PH Resorts Holdings Group Inc. has officially derecognized a PHP 8.75 billion (~US$153.5 million) financial liability tied to the Emerald Bay development in Mactan, Cebu, Philippines. This move is disclosed in the company's second-quarter earnings filed with the Philippine Stock Exchange.

Background: Sale-and-Leaseback Structure and Expired Repurchase Option

In October 2023, PH Resorts entered into a sale-and-leaseback (SLBB) agreement with China Banking Corp (Chinabank), allowing it to continue using the land and construction assets through Lapulapu Leisure Inc. (LLI) and Lapulapu Land Corp. (LLC), while securing an option to buy them back.

As of March 31, 2025, that repurchase option expired. Consequently, the group removed the PHP 13.65 billion in properties plus improvements (“Mactan properties”) and the PHP 8.75 billion associated liability from its balance sheets.

Financial Fallout and Going Concern Warning

PH Resorts' half-year results for 1H 2025 show a net loss of approximately PHP 6.75 billion, mainly due to a "loss on extinguishment of financial liability" tied to the Chinabank SLBB deal.

With said loss, the company reported a capital deficiency of nearly PHP 5.83 billion as of June 30 and reaffirmed a "going concern" warning—highlighting major doubts about its ability to continue operations under current conditions.

Modest Recovery: Deposit Repayment

On a modest positive note, PH Resorts repaid a remaining PHP 76 million balance on a PHP 1.0 billion deposit previously provided by Bloomberry Resorts Corp, which had considered involvement in Emerald Bay but terminated the non-binding agreement in March 2023.