from the passage of time which is determined by applying the discount rate based on high quality corporate bonds to the net defined benefit liability or asset. Net interest on the net defined benefit liability or asset is recognized as expense or income in profit or loss. Remeasurements comprising actuarial gains and losses, return on plan assets and any change in the effect of the asset ceiling (excluding net interest on defined benefit liability) are recognized immediately in OCI in the period in which they arise. Remeasurements are not reclassified to profit or loss in subsequent periods. Plan assets are assets that are held by a long-term employee benefit fund or qualifying insurance policies. Plan assets are not available to the creditors of the Group, nor can they be paid directly to the Group. Fair value of plan assets is based on market price information. When no market price is available, the fair value of plan assets is estimated by discounting expected future cash flows using a discount rate that reflects both the risk associated with the plan assets and the maturity or expected disposal date of those assets (or, if they have no maturity, the expected period until the settlement of the related obligations). The Group’s right to be reimbursed of some or all of the expenditure required to settle a defined benefit obligation is recognized as a separate asset at fair value when and only when reimbursement is virtually certain. Income Taxes Current tax Current tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted at the reporting date. The Group periodically evaluates the income tax positions taken in situations where the applicable tax regulations are subject to interpretation and considers these positions separately from other uncertainties. The Group assesses whether or not it is probable that those income tax positions will be accepted by the tax authorities, where if not, the Group recognizes additional income tax expense and liability relating to those positions. Deferred tax Deferred tax is provided on temporary differences using the liability method, with certain exceptions, at the reporting date between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 23 - *SGVFS197678* Deferred tax liabilities are recognized for all taxable temporary differences, except, when in respect of all taxable temporary differences associated with investments in subsidiaries, associates and interests in joint ventures, when the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse in foreseeable future. Deferred tax assets are recognized for all deductible temporary differences, carryforward benefit of unused tax credits from excess of minimum corporate income tax (MCIT) over the regular corporate income tax (RCIT) and unused net operating loss carryover (NOLCO), to the extent that it is probable that future taxable income will be available against which the deductible temporary differences and carryforward benefits of unused tax credits from MCIT and NOLCO can be utilized. Deferred tax assets shall be recognized for deductible temporary differences associated with investments in subsidiaries, associates and interests in joint ventures only to the extent that it is probable that the temporary differences will reverse in the foreseeable future and future taxable profit will be available against which the temporary differences can be utilized. The carrying amount of deferred tax assets is reviewed at each financial reporting date and reduced to the extent that it is no longer probable that sufficient taxable income will be available to allow the deferred tax assets to be utilized. Unrecognized deferred tax assets are reassessed at each financial reporting date and are recognized to the extent that it has become probable that future taxable income will allow the deferred tax asset to be recovered. Deferred tax assets and liabilities are measured at the tax rate that is expected to apply in the period when the asset is realized or the liability is settled, based on tax rates and tax laws that have been enacted or substantively enacted at the reporting date. Deferred tax relating to items recognized outside profit or loss is recognized in OCI. Deferred tax items recognized in correlation to the underlying transaction either in OCI or directly in equity. Deferred tax assets and deferred tax liabilities are offset if a legally enforceable right exists to set off current tax assets against current tax liabilities, and the deferred taxes relate to the same taxable entity and the same taxation authority. Borrowing Costs Borrowing costs directly attributable to the acquisition or construction of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalized as part of the cost of the respective assets. For real estate inventories, Starting January 1, 2024, upon adoption of the IFRIC agenda decision on over time transfer of constructed goods under PAS 23, Borrowing costs for real estate industry, interests are capitalized on the purchase cost of a site of property acquired specifically for sale but only to the extent where activities are necessary to prepare the asset for selling are in progress prior pre-selling activities and the borrowing costs that have been previously capitalized after pre-selling activities as part of the cost of real estate inventories have been derecognized (see Note 3). Borrowing costs attributable to investment properties remains capitalizable. All other borrowing costs are expensed in the period in which these occur. Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 24 - *SGVFS197678* The interest capitalized is calculated using the Group’s weighted average cost of borrowings after adjusting for borrowings associated with specific developments. Where borrowings are associated with specific developments, the amounts capitalized is the gross interest incurred on those borrowings less any investment income arising on their temporary investment of those borrowings. Interest is capitalized from the commencement of the development work until the date of practical completion. The capitalization of borrowing costs is suspended if there are prolonged periods when development activity is interrupted. Interest is also capitalized on the purchase cost of a site of property acquired specifically for redevelopment but only where activities necessary to prepare the asset for redevelopment are in progress. Borrowings originally made to develop a specific qualifying asset are transferred to general borrowings (a) when substantially all of the activities necessary to prepare that asset for its intended use or sale are complete, and (b) the entity chooses to use its funds on constructing other qualifying assets rather than repaying the loan. Costs and Expenses Costs and expenses are recognized in the consolidated statement of comprehensive income when decrease in future economic benefit related to a decrease in an asset or an increase in a liability has arisen that can be measured reliably. Costs and expenses are recognized in the consolidated statement of comprehensive income: On the basis of a direct association between the costs incurred and the earning of specific items of income; On the basis of systematic and rational allocation procedures when economic benefits are expected to arise over several accounting periods and the association can only be broadly or indirectly determined; or Immediately when expenditure produces no future economic benefits or when, and to the extent that, future economic benefits do not qualify or cease to qualify, for recognition in the consolidated statement of financial position as an asset. Costs and expenses are recognized as they are incurred based on amounts paid or payable. Leases The Group assesses at contract inception whether a contract is, or contains, a lease. That is, if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. Group as Lessee Lease liabilities At the commencement date of the lease, the Group recognizes the liabilities measured at the present value of lease payments to be made over the lease term. The lease payments include fixed payments (including in-substance fixed payments) less any lease incentives receivable, variable lease payments that depend on an index or a rate, and amounts expected to be paid under residual value guarantees. The lease payments also include the exercise price of a purchase option reasonably certain to be exercised by the Group and payments of penalties for terminating the lease, if the lease term reflects the Group exercising the option to terminate. Variable lease payments that do not depend on an index or a rate are recognized as expenses (unless they are incurred to produce inventories) in the period in which the event or condition that triggers the payment occurs. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 25 - *SGVFS197678* In calculating the present value of lease payments, the Group uses the incremental borrowing rate at the lease commencement date if the interest rate implicit in the lease is not readily determinable. After the commencement date, the amount of lease liabilities increased to reflect the accretion of interest and reduced for the lease payments made. In addition, the carrying amount of lease liabilities is remeasured if there is a modification, a change in the lease term, a change in the in-substance fixed lease payments or a change in the assessment to purchase the underlying asset. Short-term leases and Leases of low-value assets The Group applies the short-term lease recognition exemption to those leases that have a lease term of 12 months or less from the commencement date and do not contain a purchase option. The Group applies the low-value assets recognition exemption to leases of underlying assets with a value, when new, of P =0.25 million and below. Lease payments on short-term leases and low-value assets are recognized as expense on a straight-line basis over the lease term. Lease modification Lease modification is defined as a change in the scope of a lease, or the consideration for a lease, that was not part of the original terms and conditions of the lease (for example, adding or terminating the right to use one or more underlying assets, or extending or shortening the contractual lease term). A lessee recognizes the right-of-use assets and lease liability as a separate new lease after assessing that the consideration for the lease increases by an amount commensurate with the stand-alone price and any adjustments to that stand-alone price reflects the circumstances of the particular contract. The Group recognizes the amount of the remeasurement of the lease liability as an adjustment to the right-of-use assets, without affecting profit or loss. For lease termination, the difference between the right-of-use assets and lease liability is recognized in the profit or loss. Group as a Lessor Leases where the lessor does not transfer substantially all the risks and benefits of ownership of the assets are classified as operating leases. Initial direct costs incurred in negotiating operating leases are added to the carrying amount of the leased asset and recognized over the lease term on the same basis as the rental income. Contingent rents are recognized as revenue in the period in which they are earned. Lease modification is defined as a change in the scope of a lease, or the consideration for a lease, that was not part of the original terms and conditions of the lease (for example, adding or terminating the right to use one or more underlying assets, or extending or shortening the contractual lease term). A lessor shall account for a modification to an operating lease as a new lease from the effective date of the modification, considering any prepaid or accrued lease payments relating to the original lease as part of the lease payments for the new lease. If a change in lease payments does not meet the definition of a lease modification, that change would generally be accounted for as a negative variable lease payment. In the case of an operating lease, a lessor recognizes the effect of the rent concession by recognizing lower income from leases. Pretermination is defined as termination of lease contract by the lessee or lessor before the end of the lease term. In the case of pretermination of an operating lease, a lessor derecognizes the rental receivable from the effect of straight-line calculation of rental income and is charged against rental income in the statement of comprehensive income. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 26 - *SGVFS197678* Foreign Currency Translation Each entity in the Group determines its own functional currency and items included in the financial statements of each entity are measured using that functional currency. Transactions in foreign currencies are initially recorded in the functional currency rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated at the functional currency rate of exchange ruling at the reporting date. Exchange gains or losses arising from foreign exchange transactions are credited to or charged against operations for the period. The functional currency of C&P International Limited and VII is the US Dollar. As of reporting date, the assets and liabilities of foreign subsidiaries, with functional currencies other than the functional currency of the Parent Company, are translated into the presentation currency of the Group using the closing foreign exchange rate prevailing at the reporting date, and their respective income and expenses at the weighted average rates for the year. The exchange differences arising on the translation are recognized in OCI under “Cumulative Translation Adjustment”. On disposal of a foreign operation, the component of OCI relating to that particular foreign operation shall be recognized in profit or loss in the consolidated statement of comprehensive income. Basic and Diluted Earnings Per Share (EPS) Basic EPS is computed by dividing net income attributable to equity holders of the Parent Company by the weighted average number of common shares issued and outstanding during the year adjusted for any subsequent stock dividends declared. Diluted EPS is computed by dividing net income attributable to the equity holders of the Parent Company by the weighted average number of common shares issued and outstanding during the year after giving effect to assumed conversion of potential common shares. The calculation of diluted EPS does not assume conversion, exercise, or other issue of potential common shares that would have an antidilutive effect on earnings per share. Basic and diluted EPS are adjusted to give retroactive effect to any stock dividends declared during the period. As of December 31, 2024, 2023 and 2022, the Group has no potential dilutive common shares (see Note 30). Segment Reporting The Group’s operating businesses are organized and managed separately according to the nature of the products and services provided, with each segment representing a strategic business unit that offers different products and serves different markets. Financial information on operating segments is presented in Note 6 to the consolidated financial statements. Provisions Provisions are recognized when the Group has a present legal or constructive obligation as a result of past events, it is more likely than not that an outflow of resources embodying economic benefits will be required to settle the obligation, and the amount can be reliably estimated. Provisions are not recognized for future operating losses. Provisions are measured at the present value of the expenditures expected to be required to settle the obligation using a pre-tax rate that reflects the current market assessment of the time value of money and the risk specific to the obligation. Where discounting is used, the increase in the provision due to the passage of time is recognized as interest expense. Where the Group expects some or all of a provision to be reimbursed, the reimbursement is recognized only when the reimbursement is virtually certain. The expense relating to any provision is presented in consolidated statement of comprehensive income net of any reimbursement. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 27 - *SGVFS197678* Contingencies Contingent liabilities are not recognized in the consolidated financial statements. These are disclosed unless the possibility of an outflow of resources embodying economic benefits is remote. Contingent assets are not recognized in the consolidated financial statements but disclosed when an inflow of economic benefits is probable. Events After the Financial Reporting Date Post year-end events that provide additional information about the Group’s position at the reporting date (adjusting events) are reflected in the consolidated financial statements. Any post year-end events that are not adjusting events are disclosed in the consolidated financial statements when material. 5. Material Accounting Judgments and Estimates The preparation of the consolidated financial statements in compliance with PFRS Accounting Standards requires management to make judgments and estimates that affect the amounts reported in the consolidated financial statements and accompanying notes. The estimates and assumptions used in the consolidated financial statements are based upon management’s evaluation of relevant facts and circumstances as at the date of the consolidated financial statements. Actual results could differ from such estimates. Judgments and estimates are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Judgments In the process of applying the Group’s accounting policies, management has made the following judgments, apart from those involving estimations, which have the most significant effect on the amounts recognized in the consolidated financial statements: Revenue from contracts with customers Existence of a contract The Group’s primary document for a contract with a customer is a signed contract to sell. It has determined however, that in cases wherein contract to sell are not signed by both parties, the combination of its other signed documentation such as reservation agreement, official receipts, quotation sheets and other documents, would contain all the criteria to qualify as contract with the customer under PFRS 15. In addition, part of the assessment process of the Group before revenue recognition is to assess the probability that the Group will collect the consideration to which it will be entitled in exchange for the real estate property that will be transferred to the customer. In evaluating whether collectability of an amount of consideration is probable, an entity considers the significance of the customer’s initial payments (buyer’s equity) in relation to the total contract price. Collectability is also assessed by considering factors such as payment history of customer, age and pricing of the property. Management regularly evaluates the historical cancellations and back-outs if it would still support its current threshold of customers’ equity before commencing revenue recognition. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 28 - *SGVFS197678* Revenue recognition method and measure of progress The Group concluded that revenue for real estate sales is to be recognized over time because (a) the Group’s performance does not create an asset with an alternative use, and; (b) the Group has an enforceable right for performance completed to date. The promised property is specifically identified in the contract and the contractual restriction on the Group’s ability to direct the promised property for another use is substantive. This is because the property promised to the customer is not interchangeable with other properties without breaching the contract and without incurring significant costs that otherwise would not have been incurred in relation to that contract. In addition, under the current legal framework, the customer is contractually obliged to make payments to the developer up to the performance completed to date. The Group has determined that input method used in measuring the progress of the performance obligation faithfully depicts the Group’s performance in transferring control of real estate development to the customers. Principal versus agent considerations The contract for the commercial and office spaces leased out by the Group to its lessees includes the right to charge for the electricity usage, water usage, air conditioning charges and CUSA like maintenance, janitorial and security services. For the electricity and water usage, the Group determined that it is acting as an agent for the benefit of the lessees because the promise of the Group to the lessees is to arrange for the electricity and water supply to be provided by utility companies. The utility and service companies, and not the Group, are primarily responsible for the provisioning of the utilities while the Group administers for a minimal fee, the leased spaces and coordinates with the utility and service companies to ensure that lessees have access to these utilities. For the provision of CUSA and air-conditioning of the buildings, the existing lease contract establishes the Group to act as a principal because it retains the right to direct the service provider of maintenance, janitorial and security to the leased premises, and air-conditioning, respectively. The right to the services mentioned never transfers to the lessees and the Group has the discretion to add a nominal fee to the CUSA and air-conditioning charges. Determination of the lease term The Group determines the lease term as the noncancellable term of the lease, together with any periods covered by an option to extend the lease if it is reasonably certain to be exercised, or any periods covered by an option to terminate the lease, if it is reasonably certain not to be exercised. As a lessor, the Group enters into lease agreements that contain options to terminate or to extend the lease. At commencement date, the Group determines whether the lessee is reasonably certain to extend the lease term or not to terminate the lease. To make this analysis, the Group takes into account any difference between the contract terms and the market terms, any significant investments made by the lessee in the property, costs relating to the termination of the lease and the importance of the underlying asset to the lessee’s operations. In many cases, the Group does not identify sufficient evidence to meet the required level of certainty. As a lessee, the Group has a lease contract for the land where investment properties are situated that includes an extension and a termination option. The Group applies judgement in evaluating whether or not it is reasonably certain to exercise the option to renew or terminate the lease. That is, it considers all relevant factors that create an economic incentive for it to exercise either the renewal or termination. After the commencement date, the Group reassesses the lease term if there is a significant event or change in circumstances that is within its control and affects its ability to Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 29 - *SGVFS197678* exercise, or not to exercise, the option to renew or to terminate (e.g., construction of significant leasehold improvements or significant customization to the leased asset). Definition of default and credit-impaired installment contracts receivable The Group defines the account as in default, which is fully aligned with the definition of credit- impaired, when it meets one or more of the following criteria: Quantitative criteria The customer receives a notice of cancellation and does not continue the payments. Qualitative criteria The customer meets unlikeliness to pay criteria, which indicates the customer is in significant financial difficulty. These are instances where: a. The customer is experiencing financial difficulty or is insolvent b. The customer is in breach of financial covenant(s) c. An active market for that financial assets has disappeared because of financial difficulties d. Concessions have been granted by the Group, for economic or contractual reasons relating to the customer’s financial difficulty e. It is becoming probable that the customer will enter bankruptcy or other financial reorganization The criteria above have been applied to the financial instruments held by the Group and are consistent with the definition of default used for internal credit risk management purposes. The default definition has been applied consistently to model the Probability of Default (PD), Loss Given Default (LGD) and Exposure at Default (EAD) throughout the Group’s expected loss calculation. Incorporation of forward-looking information The Group considers a range of relevant forward-looking macro-economic assumptions (i.e., inflation rate and GDP growth rate for commercial segment and bank lending rate, inflation rate or GDP growth rate for residential segment) for the determination of unbiased general industry adjustments and any related specific industry adjustments that support the calculation of ECLs. Based on the Group’s evaluation and assessment and after taking into consideration external actual and forecast information, the Group formulates a ‘base case’ view of the future direction of relevant economic variables as well as a representative range of other possible forecast scenarios. This process involves developing two or more additional economic scenarios and considering the relative probabilities of each outcome. External information includes economic data and forecasts published by governmental bodies, monetary authorities and selected private-sector and academic institutions. The base case represents a most-likely outcome and is aligned with information used by the Group for other purposes such as strategic planning and budgeting. The other scenarios represent more optimistic and more pessimistic outcomes. Periodically, the Group carries out stress testing of more extreme shocks to calibrate its determination of these other representative scenarios. The Group has identified and documented key drivers of credit risk and credit losses of each portfolio of financial instruments and, using an analysis of historical data, has estimated relationships between macro-economic variables and credit risk and credit losses. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 30 - *SGVFS197678* Significant increase in credit risk The criteria for determining whether credit risk has increased significantly vary by portfolio and include quantitative changes in PDs and qualitative factors. The Group’s cash and cash equivalents, short-term cash investments, investments at amortized cost, and restricted cash are graded in the top investment category by globally recognized credit rating agencies such as S&P, Moody’s and Fitch and, therefore, are considered to be low credit risk investments. However, when there has been a significant increase in credit risk since origination, the allowance will be based on the lifetime ECL. The Group uses the ratings from these credit rating agencies both to determine whether the debt instrument has significantly increased in credit risk and to estimate ECLs. Using its expert credit judgement and, where possible, relevant historical experience, the Group may determine that an exposure has undergone a significant increase in credit risk based on particular qualitative indicators that it considers are indicative of such and whose effect may not otherwise be fully reflected in its quantitative analysis on a timely basis. Operating lease commitments - Group as lessor The Group has entered into commercial, office and industrial property leases on its investment properties portfolio. Based on an evaluation of the terms and conditions of the arrangements, the Group has determined that it retains all the significant risks and rewards of ownership of these properties and accounts for them as operating leases. In determining significant risks and benefits of ownership, the Group considered, among others, the significance of the lease term as compared with the EUL of the related asset. A number of the Group’s operating lease contracts are accounted for as noncancellable operating leases and the rest are cancellable. In determining whether a lease contract is cancellable or not, the Group considers, among others, the significance of the penalty, including the economic consequence to the lessee (see Note 28). Distinction among real estate inventories, land held for future development and investment properties The Group determines whether a property will be classified as Real estate inventories, Land held for future development and Investment properties. In making this judgment, the Group considers whether the property will be sold in the normal operating cycle (Real estate inventories), whether it will be retained as part of the Group’s strategic land banking activities for development or sale in the medium or long-term (Land held for future development) or whether it will be held to earn rentals or for capital appreciation (Investment properties). For land properties, the Group considers the purpose for which the land was acquired. Recognition of deferred tax assets Deferred tax assets are recognized for all deductible temporary differences to the extent that it is probable that sufficient taxable income will be available against which the deductible temporary differences can be utilized. Significant management estimate is required to determine the amount of deferred tax asset that can be recognized, based upon the likely timing and level of future taxable income together with future tax planning. The Group’s recognized deferred tax assets amounted to P =2,183.41 million and P =2,235.40 million as of December 31, 2024 and 2023, respectively (see Note 27). Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 31 - *SGVFS197678* Judgments made in determining taxable profit (tax loss), tax bases, unused tax losses, unused tax credits and tax rates applying paragraph 122 of PAS 1, Presentation of Financial Statements Upon adoption of the Interpretation, the Group has assessed whether it has any uncertain tax position. The Group applies significant judgment in identifying uncertainties over its income tax treatments. The Group determined, based on its assessment, in consultation with its tax counsel, that it is probable that its uncertain income tax treatments (including those for the subsidiaries) will be accepted by the taxation authorities. Assessment of Joint Control The investment in VVTI is accounted for as investment in joint venture despite the Group owning 60%, this is because the relevant activities such as matters related to project development, approval of annual budget and programme, change in joint venture business structure and distribution of dividends among others of the Group and Mitsubishi Estate Co., Ltd. require the unanimous consent of both parties. Even though the Group holds 60% ownership interest on these arrangements, their respective joint arrangement agreements require unanimous consent from all parties to the agreement for the relevant activities identified. The Group and the parties to the agreement only have rights to the net assets of the joint venture through the terms of the contractual arrangements. Adoption of a ‘no tax’ regime for VistaREIT, Inc (VREIT). As a Real Estate Investment Trust (REIT) entity, VREIT can choose to operate within one of two tax regimes (i.e., a ‘full tax’ regime or a ‘no tax’ regime). The REIT entity can effectively operate under a ‘no tax’ regime provided that it meets certain conditions (e.g., listing status, minimum required dividend payments). A REIT entity is required to distribute at least 90% of its annual income as dividends to its investors and is allowed to treat the dividend as deduction for tax purposes making it effectively an income tax-free entity. As of December 31, 2024 and 2023, VREIT met the provisions of the REIT law and complies with the 90% dividend distribution requirement. VREIT has determined, based on its current tax regime and expected dividend distribution in the succeeding periods, that it can effectively operate on a “no-tax” regime. VREIT did not recognize any deferred taxes in 2024 and 2023. Management’s Use of Estimates and Assumptions The key estimates and assumptions concerning the future and other key sources of estimation uncertainty at the reporting date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below. Measurement of progress when revenue is recognized over time The Group’s real estate sales is recognized over time and the percentage-of-completion (POC) is determined using input method measured principally based on total actual cost of resources consumed such as materials, labor hours expended, and actual overhead incurred over the total expected project development cost. Actual costs also include incurred costs but not yet billed which are estimated by the project engineers. Total estimated project development cost involves significant estimate since it requires technical determination by management’s specialists (project engineers). Estimated project development costs include costs of land, land development, building costs, professional fees, depreciation of equipment directly used in the construction, payments for permits and licenses. Revisions in estimated development costs brought about by increases in projected costs in excess of the original budgeted amounts, form part of total project costs on a prospective basis and is allocated between costs of sales and real estate inventories. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 32 - *SGVFS197678* In 2024, upon adoption of PIC Q&A 2018-12 - E, the land component which is previously included in the determination of the POC was excluded. The impact of the adoption amounted to P=630.38 million (see Note 3). Provision for expected credit losses of financial assets Cash and cash equivalents, short-term cash investments, investments at amortized cost and restricted cash: The Group recognizes a loss allowance based on either 12-month ECLs or Lifetime ECLs, depending on whether there has been a significant increase in credit risk on the financial instrument since initial recognition. The changes in the loss allowance balance are recognized in profit or loss as an impairment gain or loss. The Group uses external credit rating approach to calculate ECL for cash and cash equivalents, short-term cash investments, investments at amortized cost, and restricted cash. This approach leverages on available market data (i.e., S&P and Moody’s and Fitch credit ratings for default rates). S&P, Moody’s, Fitch and Reuters are reliable market data sources that provide default and recovery rate data. These information are widely used by investors and stakeholders in decision- making in terms of investment, credit activities, etc. Installment contracts receivables, accounts receivable and rental receivable: The Group uses vintage analysis to calculate ECLs for installment contracts receivable. The PD rates using vintage analysis are based on default counts of contract issuances in a given period for groupings of various customer segments that have similar loss patterns (e.g., by customer’s type of financing and employment). The vintage analysis is initially based on the Group’s historical observed default rates. The Group will calibrate the matrices to adjust the historical credit loss experience with forward-looking information. For instance, if forecast economic conditions (i.e., gross domestic product) are expected to deteriorate over the next year which can lead to an increased number of defaults in the real estate sector, the historical default rates are adjusted. At every reporting date, the historical observed default rates are updated and changes in the forward- looking estimates are analyzed. The Group also considers the timing of re-sale of the covered properties and related costs in determining the expected net recoveries. For third-party rental receivable, the Group recognizes a loss allowance based on lifetime ECLs. The changes in the loss allowance balance are recognized in profit or loss as an impairment gain or loss. For related party rental receivable, the Group considers the ability to pay of the related party and considers factors whether the related party is a listed company or not, its current results of operations and the projected cash flows from operations. The assessment also includes the assumption of the liability of the related parties’ parent company and future plans of payments for remaining uncollected receivables such as entering into property exchange or joint venture arrangements wherein land properties will be received as form of settlement, which are to be used in the Group’s planned expansion activities. The collectability assessment also includes the continuing commitment to provide financial support to these related parties and common control entities by Fine Properties, Inc. and the assessment of the latter’s capacity to provide such financial support. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 33 - *SGVFS197678* The assessment of the relationship between historical observed default rates, forecast economic conditions and ECLs is a significant estimate. The amount of ECLs is sensitive to changes in circumstances and of forecast economic conditions. The Group’s historical credit loss experience and forecast of economic conditions may also not be representative of customer’s actual default in the future. The collectability of the significant portion of its receivables from real estate sales is impacted by the continuing employment of its customers, both the overseas contract workers and locally employed customers. Tenants which belong to micro, small and medium enterprise and those operating under entertainment, non-essentials and food industries were previously adversely affected due to temporary closure of mall operations which increased the risk of non-collection of the remaining receivables. The Group has updated its assumptions as various tenants has recovered from the impact of the pandemic. For the installment contracts receivable, the calculation of the probability of default (PD) was updated by further segmenting the buyers tagged as overseas Filipino workers based on location of employment (e.g., Middle East, Europe, East Asia, etc.). For receivables from tenants, the PD scenario used in the calculation of ECL were assigned with 33% equal probability for all scenarios as of December 31, 2024 and 2023, and 30% best, 33% base, and 37% worse and 31% best, 33% base, and 36% worst case probability scenario as of December 31, 2022, respectively. The base case represents a most-likely outcome and is aligned with information used by the Group for other purposes such as strategic planning and budgeting. The other scenarios represent more optimistic and more pessimistic outcomes. As a result of the loss estimation, management recognized impairment loss for rental receivable and investments at amortized cost in each period presented. Further details are provided in Notes 10, 11 and 32. Fair value of financial instruments Where the fair values of financial assets and financial liabilities recorded in the consolidated statement of financial position or disclosed in the notes to the consolidated financial statements cannot be derived from active markets, they are determined using internal valuation techniques using generally accepted market valuation models. The inputs to these models are taken from observable markets where possible, but where this is not feasible, estimates are used in establishing fair values. These estimates may include considerations of liquidity, volatility, and correlation. Further details about the fair value of financial instruments are provided in Note 31. Evaluation of impairment of nonfinancial assets The Group reviews project development costs, investment in joint venture, property and equipment, investment properties, goodwill, and other nonfinancial assets for impairment of value. This includes considering certain indications of impairment such as significant changes in asset usage, significant decline in assets’ market value, obsolescence or physical damage of an asset, significant underperformance relative to expected historical or projected future operating results and significant industry or economic trends. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 34 - *SGVFS197678* The Group estimates the recoverable amount as the higher of the fair value less costs to sell and value in use. Fair value less costs to sell pertain to quoted prices and for fair values determined using discounted cash flows or other valuation technique such as multiples. In determining the present value of estimated future cash flows expected to be generated from the continued use of the assets, the Group is required to make estimates and assumptions that may affect project development costs, investment in joint venture, property and equipment, investment properties, goodwill, and other nonfinancial assets. For goodwill, this requires an estimation of the recoverable amount which is the fair value less costs to sell or value in use of the cash-generating units to which the goodwill is allocated. Estimating a value in use amount requires management to make an estimate of the future cash flows for the cash generating unit and also to choose a suitable discount rate in order to calculate the present value of cash flows. Further details are provided in Notes 8, 13, 14, 15, 16, and 17. Determining the fair value of investment properties The Group discloses the fair values of its investment properties. The Group’s investment properties consist of land and land developments and building and building improvements. For properties for leasing, the fair values were derived using income approach as determined by third party appraisers while land properties held for capital appreciation were based on market-based listing of the properties of the same features and locations as determined by management. Fair values of right of use asset were determined using the latest discount rate every end of reporting period based on remaining cash flows while that of construction in progress is aligned with cost as management believes the values of cost represents the current replacement cost as of balance sheet date. Further details are provided in Note 14. Pension cost The determination of the obligation and cost of pension benefits is dependent on the selection of certain assumptions used in calculating such amounts. Those assumptions include, among others, discount rates and salary increase rates (see Note 30). The cost of defined benefit pension plan and the present value of the pension liabilities are determined using actuarial valuations. Due to the complexity of the valuation, the underlying assumptions and its long-term nature, defined benefit liabilities are highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date. In determining the appropriate discount rate, management considers the interest rates of government bonds that are denominated in the currency in which the benefits will be paid, with extrapolated maturities corresponding to the expected duration of the defined benefit liability. Future salary increases are based on expected future inflation rates and other relevant factors. The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows using interest rates of Philippine government bonds with terms consistent with the expected employee benefit payout as of reporting date. As of December 31, 2024 and 2023, the Group’s net pension asset amounted to P =322.39 million and P=290.76 million, respectively (see Note 26). Leases - Estimating the incremental borrowing rate The Group cannot readily determine the interest rate implicit in the lease, therefore, it uses its incremental borrowing rate (IBR) to measure lease liabilities. The IBR is the rate of interest that the Group would have to pay to borrow over a similar term, and with a similar security, the funds Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 35 - *SGVFS197678* necessary to obtain an asset of a similar value to the right-of-use asset in a similar economic environment. The IBR therefore reflects what the Group ‘would have to pay’, which requires estimation when no observable rates are available (such as for subsidiaries that do not enter into financing transactions) or when they need to be adjusted to reflect the terms and conditions of the lease (for example, when leases are not in the subsidiary’s functional currency). The Group estimates the IBR using observable inputs (such as market interest rates) when available and is required to make certain entity-specific estimates (such as the subsidiary’s stand-alone credit rating). The Group’s lease liabilities amounted to P =5,436.05 million and P =5,440.22 million as of December 31, 2024 and 2023, respectively (see Note 28). Estimation of useful lives of property and equipment and investment properties The Group estimates the useful lives of its depreciable property and equipment and investment properties based on the period over which the assets are expected to be available for use. The EUL of the said depreciable assets are reviewed at least annually and are updated if expectations differ from previous estimates due to physical wear and tear and technical or commercial obsolescence on the use of these assets. It is possible that future results of operations could be materially affected by changes in these estimates brought about by changes in the factors mentioned above. A reduction in the EUL of the depreciable property and equipment and investment properties would increase depreciation expense and decrease noncurrent assets. Further details are provided in Notes 14 and 15. Significant financing component The Group determined that its transaction price on sale of real estate recognized over time does include a significant financing component since the customer’s payment of the transaction price does not coincide with the percentage-of-completion of the project. This gives rise to significant financing either by the customer to the Group as the property developer or vice versa. The Group uses its recent borrowing rates from the banks when the buyer pays ahead of the percentage-of-completion of the related project or the prevailing interest rates in the market as lending rate when the percentage-of- completion of the related project is ahead of the buyer’s payment. Since contracts from customers comprise a significant component, a portion of the contract price is regarded as interest income and interest expense, included in interest income from real estate sales and interest and other financing charges account, respectively, in the consolidated statements of comprehensive income. 6. Segment Information For management purposes, the Group’s operating segments are organized and managed separately according to the nature of the products provided, with each segment representing a strategic business unit that offers different products and serves different markets. The Group has three reportable operating segments as follows: Horizontal Projects This segment pertains to the development and sale of residential house and lot across the Philippines. Vertical Projects This segment caters on the development and sale of residential condominium projects across the Philippines. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 36 - *SGVFS197678* Commercial and others This segment pertains to rental of malls and office spaces, hotel operations, and activities of holding companies. Management monitors the operating results of its business units separately for the purpose of making decisions about resource allocation and performance assessment. Segment performance is evaluated based on segment operating income or loss before income tax and earnings before income tax, depreciation and amortization (EBITDA) and other gains/losses. Other gains/losses include proceeds from insurance claims, interest income, provision for impairment losses and borrowing cost. Segment operating income or loss before income tax is based on the same accounting policies as consolidated operating income or loss, excluding interest income from real estate sales. No operating segments have been aggregated to form the above reportable operating business segments. The chief operating decision-maker (CODM) has been identified as the chief executive officer. The CODM reviews the Group’s internal reports in order to assess performance of the Group. Transfer prices between operating segments are based on the agreed terms between the related parties. The amount of segment assets and liabilities are based on the measurement principles that are similar with those used in measuring the assets and liabilities in the consolidated statements of financial position which is in accordance with PFRS Accounting Standards. The segment assets are presented separately from the advances a to related party, investments at fair value through other comprehensive income (FVOCI), investments at amortized cost and deferred taxes. Segment liabilities are presented separately from the deferred tax liabilities. The financial information about the operations of these operating segments is summarized below: December 31, 2024 Horizontal Vertical Commercial and Others Intersegment Adjustments Consolidated (Amounts in thousands) Real estate revenue (Note 7) P =8,719,804 P =7,914,210 P =− P =− P =16,634,014 Rental income (Notes 14 and 34) − − 16,622,143 (291,922) 16,330,221 Parking, hotel, mall administrative and processing fees, and others (Note 25) 727,615 226,195 733,314 - 1,687,124 9,447,419 8,140,405 17,355, (291,922) 34,651,359 Costs and operating expenses (Note 24) 4,391,116 3,965,273 4,882,492 (669,233) 12,569,648 Segment income before income tax 5,056,303 4,175,132 13,227,587 (377,311) 22,081,711 Interest income from real estate sales and interest income from investments and other income (Note 25) 175,557 95,626 1,761,797 − 2,032,980 Interest and other financing charges (Note 25) (33,930) (302,662) (9,490,301) − (9,826,893) Depreciation and amortization (Note 24) (712,082) (29,979) (1,898,234) − (2,640,296) Income before income tax 4,485,848 3,938,117 3,600,847 (377,311) 11,647,501 Provision for income tax (Note 27) 787,366 764,898 726,753 − 2,279,017 Net income P=3,698,482 P=3,173,219 P=2,874,095 (377,312) P=9,368,484 Other Information Segment assets P =127,593,297 P =34,557,323 P =167,420,845 (P =570,557)P =329,000,908 Advances to a related party (Note 29) 6,256,900 − − − 6,256,900 Investment in joint venture (Note 17) − 499,064 − − 499,064 Investments at FVOCI (Note 10) 12,158 − 160,000 − 172,158 Investments at amortized cost (Note 10) − − 42,003,990 − 42,003,990 Deferred tax assets - net (Note 27) 6,148 − − − 6,148 Total Assets P =133,868,503 P =35,056,388 P =209,584,835 (P =570,557)P =377,939,169 Segment liabilities P=25,542,651 P=18,281,237 P=183,087,775 (P=494,537) P=226,417,126 Deferred tax liabilities - net (Note 27) 4,553,690 1,479,368 9,401,164 − 15,434,222 Total Liabilities P =30,096,341 P =19,760,605 P =192,488,939 (P =494,537)P =241,851,348 Capital expenditures P =14,772,429 P =13,407,651 P =752,810 P =− P =28,932,890 *For the year ended December 31, 2024, EBITDA amounts to P=22,822 million. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 37 - *SGVFS197678* December 31, 2023 Horizontal Vertical Commercial and Others Intersegment Adjustments Consolidated (Amounts in thousands) Real estate revenue (Note 7) P=9,814,162 P=5,414,322 P=− P=− P=15,228,484 Rental income (Notes 14 and 34) − − 16,191,431 (170,001) 16,021,430 Parking, hotel, mall administrative and processing fees, and others (Note 25) 745,278 264,408 1,118,715 (23,520) 2,104,881 10,559,440 5,678,730 17,310,146 (193,521) 33,354,795 Costs and operating expenses (Note 24) 6,826,007 3,571,149 4,445,522 (23,520) 14,819,158 Segment income before income tax 3,733,433 2,107,581 12,864,624 (170,001) 18,535,637 Proceeds from insurance claims (Note 24) − − 1,841,156 − 1,841,156 Interest income from real estate sales and interest income from investments and other income (Note 25) 505,999 93,421 1,209,162 − 1,808,582 Interest and other financing charges (Note 25) (356,598) (21) (5,329,021) − (5,685,640) Depreciation and amortization (Note 24) (836,829) (28,839) (2,023,356) − (2,889,024) Income before income tax 3,046,005 2,172,142 8,562,565 (170,001) 13,610,711 Provision for income tax (Note 27) 777,971 514,400 2,026,276 − 3,318,647 Net income P=2,268,034 P=1,657,742 P=6,536,289 (P=170,001) P=10,292,064 Other Information Segment assets P=123,946,924 P=23,929,978 P=147,276,690 (P=258,617) P=294,894,975 Advances to a related party (Note 29) 7,559,440 − − − 7,559,440 Investment in joint venture (Note 17) − 499,448 − − 499,448 Investments at FVOCI (Note 10) 12,158 − 120,000 − 132,158 Investments at amortized cost (Note 10) − − 39,209,417 − 39,209,417 Deferred tax assets - net (Note 27) 104,627 − 1,083 − 105,710 Total Assets P=131,623,149 P=24,429,426 P=186,607,190 (P=258,617) P=342,401,148 Segment liabilities P=13,763,051 P=8,844,209 P=178,819,711 (P=88,616) 201,338,355 Deferred tax liabilities - net (Note 27) 492,700 435,502 7,273,230 − 8,201,432 Total Liabilities P=14,255,751 P=9,279,711 P=186,092,941 (P=88,616) P=209,539,787 Capital expenditures P=15,616,691 P=8,615,489 P=2,882,950 P=− P=27,115,130 *For the year ended December 31, 2023, EBITDA amounts toP=20,252.11 million. December 31, 2022 Horizontal Vertical Commercial and Others Intersegment Adjustments Consolidated (Amounts in thousands) Real estate revenue (Note 7) P=8,402,272 P=4,387,606 P=− P=− P=12,789,878 Rental income (Notes 14 and 34) − − 14,135,752 (393,494) 13,742,258 Parking, hotel, mall administrative and processing fees, and others (Note 25) 708,601 292,840 627,244 (21,340) 1,607,345 9,110,873 4,680,446 14,762,996 (414,834) 28,139,481 Costs and operating expenses (Note 24) 5,229,702 3,111,737 4,210,076 − 12,551,515 Segment income before income tax 3,881,171 1,568,709 10,552,920 (414,834) 15,587,966 Interest income from real estate sales and interest income from investments and other income (Note 25) 909,341 55,511 717,686 − 1,682,538 Interest and other financing charges (Note 25) (429,929) (35,853) (4,752,105) − (5,217,887) Depreciation and amortization (Note 24) (656,089) (25,285) (1,957,479) − (2,638,853) Income before income tax 3,704,494 1,563,082 4,561,022 (414,834) 9,413,764 Provision for income tax (Note 27) 522,632 312,616 1,185,866 − 2,021,114 Net income P=3,181,862 P=1,250,466 P=3,375,156 (P=414,834) P=7,392,650 Other Information Segment assets P=99,716,662 P=23,922,805 P=149,522,455 (P=186,312) P=272,975,610 Advances to a related party (Note 29) 7,042,276 − − − 7,042,276 Investment in joint venture (Note 17) − 468,074 − − 468,074 Investments at FVOCI (Note 10) 12,158 − 105,000 − 117,158 Investments at amortized cost (Note 10) − − 41,499,484 − 41,499,484 Deferred tax assets - net (Note 27) 111,464 − − − 111,464 Total Assets P=106,882,560 P=24,390,879 P=191,126,939 (P=186,312) P=322,214,066 Segment liabilities P=20,217,005 P=7,822,545 P=164,603,249 (P=186,312) P=192,456,487 Deferred tax liabilities - net (Note 27) 1,664,144 152,292 4,290,951 − 6,107,387 Total Liabilities P=21,881,149 P=7,974,837 P=168,894,200 (P=186,312) P=198,563,874 Capital expenditures P=12,089,005 P=6,323,525 P=4,103,770 P=− P=22,516,300 *For the year ended December 31, 2022, EBITDA amounts to P=17,007.09 million. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 38 - *SGVFS197678* Capital expenditures consists of construction costs, land acquisition and land development costs. The reconciliation of the Group’s income before income tax to EBITDA and other gains/losses is as follows (amounts in millions): 2024 2023 2022 Income before income tax P =11,648 P=13,611 P=9,414 Interest and other financing charges 9,827 5,686 5,218 Depreciation and amortization 2,640 2,889 2,639 Proceeds from insurance claims − (1,841) − Interest income and others (1,292) 229 (264) EBITDA and other gains P =22,822 P=20,574 P=17,007 For the years ended December 31, 2024, 2023 and 2022, rental income amounting to P=12,674.54 million or 77.61%, P =12,394.34 million or 77.36% and P =11,506.05 million or 83.73% of the commercial segment of the Group was generated from anchor tenants as defined in Note 29. There is no cyclicality in the Group’s operations. 7. Revenue from Contracts with Customers a. Disaggregated Revenue Information The Group derives revenue from the transfer of services and goods over time and at a point in time, respectively, in different product types and other geographical location within the Philippines. The Group’s disaggregation of each source of revenue from contracts with customers are presented below: 2024 2023 2022 (Amounts in Thousands) Type of product Real estate sales Horizontal P =8,719,804 P=9,814,162 P=8,402,272 Vertical 7,914,210 5,414,322 4,387,606 16,634,014 15,228,484 12,789,878 Hotel operations (Note 25) 127,202 133,346 103,138 P =16,761,216 P=15,361,830 P=12,893,016 All of the Group’s real estate sales and revenue from room accommodation services are revenue from contracts with customers that are recognized over time, except for hotel operation’s sale of food and beverages which are at point in time. There are no inter-segment eliminations among revenue from contracts with customers on real estate, as these are all sold to external customers as disclosed in the segment information in 2024 and 2023 (see Note 6). Contract Balances 2024 2023 Installment contracts receivable (Note 11) P =58,950,766,031 P=34,274,453,178 Contract liabilities 2,144,865,695 2,025,370,670 Cost to obtain contract 725,318,921 510,675,843 Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 39 - *SGVFS197678* Installment contracts receivable are from real estate sales which are collectible in equal monthly principal installments with various terms up to a maximum of 15 years. These are recognized at amortized cost using the effective interest rate method. Interest rates, which vary depending on the term of the receivable, ranges from 0.40% to 9.06% per annum, 5.56% to 16.00% per annum and 2.43% to 19.00 per annum in 2024, 2023 and 2022, respectively. The corresponding titles to the residential units sold under this arrangement are transferred to the customers only upon full payment of the contract price. Contract liabilities consist of collections from real estate customers which have not reached the equity threshold to qualify for revenue recognition and excess of collections over the goods and services transferred by the Group based on percentage-of-completion. The movement in contract liability is mainly due to reservation sales and advance payment of buyers less real estate sales recognized upon reaching the equity threshold and from increase in percentage-of-completion. The amount of revenue recognized in 2024, 2023 and 2022 from amounts included in contract liabilities at the beginning of the year amounted to P =771.28 million, P =495.82 million and P=799.11 million, respectively. b. Performance obligations Information about the Group’s performance obligations are summarized below: Real estate sales The Group entered into reservation agreements with one identified performance obligation which is the sale of the real estate unit together with the services to transfer the title to the buyer upon full payment of contract price. The amount of consideration indicated in the reservation agreement is fixed and has no variable consideration. The sale of real estate unit covers subdivision land, residential house units, and condominium units and the Group concluded that there is one performance obligation in each of these contracts. The Group recognizes revenue from the sale of these real estate projects under pre-completed contract over time during the course of the construction. Payment commences upon signing of the reservation agreement and the consideration is payable in cash or under various financing schemes entered with the customer. The financing scheme would include payment of 10% - 20% of the contract price to be paid over a maximum of 24 months at a fixed payment for horizontal developments and 20% - 40% of the contract price to be paid over a maximum of 48 months at a fixed payment for vertical developments with remaining balance payable (a) in full at the end of the period either through cash or external financing; or (b) through in-house financing which ranges from two (2) to 15 years with fixed monthly payment. The amount due for collection under the amortization schedule for each of the customer does not necessarily coincide with the progress of construction, which results to either an installment contracts receivable or contract liability. After the delivery of the completed real estate unit, the Group provides one-year warranty to repair minor defects on the delivered serviced lot and house and condominium unit. This is assessed by the Group as a quality assurance warranty and not treated as a separate performance obligation. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 40 - *SGVFS197678* The transaction price allocated to the remaining performance obligations (unsatisfied or partially satisfied) as at December 31, 2024 and 2023 are follows: 2024 2023 Within one year P =10,689,014,136 P=8,190,047,037 More than one year 4,755,160,750 3,785,834,615 P =15,444,174,886 P=11,975,881,652 The remaining performance obligations expected to be recognized within one year and more than one year relate to the continuous development of the Group’s real estate projects. The Group’s condominium units are completed within three to five years from start of construction while serviced lots and serviced lots and house are expected to be completed within two to three years from start of development. Rental agreements The Group entered into lease agreements for its mall retail spaces and office spaces with the following identified performance obligations: (a) lease of space, (b) provisioning of water and electricity, and (c) connection to air conditioning system, (d) CUSA services, and (e) administration fee. Revenue from lease of space is recognized on a straight-line basis over the lease term while revenue for the remaining performance obligations are recognized when services are rendered. The tenant is required to settle within 30 days upon receipt of the bill. Except for related party tenants, in case of delay in payments, a penalty of 5% is charged for the amount due and shall be charged another 5% the following month of delay and every month thereafter inclusive of penalties previously charged. Except for related party tenants, the lease arrangement would typically require a tenant to pay advance rental equivalent to two (2) to four (4) months and a security deposit equivalent to 2 to 4 months rental to cover any breakages after the rental period, with the excess returned to the tenant. In January 2022, due to the fire that damaged Star Mall Alabang in Muntinlupa City, the tenants pre-terminated the contracts that resulted to reversal of the Group’s rental receivables, which is the effect of straight-line calculation of rental income, amounting to P =385.01 million with related deferred tax liabilities of P =96.25 million. Of these terminated tenants, P =377.77 million were related parties (see Note 29). c. Cost to Obtain Contract The balances below pertain to the cost to obtain contract presented in consolidated statements of financial position: 2024 2023 Balance at beginning of year P =510,675,843 P=740,176,709 Impact of adoption of PFRS 15 covered by PIC Q&A 2018-12-D (Notes 3) 55,070,476 − Balance at the beginning of the year, as restated 565,746,319 740,176,709 Net additions 884,272,830 454,998,698 Amortization (Note 24) (724,700,223) (684,499,564) 725,318,926 510,675,843 Less noncurrent portion 244,118,320 202,050,708 Balance at end of year P =481,200,696 P=308,625,135 Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 41 - *SGVFS197678* 8. Goodwill On December 29, 2015, VLCC, a wholly owned subsidiary of VRI, acquired 100% ownership of MRHI for a total cash consideration of P =157.00 million. MRHI owns and operates the Boracay Sands Hotel. The transaction was accounted for as a business combination under acquisition method. Fair values of identifiable net assets of MRHI amounted to P =9.73 million, which resulted to recognition of goodwill of P =147.27 million. The recoverable amount is based on value in use calculations using cash flow projections from financial budgets approved by the Group’s management covering the period the CGU is expected to be operational. The pre-tax discount rate used on December 31, 2024 and 2023 are 6.62% and 8.23% respectively, which are based on weighted average cost of capital of comparable entities. The average growth rate used is 4.00% as of December 31, 2024 and 2023. The value-in-use computation is most sensitive to the discount rate and growth rate applies to the cash flow projection. There is no impairment loss recognized since acquisition. 9. Cash and Cash Equivalents This account consists of: 2024 2023 Cash on hand P =13,431,880 P=14,662,374 Cash in banks 3,568,214,794 8,281,651,521 Cash equivalents 10,474,602 2,395,838,245 P =3,592,121,276P=10,692,152,140 Cash in banks are stated at face amount and earn interest at the prevailing bank deposit rates. Cash equivalents are short-term, highly liquid investments that are readily convertible to known amounts of cash with original maturities of three (3) months or less from dates of placement and that are subject to an insignificant risk of changes in value. The Group earns annual interest from cash in banks and cash equivalents as follows: 2024 2023 2022 Philippine Peso 0.01% to 3.10% 0.01% to 4.25% 0.01% to 1.25% US Dollar 0.13% to 3.05% 0.06% to 1.50% 0.06% to 0.13% Interest earned from cash in banks and cash equivalents for the years ended December 31, 2024, 2023 and 2022 amounted to P =153.27 million, P =210.10 million and P =45.84 million, respectively (see Note 25). No cash and cash equivalents are used to secure the obligations of the Group. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 42 - *SGVFS197678* 10. Investments Short-term cash investments As of 2023 (nil as of 2024), short-term cash investments consist of money market placements with maturities of more than three (3) months up to one (1) year and earn annual interest at the respective short-term investment rates of 1.26% As of December 31, 2024, and 2023, short-term cash investments amounted to nil and P =7.32 million, respectively. Interest earned from short-term cash investments for the years ended December 31, 2024, 2023 and 2022 amounted to nil, P =0.09 million and P =1.12 million, respectively (see Note 25). Investments at amortized cost This account consists of the Group’s investments in various US dollar-denominated debt securities with nominal interest rates ranging from 0.13% to 7.88%, 0.58% to 8.88% and 0.25% to 8% for the years ended December 31, 2024, 2023 and 2022, respectively. In 2024, 2023 and 2022, effective interest rate ranges from 1.42% to 7.81%, 0.12% to 10.74% and 1.05% to 7.19%, respectively. Investments at amortized cost amounting to $607.39 million (P =35,134.47 million) and $548.24 million (P =30,355.86 million) are used to secure the bank loans of the Parent Company amounting to P=33,956.35 million and P =27,546.54 million as of December 31, 2024 and 2023, respectively. The fair values of the investments used as collateral amounted to P =34,799.04 million and P=31,319.04 million as of December 31, 2024 and 2023 respectively (see Note 20). Interest income from these investments including amortization of premium amounted to P=1,602.93 million, P =984.53 million and P =931.41 million in 2024, 2023 and 2022, respectively (see Note 25). Provision for (recovery from) expected credit loss amounting to (P =1.41 million), (P =100.43 million) and P =23.29 million were recognized in 2024, 2023 and 2022 on these investments, respectively (see Note 24). The following presents the breakdown of investments by contractual maturity dates as of December 31, 2023 and 2022: 2024 2023 Due in one (1) year or less P =13,639,899,114P=18,425,130,586 Due after one (1) year through five (5) years 24,220,023,838 20,503,648,593 Due after five (5) years 4,144,067,119 280,638,050 P =42,003,990,071P=39,209,417,229 Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 43 - *SGVFS197678* The rollforward analysis of investments at amortized cost follow: 2024 2023 Balance at beginning of year P =39,209,417,229 P=41,499,484,082 Additions 72,907,404,492 17,958,242,982 Redemptions* (71,193,718,679) (19,557,879,066) Amortization of premium (61,561,226) (485,189,637) Cumulative translation adjustment 1,141,040,353 (305,673,100) Provision for expected credit loss (Note 24) 1,407,902 100,431,968 Balance at end of year 42,003,990,071 39,209,417,229 Less noncurrent portion 28,364,090,958 20,784,286,643 Current portion P =13,639,899,113 P=18,425,130,586 *These include early redemptions initiated by the issuer/s. Investment at fair value through FVOCI The investment at fair value through FVOCI consists primarily of investments in golf club shares and preferred shares in utility companies carried at fair value which the Group irrevocably elected to classify as FVOCI. 2024 2023 Investment at cost Balance at beginning and end of year P =40,000,000 P=40,000,000 Unrealized gain on fair value of investment Balance at beginning of year 92,158,380 77,158,380 Fair value movement during the year 40,000,000 15,000,000 Balance at end of year 132,158,380 92,158,380 172,158,380 132,158,380 11. Receivables This account consists of: 2024 2023 Installment contracts receivable (Notes 7 and 33) P =58,950,766,031 P=34,274,453,178 Rental receivable (Note 29) 44,407,515,278 32,577,928,630 Accounts receivable: Home Development Mutual Fund (HDMF) 312,478,322 362,103,100 Buyers 221,355,274 184,969,070 Others 59,339,320 59,816,222 Advances to: Contractors and suppliers (Note 29) 10,154,310,563 10,916,450,265 Private companies (Note 29) 2,933,003,214 2,672,917,254 Brokers 725,196,467 297,454,553 Receivables from related parties (Note 29) 5,050,542,342 3,218,440,000 Accrued interest receivable 343,754,642 390,958,484 123,158,261,453 84,955,490,756 Less allowance for impairment losses 1,844,281,233 1,552,389,443 121,313,980,220 83,403,101,313 Less noncurrent portion 47,331,081,668 31,191,466,002 Current portion P =73,982,898,552 P=52,211,635,311 Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 44 - *SGVFS197678* Installment Contracts Receivable Installment contracts receivable consist of accounts collectible in equal monthly installments with various terms up to a maximum of 15 years. These are carried at amortized cost. The corresponding titles to the subdivision or condominium units sold under this arrangement are transferred to the buyers only upon full payment of the contract price. The installment contracts receivables are interest-bearing except for those with installment terms within two years. Annual nominal interest rates on installment contracts receivables range from 12% to 16% in 2024 and 2023, respectively. Interest income from real estate sales recognized amounted to nil, P =539.02 million and P =671.52 million in 2024, 2023 and 2022, respectively (see Note 25). In 2023, installment contracts receivables with a total nominal amount of P =690.37 million, were recorded at amortized cost amounting to P =638.75 million. These are installment contracts receivables that are to be collected in two years which are noninterest-bearing. The fair value upon initial recognition is derived using discounted cash flow model at discount rates ranging from 5.56% to 7.74% 2023. Interest income recognized from these receivables amounted to P =67.28 million and P=29.83 million in 2023 and 2022, respectively (see Note 25) The unamortized discount amounted to nil and P =40.38 million as of December 31, 2024 and 2023, respectively. Rollforward of unamortized discount arising from noninterest-bearing installment contract receivables is as follows: 2024 2023 Balance at beginning of year P =40,380,961 P=56,034,328 Impact of adoption of PFRS 15 covered by PIC Q&A 2018-12-D (40,380,961) − Balance at beginning of year, as restated − 56,034,328 Additions − 51,623,950 Accretion (Note 25) − (67,277,317) Balance at end of year P =− P=40,380,961 In 2024, upon adoption of PIC Q&A 2018-12-D, the adoption resulted to a full reversal of unamortized discount from noninterest-bearing installment contract receivables. Significant financing component was recognized as interest income from real estate sales amounting to P =276.70 million (see Note 25). Effective interest rates on contracts with significant financing component ranges from 0.40% to 9.06%. In 2024 and 2023, the Group entered into various purchase agreements with financial institutions whereby the Group sold its installment contracts receivables on a with recourse basis. These installment contracts receivables on a with recourse basis are used as collateral to secure the corresponding loans payable obtained. The purchase agreements provide substitution of contracts which will default. The Group still retains the sold receivables in the installment contracts receivables account and records the proceeds from these sales as loans payable. Proceeds from these are used to support the working capital of the Group As of December 31, 2024, 2023 and 2022, the carrying value of installment contracts receivables sold and the corresponding loans payable amounted to P =14,857.02 million, 19,482.76 million and P=4,310.47 million and P =5,059.73 million, P =7,443.72 million and P =5,334.62 million, respectively (see Note 20). Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 45 - *SGVFS197678* Rental Receivable Rental receivable comprise of receivables from tenants and accrued rental receivable. Receivables from tenants represent the outstanding receivables arising from the lease of commercial centers relating to the Group’s mall and offices and are collectible within 30 days from billing date. Except for lease contracts with related parties, these are covered by security deposit of tenants’ equivalent to 2 to 4-month rental and 2 to 4-month advance rental paid by the lessees. This includes both the billed fixed and contingent portion of lease. Accrued rental receivable pertains to the effect of straight-line calculation of rental income. The noncurrent portion of accrued rent receivable are expected to be realized beyond one year from the reporting date. As of December 31, 2024 and 2023, out of the total rental receivables amounting P =44,407.52 million and P =32,577.93 million, respectively, the accrued rent receivable amounted to P =30,647.76 million and P=22,905.71 million, respectively. Accounts Receivable The accounts receivables are noninterest-bearing and collectible within one year. This consists of: Receivable from HDMF Receivable from HDMF pertains to amounts retained by HDMF from the proceeds of loans availed by real estate buyers. This amount is released by HDMF upon the release of the related title on the property by the Group to HDMF within a six-month to one year period from loan takeout date. Receivable from buyers Receivables from buyers mainly consist of receivables from buyers of real estate arising from restructured amortization including interest and penalties for late payments. These are noninterest- bearing and are due and demandable. Others Other receivables are noninterest-bearing and are due and demandable. Advances This consist of the following: Advances to contractors and suppliers Advances to contractors are advance payments in relation to the Group’s construction activities and are recouped against progress billings as the construction progresses. Advances to suppliers are advance payments for the purchase of construction materials and are applied to billings for deliveries made. Recoupment occur within one to five years from the date the advances were made. Current portion of these advances are for the construction of inventories, while advance payments for the construction of investment properties are presented as noncurrent portion. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 46 - *SGVFS197678* Advances to private companies Advances to private companies pertain to advances made by the Group to to facilitate the transfer of title to the buyers. These include expected charges for documentary stamp taxes, transfer fees, registration fees, city and business tax and notarial expenses. These advances are liquidated by the private companies once the purpose for which the advances were made had been accomplished. Advances to brokers Advances to brokers are cash advances for operating use. These are applied to subsequent commission payout to brokers. Accrued Interest Receivable Accrued interest receivable pertains to income earned from investments at amortized cost. Allowance for Impairment Losses The rollforward analysis of allowance for impairment losses are as follow: Rental Receivable Accounts Receivable - buyer and others Advances to private companies Advances to Contractors and suppliers Total Balance at January 1, 2023 P=495,636,493 P=− P=126,761,771 P=6,106,983 P=628,505,247 Provision during the year (Note 24) 523,013,817 395,595,740 − 5,274,639 923,884,196 Balance at December 31, 2023 1,018,650,310 395,595,740 126,761,771 11,381,622 1,552,389,443 Write-off (8,256,373) − − − (8,256,373) Provision during the year (Note 24) 300,148,163 − − − 300,148,163 Balance at December 31, 2024 1,310,542,100 395,595,740 126,761,771 11,381,622 P=1,844,281,233 In 2023, the Group has written-off specifically impaired receivable from third-party tenants arising from the damaged in Starmall Alabang amounting to P =24.53 million this is included on the “Provision for impairment losses on receivables” account under “Operating expenses” in the consolidated statements of comprehensive income (see Note 24). Set out below is the information about the credit risk exposure on the Group’s accounts receivable from third party tenants using a provision matrix: 2024 Current Days past due Total1 to 30 days 31 to 60 days 61 to 90 days Over 90 days Average expected credit loss rates 8.32% 14.20% 23.39% 26.46% 45.69% Amount of exposure at default net of advance rent and security deposits P =83,073,350 P =28,318,113 P =25,935,846 P =18,879,843 P =129,759,309 P =285,966,461 Expected credit loss P =6,910,564 P =4,021,974 P =6,066,196 P =4,995,367 P =59,293,008 P =81,287,108 2023 Current Days past due Total1 to 30 days 31 to 60 days 61 to 90 days Over 90 days Average expected credit loss rates 14.14% 22.22% 42.37% 53.60% 60.09% Amount of exposure at default net of advance rent and security deposits P=98,530,332 P=16,074,222 P=10,751,129 P=7,972,972 P=88,266,347 P=221,595,002 Expected credit loss P=13,933,697 P=3,571,498 P=4,554,795 P=4,273,456 P=53,036,590 P=79,370,036 In 2024, out of the total impairment loss of P =300.15 million, P =218.87 million pertains to specifically impaired receivables, while P =81.29 million is from generally impaired receivables from expected credit loss testing (see Note 24). Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 47 - *SGVFS197678* In 2023, out of the total impairment loss of P =923.88 million, P =844.51 million pertains to specifically impaired receivables, while P =79.37 million is from generally impaired receivables from expected credit loss testing (see Note 24). In 2022, the Group has no specifically impaired receivables. For the accounts receivable from related party tenants, the expected credit loss from the impairment exercise using a provision matrix is zero as of December 31, 2024 and 2023 (see Note 5). 12. Real Estate Inventories The rollforward analysis of this account follows: 2024 2023 Balance at beginning of year P =63,771,221,098P=53,533,899,417 Impact of the adoption of IFRIC Agenda Decision on Over Time Transfer of Constructed Goods under PAS 23, Borrowing Cost (12,370,832,612) − 53,533,899,417 Construction/development costs incurred 10,414,627,079 12,099,427,086 Borrowing costs capitalized (Note 25) 67,037,327 3,509,509,742 Purchases of construction materials and others 83,162,275 473,166,204 Additions to land 139,839,200 208,776,211 Transfers (Note 11, 14 and 15) (291,251,378) 58,463,403 Costs of real estate sales (Note 24) (4,801,807,537) (6,112,020,965) Balance at end of year P =57,011,995,452P=63,771,221,098 The real estate inventories are carried at cost. No inventory is recorded at amount lower than its cost in 2024 and 2023. This account consists of: 2024 2023 Subdivision land for sale P =22,729,389,363P=30,817,164,894 Subdivision land for development 20,606,138,264 20,318,261,604 Condominium units for sale and development 11,929,209,884 10,389,887,858 Residential house for sale and development 939,419,758 1,171,967,698 Construction materials and others 807,838,183 1,073,939,044 P =57,011,995,452P=63,771,221,098 Subdivision land (e.g., lot only) for sale and development includes real estate subdivision projects in which the Group has been granted License to Sell (LTS) by the Housing and Land Use Regulatory Board. It also includes raw land inventories that are under development and those that are about to undergo development. Construction materials pertain to supplies, such as but not limited to steel bars, cement, plywood and hollow blocks, used in the construction and development. These are expected to be utilized within one year and included in the cost of real estate inventories upon utilization. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 48 - *SGVFS197678* Real estate inventories recognized as costs of real estate sales amounted to P =4,801.81 million in 2024, P=6,112.02 million in 2023, P =5,542.97 million in 2022, and are included as costs of real estate sales in the consolidated statements of comprehensive income (see Note 24). In 2024, upon the adoption of IFRIC agenda decision on over time transfer of constructed goods for real estate industry in 2024, the borrowing cost previously capitalized to inventories amounting P=9,999.57 million (net of tax) have been derecognized (see Note 3). There are no inventories pledged or used as collateral to secure the borrowings of the Group. The related commitments on subdivision land, subdivision land for development, condominium units for sale and development and residential units for sale and development are disclosed in Note 35. 13. Other Current Assets This account consists of: 2024 2023 Input VAT - current portion P =3,353,815,882 P=3,559,749,034 Prepaid expenses 1,418,809,279 1,056,595,349 Creditable withholding taxes 1,087,164,039 1,473,868,086 Restricted cash 2,960,001 323,916,368 Others 37,403,635 33,806,221 P =5,900,152,836 P=6,447,935,058 Input VAT Input VAT is a tax imposed on purchases of goods, professional and consulting services, and construction costs. These are available for offset against output VAT in future periods. Prepaid expenses Prepaid expenses mainly include advertising and marketing fees, taxes and licenses, rentals and insurance paid in advance. These are to be fully amortized within one year. Creditable withholding taxes Creditable withholding taxes pertain to taxes withheld by the customer and are recoverable and can be applied against income tax in future periods. For the years ended December 31, 2024, 2023 and 2022, creditable withholding taxes applied to income tax payable amounted to P =1,608.71 million, P=983.71 million and P =819.85 million, respectively. Restricted cash Cash restricted for use are deposits restricted solely for payment of the principal amortization and interest of certain bank loans. These deposits bear prevailing interest rates and will be retained as deposits until the bank loans are fully paid. Deposit balance should be equivalent to two quarters of debt amortization. Interest income from cash restricted for use amounted to P =0.09 million, P=7.56 million and P =2.83 million in 2024, 2023 and 2022, respectively (see Note 25). The noncurrent portion of this account is presented as noncurrent restricted cash under “Other noncurrent assets” in the Group’s consolidated statements of financial position (see Note 17). Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 49 - *SGVFS197678* 14. Investment Properties The rollforward of analysis of this account follows: 2024 Land and Land Developments Building and Building Improvements Construction in Progress Right-of-use Assets Total Cost Balances at beginning of year P =69,708,225,450 P =58,438,745,660 P =7,716,372,728 P =5,066,106,297 P =140,929,450,135 Additions 10,680,850,008 830,149,245 537,274,931 29,276,578 12,077,550,762 Transfers (Note 15) − 1,640,520,123 (1,297,569,437) − 342,950,686 Retirement (Note 24) − (72,258,230) − − (72,258,230) Balances at end of year 80,389,075,458 60,837,156,799 6,956,078,222 5,095,382,875 153,277,693,354 Accumulated Depreciation and Amortization Balances at beginning of year − 15,371,484,097 − 901,835,300 16,273,319,397 Depreciation and amortization (Note 24) − 2,118,525,998 − 205,622,913 2,324,148,911 Retirement (Note 24) − (72,258,230) − − (72,258,230) Balances at end of year − 17,417,751,866 − 1,107,458,213 18,525,210,079 Net Book Value P =80,418,004,046 P =43,419,404,933 P =6,956,078,222 P =3,987,924,662 P =134,752,483,275 2023 Land and Land Developments Building and Building Improvements Construction in Progress Right-of-use Assets Total Cost Balances at beginning of year P=63,738,889,690 P=58,207,880,072 P=5,053,402,011 P=5,066,106,297 P=132,066,278,070 Additions 6,027,799,163 415,566,459 2,662,970,717 − 9,106,336,339 Transfers (Note 12) (58,463,403) − − − (58,463,403) Retirement (Note 24) − (184,700,871) − − (184,700,871) Balances at end of year 69,708,225,450 58,438,745,660 7,716,372,728 5,066,106,297 140,929,450,135 Accumulated Depreciation and Amortization Balances at beginning of year − 13,030,061,731 − 692,618,440 13,722,680,171 Depreciation and amortization (Note 24) − 2,361,473,936 − 209,216,860 2,570,690,796 Retirement (Note 24) − (20,051,570) − − (20,051,570) Balances at end of year − 15,371,484,097 − 901,835,300 16,273,319,397 Net Book Value P=69,708,225,450 P=43,067,261,563 P=7,716,372,728 P=4,164,270,997 P=124,656,130,738 Investment properties include properties, currently being leased out, for future leasing or currently held for capital appreciation. The commercial centers include retail malls, commercial centers within residential projects, Vistamalls and Starmalls that are located in key cities and municipalities in the Philippines and office spaces. Rental income earned from investment properties amounted to P =16,610.78 million, P=16,021.43 million and P =13,742.26 million in 2024, 2023 and 2022, respectively. Repairs and maintenance costs recognized under “Operating expenses” arising from investment properties amounted to P =481.13 million, P =382.66 million and P =156.65 million for the years ended December 31, 2024, 2023 and 2022, respectively (see Note 24). Cost of property operations amounted to P =4,011.38 million, P =5,284.74 million and P =5,625.67 million for the years ended December 31, 2024, 2023 and 2022, respectively (see Note 24). For the terms and conditions on the lease, refer to Note 34. As of December 31, 2024 and 2023, the aggregate fair values of investment properties amounted to P=589,884.87 million and P =637,875.42 million, determined using Level 3 (significant unobservable inputs). The fair values of the investment properties held for leasing were determined by independent professionally qualified appraisers while that for land and land developments were determined by management. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 50 - *SGVFS197678* In the determination of fair values, market value approach method was used for land and land development, income approach method was used for completed and substantially completed malls and office buildings for rent, cost approach method was used for construction in progress under early stage of construction and discounted cash flow method was used for right-of-use asset. The key assumptions used to determine the fair value of the investment properties held for leasing are the estimated rental value per sqm per year, rental growth rate per annum, vacancy rate and discount rate. The discount rate used in the valuation range from 8.43% to 9.09% and 9.20% to 9.60% in 2024 and 2023, respectively. Significant increases (decreases) in estimated rental value and rent growth per annum in isolation would result in a significantly higher (lower) fair value of the properties. Significant increases (decreases) in the long-term vacancy rate and discount rate (and exit yield) in isolation would result in a significantly lower (higher) fair value. Generally, a change in the assumption made for the estimated rental value is accompanied by a directionally similar change in the rent growth per annum and discount rate, and an opposite change in the long-term vacancy rate. The parcels of land are mainly located in Bulacan, Tagaytay, Tanza, Bacoor, Dasmariñas, General Trias, Caloocan, Imus, Laguna, Muntinlupa, Nueva Ecija, Pangasinan, Tarlac, Ilocos Sur, Iloilo, Cagayan de Oro and Bacolod. The market price per square meter of the land ranges between P=4,505 to P =126,000 in Mega Manila, P =18,584 to P =47,566 in Northern Luzon, P =8,955 to P =63,725 in Southern Luzon, P =5,500 to P =404,040 in Central Luzon, P =6,000 to P =109,639 in Visayas, and P =15,068 to P =48,252 in Mindanao. The fair value measurement using unobservable data in active market is Level 3 of the fair value hierarchy. Investment properties with carrying value of P =370.56 million are used to secure the bank loans of the Group as of December 31, 2024 and 2023, respectively (see Note 20). The fair value of the investment properties used as collateral amounted to P =5,626.72 million and P =5,575.57 million under market approach as of December 31, 2024 and 2023. Borrowing cost capitalized to investment properties amounted to P =2,608.12 million, P=2,594.83 million and P =2,702.61 million for years ended December 31, 2024, 2023 and 2022, respectively. Depreciation and amortization expense charged to operations amounted to P=2,251.96 million, P= 2,570.69 million and P =2,415.05 million for the years ended December 31, 2024, 2023 and 2022, respectively (see Note 24). In 2024 and 2023, the Group has written off investment properties that were identified as no longer functioning as intended, with carrying value of nil and P=164.65 million, respectively. The 2023 write- off was included under “Repairs and maintenance and loss on asset retirement” account under “Operating expenses” in the consolidated statements of comprehensive income (see Note 24). On January 8, 2022, a fire damaged Star Mall Alabang in Muntinlupa City which resulted to loss of assets with carrying value of P =983.37 million (see Note 24). In relation to the assignment to AVHC, as the Assignee of the Assignors’ rental payables to the Group as discussed in Note 29, AVHC transferred additional parcels of land to the Group valued at P=874.48 million as a form of settlement of the assigned receivables. These were recorded under “Investment properties” in the consolidated statement of financial position. The remaining assigned receivables are expected to be settled by AVHC through land properties. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 51 - *SGVFS197678* The total contractual obligations to either purchase or construct or develop investment properties or for repairs, maintenance and enhancement amounted to P =1,410.75 million and P =1,839.38 million as of December 31, 2024 and 2023, respectively. 15. Property and Equipment The rollforward analysis of this account follow: 2024 Land Hotel Building Building and Building Improvements Transportation Equipment Office Furniture, Fixtures and Equipment Construction Equipment Other Fixed Assets Total Cost Balances at beginning of year P =83,333,600 P =880,004,223 P =781,249,463 P =973,316,779 P =1,181,649,661 P =1,319,589,916 P =421,277,900 P =5,640,421,542 Additions − − 30,859,008 1,774,488 12,361,519 19,254,049 43,257,009 107,506,073 Transfers (Note 14) − − (170,300,808) (172,649,878) (342,950,686) Balances at end of year 83,333,600 880,004,223 641,807,663 975,091,267 1,194,011,180 1,338,843,965 291,885,031 5,404,976,929 Accumulated Depreciation and Amortization Balances at beginning of year − 205,979,129 301,793,902 855,363,448 1,091,449,636 303,974,982 245,709,384 3,004,270,481 Depreciation and amortization (Note 24) − 23,248,743 45,020,957 76,104,897 55,398,428 14,004,461 43,135,566 256,913,052 Transfers (Note 12) − − − − − 91,118,000 − 91,118,000 Balances at end of year − 229,227,872 346,814,859 931,468,345 1,146,848,064 409,097,443 288,844,950 3,352,301,522 Net Book Value P =83,333,600 P =650,776,351 P =294,992,804 P =43,622,922 P =47,163,116 P =929,746,522 P =3,040,081 P =2,052,675,396 2023 Land Hotel Building Building and Building Improvements Transportation Equipment Office Furniture, Fixtures and Equipment Construction Equipment Other Fixed Assets Total Cost Balances at beginning of year P=83,333,600 P =794,394,692 P =461,823,991 P=941,358,954 P =1,091,878,461 P =1,333,412,183 P =344,551,951 P =5,050,753,832 Additions − 85,609,531 319,425,472 31,957,825 89,771,200 75,094,043 76,725,949 678,584,020 Write off (Note 24) − ‒ − − − (88,916,310) − (88,916,310) Balances at end of year 83,333,600 880,004,223 781,249,463 973,316,779 1,181,649,661 1,319,589,916 421,277,900 5,640,421,542 Accumulated Depreciation and Amortization Balances at beginning of year − 179,939,378 290,901,951 800,591,074 989,478,352 272,264,761 216,491,828 2,749,667,344 Depreciation and amortization (Note 24) − 26,039,751 10,891,951 54,772,374 101,971,284 31,710,221 29,217,556 254,603,137 Balances at end of year − 205,979,129 301,793,902 855,363,448 1,091,449,636 303,974,982 245,709,384 3,004,270,481 Net Book Value P=83,333,600 P=674,025,094 P=479,455,561 P=117,953,331 P=90,200,025 P=1,015,614,934 P=175,568,516 P=2,636,151,061 Depreciation and amortization expense charged to operations amounted to P =256.91 million, P=254.60 million and P =167.64 million for the years ended December 31, 2024, 2023 and 2022, respectively (see Note 24). The Group performed impairment testing on its hotel property and equipment with carrying value of P=650.78 million and P =674.03 million as of December 31, 2024 and 2023, respectively, by assessing its recoverable amount through estimation of its value-in-use (VIU). VIU is the present value of the future cash flows expected to be derived from an asset. The significant assumptions used in the valuation are discount rate of 6.62% with an average growth rate of 4.00%. Based on the impairment testing, there is no impairment loss on the Group’s hotel property and equipment. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 52 - *SGVFS197678* The Group’s transportation equipment with a carrying value of P =4.24 million, P =15.61 million and P=9.75 million as of December 31, 2024, 2023 and 2022, respectively, were pledged as collateral under chattel mortgage to secure the car loans of the Group with various financial institutions (see Note 20). 16. Project Development Costs Project development costs pertain to (a) advances to a related party, covered by memorandum of agreement for the purchase of socialized housing units, (b) advances to third and related parties for project developments. The requirement for socialized housing units is required by the Housing and Land Use Regulatory Board (HLURB) (see Note 29). These advances are recouped upon receipt of the socialized housing units from Bria Homes. On December 23, 2019, the Group entered into a Memorandum of Agreement with Bria Homes, Inc. that stipulated the allocated socialized housing units to the Group from the latter’s ongoing and new projects. On December 21, 2020, the Group executed an amended Memorandum of Agreement with Bria Homes, Inc. that stipulated the number of socialized housing credits to be delivered as final settlement of the advances from its on-going projects under different documentation stages after deducting the partial delivery of social housing credits and cash payments. This account also includes deposits, cash advances and other charges in connection with joint venture agreements and memorandum of agreements entered into by the Group with individuals, corporate entities and related parties for the development of real estate projects. These agreements provide, among others, the following: a) the Group will undertake the improvement and development of the real estate project within a certain period, subject to certain conditions to be fulfilled by the real estate property owner; and b) the parties shall divide among themselves all saleable inventory and commercial development of the real estate project in accordance with the ratio mutually agreed. The real estate projects are in various stages of development from planning to ongoing construction. As of December 31, 2024 and 2023, project development costs amounted to P =2,204.82 million and P=1,396.27 million, respectively. 17. Investment in Joint Venture and Other Noncurrent Assets Investment in Joint Venture Vista Ventures Taft, Inc. (VVTI) was incorporated in the Republic of the Philippines primarily to engage in real estate activities particularly from construction and sale of condominium project at Taft Avenue, Manila. VRI originally subscribed for 4,587,718 shares of stock of VVTI with par value of P=100 per share amounting to P =458.77 million. As of December 31, 2019, VVTI was previously a wholly owned subsidiary of VRI. On November 27, 2020, VRI executed a joint venture agreement (JVA) with Mitsubishi Estate Corp. (MEC). VVTI is 60% owned by VRI and 40% owned by MEC, however, it was agreed in the JVA that at least affirmative vote of four board representatives are required in board reserved matters which include the budget and design of the condominium project. VVTI’s principal place of business is LGF Bldg B Evia Lifestyle Center, Daang Hari, Almanza Dos, Las Piñas City. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 53 - *SGVFS197678* Below is the financial information on VVTI as of December 31, 2024 and 2023: 2024 2023 Current assets P =2,591,614,999 P=2,158,030,541 Noncurrent assets 9,120,131 2,213,544 Current liabilities 348,968,102 222,861,570 Noncurrent liabilities 1,400,010,313 1,084,986,183 Equity 851,756,716 852,396,332 Proportion of Group’s ownership 60% 60% Group’s share in identifiable net assets 511,054,029 511,437,798 Other adjustments (11,989,749) (11,989,749) Carrying amount of the investment P =499,064,280 P=499,448,049 Revenue P =264,050,737 P=169,605,706 Net income 81,827,993 52,290,436 Total comprehensive income 81,827,993 52,290,436 Below is the reconciliation with the carrying amount of the investment in the consolidated financial statements: 2024 2023 At beginning of year P =499,448,049 P=468,073,789 Impact of adoption of PFRS 15 covered by PIC Q&A 2018-12-D (49,480,566) − Share in equity earnings during the year 49,096,797 31,374,260 At end of year P =499,064,280 P=499,448,049 Amortization of system development costs amounted to P =59.23 million, P =63.73 million and P=56.16 million for the years ended December 31, 2024, 2023 and 2022, respectively. These are included in the “Depreciation and amortization” account under “Operating expenses” in the consolidated statements of comprehensive income (see Note 24). Other Noncurrent Assets This account consists of: 2024 2023 Deposits P =652,427,523 P=630,110,886 Model house accessories at cost 138,461,572 174,286,682 Deferred input VAT 85,508,863 79,906,037 Systems development costs 51,390,625 40,836,783 Cash restricted for use (Note 13) 163,104,955 10,848,491 P =1,090,893,538 P=935,988,879 Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 54 - *SGVFS197678* 18. Accounts and Other Payables This account consists of: 2024 2023 Accounts payable Contractors P =14,058,360,834 P=5,329,525,074 Suppliers 3,346,441,698 2,851,391,542 Incidental costs 2,031,846,322 2,090,433,184 Buyers 1,457,707,298 1,096,012,563 Accrued expenses 2,840,505,054 2,184,783,101 Commissions payable 2,010,875,594 1,629,257,467 Current portion of deferred output tax 1,873,761,195 2,007,448,590 Current portion of liabilities for purchased land 1,853,158,586 1,745,507,099 Current portion of retention payable 1,187,208,590 1,152,301,636 Other payables 784,481,185 430,690,617 P =31,444,875,608P=20,517,350,873 Accounts payable - contractors Accounts payable - contractors pertain to contractors’ billings for construction services related to the development of various projects of the Group. These are expected to be settled within a year after the financial reporting date. Accounts payable - suppliers Accounts payable - suppliers represent payables for construction materials, marketing collaterals, office supplies and property and equipment ordered and delivered but not yet due. These are expected to be settled within a year from recognition date. Accounts payable - incidental costs Accounts payable - incidental costs pertain to liabilities incurred in relation to land acquired. These include payable for titling costs, clearing, security and such other additional costs incurred. Accounts payable - buyers Accounts payable - buyers pertain to refunds arising from the cancellation of contract to sell agreement which is determined based on the required refund under the Maceda Law. Accrued expenses Details of accrued expenses as follow: 2024 2023 Interest P =2,221,159,401 P=1,589,407,383 Subdivision maintenance and licenses 171,603,644 169,976,477 Light and power 46,614,777 111,759,773 Repairs and maintenance 61,399,794 58,264,145 Security 48,885,026 55,167,310 Rental 49,582,846 43,706,583 Contracted services 61,135,783 37,668,623 Marketing 48,303,935 32,228,464 Others 131,819,848 86,604,343 P =2,840,505,054 P=2,184,783,101 Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 55 - *SGVFS197678* Deferred output tax Deferred output tax pertains to the VAT charged to the buyers on installment upon contracting of real estate sale but were not yet collected as of reporting date. Further, upon collection of the VAT portion of installment receivables, the equivalent output tax is included in the current VAT payable of the month. Deferred output VAT pertaining to installment receivables that are beyond one year after reporting date are presented as noncurrent liabilities (see Note 22). Liabilities for purchased land Liabilities for purchased land are payables to various real estate property sellers. Under the terms of the agreements executed by the Group covering the purchase of certain real estate properties, the titles of the subject properties shall be transferred to the Group only upon full payment of the real estate payables. Liabilities for purchased land that are payable beyond one year from reporting date are presented as noncurrent liabilities (see Note 22). Commissions payable Commissions payable pertains to fees due to brokers for services rendered which are expected to be settled within one year. Retention payable Retention payable pertains to 10.00% retention from the contractors’ progress billings which will be released after the completion of contractors’ project and upon acceptance of the work by the Group. The retention serves as a holdout amount withheld from the contractor to cover for back charges that may arise from quality issues in affected projects. Retention payables that will be settled beyond one year from reporting date are presented as noncurrent liabilities (see Note 22). Other payables Other payables include statutory payables which are remitted on a monthly basis. 19. Security Deposits and Advance Rent This account consists of: 2024 2023 Current portion of security deposits (Note 22) P =984,779,835 P=1,167,057,893 Current portion of advance rent (Note 22) 727,120,268 845,985,875 P =1,711,900,103 P=2,013,043,768 Current portion of security deposits Security deposits represent deposits required by lease agreements. These can be recovered upon termination of the lease agreement through refund or application to unpaid rent and/or other charges. Security deposit also include bond deposits of homeowners for their house extension, fence construction and landscaping works which will be refunded after considering any charges. Current portion are those to be settled within one year from financial reporting date. Current portion of advance rent Advance rent includes three-month advance rental paid by lessee as required under lease contract. These will be applied to the first or last three months rental depending on the contract terms of the related lease contract. These also include overpayments made by lessee against its monthly billings which will applied to future billings. Current portion are those to be settled within one year from financial reporting date. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 56 - *SGVFS197678* 20. Bank Loans and Loans Payable Bank Loans Bank loans pertain to the borrowings of the Group from various local financial institutions. These bank loans are obtained to finance capital expenditures and for general corporate purposes. The rollforward analysis of this account follows: 2024 2023 Principal Balance at beginning of year P =53,272,058,104P=56,044,615,331 Availments* 46,085,326,087 39,917,136,939 Payments* (43,653,321,281) (42,689,694,166) Balance at end of year 55,704,062,910 53,272,058,104 Debt issue cost Balance at beginning of year 89,089,909 97,792,214 Additions 29,534,666 34,946,237 Amortizations (50,685,632) (43,648,542) Balance at end of year 67,938,943 89,089,909 Carrying value 55,636,123,967 53,182,968,195 Less current portion 18,236,007,959 25,874,160,220 Noncurrent portion P =37,400,116,008P=27,308,807,975 *Gross of bank loans that were rolled over during the year (see Note 33). Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 57 - *SGVFS197678* Details of the bank loans as of December 31, 2024 and 2023 follow: Loan Type Date of Availment 2024 2023 Maturity Interest Rate Payment Terms Covenants/Collaterals VLLI Bank loan December 2024 P =880,873,118 P=− December 2029 7.76% Interest and principal payable quarterly Current ratio of at least 1:1.00; Debt to Equity maximum of 2.50:1.00 and DSCR 1:1.00; unsecured; Guaranteed by subsidiaries Bank loan September 2024 554,467,523 − September 2029 7.00% Principal payable quarterly, interest payable upon maturity Current ratio of at least 1:1.00; Debt to Equity maximum of 2.50:1.00 and DSCR 1:1.00; unsecured; Bank loan March 2024 1,972,503,439 − March 2029 7.56% Interest and principal payable quarterly Current ratio of at least 1:1.00; Debt to Equity maximum of 2.50:1.00 and DSCR 1:1.00; unsecured; Guaranteed by subsidiaries Bank loan December 2023 5,171,746,675 6,465,053,763 December 2028 7.54% Interest and principal payable quarterly Current ratio of at least 1:1.00; Debt to Equity maximum of 2.50:1.00 and DSCR 1:1.00; unsecured; Guaranteed by subsidiaries Bank loan December 2023 1,253,621,257 1,600,000,000 December 2026 7.10% Interest and 70% of principal payable quarterly and 30% of principal payable upon maturity Current ratio of at least 1:1.00; Debt to Equity maximum of 2.50:1.00 and DSCR 1:1.00; unsecured; Guaranteed by subsidiaries Bank loan June 2022 4,987,286,570 6,974,384,611 June 2027 7.13% Interest and principal payable quarterly Current ratio of at least 1:1.00; Debt to Equity maximum of 2.50:1.00 and DSCR 1:1.00; unsecured Bank loan November 2022 1,000,000,000 1,000,000,000 Various maturities, renewed upon maturity subject to change in interest rate 8.00% Interest payable monthly, principal payable annually upon maturity − Bank loan June 2021 1,497,407,324 2,493,341,306 June 2026 4.75% Interest and principal payable quarterly Current ratio of at least 1:1.00; Debt to Equity maximum of 2.50:1.00 and DSCR 1:1.00; unsecured; Guaranteed by subsidiaries Bank loan June 2021 − 2,353,055,000 April 2024 6.80% Interest and principal payable upon maturity Secured by hold-out investments at amortized cost Bank loan May 2021 933,958,333 1,556,458,333 May 2026 4.75% Interest and principal payable quarterly Current ratio of at least 1:1.00; Debt to Equity maximum of 2.50:1.00 and DSCR 1:1.00; unsecured; Guaranteed by subsidiaries Bank loan March 2020 263,157,895 1,314,250,365 March 2025 5.15% Interest and principal payable quarterly Current ratio of at least 1:1.00; Debt to Equity maximum of 2.50:1.00 and DSCR 1:1.00; unsecured; Guaranteed by subsidiaries Bank loan April 2018 400,000,000 1,200,000,000 April 2025 7.36% Interest and principal payable quarterly Current ratio of at least 1:1.00; Debt to Equity maximum of 2.50:1.00 and DSCR 1:1.00; unsecured Bank loan October 2019 − 315,789,474 May 2024 5.54% Interest and principal payable quarterly Current ratio of at least 1:1.00; Debt to Equity maximum of 2.50:1.00 and DSCR 1:1.00; unsecured; Guaranteed by subsidiaries Bank loan May 2019 − 200,000,000 May 2024 7.15% Interest and principal payable quarterly Current ratio of at least 1:1.00; Debt to Equity maximum of 2.50:1.00 and DSCR 1:1.00; unsecured; Guaranteed by subsidiaries Bank loan Availed and/or renewed in various dates in 2024 and 2023 36,094,688,675 24,708,470,535 Various maturities, renewed upon maturity subject to change in interest rate 6.75% to 7.13% in 2023; 6.55% to 8.50% in 2024 Interest payable monthly and quarterly, principal payable upon maturity Secured by hold-out of investments at amortized cost 53,074,370,168 50,180,803,387 VII Bank Loan June 2024 June 2023 1,295,728,000 1,035,019,035 June 2025 June 2024 7.00% in 2023; 6.53% in 2024 Interest and principal payable upon maturity Secured by hold-out of investments at amortized cost (Forward) Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 58 - *SGVFS197678* Loan Type Date of Availment 2024 2023 Maturity Interest Rate Payment Terms Covenants/Collaterals MAPI Bank loan July 2017 P =171,875,000 P=234,375,000 June 2027 6.23% Interest and principal payable monthly Current ratio of at least 1:1.00; Debt to Equity maximum of 2.50:1.00 and DSCR 1:1.00 MC Bank loan October 2022 1,092,191,996 1,485,711,186 October 2027 7.55% Interest and principal payable quarterly With investment properties used as collateral HDC Bank loan November 2023 − 98,840,000 November 2024 8.25% Interest payable quarterly, principal payable upon maturity Unsecured Prima Bank Loan March 2023 − 1,134,564 March 2025 8.05% Interest and principal payable monthly Chattel Mortgage Brittany Bank loan October 2022 1,795,399 3,589,669 October 2026 7.47% Interest and principal payable monthly Chattel Mortgage VRI Bank loan December 2017 163,404 142,538,104 December 2024 6.70% Interest payable quarterly, principal payable upon maturity Unsecured Bank loan Various − 957,250 October 2024 and May 2023 6.92% in 2023; nil in 2024 Interest and principal payable monthly Chattel mortgage 163,404 143,495,354 P =55,636,123,967 53,182,968,195 Less current portion 18,236,007,959 25,874,160,220 Bank loans, net of current portion P =37,400,116,008 P=27,308,807,975 Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 59 - *SGVFS197678* In December 2024, the Parent Company obtained a 5-year unsecured peso denominated loan amounting to P =880.87 million which bears annual fixed interest of 7.76%, payable quarterly. The principal balance of the loan will be paid quarterly. This loan is guaranteed by the Parent Company’s subsidiaries consisting of Brittany Corporation, Crown Asia Philippines Inc., Camella Homes, Inc., Communities Philippines, Inc., Vistamalls, Inc., and Vista Residences Inc. (see Note 29). In September 2024, the Parent Company obtained a 5-year dollar-denominated loan amounting to $10,000.00 million (P =557.30 million) which bears annual fixed interest of 7.00%, principal payable in 17 equal quarterly installments, without need of notice, demand, presentment or any other act or deed, starting on first anniversary date of initial drawdown. In March 2024, the Parent Company signed a P =2-billion loan deal with the Manila branch of Sumitomo Mitsui Banking Corp. to finance the property developer’s capital expenditures. The loan will also be used for the Group’s capital expenditures for property development, refinancing and to fund other general corporate purposes. This loan is guaranteed by the Parent Company’s subsidiaries consisting of Brittany Corporation, Crown Asia Philippines Inc., Camella Homes, Inc., Communities Philippines, Inc., Vistamalls, Inc., and Vista Residences Inc. (see Note 29). In December 2023, the Parent Company obtained a 5-year unsecured peso denominated loan amounting to P =6,500.00 million which bears annual fixed interest of 7.54%, payable quarterly. The principal balance of the loan will be paid in 20 equal quarterly installments commencing on the first interest payment date subject to prepayment option. In December 2023, the Parent Company obtained a 3-year unsecured peso denominated loan amounting to P =1,600.00 million which bears annual fixed interest of 7.10% payable quarterly. 70% of the principal amount of the loan will be paid in equal quarterly installments commencing on the second interest payment date, and the 30% balance will be paid in full on maturity date. In June 2022, the Parent Company obtained a 5-year unsecured peso denominated loan amounting to P=10,000.00 million which bears annual fixed interest of 7.13%, payable quarterly. The principal balance of the loan will be paid in 20 equal quarterly installments commencing on the first interest payment date subject to prepayment option. In November 2022, the Parent Company obtained various peso-denominated bank loans with interest rate of 8.00% per annum as of December 31, 2024 and 2023, respectively. These bank loans are renewable upon maturity subject to change in interest rates. The Parent Company has various peso-denominated bank loans with fixed interest-rates ranging from 6.75% to 7.12% per annum and 6.75% to 7.13% per annum as of December 31, 2024 and 2023, respectively. In 2024 and 2023, these bank loans are renewable upon maturity subject to change in interest rates and/or hold-out amount of the investments at amortized cost of VII amounting to $607.07 million (P =35,115.92million) and $548.24 million (P =30,355.86 million) as of December 31, 2024 and 2023, respectively. No fees are charged by VII for its investments held as security (see Note 29). As disclosed in Notes 10, 14, and 15, certain investments at amortized cost, property and equipment, and investment properties are used as collateral to the bank loans. Subsidiaries of the Parent Company namely, Brittany Corporation, Camella Homes, Inc., Crown Asia Properties, Inc., Communities Philippines, Inc., Vistamalls, Inc. (formerly Starmalls, Inc.) and Vista Residences, Inc. acted as guarantors for selected bank loans of the Parent Company. No fees are charged for these guarantee agreements (see Note 29). Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 60 - *SGVFS197678* Loans Payable These loans bear annual fixed interest rates ranging from 6.25% to 8.05% and 6.25% to 8.25% as at December 31, 2024 and 2023, respectively, payable on equal monthly installment over a maximum period of 10 years. Installment contracts receivable serve as collateral to the loans payable (see Note 11). Movement of loans payable follows: 2024 2023 Balance at beginning of year P =7,443,723,350 P=5,334,619,152 Additions (Note 33) 14,752,671,118 3,963,399,970 Payments (2,713,629,867) (1,854,295,772) Balance at end of year 19,482,654,601 7,443,723,350 Less current portion 3,497,817,361 3,176,026,696 Noncurrent portion P =15,984,947,240 P=4,267,696,654 Interest expense on bank loans and loans payable amounted to P =4,462.22 million, P =3,673.31 million and P =3,197.46 million in 2024, 2023 and 2022, respectively (see Note 25). The Group was able to comply with the loan covenants as of December 31, 2024 and 2023. 21. Notes Payable This account consists of: 2024 2023 Dollar denominated bonds P =50,107,110,618 P=42,664,040,138 Corporate note facility 35,918,464,900 41,135,771,640 Retail bonds 21,404,217,702 24,348,969,861 107,429,793,220 108,148,781,639 Less current portion 27,787,034,267 28,005,337,553 Noncurrent portion P =79,642,758,953 P=80,143,444,086 The rollforward analysis of this account follows: 2024 2023 Principal Balances at beginning of year P =108,522,364,867P=102,735,489,800 Drawdown 26,265,750,000 18,900,000,000 Principal payments (28,286,174,933) (12,816,674,933) Translation adjustment 1,381,500,000 (296,450,000) Balances at end of year P =107,883,439,934P=108,522,364,867 Debt issue cost Balance at beginning of year 373,583,228 287,286,359 Addition 311,635,807 288,335,915 Debt issue cost amortization (223,737,200) (202,040,174) Translation adjustment (7,835,121) 1,128 Balance at end of year 453,646,714 373,583,228 Carrying value 107,429,793,220 108,148,781,639 Less current portion 27,787,034,267 28,005,337,553 Noncurrent portion P =79,642,758,953 P=80,143,444,086 Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 61 - *SGVFS197678* A. Dollar Denominated Bonds a. US$220.00 million Notes (Due July 2027) On May 17, 2021, VII (the Issuer) issued US$170.00 million notes (“Notes”) with a term of six years from initial drawdown date. The interest rate is 7.25% per annum, payable semi- annually in arrears on January 20 and July 20 of each year beginning on January 20, 2022. The Notes were used to refinance existing debt as a result of liability management exercise and excess proceeds were used to refinance existing debt and for general corporate purposes. There are no properties owned by the Group that are pledged as collateral to this note. As of December 31, 2024 and 2023, outstanding balance of the note amounted to US$172.18 million (P =9,959.98 million) and US$172.60 million (P =9,556.63 million), respectively. On June 1, 2021, VII issued an additional US$50.00 million unsecured note, with similar terms and conditions as the above notes. There are no properties owned by the Group that are pledged as collateral to this note. As of December 31, 2024 and 2023, outstanding balance of the note amounted to US$49.78 million (P =2,878.57 million) and US$50.76 million (P =2,810.78 million), respectively. Redemption at the option of the Issuer At any time, the Issuer may on any one or more occasions redeem all or a part of the Notes on any business day or after July 20, 2024 and up to but excluding the Maturity date, the Issuer may on one or more occasions redeem all or part of the Notes, at the redemption price, plus accrued and unpaid interest, if any, to (but not including) the date of redemption, if redeemed during the 12-month period commencing on July 20 of the years set forth below: Period Price 2024 103.6250% 2025 101.8125% 2026 and thereafter 100.0000% The redemption option was assessed to be embedded derivatives that is clearly and closely related to the host contract, therefore, not required to be bifurcated. Covenants The Notes provide for the Group to comply with certain covenants including, among others, incurrence of additional debt; grant of security interest; payment of dividends; mergers, acquisitions and disposals; and certain other covenants. The incurrence test for additional debt requires the Group to have a (Fixed Charge Coverage Ratio) FCCR of not less than 2.25x. The Group was able to comply with the loan covenant as of December 31, 2024 and 2023. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 62 - *SGVFS197678* b. US$200.00 million Notes (Due July 2027) On July 20, 2020, VII (the Issuer) issued US$200.00 million notes (“Notes”) with a term of seven years from initial drawdown date. The interest rate is 7.25% per annum, payable semi- annually in arrears on January 20 and July 20 of each year beginning on January 20, 2021. The Notes were used to refinance existing debt as a result of liability management exercise and excess proceeds were used to refinance existing debt and for general corporate purposes. There are no properties owned by the Group that are pledged as collateral to this note. As of December 31, 2024 and 2023, outstanding balance of the note amounted to US$198.98 million (P =11,510.15 million) and US$198.62 million (P =10,997.85 million), respectively. Redemption at the option of the Issuer At any time, the Issuer may on any one or more occasions redeem all or a part of the Notes on any business day or after July 20, 2024 and up to but excluding the Maturity date, the Issuer may on one or more occasions redeem all or part of the Notes, at the redemption price, plus accrued and unpaid interest, if any, to (but not including) the date of redemption, if redeemed during the 12-month period commencing on July 20 of the years set forth below: Period Price 2024 103.6250% 2025 101.8125% 2026 and thereafter 100.0000% The redemption option was assessed to be embedded derivatives that is clearly and closely related to the host contract, therefore, not required to be bifurcated. Covenants The Notes provide for the Group to comply with certain covenants including, among others, incurrence of additional debt; grant of security interest; payment of dividends; mergers, acquisitions and disposals; and certain other covenants. The incurrence test for additional debt requires the Group to have a (Fixed Charge Coverage Ratio) FCCR of not less than 2.25x. The Group was able to comply with the loan covenant as of December 31, 2024 and 2023. c. US$350.00 million Notes (Due November 2024) On November 28, 2017, VII (the Issuer) issued US$350.00 million notes (“Notes”) with a term of seven years from initial drawdown date. The interest rate is 5.75% per annum, payable semi-annually in arrears on May 28 and November 28 of each year beginning on November 28, 2017. The Notes were used to refinance existing debt as a result of liability management exercise and excess proceeds were used to refinance existing debt and for general corporate purposes. There are no properties owned by the Group that are pledged as collateral to these notes. The Group fully paid these Notes in November 2024. As of December 31, 2023, outstanding balance of the note amounted to US$348.54 million (P =19,298.78 million). Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 63 - *SGVFS197678* Redemption at the option of the Issuer At any time, the Issuer may on any one or more occasions redeem all or a part of the Notes on any business day or after November 28, 2021 and up to but excluding the Maturity date, the Issuer may on one or more occasions redeem all or part of the Notes, at the redemption price, plus accrued and unpaid interest, if any, to (but not including) the date of redemption, if redeemed during the 12-month period commencing on November 28 of the years set forth below: Period Price 2021 102.8750% 2022 101.4375% 2023 and thereafter 100.0000% The redemption option was assessed to be embedded derivatives that is clearly and closely related to the host contract, therefore, not required to be bifurcated. Covenants The Notes provide for the Group to comply with certain covenants including, among others, incurrence of additional debt; grant of security interest; payment of dividends; mergers, acquisitions and disposals; and certain other covenants. The incurrence test for additional debt requires the Group to have a (Fixed Charge Coverage Ratio) FCCR of not less than 2.25x. The Group was able to comply with loan covenants as of December 31, 2024 and 2023. d. US$2,000.00 million Medium Term Note Programme On December 29, 2023, the Parent Company’s BOD approved the establishment of a US$2,000.00 million Medium Term Note Programme pursuant to which the Issuer (VII) may from time to time issue US Dollar-denominated notes in such amount, with interest rate, and under such other terms and conditions as the Management of the Parent Company and/or the Issuer may subsequently approve or ratify. Accordingly, the Issuer has executed a Programme Agreement with DBS Bank Ltd. And HSBC, as Dealers, for the offer, sale and issuance of the Notes. On July 29, 2024, VII (the Issuer) issued US$300 million notes (“Notes”) with a term of five years from initial draw down date. The interest rate is 9.375% per annum payable semi- annually in arrears on January 29 and July 29 of each year beginning on July 29, 2024. The notes were used to refinance existing debt as a result of liability management exercise and excess proceeds were used to refinance existing debt and for general corporate purposes. There are no properties owned by the Group that were pledged as collateral to this note. As of December 31, 2024, outstanding balance of the note amounted to US$296.28 million (P =17,138.38 million). On August 6, 2024, VII issued an additional US$50.0 million unsecured note, with similar terms and conditions as the above notes. There are no properties owned by the Group that were pledged as collateral to this note. As of December 31, 2024, outstanding balance of the note amounted to US$49.38 million (P =2,856.40 million). Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 64 - *SGVFS197678* On October 9, 2024, VII issued an additional US$50.0 million unsecured note, with similar terms and conditions as the above notes. There are no properties owned by the Group that were pledged as collateral to this note. As of December 31, 2024, outstanding balance of the note amounted to US$49.38 million (P =2,856.40 million). On October 28, 2024, VII issued an additional US$50.0 million unsecured note, with similar terms and conditions as the above notes. There are no properties owned by the Group that were pledged as collateral to this note. As of December 31, 2024, outstanding balance of the note amounted to US$49.38 million (P =2,856.40 million). Redemption at the option of the Issuer At any time, the Issuer may on any one or more occasions redeem all or part of the Notes on any business day, the Issuer may on one or more occasions redeem all or part of the Notes, at the redemption price equal to 100% of the principal amount of the Notes redeemed, plus Applicable Premium as of, and accrued and unpaid interest, if any, to the date of redemption. Covenants The Notes provide for the Group to comply with certain covenants including, among others, incurrence of additional debt; grant of security interest; payment of dividends; mergers, acquisitions and disposals; and certain other covenants. The incurrence test for additional debt requires the Group to have a proforma Net Debt-to Equity Ratio of not more than 2.50x to 1.00x. These were complied with by the Group as at December 31, 2024. As part of the issuance of the Notes, the Parent Company and its subsidiaries that acted as guarantors, irrevocably and unconditionally, are: Vista Land & Lifescapes, Inc., Brittany Corporation, Camella Homes, Inc., Crown Asia Properties, Inc., Communities Philippines, Inc., Vistamalls, Inc. (formerly Starmalls, Inc.) and Vista Residences Inc. No fees are charged for these guarantee agreements (see Note 29). B. Corporate Note Facility a. P=10,000 million Corporate Notes (Due April 2026) On April 4, 2023, the Parent Company (the Issuer) entered into a Corporate Notes Facility Agreement for the issuance of a long-term corporate notes consisting of Three-Year Corporate Notes due 2026 amounting to P =6,000.00 million at a fixed rate of 7.61% per annum, payable on maturity date. On April 14, 2023, an additional issuance of Corporate Notes was made in the amount of P=4,000.00 million due 2026, at a fixed interest of 7.63% per annum, payable on maturity date. The proceeds of the corporate notes were used for refinancing of existing or maturing obligations of the Parent Company, and for other general corporate purposes. The issue cost amounted to P =105.22 million. This was capitalized as debt issue cost and amortized over the life of the liability and was offset to the carrying value of the liability. As of December 31, 2024 and 2023, the outstanding balance of the Corporate Notes is P=9,952.84 million and P =9,918.49 million, respectively. The Corporate Notes do not provide early redemption at the option of the Issuer. There are no properties pledged to secure the obligation of the Group. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 65 - *SGVFS197678* Covenants The Corporate Notes requires the Issuer to maintain the ranking with all and future unsecured and unsubordinated indebtedness except for obligations mandatorily preferred or in respect of which a statutory preference is established by law. The Issuer is also required to maintain at all times the following financial ratios: current ratio of at least 1.00, maximum debt to equity at 2.50 and debt service coverage ratio of at least 1.00. The Group was able to comply with the loan covenants as of December 31, 2024 and 2023. b. P=6,000.00 million Corporate Notes (Due March 2027) On March 28, 2022, the Parent Company (the Issuer) entered into a Corporate Notes Facility Agreement for the issuance of a long-term corporate notes consisting of Five-Year Corporate Notes due 2027 amounting to P =4,000.00 million at a fixed rate of 6.64% per annum, payable in equal 18 quarters commencing on the second interest payment date. On June 1, 2022, an additional issuance of Corporate Notes was made in the amount of P=2,000.00 million due 2027, at a fixed interest of 7.24% per annum, payable in equal 18 quarters commencing on the second interest payment date. The proceeds of the corporate notes were used for refinancing of existing or maturing obligations of the Parent Company, and for other general corporate purposes. The issue cost amounted to P =51.36 million. This was capitalized as debt issue cost and amortized over the life of the liability and was offset to the carrying value of the liability. As of December 31, 2024 and 2023, the outstanding balance of the Corporate Notes is P=3,321.46 million and P=4,643.22 million, respectively. The Corporate Notes provide early Redemption at the option of the Issuer as follows: Early Redemption Date Early Redemption Amount 3rd anniversary from issue date and interest payment thereafter 102.00% 4th anniversary from issue date and interest payment thereafter 101.00% The redemption option was assessed to be embedded derivatives that is clearly and closely related to the host contract, therefore, not required to be bifurcated. There are no properties pledged to secure the obligation of the Group. Covenants The Corporate Notes requires the Issuer to maintain the pari passu ranking with all and future unsecured and unsubordinated indebtedness except for obligations mandatorily preferred or in respect of which a statutory preference is established by law. The Issuer is also required to maintain at all times the following financial ratios: current ratio of at least 1.00, maximum debt to equity at 2.50 and debt service coverage ratio of at least 1.00. The Group was able to comply with the debt covenants as at December 31, 2024 and 2023. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 66 - *SGVFS197678* c. P=12,000.00 million Corporate Notes (Due December 2025) On January 31, 2023, an additional issuance of Corporate Notes was made in the amount of P=2,900.00 million due 2025, at a fixed interest of 7.26% per annum, payable on maturity date. On December 28, 2022, the Parent Company (the Issuer) entered into a Corporate Notes Facility Agreement for the issuance of a long-term corporate notes consisting of Three-Year Corporate Notes due 2025 amounting to P =8,600.00 million at a fixed rate of 7.93% per annum, payable on maturity date. The proceeds of the corporate notes were used for refinancing of existing or maturing obligations of the Parent Company, and for other general corporate purposes. The issue cost amounted to P =46.70 million and P =88.84 million for the 2024 and 2023 corporate notes, respectively. These were capitalized as debt issue cost and amortized over the life of the liability and were offset to the carrying value of the liability. As of December 31, 2024 and 2023, the outstanding balance of the Corporate Notes is P=11,449.56 million and P=11,402.86 million, respectively. The Corporate Notes do not provide early redemption at the option of the Issuer. There are no properties pledged to secure the borrowing of the Group. Covenants The Corporate Notes requires the Issuer to maintain the pari passu ranking with all and future unsecured and unsubordinated indebtedness except for obligations mandatorily preferred or in respect of which a statutory preference is established by law. The Issuer is also required to maintain at all times the following financial ratios: current ratio of at least 1.00, maximum debt to equity at 2.50 and debt service coverage ratio of at least 1.00. The Group complied with the covenants as at December 31, 2024 and 2023. d. P=15,000.00 million Corporate Notes (Due July 2024) On July 15, 2019, the Parent Company (the Issuer) entered into a Corporate Notes Facility Agreement for the issuance of a long-term corporate notes consisting of Five-Year Corporate Notes due 2024 amounting to P =14,500.00 million at a fixed rate of 6.77% per annum, payable quarterly. On October 17, 2019, an additional issuance of Corporate Notes was made in the amount of P=500.00 million due 2024, at a fixed interest of 6.77% per annum, payable quarterly. The proceeds of the corporate notes were utilized for the 2019 capital expenditures for commercial property projects, and to fund other general corporate expenses of the Group. The issue cost amounted to P =159.91 million. This was capitalized as debt issue cost and amortized over the life of the liability and was offset to the carrying value of the liability. The Group fully paid the Corporate Notes in July 2024. As of December 31, 2023, the outstanding balance of the Corporate Notes is P=2,810.51 million. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 67 - *SGVFS197678* The Corporate Notes provide early Redemption at the option of the Issuer as follows: Early Redemption Date Early Redemption Amount 3rd anniversary from issue date and interest payment thereafter 101.00% 4th anniversary from issue date and interest payment thereafter 100.50% The redemption option was assessed to be embedded derivatives that is clearly and closely related to the host contract, therefore, not required to be bifurcated. There are no properties pledged to secure the borrowing of the Group. Covenants The Corporate Notes requires the Issuer to maintain the pari passu ranking with all and future unsecured and unsubordinated indebtedness except for obligations mandatorily preferred or in respect of which a statutory preference is established by law. The Issuer is also required to maintain at all times the following financial ratios: current ratio at 1.00, debt to equity at 2.50 and debt service coverage ratio of at least 1.00. The Group complied with the loan covenants as of December 31, 2024 and 2023. e. P=8,200.00 million Corporate Notes (Due July 2025 and 2028) On July 11, 2018, the Parent Company (the Issuer) entered into a Corporate Notes Facility Agreement for the issuance of a long term corporate notes consisting of Seven-Year Corporate Notes due 2025 amounting to P =1,700.00 million at a fixed rate of 7.4913% per annum, payable quarterly and Ten-Year Corporate Notes due 2028 amounting to P=6,000.00 million at a fixed rate of 7.7083% per annum, payable quarterly. On July 25, 2018, an additional issuance of Corporate Notes was made in the amount of P=500.00 million due 2025, at a fixed interest of 7.4985% per annum. The proceeds of the corporate notes were utilized for the 2018 capital expenditures for commercial property projects, and to fund other general corporate expenses of the Group. The issue cost amounted to P =105.30 million. This was capitalized as debt issue cost and amortized over the life of the liability and was offset to the carrying value of the liability. As of December 31, 2024 and 2023, the outstanding balance of the Corporate Notes is P=2,763.50 million and P=3,788.12 million, respectively. The Corporate Notes provide early Redemption at the option of the Issuer as follows: Seven Year Notes: Early Redemption Date Early Redemption Amount 5th anniversary from issue date and interest payment thereafter 101.00% 6th anniversary from issue date and interest payment thereafter 100.50% Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 68 - *SGVFS197678* Ten Year Notes: Early Redemption Date Early Redemption Amount 7th anniversary from issue date and interest payment thereafter 102.00% 8th anniversary from issue date and interest payment thereafter 101.00% 9th anniversary from issue date and interest payment thereafter 100.50% The redemption option was assessed to be embedded derivatives that is clearly and closely related to the host contract, therefore, not required to be bifurcated. There are no properties pledged to secure the borrowings of the Group. Covenants The Corporate Notes requires the Issuer to maintain the pari passu ranking with all and future unsecured and unsubordinated indebtedness except for obligations mandatorily preferred or in respect of which a statutory preference is established by law. The Issuer is also required to maintain at all times the following financial ratios: current ratio at 1.00, debt to equity at 2.50 and debt service coverage ratio of at least 1.00. The Group complied with the loan covenants as at December 31, 2024 and 2023. f. P=10,000.00 million Corporate Notes (Due December 2026) On December 28, 2016, the Parent Company (the Issuer) entered into a Corporate Notes Facility Agreement for the issuance of a long-term corporate notes with a principal amount of up to P =8,000.00 million. On April 21, 2017, a consent solicitation was made for amendments to include among others, increasing the Corporate Notes principal amount to up to P=10,000.00 million in respect to the second drawdown. Such amendments were consented by Note Holders representing at least fifty one percent (51%) of the outstanding Corporate Notes. On April 27, 2017, the Issuer made such amendments to the Corporate Note Facility dated December 28, 2016. The first drawdown was at P =5,150.00 million in 2016, at fixed interest of 6.19% per annum, payable quarterly. On May 3, 2017, the Issuer made its second drawdown at P =4,850.00 million, at fixed interest of 6.23% per annum, payable quarterly. The proceeds of the Corporate Notes were utilized for the 2017 capital expenditures, refinancing of existing indebtedness and to fund other general corporate expenses. The issue cost amounted to P =38.72 million. This was capitalized as debt issue cost and amortized over the life of the liability and was offset to the carrying value of the liability. As of December 31, 2024 and 2023, the outstanding balance of the Corporate Notes is P=8,431.10 million and P=8,572.57 million, respectively. The Corporate Notes provide early Redemption at the option of the Issuer as follows: Early Redemption Date Early Redemption Amount 7th anniversary from issue date and interest payment thereafter 102.00% 8th anniversary from issue date and interest payment thereafter 101.00% 9th anniversary from issue date and interest payment thereafter 100.50% Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 69 - *SGVFS197678* The redemption option was assessed to be embedded derivatives that is clearly and closely related to the host contract, therefore, not required to be bifurcated. There are no properties pledged to secure the borrowings of the Group. Covenants The Corporate Notes requires the Issuer to maintain the pari passu ranking with all and future unsecured and unsubordinated indebtedness except for obligations mandatorily preferred or in respect of which a statutory preference is established by law. The Issuer is also required to maintain at all times the following financial ratios: current ratio at 1.00, debt to equity at 2.50 and debt service coverage ratio of at least 1.00. The Group complied with the loan covenants as at December 31, 2024 and 2023. As part of the issuance of the Corporate Notes, the subsidiaries of the Parent Company that acted as guarantors, irrevocably and unconditionally, are: Brittany Corporation, Camella Homes, Inc., Crown Asia Properties, Inc., Communities Philippines, Inc., Vistamalls, Inc. (formerly Starmalls, Inc.) and Vista Residences Inc. No fees are charged for these guarantee agreements. C. Retail Bonds a. 2023 Fixed-rate Peso Retail Bonds The Parent Company has shelf registration of Retail Bonds in the aggregate principal amount of up to P =35,000.00 million to be offered within a period of three years. On December 6, 2023, the Parent Company issued unsecured fixed-rate Peso Retail Bonds with an aggregate principal amount of P =6,000.0 million. This is the first tranche out of the P =35,000.00 million shelf registration. The proceeds of the issuance were used for refinancing maturing loan obligations as well as for general and corporate purposes. The issue costs amounted to P = 94.27 million. This was capitalized as debt issue cost and amortized over the life of the liability and was offset to the carrying value of the liability. The offer is comprised of 3-year Retail Bonds due on December 6, 2026 with interest rate of 7.54% per annum and 5-year Retail Bonds due on December 6, 2028 with interest rates of 7.69% per annum. Interest on the Retail Bonds is payable quarterly in arrears starting on March 6, 2024 for the first interest payment date and on March 6, June 6, September 6 and December 6 each year for each subsequent payment date. As of December 31, 2024 and 2023, the outstanding balance of the Retail Bonds is P=5,930.35 million and P=5,907.27 million, respectively. There are no properties pledged to secure the borrowings of the Group. Redemption at the option of the Issuer The 3-year Retail Bonds do not provide early redemption at the option of the Issuer. The 5-year Retail Bonds provide early redemption at the option of the Issuer. The Issuer may redeem in whole, the outstanding Retail Bonds on the following relevant dates. The amount payable to the bondholders upon the exercise of the early redemption option by the Issuer shall be calculated, based on the principal amount of Retail Bonds being redeemed, as the sum of: (i) accrued interest computed from the last interest payment date up to the relevant early redemption option date; and (ii) the product of the principal amount of the Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 70 - *SGVFS197678* Retail Bonds being redeemed and the early redemption price in accordance with the following schedule: i. Three (3) years from issue date at early redemption price of 101.00% ii. Four (4) years from issue date at early redemption price of 100.50% The redemption option was assessed to be embedded derivatives that is clearly and closely related to the host contract, therefore, not required to be bifurcated. Covenants The Retail Bonds provide for the Issuer to comply with covenants including, among others, incurrence or guarantee of additional indebtedness; prepayment or redemption of subordinate debt and equity; making certain investments and capital expenditures; consolidation or merger with other entities; and certain other covenants. The Retail Bonds requires the Issuer to maintain a current ratio of at least 1.00:1.00, a maximum debt-to-equity ratio of 2.50:1.00 and a DSCR of at least 1.00:100. The Group complied with the loan covenants as at December 31, 2024 and 2023. b. 2019 Fixed-rate Peso Retail Bonds On December 18, 2019, the Parent Company (the Issuer) issued an unsecured fixed-rate Peso Retail Bonds with an aggregate principal amount of P =10,000.00 million. The proceeds of the issuance were used to fund the construction and completion of the various malls and condominium projects, redevelopment of existing malls, as well as for general corporate purposes. The issue costs amounted P =91.07 million. This was capitalized as debt issue cost and amortized over the life of the liability and was offset to the carrying value of the liability. The offer is comprised of 5-year Retail Bonds due on June 18, 2025 with interest rate of 5.70% per annum. This is the third and last tranche offered out of the shelf registration of Peso Retail Bonds in the aggregate principal amount of up to P =20,000.00 million and initial tranche offered out of the shelf registration of Retail Bonds in the aggregate principal amount of up to P =30,000.00 million to be offered within a period of three (3) years. Interest on the Retail Bonds is payable quarterly in arrears starting on March 18, 2020, for the first interest payment date and on June 18, September 18, December 18 each year for each subsequent payment date. As of December 31, 2024 and 2023, the outstanding balance of the Retail Bonds is P=9,990.38 million and P=9,972.65 million, respectively. There are no properties pledged to secure the borrowings of the Group. Redemption at the option of the Issuer The Issuer may redeem in whole, the outstanding Retail Bonds on the following relevant dates. The amount payable to the bondholders upon the exercise of the early redemption option by the Issuer shall be calculated, based on the principal amount of Retail Bonds being redeemed, as the sum of: (i) accrued interest computed from the last interest payment date up to the relevant early redemption option date; and (ii) the product of the principal amount of the Retail Bonds being redeemed and the early redemption price in accordance with the following schedule: i. Three (3) years from issue date at early redemption price of 101.00% ii. Four (4) years from issue date at early redemption price of 100.50% Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 71 - *SGVFS197678* The redemption option was assessed to be embedded derivatives that is clearly and closely related to the host contract, therefore, not required to be bifurcated. Covenants The Retail Bonds provide for the Issuer to comply with covenants including, among others, incurrence or guarantee of additional indebtedness; prepayment or redemption of subordinate debt and equity; making certain investments and capital expenditures; consolidation or merger with other entities; and certain other covenants. The Retail Bonds requires the Issuer to maintain a current ratio of at least 1.00:1.00, a maximum debt-to-equity ratio of 2.50:1.00 and a DSCR of at least 1.00:100. The Group complied with the loan covenants as at December 31, 2024 and 2023. c. 2018 Fixed-rate Peso Retail Bonds On December 21, 2018, the Parent Company (the Issuer) issued unsecured fixed-rate Peso Retail Bonds with an aggregate principal amount of P =10,000.00 million. The proceeds of the issuance were used to fund the construction and completion of the various malls and for general corporate purposes. The issue costs amounted to P =130.20 million. This was capitalized as debt issue cost and amortized over the life of the liability and was offset to the carrying value of the liability. The offer is comprised of 5-year Retail Bonds due on December 21, 2023 with interest rate of 8.00% per annum and 7-year Retail Bonds due on December 21, 2025 with interest rates 8.25% per annum. This is the second tranche offered out of the shelf registration of Retail Bonds in the aggregate principal amount of up to P =20,000.00 million to be offered within a period of three (3) years. Interest on the Retail Bonds is payable quarterly in arrears starting on March 21, 2019 for the first interest payment date and on March 21, June 21, September 21 and December 21 each year for each subsequent payment date. As of December 31, 2024 and 2023, the outstanding balance of the Retail Bonds is P=3,491.86 million and P=3,484.25 million, respectively. There are no properties pledged to secure the borrowings of the Group. Redemption at the option of the Issuer The Issuer may redeem in whole, the outstanding Retail Bonds on the following relevant dates. The amount payable to the bondholders upon the exercise of the early redemption option by the Issuer shall be calculated, based on the principal amount of Retail Bonds being redeemed, as the sum of: (i) accrued interest computed from the last interest payment date up to the relevant early redemption option date; and (ii) the product of the principal amount of the Retail Bonds being redeemed and the early redemption price in accordance with the following schedule: a) 5-year Bonds: i. Three (3) years from issue date at early redemption price of 101.00% ii. Four (4) years from issue date at early redemption price of 100.50% b) 7-year Bonds: i. Five (5) years from issue date at early redemption price of 101.00% ii. Six (6) years from issue date at early redemption price of 100.50% The redemption option was assessed to be embedded derivatives that is clearly and closely related to the host contract, therefore, not required to be bifurcated. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 72 - *SGVFS197678* Covenants The Retail Bonds provide for the Issuer to comply with covenants including, among others, incurrence or guarantee of additional indebtedness; prepayment or redemption of subordinate debt and equity; making certain investments and capital expenditures; consolidation or merger with other entities; and certain other covenants. The Retail Bonds requires the Issuer to maintain a current ratio of at least 1.00:1.00, a maximum debt-to-equity ratio of 2.50:1.00 and a DSCR of at least 1.00:100. The Group complied with the loan covenants as at December 31, 2024, and 2023. d. 2017 Fixed-rate Peso Retail Bonds On August 8, 2017, the Parent Company (the Issuer) issued unsecured fixed-rate Peso Retail Bonds with an aggregate principal amount of P =5,000.00 million. The proceeds of the issuance were used to partially finance certain commercial development projects and for general corporate purposes. The issue costs amounted to P =64.87 million. This was capitalized as debt issue cost and amortized over the life of the liability and was offset to the carrying value of the liability. The offer is comprised of 7-year Retail Bonds due on August 8, 2024 with interest rate of 5.75% per annum and 10-year Retail Bonds due on August 9, 2027 with interest rate of 6.23% per annum. This is the initial tranche offered out of the shelf registration of Retail Bonds in the aggregate principal amount of up to P =20,000.00 million to be offered within a period of three (3) years. Interest on the Retail Bonds is payable quarterly in arrears starting on November 8, 2017 for the first interest payment date and on February 8, May 8, August 8 and November 8 each year for each subsequent payment date. As of December 31, 2024, and 2023, the outstanding balance of the Retail Bonds is P=1,991.63 million and P=4,984.80 million, respectively. There are no properties pledged to secure the borrowings of the Group. Redemption at the option of the Issuer The Issuer may redeem in whole, the outstanding Retail Bonds on the following relevant dates. The amount payable to the bondholders upon the exercise of the early redemption option by the Issuer shall be calculated, based on the principal amount of Retail Bonds being redeemed, as the sum of: (i) accrued interest computed from the last interest payment date up to the relevant early redemption option date; and (ii) the product of the principal amount of the Retail Bonds being redeemed and the early redemption price in accordance with the following schedule: a) 7-year Bonds: i. Five (5) years and six (6) months from issue date at early redemption price of 101.00% ii. Six (6) years from issue date at early redemption price of 100.50% b) 10-year Bonds: i. Seven (7) years from issue date at early redemption price of 102.00% ii. Eight (8) years from issue date at early redemption price of 101.00% iii. Nine (9) years from issue date at early redemption price of 100.50% The redemption option was assessed to be embedded derivatives that is clearly and closely related to the host contract, therefore, not required to be bifurcated. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 73 - *SGVFS197678* Covenants The Retail Bonds provide for the Issuer to comply with covenants including, among others, incurrence or guarantee of additional indebtedness; prepayment or redemption of subordinate debt and equity; making certain investments and capital expenditures; consolidation or merger with other entities; and certain other covenants. The Retail Bonds requires the Issuer to maintain a current ratio of at least 1.00:1.00, a maximum debt-to-equity ratio of 2.50:1.00 and a DSCR of at least 1.00:100. The Group complied with the loan covenants as at December 31, 2024 and 2023. Interest expense on Notes payable amounted to P =8,003.86 million, P =7,714.46 million and P=7,279.84 million in 2024, 2023 and 2022, respectively (see Note 25). 22. Other Noncurrent Liabilities This account consists of: 2024 2023 Security deposits - net of current portion (Note 19) P =606,867,722 P=303,975,183 Deferred output tax - net of current portion (Note 18) 499,085,497 117,108,064 Advance rent - net of current portion (Note 19) 489,653,311 155,498,565 Retention payable - net of current portion (Note 18) 466,463,780 515,046,096 Liabilities for purchased land - net of current portion (Note 18) 458,940,800 1,064,772,247 P =2,521,011,110 P=2,156,400,155 23. Equity Capital Stock The details of the Parent Company’s capital stock as at December 31 follow: 2024 2023 2022 Common Authorized shares 17,900,000,000 17,900,000,000 17,900,000,000 Par value per share P =1.00 P=1.00 P=1.00 Issued shares 13,114,136,376 13,114,136,376 13,114,136,376 Outstanding shares 11,945,799,461 11,945,799,461 11,945,799,461 Value of shares issued P =13,114,136,376 P=13,114,136,376 P=13,114,136,376 Preferred Series 1 Authorized shares 8,000,000,000 8,000,000,000 8,000,000,000 Par value per share P =0.01 P=0.01 P=0.01 Issued and outstanding shares 3,300,000,000 3,300,000,000 3,300,000,000 Value of shares issued P =33,000,000 P=33,000,000 P=33,000,000 Preferred Series 2 Authorized shares 200,000,000 200,000,000 200,000,000 Par value per share P =0.10 P=0.10 P=0.10 Issued and outstanding shares 30,000,000 – – Value of shares issued P =3,000,000 P=– P=– Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 74 - *SGVFS197678* Preferred Series 1 Voting, non-cumulative, non-participating, non-convertible and non-redeemable. The BOD may determine the dividend rate which shall in no case be more than 10.00% per annum. Preferred Series 2 On June 17, 2019, the Stockholders approved the reclassification of the unissued preferred capital stock of the Parent Company to create Two Hundred Million (200,000,000) non-voting, cumulative, non-participating, non-convertible and redeemable Series 2 preferred shares with par value of P=0.10 each and the corresponding amendment of the Articles of Incorporation of the Parent Company. The Board likewise approved the shelf registration and listing of such redeemable preferred series 2 shares. On October 4, 2024, the Company issued 30,000,000 preferred series 2 shares at an issue price of P=100.00 per share. The SEC approved the registration statement and issued a permit to sell on September 13, 2024. The preferred series 2 shares were issued in two subseries, Subseries 2A and Subseries 2B, which are Peso-denominated, perpetual, cumulative, non-participating, non-voting, redeemable, and non- convertible. The Company has the redemption option starting on the fourth and seventh year and every dividend payment thereafter, with a “step-up” rate effective on the fourth and seventh year, respectively, if the shares are not redeemed. Dividend rates are 7.9892% and 8.400% per annum for subseries 2A and subseries 2B preferred series 2 shares, respectively. Registration Track Record On July 26, 2007, the Parent Company launched its follow-on offer where a total of 8,538,740,614 common shares were offered at an offering price of P =6.85 per share. The registration statement was approved on June 25, 2007. Below is the summary of the Parent Company’s track record of registration of securities with the SEC as of December 31: Number of Shares Registered Number of holders of securities as of year end December 31, 2022 13,114,136,376 934 Add/(Deduct) Movement − (4) December 31, 2023 13,114,136,376 930 Add/(Deduct) Movement − (8) December 31, 2024 13,114,136,3769 22 Treasury Shares Treasury shares totaling 416,128,700 of the Parent Company amounting to P =2,361.98 million as of December 31, 2024, 2023 and 2022 represents the shares of stock held by the Parent Company, while treasury shares amounting to P =5,378.28 million as of December 31, 2024, 2023 and 2022 is attributable to the 752,208,215 shares issued by the Parent Company to Manuela Corporation during the acquisition of Vistamalls Group (formerly, Starmalls Group) in 2015. Manuela Corporation still holds the Parent Company shares as of December 31, 2024 and 2023. These treasury shares are recorded at cost. Total number of treasury shares as of December 31, 2024, 2023 and 2022 is 1,168,336,915. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 75 - *SGVFS197678* On November 5, 2018, the BOD of the Parent Company approved the extension of the Share Buyback Program up to November 5, 2020 subject to the prevailing market price at the time of the buyback over a 24-month period but subject to periodic review by the management. There were no movement in the number and balance of treasury shares since 2021. Retained Earnings Retained earnings include the accumulated equity in undistributed earnings of consolidated subsidiaries amounting to P =52,965.75 million, P =66,307.19 million and P =81,670.79 million as at and December 31, 2024, 2023 and 2022, respectively, which are not available for dividend declaration by the Parent Company until these are declared by the subsidiaries. The accumulated equity in undistributed earnings of consolidated subsidiaries pertains to the accumulated earnings of subsidiaries which have positive retained earnings balance only and excludes those that are in deficit position. The Parent Company’s retained earnings is restricted to payments of dividends to the extent of cost of treasury shares amounting P =2,361.98 million as at December 31, 2024, 2023 and 2022. The BOD of the Parent Company approved the declaration of regular cash dividend amounting to P=1,337.93 million or P =0.112 per share, P =740.65 million or P =0.0620 per share and P =348.36 million or P=0.0292 per share on November 14, 2024, September 29, 2023 and September 30, 2022, respectively. The dividend declarations are in favor of all stockholders of record as of November 28, 2024, October 16, 2023 and October 14, 2022 and paid on December 12, 2024, October 31, 2023 and October 28, 2022, respectively. Noncontrolling Interest Sale of VistaREIT, Inc.’s share through a public listing On June 15, 2022, the Group sold through a public listing its 39.91% effective noncontrolling interest in VistaREIT, Inc. at P =1.75 per share. As a result of the sale and buy-back transactions, the Group’s ownership interest in VistaREIT, Inc. was diluted from 98.94% to 60.09%. In relation to the dilution without loss of control, the impact to the Group’s additional paid-in-capital amounted to P=29.28 million. The Group’s noncontrolling interest increased by P =4,197.40 million, as a result of the public offering of VistaREIT, Inc. The difference between the consideration and carrying value of the noncontrolling interest was credited to additional paid-in-capital as shown below: Consideration received, net of expenses Carrying value of Non-controlling interests deemed disposed Difference recognized within Equity as Additional paid- in-capital 39.91% in VistaREIT, Inc. P=4,226,683,974 P=4,197,400,031 P=29,283,943 Dividends declaration The BOD of the Company approved the declaration of regular cash dividend amounting to P=403.50 million or P =0.05 per share, P =309.90 million or P =0.04 per share, P =339.23 million or P=0.05 per share and P =350.00 million or P =0.05 per share on April 15, May 20, August 14 and November 13, 2024, respectively. The dividend declarations are in favor of all stockholders of record as of May 7, June 5, September 12, and December 13, 2024 which were paid on May 28, June 27, October 3, 2024 and January 10, 2025, respectively. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 76 - *SGVFS197678* The BOD of VistaREIT, Inc. approved the declaration of regular cash dividend amounting to P =102.39 million or P =0.0386 per share, P =103.99 million or P =0.0392 per share, P =105.05 million or P = 0.0396 per share and P =106.11 million or P =0.0400 per share on April 19, May 18, August 14 and November 14, 2023, respectively. The dividend declarations are in favor of all stockholders of record as of May 8, June 2, August 31 and December 14, 2023 and paid on , May 29, June 26, September 21, 2023 and January 19, 2024, respectively. The BOD of VistaREIT, Inc. approved the declaration of regular cash dividend amounting to P =49.33 million or P =0.0210 per share and P =95.76 million or P =0.0361 per share in, August and November 2022, respectively. The dividend declarations are in favor of all stockholders of record as of August 30 and November 28, 2022 which were paid on September 20 and December 19, 2022, respectively. The BOD of Vistamalls, Inc. approved the declaration of cash dividends amounting to P=307.66 million or P =0.0365 per share on November 30, 2024. The dividend declarations are in favor of all stockholders of record as of December 13, 2024 and remains to be unpaid as of December 31, 2024. The BOD of Vistamalls, Inc. approved the declaration of cash dividends amounting to P=30.10 million or P =0.0306 per share on September 28, 2023. The dividend declarations are in favor of all stockholders of record as of October 13, 2023 and paid on October 27, 2023. The BOD of Vistamalls, Inc. approved the declaration of regular cash dividend amounting to P=25.70 million or P =0.0262 per share on September 30, 2022, respectively. The dividend declarations are in favor of all stockholders of record as of October 14, 2022 and paid on October 27, 2022, respectively. The above declarations are reflected as dividend declared to noncontrolling interest in the consolidated statements of changes in stockholder’s equity. As at December 31, 2024 and 2023, the Group’s total dividends payable amounted to P =476.52 million and P =298.02 million, respectively. Capital Management The primary objective of the Group’s capital management policy is to ensure that debt and equity capital are mobilized efficiently to support business objectives and maximize shareholder value. The Group establishes the appropriate capital structure for each business line that properly reflects its premier credit rating and allows it the financial flexibility, while providing it sufficient cushion to absorb cyclical industry risks. The Group considers debt as a stable source of funding. The Group lengthened the maturity profile of its debt portfolio and makes it a point to spread out its debt maturities by not having a significant percentage of its total debt maturing in a single year. The Group manages its capital structure and makes adjustments to it, in light of changes in economic conditions. It monitors capital using leverage ratios on both a gross debt and net debt basis. No changes were made in the objectives, policies or processes for managing capital for the years ended December 31, 2024, 2023 and 2022. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 77 - *SGVFS197678* The Group considers as capital the equity attributable to equity holders of the Parent Company. The following table shows the component of the Group’s equity which it manages as capital as of December 31, 2024, 2023 and 2022: 2024 2023 2022 Total paid-up capital P =46,777,353,508 P=43,831,849,668 P=43,831,849,668 Retained earnings 86,409,105,697 86,226,517,112 78,311,116,523 Treasury shares (7,740,264,387) (7,740,264,387) (7,740,264,387) Other comprehensive income 1,026,361,692 905,783,398 798,914,337 P =126,472,556,511 P=123,223,885,791 P=115,201,616,141 Financial Risk Assessment The Group’s financial condition and operating results would not be materially affected by the current changes in liquidity, credit, interest, currency and market conditions. Credit risks continue to be managed through defined credit policies and continuing monitoring of exposure to credit risks. The Group’s counterparties remain diverse and outstanding balance of selected related parties are provided with financial support by Fine Properties, Inc., ultimate parent company. Out of the total rental income in 2024, P =14,149.77 million or 86.65% are transactions with related parties. Out of the rental income in 2023, P =13,878.07 million or 86.62% are transactions with related parties. Out of the total rental income in 2022, P =11,708.40 million or 85.20% are transactions with related parties (see Notes 7 and 29). Exposure to changes in interest rates is reduced by regular availment of short-term loans which is collateralized by the installment contracts receivables in order to cushion the impact of potential increase in loan interest rates. The Parent Company has a formal foreign exchange and interest risk management policy. The Parent Company actively monitors foreign exchange exposure and interest rate changes. And in addition, the Parent Company ensures that all loan covenants and regulatory requirements are complied with. Exposure to foreign currency holdings are as follows: 2024 2023 Cash and cash equivalents US$16,650,768 US$82,222,562 Investments in amortized cost 688,146,625 708,134,680 Notes payable 870,000,000 770,526,280 Bank loans 22,400,000 18,692,777 Liquidity risk is addressed with long-term funding already locked in, while funds are placed on a short-term placement. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 78 - *SGVFS197678* 24. Costs and Expenses Costs of real estate sales Cost includes acquisition cost of land, materials, labor, and overhead in construction and development and capitalized borrowing costs. Costs of real estate sales recognized for the years ended December 31, 2024, 2023 and 2022 amounted to P =4,801.81 million, P =6,112.02 million and P =5,542.97 million, respectively (see Note 12). Operating expenses This account consists of: 2024 2023 2022 Depreciation and amortization (Notes 14, 15 and 17) P =2,640,295,868 P=2,889,023,944 P=2,638,853,067 Contracted services 1,534,149,056 748,110,261 891,373,658 Salaries, wages and employee benefits (Note 26) 1,501,929,207 1,594,011,055 1,352,706,605 Repairs and maintenance and loss on asset retirement (Note 14) 1,075,913,380 1,296,854,242 1,275,583,294 Occupancy costs (Note 28) 805,214,436 1,116,539,037 765,608,912 Taxes and licenses 763,034,585 1,076,078,779 1,086,964,974 Commissions (Note 7) 719,385,283 684,499,564 606,144,722 Advertising and promotions 573,904,962 561,135,676 396,596,297 Provision for impairment losses on receivables and investments (Notes 10 and 11) 298,740,261 847,977,636 21,740,170 Transportation and travel 80,198,301 148,030,852 116,760,139 Representation and entertainment 30,815,315 40,895,966 34,489,441 Office expenses 28,197,206 50,417,825 50,936,419 Miscellaneous 356,358,516 542,586,586 409,643,180 P =10,408,136,376P=11,596,161,423 P=9,647,400,878 Operating expenses represent the cost of administering the business of the Group. These are recognized when the related services and costs have been incurred. Occupancy cost Occupancy cost consists of rental expenses relating to short-term lease and utilities expense such as light, power, and telephone charges. Miscellaneous expenses Miscellaneous expenses include dues and subscriptions, donations and other expenditures. This includes a net loss of P =366.93 million from the damages which hit Star Mall Alabang in Muntinlupa City on January 8, 2022. The net loss of P =366.93 million is composed of the carrying values of the investment property and other related assets net of proceeds received from the insurance claims in 2022. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 79 - *SGVFS197678* In 2023, the Group received proceeds from the insurance companies amounting to P =1,841.16 million and this was reported as “Proceeds from insurance claims” in the 2023 consolidated statement of comprehensive income. 25. Interest and Other Income from Investments, Parking, Hotel, Mall Administrative and Processing Fees, and Other Revenue, and Interest and Other Financing Charges Interest and other income from investments consist of: 2024 2023 2022 Real estate sales (Note 11) P =276,695,395 P=539,020,967 P=671,515,534 Accretion of unamortized discount (Note 11) ‒ 67,277,317 29,826,779 P =276,695,395 P=606,298,284 P=701,342,313 Interest income from: Cash and cash equivalents, short- term investments and cash restricted for use (Notes 9, 10 and 13) P =153,351,867 P=217,753,867 P=49,785,418 Investments at amortized cost (Note 10) 1,602,932,452 984,530,189 931,410,352 P =1,756,284,319 P=1,202,284,056 P=981,195,770 Parking, hotel, mall administrative and processing fee, and other revenue consist of: 2024 2023 2022 Forfeitures P =619,863,476 P=959,872,802 P=716,018,867 Mall administrative and processing fee 615,426,325 482,316,867 478,225,541 Sale of merchandise and other assets − 168,329,323 3,778,467 Parking 191,294,020 167,918,273 137,168,131 Hotel (Note 7) 129,946,104 133,346,071 103,138,406 Loan processing fees from banks 39,814,082 44,830,841 37,722,319 Share in net earnings 49,096,796 31,374,260 9,301,990 Penalty and others 41,683,168 116,892,302 121,991,334 P =1,687,123,971 P=2,104,880,739 P=1,607,345,055 Forfeitures pertain to forfeited reservation fees and payments for cancelled sales less of any amount refundable to buyers. Parking pertains to payments from mall goers and tenants for use of the parking slots both for commercial and residential buildings. Loan processing fees from banks pertain to payments from banks for processing of loan requirements in their behalf. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 80 - *SGVFS197678* Penalty and others are payments from interest and surcharge for past due accounts. This also includes reversal of liabilities pertain to long-outstanding accounts payable - contractors which will not be settled anymore by the Group as assessed by management and sale of merchandise and other assets. Interest and other financing charges consist of: 2024 2023 2022 Interest incurred on: Notes payable (Note 21) P =8,003,863,160 P=7,714,456,144 P=7,279,838,507 Bank loans and loans payable (Note 20) 4,462,215,186 3,673,313,320 3,197,461,584 Lease liabilities (Note 28) 384,136,961 376,611,498 373,231,355 Other bank charges 16,590,290 25,601,894 13,884,241 12,866,805,597 11,789,982,856 10,864,415,687 Amounts capitalized (Notes 12 and 14) (3,039,912,506) (6,104,343,199) (5,646,528,612) P =9,826,893,091 P=5,685,639,657 P=5,217,887,075 26. Retirement Plan The Group has noncontributory defined benefit pension plan covering substantially all of its regular employees. The benefits are based on current salaries and years of service and related compensation on the last year of employment. The retirement benefit is the only long-term employee benefit. The principal actuarial assumptions used to determine the pension benefits with respect to the discount rate, salary increases and return on plan assets were based on historical and projected normal rates. The components of pension expense follow: 2024 2023 2022 Current service cost P =49,145,844 P=44,116,935 P=50,647,447 Interest income - net (17,935,343) (23,468,994) (13,030,904) Total pension expense P =31,210,501 P=20,647,941 P=37,616,543 Pension expense is included in “Salaries, wages and employee benefits” under Operating expenses in the consolidated statements of comprehensive income. Funded status and amounts recognized in the consolidated statements of financial position for the pension plan follow: 2024 2023 2022 Plan assets P =901,704,182 P=846,824,610 P=784,930,802 Defined benefit obligation (579,319,172) (556,065,553) (464,219,113) Pension assets recognized in the consolidated statements of financial position P =322,385,010 P=290,759,057 P=320,711,689 Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 81 - *SGVFS197678* Changes in the combined present value of the combined defined benefit obligation are as follows: 2024 2023 2022 Balance at beginning of year P =556,065,553 P=464,219,113 P=489,729,931 Current service cost 49,145,844 44,116,935 50,647,447 Interest cost 33,600,152 33,644,325 25,331,175 Actuarial losses (gains) due to: Changes in financial assumptions 5,593,767 80,003,772 (157,805,840) Experience adjustments (60,892,093) (65,918,592) 61,294,656 Net acquired (transferred) obligation from employee transfers (117,051) ‒ 17,092,500 Benefits paid from retirement fund − ‒ (17,092,500) Benefits paid from Company operating funds (4,077,000) ‒ (4,978,256) Balance at end of year P =579,319,172 P=556,065,553 P=464,219,113 Changes in the fair value of the combined plan assets are as follows: 2024 2023 2022 Balance at beginning of year P =846,824,610 P=784,930,802 P=772,695,349 Interest income included in net interest cost 51,535,495 57,113,319 38,362,079 Contributions − 16,020,000 61,374,100 Actual gains (losses) on return of plan assets excluding amount included in net interest cost 3,848,494 (11,239,511) (70,408,226) Net transferred asset from employee transfers (504,417) − − Benefits paid from retirement fund − ‒ (17,092,500) Balance at end of year P =901,704,182 P=846,824,610 P=784,930,802 The movements in the combined net pension assets follow: 2024 2023 2022 Balance at beginning of year (P =290,759,057) (P=320,711,689) (P=282,965,418) Total amount recognized in OCI (59,146,820) 25,324,691 (26,102,958) Pension expense 31,210,501 20,647,941 37,616,543 Contributions − (16,020,000) (61,374,100) Net acquired (transferred) obligation from employee transfers (117,051) ‒ 17,092,500 Net transferred asset from employee transfers 504,417 Benefits paid from Company operating funds (4,077,000) ‒ (4,978,256) Balance at end of year (P =322,385,010) (P=290,759,057) (P=320,711,689) Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 82 - *SGVFS197678* The assumptions used to determine the pension benefits for the Group are as follows: 2024 2023 2022 Discount rates 6.08% 6.16% 7.36% Salary increase rate 7.71% 7.71% 7.71% The turn-over rate used to compute the retirement liability is ranging from 10% at age 18 to 0% at age 60 in 2024 and 2023. The distribution of the plan assets at year-end follows: 2024 2023 2022 Assets Cash and cash equivalents P =404,248,215 P=387,498,745 P=237,191,029 Investments in private companies 432,771,241 433,277,019 290,603,290 Investments in government securities 64,252,860 20,066,562 253,216,893 Receivables 3,736,222 7,616,835 5,053,057 905,008,538 848,459,161 786,064,269 Liabilities Trust fee payables 2,157,281 1,369,687 991,625 Other payable 147,075 264,864 141,842 2,304,356 1,634,551 1,133,467 Net plan assets P =901,704,184 P=846,824,610 P=784,930,802 The carrying amounts disclosed above reasonably approximate fair value at reporting date. The overall expected rate of return on assets is determined based on the market prices prevailing on that date, applicable to the period over which the obligation is to be settled. The net unrealized gains (losses) on investments in government securities amounted to P=0.15 million, P =1.27 million and (P =4.43 million) in 2024, 2023 and 2022, respectively. The Group expects to contribute to its retirement fund the amount of P =23.31 million in 2025. The composition of the fair value of the Fund includes: Cash and cash equivalents - include savings and time deposit with various banks and special deposit account. Investments in private companies - include investments in long-term debt notes and corporate bonds. Investments in government securities - include investment in Philippine RTBs. Receivables - includes interest and dividends receivable generated from investments included in the plan. Trust fee payable - pertain mainly to charges of trust or in the management of the plan. The Group retirement benefit fund is in the form of a trust being maintained by a trustee bank. The fund includes investment in the form of fixed-rate peso retail bonds issued by the Parent Company due in 2024 up to 2027 with interest rates ranging from 6.23% and 7.54% as of December 31, 2024, 5.75% and 7.54% as of December 31, 2023 and due in 2027 with interest rates of 6.23% as of December 31, 2022. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 83 - *SGVFS197678* As of December 31, 2024, 2023 and 2022, the fair value of investment amounted to P =64.25 million, P=20.07 million and P =253.52 million, respectively. Interest income earned from the investments in bonds amounted to P =32.04 million, P =20.48 million and P =11.01 million in 2024, 2023 and 2022, respectively. The allocation of the fair value of plan assets follows: 2024 2023 Deposits 44.92% 46.57% Corporate bonds 47.94% 51.07% Government bonds 7.14% 2.37% The funds are administered by a trustee bank under the supervision of the Board of Directors of the plan. The Board of Directors is responsible for investment of the assets. It defines the investment strategy as often as necessary, at least annually, especially in the case of significant market developments or changes to the structure of the plan participants. When defining the investment strategy, it takes account of the plans’ objectives, benefit obligations and risk capacity. Shown below is the maturity analysis of the undiscounted benefit payments: Plan Year 2024 2023 Less than 1 year P =22,112,000 P=19,641,690 More than 1 year to 5 years 113,810,690 76,083,843 More than 5 years to 10 years 253,654,992 267,396,985 More than 10 years to 15 years 378,106,462 425,061,897 More than 15 years to 20 years 655,730,602 579,781,505 20 years and beyond 3,561,539,768 4,295,622,378 P =4,984,954,514 P=5,663,588,298 The average duration of the expected benefit payments at the end of the reporting period is 19.98 years and 22.48 years as of December 31, 2024 and 2023, respectively. Sensitivity analysis on the actuarial assumptions Each sensitivity analysis on the significant actuarial assumptions was prepared by remeasuring the Defined Benefit Obligation (DBO) at the reporting date after adjusting one of the current assumptions according to the applicable sensitivity increment or decrement (based on changes in the relevant assumption that were reasonably possible at the valuation date) while all other assumptions remained unchanged. The sensitivities were expressed as the corresponding change in the DBO. It should be noted that the changes assumed to be reasonably possible at the valuation date are open to subjectivity, and do not consider more complex scenarios in which changes other than those assumed may be deemed to be more reasonable. Rates Increase (decrease) on Defined Benefit Obligation 2024 2023 Discount rate +1% (P =70,966,556) (P=68,748,206) -1% 86,017,350 83,422,482 Salary rate +1% 86,555,099 83,938,460 -1% (72,755,253) (70,464,445) Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 84 - *SGVFS197678* Each year, an Asset-Liability Matching Study (ALM) is performed with the result being analyzed in terms of risk-and-return profiles with mandate of management. Union Bank’s (UB) current strategic investment strategy consists of 44.61% of cash, 7.11% of investments in government securities, 47.87% of investment in private companies and 0.41% receivables. 27. Income Tax Provision for income tax consists of: 2024 2023 2022 Current: RCIT/MCIT P =884,948,345 P=1,215,597,333 P=964,402,594 Final 33,223,880 25,771,954 1,581,268 Deferred 1,360,844,724 2,077,276,945 1,055,130,245 P =2,279,017,408 P=3,318,646,232 P=2,021,114,107 The components of the Group’s deferred taxes are as follows: Net deferred tax assets: 2024 2023 Deferred tax assets on: Excess of tax basis over book basis of deferred gross profit on real estate sales P =3,851,839 P=118,684,072 Accrual of retirement costs, net of contributions 3,515,035 9,403,409 NOLCO − 2,621,620 Allowance for impairment losses 35,800 2,066,978 Unamortized discount on receivables − 172,352 MCIT − 861,842 7,402,674 133,810,273 Deferred tax liabilities on: Capitalized borrowing costs − 17,954,036 Remeasurement gain on defined benefit obligation 1,254,301 10,146,564 1,254,301 28,100,600 P =6,148,373 P=105,709,673 Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 85 - *SGVFS197678* Net deferred tax liabilities: 2024 2023 Deferred tax assets on: Lease liabilities P =1,359,012,028 P=1,360,055,011 Allowance for impairment losses 461,034,508 386,030,383 NOLCO 226,939,136 185,999,506 Accrual of retirement costs 91,124,329 86,798,230 MCIT 27,527,704 18,995,273 Unamortized discount on receivables − 9,922,888 Excess of tax basis over book basis of deferred gross profit on real estate sales 63,084,930 1,796,043 2,214,515,343 2,049,597,334 Deferred tax liabilities on: Straight line lease adjustment on rent income 7,113,251,979 5,456,844,483 Excess of book basis over tax basis of deferred gross profit on real estate sales 8,424,762,534 2,068,101,111 Capitalized borrowing costs 950,289,309 1,054,172,802 Right-of-use assets 996,981,166 1,041,067,749 Difference in tax basis of depreciation expense − 460,289,100 Remeasurement gain on defined benefit obligation 167,637,102 158,744,839 Fair value adjustments from business combination 9,841,339 11,809,607 17,648,737,858 10,251,029,691 (P =15,434,222,515)(P=8,201,432,357) Out of the P =7,332.35 million movement in net deferred tax liabilities, P =5,956.72 was recognized as a result of the adoption of PIC Q&A 2018-12 - D and E and IFRIC agenda decision on overtime transfer of constructed goods (see Note 3) and P =14.79 million was booked as movement in OCI in 2024. Out of the P =2,099.80 million movement in net deferred tax liabilities, P =22.52 million was booked as movement in OCI in 2023. Out of the P =1,061.66 million movement in net deferred tax liabilities, P =6.53 million was booked as movement in OCI in 2022. The Group has deductible temporary differences, NOLCO and MCIT that are available for offset against future taxable income for which no deferred tax assets have been recognized, as follows: 2024 2023 2022 NOLCO P =21,308,671,723P=15,763,953,343 P=11,250,881,066 MCIT 4,883,631 3,263,811 3,686,409 The related unrecognized deferred tax assets on these deductible temporary differences, NOLCO and MCIT amounted to P =5,332.05 million, P =3,944.25 million and P =2,816.41 million as of December 31, 2024, 2023 and 2022, respectively. These are mostly coming from holding companies namely, VLL, CPI and hotel entities. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 86 - *SGVFS197678* Deferred tax assets are recognized only to the extent that taxable income will be available against which the deferred tax assets can be used. The subsidiaries recognize a previously unrecognized deferred tax asset to the extent that it has become probable that future taxable income will allow the deferred tax asset to be recovered. NOLCO On September 30, 2020, the BIR issued Revenue Regulations No. 25-2020 implementing Section 4(bbbb) of “Bayanihan to Recover As One Act” which states that the NOLCO incurred for taxable years 2020 and 2021 can be carried over and claimed as a deduction from gross income for the next five (5) consecutive taxable years immediately following the year of such loss. As of December 31, 2024 and 2023, the entities within the Group has incurred NOLCO before and after taxable years 2021 and 2022 which can be claimed as deduction from the regular taxable income for the next three (3) consecutive taxable years, as follows: Inception Year Amount Used/Expired Balance Expiry Year 2024 P=5,747,525,820 P=− P=5,747,525,820 2027 2023 4,546,111,658 − 4,546,111,658 2026 2022 3,749,376,576 (13,865,381) 3,735,511,195 2025 P=14,043,014,054 (P=13,865,381) P=14,029,148,673 As of December 31, 2024 and 2023, the entities within the Group has incurred NOLCO in taxable years 2022 and 2021 which can be claimed as deduction from the regular taxable income for the next five (5) consecutive taxable years pursuant to the Bayanihan to Recover As One Act, as follows: Inception Year Amount Used/Expired Balance Expiry Year 2021 P=3,291,945,263 (P=159,622,041) P=3,132,323,222 2026 2020 5,316,791,764 (261,835,391) 5,054,956,373 2025 P=8,608,737,027 (P=421,457,432) P=8,187,279,595 MCIT Inception Year Amount Used/Expired Balance Expiry Year 2024 P=14,349,849 P=− P=14,349,849 2027 2023 13,811,331 − 13,811,331 2026 2022 5,761,382 (1,511,227) 4,250,155 2025 2021 5,854,783 (5,854,783) − 2024 P=39,777,358 (P=7,366,010) P=32,411,335 Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 87 - *SGVFS197678* The reconciliation of the provision for income tax computed at the statutory income tax rate to the provision for income tax shown in profit or loss follows: 2024 2023 2022 Provision for income tax computed at the statutory income tax rate 25.00% 25.00% 25.00% Additions to (reductions in) income tax resulting from: Change in unrecognized deferred tax assets 11.90 8.28 (12.13) Nondeductible interest and other expenses 2.03 0.79 9.97 Expired MCIT and NOLCO 0.02 0.01 7.71 Interest income already subjected to final tax (0.04) (0.07) (0.01) Tax-exempt income on BOI- Projects (3.28) (1.36) (1.92) Tax-exempt interest income (4.44) (1.94) (2.58) Tax-exempt income on REIT (6.38) (3.65) (1.86) Others (5.24) (2.68) (2.71) Provision for income tax 19.57% 24.38% 21.47% Board of Investments (BOI) Incentives The BOI issued in favor of certain subsidiaries in the Group a Certificate of Registration as Developer of Mass Housing Projects for its 22 projects in 2024 and 44 projects in 2023 and 2022, in accordance with the Omnibus Investment Code of 1987. Pursuant thereto, the projects have been granted an Income Tax Holiday for a period of either three years for new projects, or four years for expansion projects, commencing from the date of issuance of the Certificate of Registration. 28. Lease Liabilities The Group, as lessee, has lease contracts for parcels of land where its commercial centers are situated with lease terms of 11 - 30 years. Rental due is based on prevailing market conditions. Generally, the Group is not restricted from assigning and subleasing the leased assets. There are several lease contracts that include extension and termination options, which are further discussed below. The following are the amounts recognized in consolidated statements of comprehensive income: 2024 2023 Depreciation expense of right-of-use assets included in investment properties (Note 14) P =205,622,913 P=209,216,860 Interest expense on lease liabilities 384,136,961 376,611,498 Expenses relating to short-term leases (included in operating expenses) 71,909,145 61,976,408 Total amount recognized in statement of comprehensive income P =661,669,019 P=647,804,766 Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 88 - *SGVFS197678* The rollforward analysis of lease liabilities follows: 2024 2023 Balances at beginning of year P =5,440,220,042 P=5,434,053,003 Interest expense (Note 25) 384,136,961 376,611,498 Payments (388,308,890) (370,444,459) Balances at end of year 5,436,048,113 5,440,220,042 Less current portion 421,351,896 388,872,997 Noncurrent portion P =5,014,696,216 P=5,051,347,045 The Group has no lease contract that contains variable payments. The Group’s fixed payments amounted to P =460.22 million, P =432.42 million and P =390.16 million in 2024, 2023 and 2022, respectively. The Group’s lease contracts include extension and termination options. These options are negotiated by management to provide flexibility in managing the leased-asset portfolio and align with the Group’s business needs. Management exercises significant judgement in determining whether these extension and termination options are reasonably certain to be exercised (see Note 5). Shown below is the maturity analysis of the undiscounted lease payments: 2024 2023 Within 1 year P =421,351,897 P=388,872,997 More than 1 year to 2 years 447,869,237 417,661,646 More than 2 years to 3 years 470,991,053 444,031,726 More than 3 years to 4 years 498,240,963 470,682,075 More than 4 years to 5 years 526,269,387 498,240,963 More than 5 years 7,824,370,367 8,350,639,754 P =10,189,092,904 P=10,570,129,161 29. Related Party Transactions Parties are considered to be related if one party has the ability, directly or indirectly, to control the other party in making financial and operating decisions or the parties are subject to common control or common significant influence. Entities under common control are those entities outside the Group but are related parties of Fine Properties, Inc. Related parties may be individuals or corporate entities. All publicly listed and certain member companies of the Group have Material Related Party Transactions Policies containing the approval requirements and limits on amounts and extent of related party transactions in compliance with the requirement under Revised SRC Rule 68 and SEC Memorandum Circular 10, series 2019. The Parent Company has an approval requirement such that material related party transaction (RPT) shall be reviewed by the Risk Management Committee (the Committee) and endorsed to the BOD for approval. Material RPTs are those transactions that meet the threshold value as approved by the Committee amounting to 10% or higher of the Group’s total consolidated assets based on its latest audited financial statements. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 89 - *SGVFS197678* The Group in their regular conduct of business has entered into transactions with related parties principally consisting of trade transactions from mall leasing, advances, reimbursement of expenses, provision of construction materials and purchase and sale of real estate properties. Except as otherwise indicated, the outstanding accounts with related parties shall be settled in cash. The transactions are made at terms and prices agreed upon by the parties. The Group has not recognized any impairment losses on amounts receivables from related parties for the years ended December 31, 2024, 2023 and 2022. This assessment is undertaken each financial year through a review of the financial position and operating cash flows of the related party and the market in which the related party operates. The consolidated statements of financial position include the following amounts resulting from the foregoing transactions which represent amounts receivable from (payable to) related parties as of December 31, 2024, 2023 and 2022: 2024 Relationship Nature of Transaction Net Amount/ Volume Outstanding Balance Terms Conditions Rental receivable (Note 11) Entities under Common Control a) Rental of mall spaces P =14,148,652,391 P =41,301,261,464 Noninterest-bearing Certain receivables with letter of financial support from Fine Properties Inc., No impairment Ultimate Parent a) Rental of office spaces 1,240,221 8,208,152 Noninterest-bearing Unsecured, No impairment P =41,309,469,616 Receivables from related parties (Note 11) Entities under common control a) Advances P =1,832,102,342 P =5,050,542,342 Noninterest-bearing With letter of financial support from Fine Properties Inc., No impairment Advances to a related party Ultimate Parent b) Joint venture advances (P =1,302,540,520) P =6,256,899,720 Noninterest-bearing Unsecured, No impairment Advances in project development cost (Note 16) Ultimate Parent b) Joint venture advances P =‒ P =91,646,033 Noninterest-bearing Unsecured, No impairment Entities under Common Control b) Purchase and return of advances for housing credits 673,238,871 1,202,693,199 Noninterest-bearing Unsecured, No impairment P =1,294,339,232 Lease liabilities (Note 28) Ultimate Parent c) Rental of parcels of land P =116,394,361 (P =267,935,817) Interest-bearing Unsecured Interest expense (Note 28) Ultimate Parent c) Rental of parcels of land P =28,083,722 P =− Interest-bearing Unsecured Dividends Declared/Payable Stockholders d) Dividends P =282,076,480 P =476,520,540 Advances to (Note 11) Entities under Common Control f) Advances (P =118,440,000) P =1,071,743,022 Noninterest-bearing Unsecured, No impairment 2023 Relationship Nature of Transaction Net Amount/ Volume Outstanding Balance Terms Conditions Rental receivable (Note 11) Entities under Common Control a) Rental of mall spaces P=13,875,780,592 P =30,808,295,526 Noninterest-bearing Certain receivables with letter of financial support from Fine Properties Inc., No impairment a) Offset of rental receivable against accounts payable 1,109,037,213 ‒ ‒ ‒ Ultimate Parent a) Rental of office spaces 2,287,033 6,967,931 Noninterest-bearing Unsecured, No impairment P=30,815,263,457 Receivables from related parties (Note 11) Entities under common control a) Advances P=3,218,440,000 P=3,218,440,000 Noninterest-bearing With letter of financial support from Fine Properties Inc., No impairment Advances to a related party Ultimate Parent b) Joint venture advances P=517,163,906 P=7,559,440,240 Noninterest-bearing Unsecured, No impairment Advances in project development cost (Note 16) Ultimate Parent b) Joint venture advances P=‒ P=91,646,033 Noninterest-bearing Unsecured, No impairment Entities under Common Control b) Purchase and return of advances for housing credits 123,414,601 529,454,328 Noninterest-bearing Unsecured, No impairment P=621,100,361 Lease liabilities (Note 28) Ultimate Parent c) Rental of parcels of land (P =4,439,189) (P =384,330,178) Interest-bearing Unsecured Interest expense (Note 28) Ultimate Parent c) Rental of parcels of land P=39,914,589 P=‒ Interest-bearing Unsecured (Forward) Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 90 - *SGVFS197678* 2023 Relationship Nature of Transaction Net Amount/ Volume Outstanding Balance Terms Conditions Dividends Declared/Payable Stockholders d) Dividends P=740,652,549 P=194,444,060 Advances to (Note 11) Entities under Common Control f) Advances P=1,190,183,022 P=1,190,183,022 Noninterest-bearing Unsecured, No impairment 2022 Relationship Nature of Transaction Net Amount/ Volume Outstanding Balance Terms Conditions Rental receivable (Note 11) Entities under Common Control a) Rental of mall spaces P=11,708,398,391 P =25,554,113,420 Noninterest-bearing Certain receivables with letter of financial support from Fine Properties Inc., No impairment a) Offsetting of rental receivable against account payable 2,285,635,829 ‒ ‒ ‒ Ultimate Parent a) Rental of office spaces 69,960 3,577,888 Noninterest-bearing Unsecured, No impairment P=25,557,691,308 Advances to a related party Ultimate Parent b) Joint venture advances P=957,087,103 P=7,042,276,334 Noninterest-bearing Unsecured, No impairment e) Assignment of investment properties 1,690,504,480 − Advances in project development cost (Note 16) Ultimate Parent b) Joint venture advances P=− P=91,646,033 Noninterest-bearing Unsecured, No impairment Entities under Common Control b) Purchase and return of advances for housing credits 7,605,814 406,039,727 Noninterest-bearing Unsecured, No impairment P=7,605,814 P=497,685,760 Lease liabilities (Note 28) Ultimate Parent c) Rental of parcels of land (P =23,795,634) (P =379,890,989) Interest-bearing Unsecured Interest expense (Note 28) Ultimate Parent c) Rental of parcels of land P=39,379,722 P=− Interest-bearing Unsecured Dividends Declared/Payable Stockholders d) Dividends P=348,362,314 P=96,024,581 a) The Vista Land Group has operating lease agreements with entities under common control for the leases of commercial centers. The lease agreements are renewable and contain escalation clauses and terms range from 2 to 25 years. Rental income and receivables including the effect of straight-line calculation from related parties amounted to P =14,148.65 million and P =41,301.26 million, respectively, as of December 31, 2024, P =13,875.78 million and P=30,808.30 million, respectively, as of December 31, 2023, P =11,708.40 million and P=25,554.11 million, respectively, as of December 31, 2022. These receivables from related parties which are recognized as ‘Rental receivable’ under ‘Receivables’ are not impaired (see Note 11). Included in the related party tenants are AllHome Corp., AllDay Marts, Inc., All Day Retail Concepts, Inc., Family Shoppers Unlimited, Inc., CM Star Management, Inc., and The Village Server, Inc. which are subsidiaries of AllValue Holdings Corp. (collectively referred to as AllValue Group or Anchor Tenant). AllValue Group is engaged in retail businesses covering supermarkets, retail of apparel, construction materials and home/building appliances and furnishings. The lease agreements contain escalation clauses. Rental income and receivables from AllValue Group including the effect of future lease rate escalation amounted to P =12,674.54 million and P =38,645.51 million, respectively as of December 31, 2024, P =12,394.34 million and P =27,699.90 million, respectively, as of December 31, 2023 and P =10,257.59 million and P =23,101.10 million, respectively, as of December 31, 2022. These receivables from All Value Group which are recognized as ‘Rental receivable’ under ‘Receivables’ are not impaired (see Note 11). Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 91 - *SGVFS197678* Rental income and receivables from AllValue Group without the effect of future escalation amounted to P =5,940.04 million and P =11,188.56 million, respectively, as of December 31, 2024, P=5,702.43 million and P =6,780.33 million, respectively, as of December 31, 2023 and P=5,026.22 million and P =6,908.74 million, respectively, as of December 31, 2022. These receivables from All Value Group which are recognized as ‘Rental receivables” under ‘Receivables’ are noninterest-bearing and are not impaired (see Note 11). As of December 31, 2024 and 2023, the related parties with outstanding rent receivables including the effect of future escalation amounting to P =46,351.80 million and P =34,026.74 million were provided with financial support letter by Fine Properties, Inc. and these rent receivables including the effect of future escalation are include in “Rental receivable” and “Receivables from related parties” account under “Receivables” line item in the statements of financial position (see Note 11). As discussed in Note 7, due to the fire that damaged Star Mall Alabang, certain related party tenants which are entities under common control pre-terminated its lease contracts resulting to the reversal of rental receivable from straight-lining of rental income amounting to P =377.77 million which was charged against rental income for the year ended December 31, 2022. In January 2022, the Vista Land Group amended certain lease contracts with Family Shoppers Unlimited, Inc. and Parallax, Inc. resulting to increase in rental income and rental receivables by P=5,435.40 million. The amendments of the lease contracts are as follows: a. Extension of lease term commencing from the lease modification date; and b. From variable rent to annual fixed rent based on rate with annual escalation. The Ultimate Parent Company also has lease agreements with the Vista Land Group for the lease of its office spaces. The rental due is based on prevailing market conditions. Various related party tenants under AllValue Holdings Corp. (AVHC) (Assignors) assigned their rental payables to AVHC (Assignee), being its parent company. In March 2023, June 2023, September 2023 and March 2024, Deeds of Assignment were entered among (1) the Vista Land Group as lessor; (2) various related party tenants under AllValue Holdings Corp. (AVHC) (Assignors) and (3) AVHC (Assignee), for the Assignors to assign, transfer and convey to AVHC as the Assignee, all the Assignors’ rental payables to Vista Land Group aggregating to P=7,811.66 million. Consequently within 2023 and 2024, parcels of land valued at P =1,886.64 million and P=874.36 million, respectively, were transferred by AVHC to the Vista Land Group as a form of settlement of the assigned receivable and these were recorded under “Investment properties” in the consolidated statement of financial position (see Note 12). As of December 31, 2024 and 2023, the remaining P =5,050.54 million and P =3,218.44 million, respectively, are expected to be settled through cash, land properties or combination of both (see Notes 11, 14 and 36). In 2023 and 2022 (nil in 2024), the Group entered into a land development agreement with a third-party contractor valued at P =1,109.04 million and P =2,285.64 million, respectively, to which the Group incurred a liability of the same amount. On the same date, the Group as lessor, the third-party contractor and certain related party tenants entered into an arrangement wherein the Group’s payable to the third-party contractor was offset against certain rental receivables from All Value Group for the same amount. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 92 - *SGVFS197678* b) On December 23, 2017, the Group entered into a Memorandum of Agreement (MOA) with Bria Homes, Inc. (Bria), an entity under common control, a developer of socialized housing projects located in various areas in the Philippines, to assign portions of the socialized housing projects to various entities in the Group in compliance with the requirements of Republic Act No. 7279 (Urban Development and Housing Act of 1992). On November 23, 2018, the Group entered into another MOA with Bria to include vertical residential projects in the assignment of socialized housing projects. As such, the Group makes cash advances to Bria Homes, Inc. for the construction of socialized housing units which are recorded under project development costs (see Note 16). On December 23, 2019, another MOA was executed with Bria to specify the details of the housing credits to be delivered by Bria equivalent to the advances provided by VLL. On December 21, 2020, the Group executed an amendment updating the number of housing credit that Bria will deliver to the Group to settle its outstanding balance. As of December 31, 2024, 2023 and 2022, the related project development costs amounted to P =1,202.69 million, P=529.45 million and P =406.04 million, respectively. In 2021, CAPI, VMI and various other VLLI subsidiaries executed a Deed of Assignment of Advances (DOA) to Fine Properties, Inc., ultimate parent, totaling P =5.75 billion after deducting the partial delivery of social housing credits and cash payments in 2020 which was consolidated to Brittany Corporation (BC). The DOA effectively consolidates all receivables from Fine Properties, Inc. to BC while BC recognizes payable to the respective entities within VLLI group. These intercompany transactions between VLLI subsidiaries were eliminated at consolidated level. Furthermore, BC and Fine Properties, Inc. entered into a Land Development Agreement (LDA) to develop 159,208 square meters in Molino, Bacoor, Cavite to be developed into mixed- use residential and commercial subdivisions over a 15-year period. Fine Properties, Inc. will contribute land while the contribution of BC will be the planning, conceptualization, design, construction and financing of the Project. Both parties agreed to share the saleable lots into sharing of 60% for Fine Properties, Inc. and 40% for BC. The intention of the parties is for Fine Properties, Inc. to settle the resulting advances by BC of P =5.75 billion in addition to the existing advances to Fine Properties, Inc. of P =340.00 million totaling to P =6.09 billion, from its share of the saleable lots in the LDA. The expected settlement will start upon completion of land development but shall in no case be earlier than 36 months from execution of the agreement dated December 17, 2021. In December 2023, the start of completion of land development was extended to December 17, 2026. As of December 31, 2024, 2023 and 2022, the Group’s advances to Fine Properties, Inc. amounted to P =6,256.90 million, P =7,559.44 million and P =7,042.28 million, respectively. HDC also entered into a joint venture agreement with Fine Properties, Inc. for the development of real estate projects and the related project development costs amounted to P =91.65 million as of December 31, 2024, 2023 and 2022. c) The Group entered into lease agreements with Fine Properties, Inc. pertaining to parcels of land wherein the Group’s commercial centers are situated. These leases have terms of 25 years, with rental escalation clauses and renewal options. d) Details of dividends declared to stockholders of the Parent Company are discussed in Note 23. e) In 2022, BC assigned, transferred and conveyed all of its rights and interest on the land located in Dasmarinas, Cavite valued at P =1,690.50 million to Fine Properties, Inc. Thereafter, Fine Properties, Inc. shall assume BC’s remaining obligation to the landowner. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 93 - *SGVFS197678* f) The Group in its regular conduct of business has entered into noninterest-bearing transactions with a related party principally consisting of noninterest-bearing advances for working capital requirements. As of December 31, 2024 and 2023, the advances to an entity under common control amounted to P =1,071.74 million and P =1,190.18 million, respectively, and this was included under “Advances to private companies” account under “Receivables” in the consolidated statements of financial position (see Note 11). g) The Group has various notes payable in which the Parent Company and its subsidiaries acted as guarantors, irrevocably and unconditionally, including Vista Land & Lifescapes, Inc., Brittany Corporation, Camella Homes, Inc., Crown Asia Properties, Inc., Communities Philippines, Inc., Vistamalls, Inc. (formerly Starmalls, Inc.) and Vista Residences Inc. No fees are charged for these guarantee agreements. Refer to Note 21 for further details. As of December 31, 2024, 2023 and 2022, the retirement plan asset includes investment in fixed-rate peso retail bonds of the Parent Company with fair value amounting to P =62.52 million, P=20.07 million and P =253.52 million, respectively., respectively (see Note 26). The compensation of key management personnel by benefit type follows: 2024 2023 2022 Short-term employee benefits P =142,366,240 P=148,364,826 P=114,661,755 Post-employment benefits 14,291,777 27,464,871 24,928,030 P =156,658,016 P=175,829,697 P=139,589,785 30. Earnings Per Share and Noncontrolling Interest The following table presents information necessary to compute the EPS: 2024 2023 2022 Net income attributable to equity holders of Parent P =7,653,265,137 P=8,656,053,138 P=6,119,908,898 Less: Dividends for preferred shares 587,930 − − 7,652,677,209 − − Weighted average common shares* 11,945,799,461 11,945,799,461 11,945,799,461 Basic/Diluted Earnings per share P =0.641 P=0.725 P=0.512 *Weighted average common shares consider the effect of treasury shares The basic and dilutive earnings per share are the same due to the absence of potentially dilutive common shares for the years ended December 31, 2024, 2023 and 2022. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 94 - *SGVFS197678* The summarized financial information for which there are noncontrolling interests, are provided below. The information is based on amounts before inter-company eliminations. VistaREIT, Inc. (VistaREIT) 2024 2023 2022 (Amounts in millions) Assets P =33,618 P=29,003 P=27,519 Liabilities 2,535 1,493 1,355 Equity 31,082 27,510 26,164 Total comprehensive income (loss)* 4,983 2,526 (9,618) Attributable to: Equity holders of VistaREIT 1,318 1,284 1,033 Noncontrolling-interest 721 703 546 *This includes the increase (decrease) in fair value of investment properties carried at fair value in the financial statements of VistaREIT amounting to P=2,943.94 million, P=539.54 million and (P=11,187.19 million) in 2024, 2023 and 2022, respectively. The net income from VistaREIT amounted to P=2,038.69 million, P=1,986.95 million and P=1,578.90 million, excluding the change in fair value of its investment properties, for the years ended December 31, 2024, 2023 and 2022, respectively. **Total comprehensive income attributable to equity holders of VistaREIT amounted to P=120,914 for the year ended December 31, 2021. Vistamalls, Inc. and Subsidiaries (VMI&S) 2024 2023 2022 (Amounts in millions) Assets P =110,136 P=99,274 P=91,519 Liabilities 58,774 54,399 54,917 Equity 51,362 44,875 36,602 Total comprehensive income 6,795 8,531 6,972 Attributable to: Equity holders of VMI&S 5,801 7,598 6,243 Noncontrolling-interest 994 933 729 As of December 31, 2024, 2023 and 2022, the accumulated balances of and net income attributable to noncontrolling interests follows: 2024 2023 2022 Accumulated balances: Noncontrolling interest share in equity P =10,821,256,666 P=9,637,475,937 P=8,448,577,034 Share in dividend (Note 23) 531,978,401 447,642,154 170,796,898 Net income attributable to noncontrolling interests 1,715,783,741 1,636,012,004 1,272,741,442 Other comprehensive income 564,925 529,053 2,248,632 Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 95 - *SGVFS197678* 31. Fair Value Determination The Group uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique: Level 1: Quoted (unadjusted) prices in active markets for identical assets or liabilities; Level 2: Valuation techniques involving inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly; and Level 3: Other valuation techniques involving inputs for the asset or liability that are not based on observable market data (unobservable inputs). The following methods and assumptions were used to estimate the fair value of each class of financial instrument for which it is practicable to estimate such value: Cash and cash equivalents, short-term cash investments, accrued interest receivable, rental receivables, buyers and HDMF, accounts and other payables (except for deferred output VAT and other statutory payables) and dividends payable: Due to the short-term nature of the accounts, the fair value approximate the carrying amounts in the consolidated statements of financial position. Installment contracts receivable: The fair value of installment contracts receivable due within one year approximates its carrying amount. Noncurrent portion of installment contracts receivable are discounted using the applicable discount rates for similar types of instruments. The discount rates used range 5.56% to 16.00% and 2.43% to 19.00% as of December 31, 2023 and 2022, respectively. As a result of the adoption of PIC Q&A 2018-12 - D on January 1, 2024, the related unamortized discount from installment contracts receivables were fully reversed and significant financing component was recognized as part of interest income from real estate sales using discount rates ranging from 0.41% to 9.06% (see Note 11). Investments at FVOCI: Fair values of equity securities are based on quoted market prices. Investments at amortized cost: The fair value of these listed bonds is determined by reference to quoted market bid prices, at the close of business on the reporting date. Bank loans, loans payable, notes payable, liabilities for purchased land and retention payable: Estimated fair values are based on the discounted value of future cash flows using the applicable rates for similar types of loans. Interest rates used in discounting cash flows ranged from 6.25% to 8.05% in 2024, 6.35% to 7.96% in 2023 and 5.35% to 8.63% in 2022 using the remaining terms to maturity. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 96 - *SGVFS197678* The following table provides the fair value measurement and the hierarchy of the Group’s financial assets and liabilities recognized as of December 31, 2024 and 2023: December 31, 2024 Fair Value Carrying values Total Quoted prices in active markets for identical assets (Level 1) Significant offer observable inputs (Level 2) Significant unobservable inputs (Level 3) Assets Financial assets measured at fair value: Investments at FVOCI P=172,158,380 P=172,158,380 P=160,000,000 P=− P=12,158,380 Financial assets for which fair values are disclosed: Installment contracts receivable 58,950,766,031 58,950,766,031 − − 58,950,766,031 Investments at amortized cost 42,003,990,071 42,003,990,071 42,003,990,071 − − Liabilities Financial liabilities for which fair values are disclosed Bank loans 55,636,123,967 55,636,123,967 − − 55,636,123,967 Notes payable 107,429,793,221 107,429,793,221 − − 107,429,793,221 Loans payable 19,482,654,601 19,482,654,601 − − 19,482,654,601 Liabilities for purchased land 2,312,099,385 2,270,796,318 − − 2,270,796,318 Retention payable 1,653,672,370 1,553,378,202 − − 1,553,378,202 December 31, 2023 Fair Value Carrying values Total Quoted prices in active markets for identical assets (Level 1) Significant offer observable inputs (Level 2) Significant unobservable inputs (Level 3) Assets Financial assets measured at fair value: Investments at FVOCI P=132,158,380 P=132,158,380 P=120,000,000 P=‒ P=12,158,380 Financial assets for which fair values are disclosed: Installment contracts receivable 34,014,787,097 33,283,057,677 ‒ ‒ 33,283,057,677 Investments at amortized cost 39,209,417,229 39,220,370,657 39,220,370,657 ‒ ‒ Liabilities Financial liabilities for which fair values are disclosed Bank loans 53,182,968,195 54,711,204,168 ‒ ‒ 54,711,204,168 Notes payable 108,148,781,639 111,365,653,050 ‒ ‒ 111,365,653,050 Loans payable 7,443,723,350 7,304,007,811 ‒ ‒ 7,304,007,811 Liabilities for purchased land 2,810,279,346 2,583,086,026 ‒ ‒ 2,583,086,026 Retention payable 1,667,347,732 1,567,479,722 ‒ ‒ 1,567,479,722 In 2024 and 2023, there were no transfers between Levels of fair value measurements. Significant increases (decreases) in discount rate would result in significantly higher (lower) fair value of the installment contracts receivable, notes payable, loans payable, bank loans, retention payable and liabilities for purchased land. Description of significant unobservable inputs to valuation follows: Account Valuation Technique Significant Unobservable Inputs Installment contracts receivable Discounted cash flow analysis Discount rate Bank loans Discounted cash flow analysis Discount rate Notes payable Discounted cash flow analysis Discount rate Loans payable Discounted cash flow analysis Discount rate Retention payable Discounted cash flow analysis Discount rate Liabilities for purchased land Discounted cash flow analysis Discount rate Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 97 - *SGVFS197678* 32. Financial Assets and Liabilities Financial Risk Management Objectives and Policies Financial risk The Group’s principal financial liabilities comprise of bank loans, loans payable, notes payable, accounts and other payables (except for deferred output VAT and other statutory payables), liabilities for purchased land and retention payable. The main purpose of the Group’s financial liabilities is to raise financing for the Group’s operations. The Group has various financial assets such as installment contracts receivable, cash and cash equivalents, short-term and long-term cash investments, investments at fair value through other comprehensive income and investments at amortized cost which arise directly from its operations. The main risks arising from the use of financial instruments are interest rate risk, foreign currency risk, credit risk and liquidity risk. The BOD reviews and approves with policies for managing each of these risks. The Group monitors market price risk arising from all financial instruments and regularly report financial management activities and the results of these activities to the BOD. The Group’s risk management policies are summarized below. The exposure to risk and how they arises, as well as the Group’s objectives, policies and processes for managing the risk and the methods used to measure the risk did not change from prior years. Cash flow interest rate risk The Group’s exposure to market risk for changes in interest rates, relates primarily to its financial assets and liabilities that are interest-bearing. The Group’s policy is to manage its interest cost by entering into fixed rate debts. The Group also regularly enters into short-term loans with its installment contracts receivables as collateral to cushion the impact of potential increase in loan interest rates. The table below shows the financial assets and liabilities that are interest-bearing: December 31, 2024 Effective Interest Rate Amount Financial assets Fixed rate Cash and cash equivalents in Philippine Peso (excluding cash on hand) 0.01% to 3.10% P =2,499,129,300 Cash and cash equivalents in US Dollar 0.13% to 3.05% 1,436,879,482 Short-term cash investments − − Investments at amortized cost 1.42% to 7.81% 42,003,990,071 Installment contracts receivable 0.40% to 9.06% 58,815,211,433 P =104,755,210,286 Financial liabilities Fixed rate Notes payable 6.19% to 7.93% P =107,429,793,220 Bank loans 4.75% to 8.25% 55,629,643,158 Loans payable 6.25% to 8.05% 19,482,764,601 Lease liabilities 7.37% to 8.81% 5,436,048,113 P =187,978,249,092 Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 98 - *SGVFS197678* December 31, 2023 Effective Interest Rate Amount Financial assets Fixed rate Cash and cash equivalents in Philippine Peso (excluding cash on hand) 0.01% to 4.25% P=6,124,826,508 Cash and cash equivalents in US Dollar 0.06% to 1.50% 4,552,663,258 Short-term cash investments 1.26% 7,322,177 Investments at amortized cost 0.12% to 10.74% 39,209,417,229 Installment contracts receivable 5.56% to 16.00% 34,274,453,178 P=84,168,682,350 Financial liabilities Fixed rate Notes payable 6.42% to 7.50% P=108,148,781,639 Bank loans 6.42% to 7.50% 53,182,968,195 Loans payable 6.35% to 7.96% 7,443,723,350 Lease liabilities 7.21% to 8.89% 5,440,220,042 P=174,215,693,226 As of December 31, 2024 and 2023, the Group’s leasing income and operating cash flows are substantially independent of changes in market interest rates. Foreign exchange risk The Group’s foreign exchange risk is limited to certain USD denominated cash and cash equivalents, resulting primarily from movements of the Philippine Peso against the United States Dollar (USD). Below is the carrying amount of USD-denominated cash and cash and sensitivity analysis on exchange rate for effect on income before income tax. December 31, 2024 Amount Increase/Decrease in US Dollar rate Effect on income before tax Cash and cash equivalents US$25,306,932 +4.86% P =71,213,859 US$25,306,932 -4.86% (71,213,859) December 31, 2023 Amount Increase/Decrease in US Dollar rate Effect on income before tax Cash and cash equivalents US$600,068 +3.39% P=1,126,353 US$600,068 -3.39% (1,126,353) The functional currency of VII, a wholly owned subsidiary, is USD. VII has cash and cash equivalents, investments at amortized costs, notes payable and bank loans in USD. VII’s financial assets and liabilities are translated into Philippine peso, the presentation currency of the Group, using closing exchange rate prevailing at the reporting date, and the respective income and expenses at the weighted average rates for the period. The exchange differences arising on the translation are recognized in OCI under “Cumulative Translation Adjustments” (CTA). Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 99 - *SGVFS197678* See below for the carrying amounts and sensitivity analysis on other comprehensive income: December 31, 2024 Amount Increase/Decrease in US Dollar rate Effect on Other Comprehensive Income Assets Cash and cash equivalents US$16,560,768 +4.86% P =46,602,100 US$16,560,768 -4.86% (46,602,100) Investments at amortized costs US$688,146,625 +4.86% 1,936,448,733 US$688,146,625 -4.86% (1,936,448,733) Liabilities Notes payable US$870,000,000 +4.86% 2,343,435,313 US$770,526,280 -4.86% (2,343,435,313) Bank loans US$22,400,000 +4.86% 60,336,725 US$22,400,000 -4.86% (60,336,725) December 31, 2023 Amount Increase/Decrease in US Dollar rate Effect on Other Comprehensive Income Assets Cash and cash equivalents US$81,622,494 +3.39% P=153,208,931 US$81,622,494 -3.39% (153,208,931) Investments at amortized costs US$708,134,680 +3.39% 1,329,199,244 US$708,134,680 -3.39% (1,329,199,244) Liabilities Notes payable US$770,526,280 +3.39% (1,446,310,960) US$770,526,280 -3.39% 1,446,310,960 Bank loans US$18,692,777 +3.39% (35,087,146) US$18,692,777 -3.39% 35,087,146 In translating the foreign currency- denominated monetary assets and liabilities in peso amounts, the Philippine Peso - US dollar exchange rates as at December 31, 2024, 2023 and 2022 used were P=57.85 to US$1.00, P =55.37 to US$1.00 and P =55.76 to US$1.00, respectively. The assumed movement in basis points for foreign exchange sensitivity analysis is based on the management’s forecast of the currently observable market environment, showing no material movements as in prior years. Credit Risk Credit risk is the risk that a counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Group is exposed to credit risk from its operating activities (primarily installment contracts receivables and receivables from tenants) and from its investing activities, including deposits with banks and financial institutions. Customer credit risk is managed by each business unit subject to the Group’s established policy, procedures and control relating to customer credit risk management. Credit quality of a customer is assessed based on an extensive credit rating scorecard and individual credit limits are defined in accordance with this assessment. Receivables are regularly monitored. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 100 - *SGVFS197678* In respect of installment contracts receivable from the sale of real estate inventories, credit risk is managed primarily through credit reviews and an analysis of receivables on a continuous basis. The Group also undertakes supplemental credit review procedures for certain installment payment structures. Customer payments are facilitated through various collection modes including the use of postdated checks and auto-debit arrangements. Exposure to credit risk is not significant given that title of the real estate property is only transferred to the customer if the consideration had been fully paid. In case of default, after enforcement activities, the Group has the right to cancel the sale and enter into another contract to sell to another customer after certain proceedings (e.g. grace period, referral to legal, cancellation process, reimbursement of previous payments) had been completed. The Group evaluates the concentration of risk with respect to non-related party trade receivables as low, as its customers are located in several jurisdictions and various income brackets, and operate in largely independent markets. The Group evaluates the concentration of risk with respect to receivable from related parties (see Note 29). This is discussed in Note 6. The related parties have a strong capacity to meet their contractual cash flows and Fine Properties, Inc. has provided financial letter of support to the related party receivables. Credit risk arising from rental receivables - third parties is primarily managed through a screening of tenants based on credit history and financial information submitted. Tenants are required to pay security deposits equivalent to 2 to 4-month lease payment to cover any defaulting amounts and advance rentals also equivalent to 2 to 4-month rent. Credit risk arising from receivables from related parties is minimal as they have a low risk of default and have a strong capacity to meet their contractual cash flows in the near term. Credit risk from balances with banks and financial institutions is managed by the Group’s treasury department in accordance with the Group’s policy. Investments of surplus funds are made only with approved counterparties and within credit limits assigned to each counterparty. Counterparty credit limits are reviewed by the Group’s Board of Directors on an annual basis, and may be updated throughout the year subject to approval of the Group’s Finance Committee. The limits are set to minimize the concentration of risks and therefore mitigate financial loss through a counterparty’s potential failure to make payments. The Group’s maximum exposure to credit risk as of December 31, 2024 and 2023 is equal to the carrying values of its financial assets. As of December 31, 2024 and 2023, the credit quality per class of financial assets is as follows: 2024 Neither Past Due nor Impaired Past due but not Impaired ImpairedHigh Grade Standard Substandard Grade Total Cash and cash equivalents P =3,963,008,782 P =− P =− P =− P =− P =3,963,008,782 Investments at amortized cost 41,991,628,741 − − − 12,361,330 42,003,990,071 Investments at FVOCI 172,158,380 − − − − 172,158,380 Installment contract receivable 55,179,916,773 − − 3,511,183,177 259,666,081 58,950,766,031 Rental receivable 25,597,220,958 − − 17,499,752,218 1,310,542,100 44,407,515,278 Receivables from related parties 5,050,542,342 − − − − 5,050,542,342 Receivable from HDMF 312,478,322 − − − − 312,478,322 Receivable from buyers − − − 85,425,615 135,929,659 221,355,274 Accrued interest receivable 343,754,642 − − − − 343,754,642 Restricted cash 166,064,956 − − − − 166,064,956 P =132,776,773, P =− P =− P =21,096,361,010 P =1,718,499,170 P =155,591,634,076 Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 101 - *SGVFS197678* 2023 Neither Past Due nor Impaired Past due but not Impaired ImpairedHigh Grade Standard Substandard Grade Total Cash and cash equivalents P=10,677,489,766 P=‒ P=‒ P=‒ P=‒ P=10,677,489,766 Short-term cash investments 7,322,177 ‒ ‒ ‒ ‒ 7,322,177 Investments at amortized cost 39,209,417,229 ‒ ‒ ‒ 10,953,428 39,220,370,657 Investments at FVOCI 132,158,380 ‒ ‒ ‒ ‒ 132,158,380 Installment contract receivable 32,559,500,092 ‒ ‒ 1,455,287,005 259,666,081 34,274,453,178 Rental receivable 23,105,336,430 ‒ ‒ 8,453,941,890 1,018,650,310 32,577,928,630 Receivables from related parties 3,218,440,000 ‒ ‒ ‒ ‒ 3,218,440,000 Receivable from HDMF 362,103,100 ‒ ‒ ‒ ‒ 362,103,100 Receivable from buyers ‒ ‒ ‒ 49,039,411 135,929,659 184,969,070 Accrued interest receivable 390,958,484 ‒ ‒ ‒ ‒ 390,958,484 Restricted cash 334,764,859 ‒ ‒ ‒ ‒ 334,764,859 P=109,997,490,517 P=‒ P=‒ P=9,958,268,306 P=1,425,199,478 P=121,380,958,301 The Company’s basis in grading its receivables are as follow: High-grade - pertain to receivables from related parties which based on experience are highly collectible or collectible on demand, and of which exposure to bad debt is not significant. Installment contract receivables under bank-financing, receivable from buyers and receivable from HDMF awaiting for bank and HDMF remittance but has been processed are assessed to be high grade since the accounts have undergone credit evaluation performed by two parties, the Group and the respective bank, thus credit evaluation underwent a more stringent criteria resulting to higher probability of having good quality receivables. High-grade rental receivable and accrued interest receivable are receivables which have a high probability of collection (i.e., the counterparty has the apparent ability to satisfy its obligation and the security on receivables are readily enforceable). Standard - pertain to active accounts with minimal to regular instances of payment default, due to ordinary/common collection issues. These accounts are typically not impaired as the counterparties generally respond to credit actions and update their payments accordingly. Substandard - pertain to receivables that can be collected provided the Group makes persistent effort to collect them. The Group’s investments in unquoted equity securities presented as investments at fair value through other comprehensive income are incidental to its housing projects and are considered by the Group to be of high quality. Cash in banks and cash equivalents and short-term cash investments are deposited/placed in banks that are stable as they qualify either as universal or commercial banks. Universal and commercial banks represent the largest single group, resource-wide, of financial institutions in the country the Group is operating. They offer the widest variety of banking services among financial institutions. These financial assets are classified as high grade due to the counterparties’ low probability of insolvency. As of December 31, 2024 and 2023, the aging analyses of the Company’s receivables are as follow: 2024 Past due but not impaired Impaired TotalCurrent 1 to 30 days 31 to 60 days 61 to 90 days Over 90 days Installment contracts receivable P =55,179,916,774 P =245,402,579 P =104,240,220 P =93,370,082 P =3,068,170,295 P =259,666,081 P =58,950,766,031 Rental receivable 25,597,220,958 994,328,738 284,870,008 1,025,433,174 15,195,120,298 1,310,542,100 44,407,515,278 Receivables from related parties 5,050,542,342 − − − − − 5,050,542,342 Accrued interest receivable 343,754,642 − − − − − 343,754,642 Receivable from HDMF 312,478,322 − − − − − 312,478,322 Receivable from buyers − 30,935,880 1,562,926 2,835,776 50,091,034 135,929,659 221,355,274 Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 102 - *SGVFS197678* 2023 Past due but not impaired Impaired TotalCurrent 1 to 30 days 31 to 60 days 61 to 90 days Over 90 days Installment contracts receivable P=32,559,500,093 P=87,930,497 P=70,157,431 P=49,607,785 P=1,247,591,291 P=259,666,081 P=34,274,453,178 Rental receivable 23,105,336,430 234,158,477 3,753,114 839,167,905 7,376,862,394 1,018,650,310 32,577,928,630 Receivables from related parties 3,218,440,000 ‒ ‒ ‒ ‒ ‒ 3,218,440,000 Accrued interest receivable 390,958,484 ‒ ‒ ‒ ‒ ‒ 390,958,484 Receivable from HDMF 362,103,100 ‒ ‒ ‒ ‒ ‒ 362,103,100 Receivable from buyers ‒ 20,638,399 1,267,963 2,517,239 24,615,810 135,929,659 184,969,070 Current receivables include billed lease receivables and accrued rent receivables which are not yet contractually collectible. Past due but not impaired include lease receivables which are aged 31 to over 90 days but collection is still probable. Impaired receivables are lease receivables from terminated tenants which are less likely to be collected. The Group has collaterals in the form of security deposits and advance rent with respect to billed lease receivables that have been identified as past due but not impaired. Applying the expected credit risk model resulted to recognition of impairment loss of nil from receivables in 2024, 2023 and 2022. Liquidity Risk The Group monitors its cash flow position, debt maturity profile and overall liquidity position in assessing its exposure to liquidity risk. The Group maintains a level of cash deemed sufficient to finance its cash requirements. Operating expenses and working capital requirements are sufficiently funded through cash collections. The Group’s loan maturity profile is regularly reviewed to ensure availability of funding through adequate credit facilities with banks and other financial institutions. The extent and nature of exposures to liquidity risk and how they arise as well as the Group’s objectives, policies and processes for managing the risk and the methods used to measure the risk are the same in 2024 and 2023. Maturity Profile Financial Liabilities The tables below summarize the maturity profile of the Group’s financial liabilities as of December 31, 2024 and 2023 based on undiscounted contractual payments, including interest payable. December 31, 2024 On Demand 1 to 3 Months 3 to 12 Months More than 1 year Total Financial Liabilities Financial liabilities at amortized cost Bank loans P =− P =5,617,361,672 P =12,623,841,654 P =37,507,063,841 P =55,748,267,167 Loans payable 296,976,666 492,774,289 4,896,904,807 13,796,108,839 19,482,764,601 Liabilities for purchased land 15,798,986 357,078,297 1,480,281,309 458,940,797 2,312,099,389 Accounts payable and other payables* 13,123,077,869 5,582,285,958 9,783,884,812 466,463,780 28,955,712,419 Dividends payable 476,520,540 − − − 476,520,540 Notes payable − 1,314,582,200 27,309,432,112 79,259,425,621 107,883,439,933 Lease liabilities − 102,550,791 318,801,105 9,767,741,007 10,189,092,904 Total undiscounted financial liabilities P =13,912,374,061 P =13,466,633,207 P =56,413,145,799 P =141,255,743,885 P =225,047,896,953 *excluding statutory payables and including noncurrent portion of retention payable Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 103 - *SGVFS197678* December 31, 2023 On Demand 1 to 3 Months 3 to 12 Months More than 1 year Total Financial Liabilities Financial liabilities at amortized cost Bank loans P=‒ P=2,882,091,610 P=26,204,695,176 P=29,416,356,779 P=58,503,143,565 Loans payable 168,290,959 1,618,333,271 1,749,927,163 4,424,761,913 7,961,313,306 Liabilities for purchased land 413,948,626 113,909,476 1,217,648,997 1,064,772,247 2,810,279,346 Accounts payable and other payables* 7,554,387,718 3,140,161,802 5,787,121,268 515,046,096 16,996,716,884 Dividends payable 298,016,044 ‒ ‒ ‒ 298,016,044 Notes payable 410,818,667 3,567,425,657 31,434,004,106 91,511,628,317 126,923,876,747 Lease liabilities ‒ 94,773,692 294,099,305 10,181,256,163 10,570,129,160 Total undiscounted financial liabilities P=8,845,462,014 P=11,416,695,508 P=66,687,496,015 P=137,113,821,515 P=224,063,475,052 *excluding statutory payables and including noncurrent portion of retention payable Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 104 - *SGVFS197678* 33. Notes to Consolidated Statements of Cash Flows Details of the movement in cash flows from financing activities follow: Non-cash Change January 1, 2024 Cash flows Debt issue cost Interest and other financing charges (including capitalized borrowing cost) Foreign exchange movement Additions Dividends declared December 31, 2024 Notes payable P=108,148,781,639 (P=2,020,424,934) (P=311,635,807) P=223,737,200 P=1,389,335,122 P=− P=− P=107,429,793,220 Bank loans 53,182,968,195 2,432,004,806 (29,534,666) 50,685,632 − − − 55,636,123,967 Loans payable 7,443,723,350 3,424,862,899 − − − 8,614,178,352 − 19,482,764,601 Lease liabilities 5,440,220,042 (388,308,890) − 384,136,961 − − − 5,436,048,113 Dividends payable 298,016,044 (1,691,428,058) − − − − 1,869,932,554 476,520,540 Accrued interest expense 1,589,407,383 (11,917,664,259) 341,170,473 12,208,245,805 − − − 2,221,159,401 Issuance of shares (net of issuance costs) − 2,945,503,840 − − − − − 2,945,503,840 Total liabilities from financing activities P=176,103,116,653 (P=7,215,454,596) P=− P=12,866,805,598 P=1,389,335,122 P=8,614,178,352 P=1,869,932,554 P=193,627,913,682 Non-cash Change January 1, 2023 Cash flows Debt issue cost Interest and other financing charges (including capitalized borrowing cost) Foreign exchange movement Additions Dividends declared December 31, 2023 Notes payable P=102,448,203,441 P=6,083,325,067 (P=288,335,915) P=202,040,174 (P=296,451,128) P=− P=‒ P=108,148,781,639 Bank loans 55,946,823,117 (2,772,557,227) (34,946,237) 43,648,542 ‒ − ‒ 53,182,968,195 Loans payable 5,334,619,152 2,109,104,198 ‒ ‒ ‒ − ‒ 7,443,723,350 Lease liabilities 5,434,053,003 (370,444,459) ‒ 376,611,498 ‒ − ‒ 5,440,220,042 Dividends payable 96,024,581 (986,303,240) ‒ ‒ ‒ − 1,188,294,703 298,016,044 Accrued interest expense 1,442,359,902 (11,343,917,313) 323,282,152 11,167,682,642 ‒ − ‒ 1,589,407,383 Total liabilities from financing activities P=170,702,083,196 (P=7,280,792,974) P=‒ P=11,789,982,856 (P=296,451,128) P=− P=1,188,294,703 P=176,103,116,653 Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 105 - The Group’s noncash investing and financing activities pertain to the following: a) The Parent Company presented in the consolidated statements of cash flow the availments and payments, net of bank loans that were rolled over during the period (loans against deposit hold- outs) amounting to P =33,956.35 million and P =28,096.54 million in 2024 and 2023; b) Unpaid additions to investment properties amounted to P =625.50 million and P =758.26 million as of December 31, 2024 and 2023, respectively; c) Unpaid additions to property and equipment amounted to P =13.26 million (nil as of 2024) as of December 31, 2023; d) The Group received land with monetary value of P =874.48 million and P =1,886.64 million as payment of receivables for the year ended December 31, 2024 and 2023 and this was recorded as part of investment properties; e) The Group retired and written off its investment properties with carrying value of nil and P=164.65 million for the years ended December 31, 2024 and 2023, respectively; f) The Group written off its property and equipment with carrying value of P =88.92 million for the year ended December 31, 2023 (nil for 2024). g) The Group as lessor, the third-party contractor and certain related party tenants entered into an arrangement wherein the Group’s payable to the third-party contractor was offset against certain rental receivables from All Value Group amounting to P =1,109.04 million in 2023 (nil in 2024). h) The Group exchanged land under real estate inventories to a related party and recognized receivables amounting to P =291.25 million in 2024. i) The Group transferred property and equipment to investment properties amounting to P=342.95 million in 2024. j) Liabilities for purchased land is comprised of unpaid additions to land improvements classified as: 2024 2023 Real estate inventories P =1,719,552,879 P=2,185,650,193 Investment properties 592,546,513 624,629,153 P =2,312,099,392 P=2,810,279,346 34. Lease Commitments The Group as Lessor The Group has entered into non-cancellable property leases on its investment property portfolio, consisting of retail mall spaces and BPO commercial centers which generally provide for either (a) fixed monthly rent, or (b) minimum rent or a certain percentage of gross revenue, whichever is higher. All leases include a clause to enable upward revision of the rental charge on an annual basis based on prevailing market conditions. Future minimum rentals receivable under non-cancellable operating leases as of December 31, 2024 and 2023 follow: 2024 2023 Within 1 year P =8,112,299,570 P=7,326,932,909 More than 1 year to 2 years 8,224,870,753 7,933,609,476 More than 2 years to 3 years 8,008,471,986 8,044,295,751 More than 3 years to 4 years 8,405,380,619 7,888,662,595 More than 4 years to 5 years 8,825,712,504 8,246,581,817 More than 5 years 218,593,023,748 226,563,876,864 P =260,169,759,179 P=266,003,959,412 Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 106 - *SGVFS197678* Rental income included in the consolidated statements of comprehensive income for the years ended December 31, 2024, 2023 and 2022 amounted to P =16,610.78 million, P =16,021.43 million and P=13,742.26 million, respectively. Contingent rent included in rental income for the years ended December 31, 2024, 2023 and 2022 amounted to P =2,381.06 million, P =2,440.93 million and P =1,824.31 million, respectively. 35. Commitments and Contingencies The Group has entered into several contracts with contractors for the development of its real estate properties. As at December 31, 2024 and 2023, these contracts have an estimated aggregate cost of P=3,566.36 million and P =5,382.71 million, respectively. These contracts are due to be completed on various dates up to December 2026. The progress billings are settled within one year from date of billing. These are unsecured obligations and carried at cost. The Group has various contingent liabilities from legal cases arising from the ordinary course of business which are either pending decision by the courts or are currently being contested by the Group, the outcome of which are not presently determinable. In the opinion of the management and its legal counsel, the eventual liability under these lawsuits or claims, if any, will not have a material or adverse effect in the Group’s financial position and results of operations. For the years ended December 31, 2024 and 2023, the Group received a total insurance proceeds of nil and P =1,841.16 million, respectively. 36. Subsequent Events Dividend Declaration On April 30, 2025, VistaREIT, Inc. declared cash dividends amounting to P =0.05 per share for shareholders of record as of May 15, 2025 and the payment date on May 30, 2025. New Loan Availment On May 2, 2025, VLL International, Inc. (VII), has obtained a US$150 million syndicated term loan facility at a rate of 6.40509% per annum. The obligations of VII under the loan facility are guaranteed by the Parent Company and its subsidiaries namely Brittany Corporation, Crown Asia Properties, Inc., Camella Homes, Inc., Communities Philippines, Inc., Vistamalls, Inc., and Vista Residences, Inc. The proceeds of the term loan facility will be used for financing, refinancing or reimbursing working capital and general corporate purposes of the Group. For the foregoing purpose, the Parent Company has entered into a Syndicated Term Loan Facility with Sumitomo Mitsui Banking Corporation Singapore Branch as Mandated Lead Arranger, Underwriter and Bookrunner, and Sumitomo Mitsui Banking Corporation as Facility Agent. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 107 - *SGVFS197678* 37. Approval of the Financial Statements The consolidated financial statements of the Group as of December 31, 2024 and 2023 and for each of the three years in the period ended December 31, 2024 were authorized for issue by the BOD on May 15, 2025. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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VISTA LAND & LIFESCAPES, INC. AND SUBSIDIARIES INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND SUPPLEMENTARY SCHEDULES CONSOLIDATED FINANCIAL STATEMENTS Statement of Management’s Responsibility for Consolidated Financial Statements Report of Independent Auditors Consolidated Statements of Financial Position as of December 31, 2024 and 2023 Consolidated Statements of Comprehensive Income for the Years Ended December 31, 2024 and 2023 Consolidated Statements of Changes in Equity for the Years Ended December 31, 2024 and 2023 Consolidated Statements of Cash flows for the Years Ended December 31, 2024 and 2023 SUPPLEMENTARY SCHEDULES Report of Independent Auditors on Supplementary Schedules I. Reconciliation of Retained Earnings Available for Dividend Declaration (Part 1, Annex 68-D) II. Supplementary schedules required by Annex 68-J Schedule A: Financial Assets (Current Marketable Equity and Debt Securities and Other Short-Term Cash Investments) Schedule B: Amounts Receivable from Directors, Officers, Employees, Related Parties and Principal Stockholders (Other than Related Parties) Schedule C: Amounts Receivable from Related Parties which are Eliminated during the Consolidation of Financial Statements Schedule D: Long-term Debt Schedule E: Indebtedness to Related Parties Schedule F: Guarantees of Securities of Other Issuers Schedule G: Capital Stock III. Map of the relationships of the companies within the group Supplementary Schedule of External Auditor Fee-Related Information Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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VISTA LAND & LIFESCAPES, INC. RETAINED EARNINGS AVAILABLE FOR DIVIDEND DECLARATION AS OF DECEMBER 31, 2024 Unappropriated Retained Earnings, beginning of reporting period P=11,985,191,622 Add: Category A: Items that are directly credited to Unappropriated Retained Earnings Reversal of Retained Earnings Appropriation/s − Effect of restatements or prior-period adjustments – Others – − Less: Category B: Items that are directly debited to Unappropriated Retained Earnings Dividend declaration during the reporting period 1,337,929,540 Retained Earnings appropriated during the reporting period − Effect of restatements or prior-period adjustments – Others – 1,337,929,540 Unappropriated Retained Earnings, as adjusted 10,647,262,082 Add/Less: Net Income (loss) for the current year 2,119,036,015 Less: Category C.l: Unrealized income recognized in the profit or loss during the reporting period (net of tax) Equity in net income of associate/joint venture, net of dividends Declared – Unrealized foreign exchange gain, except those attributable to cash and cash equivalents – Unrealized fair value adjustment (mark-to-market gains) of financial instruments at fair value through profit or loss (FVTPL) – Unrealized fair value gain of Investment Property – Other unrealized gains or adjustments to the retained earnings as a result of certain transactions accounted for under the PFRS – Sub-total – Add: Category C.2: Unrealized income recognized in the profit or loss in prior reporting periods but realized in the current reporting period (net of tax) Realized foreign exchange gain, except those attributable to Cash and cash equivalents – Realized fair value adjustment (mark-to-market gains) of financial instruments at fair value through profit or loss (FVTPL) – Realized fair value gain of Investment Property – Other realized gains or adjustments to the retained earnings as a result of certain transactions accounted for under the PFRS – Sub-total – Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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- 2 - Add: Category C.3: Unrealized income recognized in profit or loss in prior periods but reversed in the current reporting period (net of tax) Reversal of previously recorded foreign exchange gain, except those attributable to cash and cash equivalents – Reversal of previously recorded fair value adjustment (mark-to- market gains) of financial instruments at fair value through profit or loss (FVTPL) – Reversal of previously recorded fair value gain of Investment Property – Reversal of other unrealized gains or adjustments to the retained earnings as a result of certain transactions accounted for under the PFRS, previously recorded – Sub-total – Adjusted Net Income/Loss 12,766,298,098 Add: Category D: Non-actual losses recognized in profit or loss during the reporting period (net of tax) Depreciation on revaluation increment (after tax) – Sub-total – Add/Less: Category E: Adjustments related to relief granted by the SEC and BSP Amortization of the effect of reporting relief – Total amount of reporting relief granted during the year – Others – Sub-total – Add/Less: Category F: Other items that should be excluded from the determination of the amount of available for dividends distribution Net movement of treasury shares (except for reacquisition of redeemable shares) – Net movement of deferred tax asset not considered in the reconciling items under the previous categories − Net movement in deferred tax asset and deferred tax liabilities related to same transaction, e.g., set up of right of use of asset and lease liability, set-up of asset and asset retirement obligation, and set-up of service concession asset and concession payable 1,183,928 Adjustment due to deviation from PFRS/GAAP - gain (loss) – Others – Sub-total 1,183,928 Total Retained Earnings, end of the reporting period available for dividend declaration P=12,767,482,026 Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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VISTA LAND & LIFESCAPES, INC. AND SUBSIDIARIES SCHEDULE A: FINANCIAL ASSETS DECEMBER 31, 2024 Name of issuing entity and association of each issue Number of shares or principal amount of bonds and notes Amount shown in the balance sheet Value based on market quotation at end of reporting period Income received and accrued Cash and cash equivalents N/A P=3,592,121,276 P=3,592,121,276 P=153,351,867 Short-term cash investments N/A - - - Restricted cash N/A 166,064,956 166,064,956 929,231 Installment contracts receivables N/A 58,950,766,031 58,950,766,031 276,695,395 Quoted equity securities 100 160,000,000 160,000,000 − Unquoted equity securities P=1,215,838 12,158,380 12,158,380 − UBS Portfolio I 10,880,066,050 10,880,066,050 10,885,530,049 4,220,811,826 UBS Portfolio VIII 1,145,368,853 1,145,368,853 1,180,612,865 UBS Portfolio XIII 11,719,397,000 11,719,397,000 11,267,910,121 UBS Portfolio XIV 5,865,483,000 5,865,483,000 5,810,974,001 HSBC Portfolio I 3,991,305,000 3,991,305,000 3,993,490,324 HSBC Portfolio II 289,225,000 289,225,000 300,538,866 CREDIT SUISSE 4,557,491,860 4,557,491,860 4,584,237,318 J.SAFFRRA SARASSIN 1,808,813,150 1,792,131,372 1,792,583,175 BDO Singapore 2,220,669,550 2,220,669,550 2,196,064,531 65,817,542 Rental receivable N/A 44,407,515,278 44,407,515,278 − Receivables from related parties N/A 5,050,542,342 5,050,542,342 − Other receivables N/A 565,109,916 565,109,916 − Total Financial Assets P=155,365,415,864 P=154,916,219,429 P=4,717,605,861 See Notes 9, 10, 11 and 25 of the Consolidated Financial Statements Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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VISTA LAND & LIFESCAPES, INC. AND SUBSIDIARIES SCHEDULE B: AMOUNTS RECEIVABLE FROM DIRECTORS, OFFICERS, EMPLOYEES, RELATED PARTIES AND PRINCIPAL STOCKHOLDER (OTHER THAN RELATED PARTIES) DECEMBER 31, 2024 Designation of debtor Balance at beginning of period Additions Amounts collected Amounts written off Current Noncurrent Balance at end of period Officers P =7,619,815 P=3,064,396 (P =3,169,229) P=− P=2,098,448 P=5,416,535 P=7,514,983 Employees 51,462,133 63,607,735 (69,770,761) − 45,299,108 45,299,108 Advances to officers and employees 59,081,948 66,672,131 (72,939,990) − 47,397,556 5,416,535 52,814,091 See Note 11 of the Consolidated Financial Statements Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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VISTA LAND & LIFESCAPES, INC. AND SUBSIDIARIES SCHEDULE C: AMOUNTS RECEIVABLES/PAYABLES FROM/TO RELATED PARTIES WHICH ARE ELIMINATED DURING THE CONSOLIDATION OF FINANCIAL STATEMENTS DECEMBER 31, 2024 Name and Designation of Debtor Balance at Beginning of Period Additions Amounts Collected Amounts Converted to APIC/Capital Stock Current Noncurrent Balance at end of period Vista Land and Lifescapes, Inc. P = 125,298,315,070 (P = 32,961,232,961) P =31,405,949,911 P=− P = 123,743,032,019 P=− P= 123,743,032,019 Prima Casa Land & Houses, Inc. 2,057,845,624 535,514,118 (194,959,140) − 2,398,400,602 − 2,398,400,602 VLL International, Inc. (17,087,402,692) 17,105,655,270 (8,702,217,233) − (8,683,964,655) − (8,683,964,655) Crown Asia Properties, Inc. (9,926,237,923) 399,080,167 (725,392,555) − (10,252,550,311) − (10,252,550,311) Vista Residences, Inc. (9,085,556,619) 2,362,576,469 (3,872,725,154) − (10,595,705,304) − (10,595,705,304) Camella Homes, Inc. (24,895,159,778) 3,126,972,907 (3,938,590,223) − (25,706,777,094) − (25,706,777,094) Brittany Corporation (16,372,747,754) 3,229,854,802 (1,972,881,349) − (15,115,774,301) − (15,115,774,301) Communities Philippines, Inc. (16,857,448,400) 4,558,226,606 (11,332,855,974) − (23,632,077,768) − (23,632,077,768) Vistamalls, Inc. (33,131,607,528) 1,643,352,622 (666,328,282) − (32,154,583,188) − (32,154,583,188) Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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VISTA LAND & LIFESCAPES, INC. AND SUBSIDIARIES SCHEDULE D: LONG TERM DEBT DECEMBER 31, 2024 Title of issue and type of obligation Amount authorized by indenture Amount shown under caption "Current portion of long-term debt” in related balance sheet Amount shown under caption "Long-term debt" in related balance sheet Interest rates Amount Number of periodic installments Maturity date Notes payable 1 P=5,150,000,000 P= 103,000,000 P= 4,239,014,476 6.19% P=4,342,014,476 Quarterly interest payments; 0.5% principal payment for 36 quarter and 82% principal on maturity date December 2026 Notes payable 2 4,850,000,000 97,000,000 3,992,081,594 6.23% 4,089,081,594 Quarterly interest payments; 1% principal payment for the 1st quarter following the issuance, .5% and 82% principal on maturity date December 2026 Notes payable 3 6,000,000,000 666,659,200 1,824,931,305 7.71% 2,491,590,505 Quarterly interest payments; 4.1667% principal payment 1 year after issuance for 24 quarters July 2028 Notes payable 4 1,700,000,000 210,113,343 ‒ 7.49% 210,113,343 Quarterly interest payments; 4.1667% principal payment 1 year after issuance for 24 quarters July 2025 Notes payable 5 500,000,000 61,798,042 ‒ 7.50% 61,798,042 Quarterly interest payments; 4.1667% principal payment 1 year after issuance for 24 quarters July 2025 Notes payable 6 4,000,000,000 888,888,889 1,325,419,326 6.64% 2,214,308,215 Quarterly interest payments; 5.56% principal payment 3 quarter after issuance for 18 quarters March 2027 Notes payable 7 2,000,000,000 444,444,445 662,709,662 7.24% 1,107,154,107 Quarterly interest payments; 5.56% principal payment 2 quarter after issuance for 18 quarters March 2027 Notes payable 8 8,600,000,000 8,562,280,563 ‒ 7.93% 8,562,280,563 Quarterly interest payments; principal payable upon maturity December 2025 Notes payable 9 2,900,000,000 2,887,280,655 ‒ 7.26% 2,887,280,655 Quarterly interest payments; principal payable upon maturity December 2025 Notes payable 10 6,000,000,000 ‒ 5,971,706,040 7.61% 5,971,706,040 Quarterly interest payments; principal payable upon maturity April 2026 Notes payable 11 4,000,000,000 ‒ 3,981,137,360 7.63% 3,981,137,360 Quarterly interest payments; principal payable upon maturity April 2026 Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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Title of issue and type of obligation Amount authorized by indenture Amount shown under caption "Current portion of long-term debt” in related balance sheet Amount shown under caption "Long-term debt" in related balance sheet Interest rates Amount Number of periodic installments Maturity date Notes Payable 12 5,000,000,000 ‒ 1,991,627,746 6.23% 1,991,627,746 Quarterly interest payments; principal payable upon maturity August 2027 Notes Payable 13 10,000,000,000 3,491,858,974 ‒ 8.25% 3,491,858,974 Quarterly interest payments; principal payable upon maturity December 2025 Notes Payable 14 10,000,000,000 9,990,376,824 ‒ 5.70% 9,990,376,824 Quarterly interest payments; principal payable upon maturity June 2025 Notes Payable 15 6,000,000,000 ‒ 3,136,107,781 7.54% 3,136,107,781 Quarterly interest payments; principal payable upon maturity December 2026 ‒ 2,794,246,377 7.69% 2,794,246,377 Quarterly interest payments; principal payable upon maturity December 2028 Notes Payable 16 $200,000,000 ‒ 11,510,146,977 7.25% 11,510,146,977 Semi-annually interest payments; bullet on principal July2027 Notes Payable 17 $220,000,000 ‒ 12,889,387,322 7.25% 12,889,387,322 Semi-annually interest payments; bullet on principal July 2027 Notes Payable 18 $450,000,000 ‒ 25,707,576,319 9.38% 25,707,576,319 Semi-annually interest payments; bullet on principal July 2029 Bank Loans Not Applicable 18,236,007,959 37,400,116,008 4.75% to 8.50% 55,636,123,967 Various payment terms (i.e., monthly and quarterly) of interest and principal Various dates Loans Payable Not Applicable 3,497,817,361 15,984,947,240 6.25% to 8.25% 19,482,764,601 Interest and principal payable monthly Various dates See Notes 20 and 21 of the Consolidated Financial Statements Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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VISTA LAND & LIFESCAPES, INC. AND SUBSIDIARIES SCHEDULE E: INDEBTEDNESS TO RELATED PARTIES DECEMBER 31, 2024 Name of related party Balance at beginning of period Balance at end of period Not Applicable Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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VISTA LAND & LIFESCAPES, INC. AND SUBSIDIARIES SCHEDULE F: GUARANTEES OF SECURITIES OF OTHER ISSUERS DECEMBER 31, 2024 Name of issuing entity of securities guaranteed by the company for which this statement is filed Title of issue of each class of securities guaranteed Total amount guaranteed and outstanding Amount of owned by person for which statement is filed Nature of guarantee Not Applicable Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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VISTA LAND & LIFESCAPES, INC. AND SUBSIDIARIES SCHEDULE G: CAPITAL STOCK DECEMBER 31, 2024 Title of issue Number of shares authorized Number of shares issued and outstanding at shown under related balance sheet caption Number of shares reserved for options, warrants, conversion and other rights Number of shares held by Related parties Directors, officers and employees Others Common Stock, P =1 par value 17,900,000,000 13,114,136,376 shares issued; 11,945,799,461 shares outstanding ‒ 9,113,046,142 516,778,325 3,068,183,209 Preferred Stock Series 1, P=0.01 par value 8,000,000,000 3,300,000,000 shares issued and outstanding ‒ 3,300,000,000 ‒ ‒ Preferred Stock Series 2, P=0.10 par value 200,000,000 30,000,000 shares issued and outstanding ‒ ‒ 10,000 29,990,000 See Note 23 of the Consolidated Financial Statements. Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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VISTA LAND & LIFESCAPES, INC. AND SUBSIDIARIES GROUP STRUCTURE Below is the map showing the relationship between and among group and its Ultimate parent company, and its subsidiaries as of December 31, 2024. *The Group effectively owns 100% of Balmoral Resources Corporation through Brittany, CAPI, VRI and HDC. **The Group effectively owns 60.09% and 98.94% of VistaREIT, Inc. (formerly Vista One, Inc.) through MC, MAPI, Communities Pampanga, Inc., CAPI and VRI and the rest are owned by individual shareholders, as of December 31, 2023 and 2022, respectively. Fine Properties, Inc. Vista Land & Lifescapes, Inc.65.84%Brittany Corporation100%Balmoral Resources Corporation *36.93%Prima Casa Land & Houses, Inc.4.80% Crown Asia Properties, Inc.100%Balmoral Resources Corporation *16.93%VistaREIT, Inc.**3.49%Prima Casa Land & Houses, Inc.10% Vista Residences, Inc.100%Vista Leisure Club Corporation100%Vista Hospitality Management Corp.100%Malay Resorts Holdings, Inc.100%Mella Hotel, Inc.100%Balmoral Resources Corporation*37.22%VProperty Management, Inc.100%VistaREIT, Inc.**17.40%Spaces Property Leasing and Services, Inc.100%Prima Casa Land & Houses, Inc.5% VLL International, Inc100%Camella Homes, Inc.100%Household Development Corporation100% Balmoral Resources Corporation* Mandalay Resources Corp.100%C&P International Limited100%Camella Sales Specialists, Inc.100%Vista Towers, Inc.100%Prima Casa Land & Houses, Inc.40% Communities Philippines, Inc100%Communities Batangas, Inc.100%Communities Bulacan, Inc.100%Communities Cebu, Inc.100%Communities Cagayan, Inc.100%Communities Davao, Inc.100%Communities General Santos, Inc.100%Communities Isabela, Inc.100%Communities Leyte, Inc.100%Communities Naga, Inc.100%Communities Iloilo, Inc.100%Communities Negros, Inc.100%Communities Pangasinan, Inc.100%Communities Tarlac, Inc.100%Communities Zamboanga, Inc.100%Communities Ilocos, Inc.100%Communities Bohol, Inc.100%Communities Quezon, Inc.100%Communities Panay, Inc.100%Communities Pampanga, Inc.100% VistaREIT, Inc. **4.86% VFund Management, Inc.100% Communities Palawan, Inc.100% Prima Casa Land & Houses, Inc.40% Vistamalls, Inc.88.34%Manuela Corporation99.85%VistaREIT, Inc.**5.92% Masterpiece Asia Properties, Inc.100%VistaREIT, Inc.**32.96% Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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SCHEDULE OF FINANCIAL SOUNDNESS INDICATORS VISTA LAND & LIFESCAPES, INC. AND SUBSIDIARIES AS OF DECEMBER 31, 2024, 2023 and 2022 Below are the financial ratios that are relevant to the Group for the years ended December 31, 2024, 2023 and 2022: Ratios Formula 2024 2023 2022 Current ratio Current assets 1.81 1.85 2.89Current liabilities Acid test ratio Quick asset1 1.07 0.99 1.64Current liabilities Solvency ratio Net income + Depreciation 0.05 0.06 0.05Total liabilities Debt ratio Interest bearing debt2 0.48 0.49 0.51Total assets 2.78 Asset to equity ratio Total assets 2.58 2.61Total equity 2.25 Interest service coverage ratio EBITDA3 2.03 1.95Total interest paid4 Return on equity Net income 0.07 0.08 0.06Total equity Return on assets Net income 0.03 0.03 0.02Average total assets Net profit margin Net income 0.27 0.30 0.26Net revenue Debt to equity ratio Interest bearing debt 2 1.34 1.27 1.32 Total equity 1Includes Cash and Cash Equivalents, Short-term Investments, Investment at FVTPL and Current Receivables 2Includes Bank loans, Notes Payable and Loans Payable 3EBITDA less Interest Income from Investments 4Total interest paid less Interest Income from Investments Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.
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VISTA LAND & LIFESCAPES, INC. AND SUBSIDIARIES Supplementary Schedule of External Auditor Fee-Related Information As at December 31, 2024 2024 2023 Total Audit Fees P =44,861,504 P=41,517,928 Non-audit services fees: Other assurance services 28,435,000 16,636,429 Tax services − − All other services − − Total non-audit fees 28,435,000 16,636,429 Total audit and non-audit fees P =73,296,504 P=58,154,357 Evaluation Only. Created with Aspose.Pdf.Kit. Copyright 2002-2011 Aspose Pty Ltd.