Troubled PH Resorts Group, the former developer of stalled Cebu integrated resort Emerald Bay, said Friday it had derecognized the property as well as financial liabilities associated with it after failing to repurchase the IR from its main lender under a sale and leaseback arrangement in March.
The update formed part of PH Resorts Group’s 2Q25 financial results, published Friday, in which it detailed the current status of operations and subsequent financial position.
The company had in October 2023 struck a refinancing deal with Chinabank that involved LLI selling Emerald Bay to the bank but with an option to buy it back by March 2025 should it successfully secure new investors.
However, after a series of investment deals proceeded to fall through – including one with Solaire operator Bloomberry Resorts Corp and another with Okada Manila parent Tiger Resort, Leisure and Entertainment Inc (TRLEI) – Chinabank confirmed in May that it was taking the option for PH Resorts Group to buy back the property off the table.
As a result, PH Resorts Group said Friday that it had derecognized the property and related improvements worth Php13.7 billion (US$240 million) from its books, as well as financial liabilities relating to the repurchase option totaling Php8.75 billion (US$153 million).
As such, for the first six months of 2025, PH Resorts Group reported a net loss of Php6.75 billion (US$118 million) mainly due to the loss on extinguishment of financial liability related to the Chinabank transaction – resulting in a deficit of Php11.7 billion (US$205 million) and a capital deficiency of Php5.83 billion (US$102 million). The loss on extinguishment of financial would be lower at Php3.29 billion (US$57.7 million) if offset with the unrealized revaluation surplus from appraised value of the property, it added.
However, current liabilities still exceed current assets by Php4.81 billon (US$84.3 million) as of 30 June 2025 – an issue it hopes to rectify via advances for future stock subscriptions and advances from related parties should they materialize.
“These conditions indicate that a material uncertainty exists that may cast significant doubt on the Group’s ability to continue as a going concern and, therefore, that the Group may not be able to realize its assets and discharge its liabilities in the normal course of business,” the company explained.
Noting that discussions are ongoing with its lenders as well as potential investors, it added, “The Group has additional ongoing strategic investor discussions with several other parties. Due diligence is ongoing and in various stages of completion.
“Management believes that considering the progress of the steps undertaken to date, these financing and capital raising plans are feasible and will generate sufficient cash flows and/or result in negotiated agreements to enable the Group to meet its obligations when they fall due and address the Group’s liquidity requirements to support its operations and the completion of its projects.”