First Pacific's flagship Philippine arm, Metro Pacific, saw net income fall 54 per cent last year to 329 million pesos (about HK$62.51 million) as provisions at its landmark Manila property venture Fort Bonifacio ate into profits.
Operating profits, before financing charges, were up 62 per cent to 2.8 billion pesos from 1.75 billion in 1997.
However, net expenses grew to 851 million pesos, reflecting provisions for possible lot returns or settlements with lot buyers at Fort Bonifacio.
In addition, Metro Pacific also made provisions for restructuring and bad debts in its shipping, packaging and bottled water businesses.
The company made progress reducing its debt by de-consolidating the balance sheet of its telecoms subsidiary Smart Communications before the sale of part of its interest to Japan's Nippon Telegraph and Telephone and by raising 14 million pesos in new equity.
At the end of last year the company's debt-to-equity ratio stood at 71 per cent, down from a massive 145 per cent at the end of 1997.
Metro Pacific president Napoleon Nazareno said the firm had achieved two key objectives for the year - boosting its balance sheet and refocusing resources on Fort Bonifacio and property projects outside Manila.