ALI burned cash of 12.5 Billion Pesos on operating activities throughout 2020. The cash burned on operations was offset by the proceeds from the AREIT IPO sponsorship. The IPO of AREIT was timely, giving ALI the necessary cash during the year.
It looks like that in 2021, ALI may yet again rely on financing activities. ALI ended the year with a cash balance of 17 Billion Pesos but short-term and current debts total 27.9 Billion Pesos. With no cash generation from operation expected due to economic slowdown brought about by pandemic, ALI will have to tap again the capital markets for necessary funds.
Underlying investments assets of ALI are more valuable than there carrying book value, but those values may not be easy to realize especially that there are no many buyers around.
With ALI down just 0.75% from a year ago, ALI is priced at a premium. ALI is now trading a price-earnings ratio of 69.65.
This analysis is an independent viewpoint on publicly traded stocks in the Philippine market. Accuretti Systems Inc. trades stocks in the Philippine market.
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