Megaworld earnings increased 12% in Q1
The Andrew Tan-led property firm Megaworld Corp. said its net income grew 12 percent during the first three months of the year to P3.3 billion, from P2.9 billion last year.
Consolidated revenues grew close to 10 percent to P13.1 billion during the first three months of the year, from P12 billion during the same period last year, the company said.
Comprising around 70 percent of its consolidated revenues, the company’s residential business was up about 6 percent in the first quarter of 2018, growing to P8.8 billion, from P8.3 billion the previous year.
“What we are excited about is the fact that our hotel businesses are also fast growing,” said Kevin L. Tan, the company’s senior vice president.
Megaworld’s hotel revenues grew 10 percent during the first quarter of the year to P368 million, from P335 million last year as the company expanded its homegrown hotel brands Savoy and Belmont to other areas.
Rental income, which primarily came from leasing of offices spaces and shopping malls, grew 16 percent to a record P3.4 billion, from last year’s P2.9 billion, the fastest growing among the company’s business segments.
“The company remains on track in achieving its goal of P20 billion in rental revenues by 2020. This year will be critical for us as we construct a record number of leasable office and mall spaces,” Tan said.
The company said it is set to complete a record number of office and commercial projects this year, strengthening the company’s recurring income portfolio expected to further drive double-digit growth in the next three years to five years.
About five office towers with a combined inventory of around 207,000 square meters of fresh office spaces will be completed by the company this year, bringing Megaworld’s total leasable office inventory to 1.2 million sq m, still the highest among office developers in the country.
These office towers include the Eastwood Global Plaza in Eastwood City in Libis, Quezon City; Two Techno Place in Iloilo Business Park; 10 West Campus in McKinley West, Southwoods BPO Tower 1 in Southwoods City, and the World Commerce Place in Uptown Bonifacio in Taguig.
Seven shopping malls and commercial properties, including expansion of existing malls with around 176,000 sq m of gross floor area, will be completed around the country. These are in Arcovia City in Pasig, Iloilo Business Park, McKinley Hill in Taguig, Alabang West in Muntinlupa, Uptown Bonifacio in Taguig and also in other developments in Makati and Las Piñas.
This brings the company’s total gross floor area for mall and commercial properties to 791,587 sq m by the end of 2018.
“We build a stronger bottomline if we continue to strengthen our recurring-income base. This is why we invest heavily on our rental properties, taking advantage of the strong economy and the influx of investments into the country,” Tan said.
This article was first published in Business Mirror on May 10, 2018.