DMCI profit jumps 41% to P185.8M in Q3 on higher real estate income

The Consunji-owned DMCI Holdings Inc. posted a 41 percent rise in its third quarter earnings this year to P185.77 million, helped by higher revenues from its real estate unit which offset the revenue drop at its coal and construction businesses.

In the nine-months ending September this year, however, DMCI’s net profit plunged 60 percent to P1.03 billion as against the previous level’s P2.57 billion due to the lack of extraordinary gains and higher costs and income taxes.

The nine-month net profit last year included a one-time gain from the sale of shares in coal unit Semirara Mining Corp. amounting to P2 billion.

In a financial report filed with securities regulators, DMCI said its wholly owned real estate firm DMCI Project Developers Inc. hit record-breaking revenues of P1.2 billion or a 21 percent increase from the previous level.

Driving the growth for DMCI-PDI are its medium-rise condominium community projects East Ortigas Mansions, Mayfield Park Residences, and Bonifacio Heights, which is earmarked for enlisted armed forces personnel. The sales growth was attributed to improved marketing and selling activities not just locally but also through overseas Filipino workers.

Mahogany Place Subdivision, a horizontal house and lot development, chipped in P361 million in revenues during the period under review.

With existing projects almost fully sold out, DMCI-PDI is set to launch new projects to meet the dwindling supply of housing units. Among these projects include Raya Gardens Condominiums, a combination of high-rise and medium-rise development in Merville, Para-ñaque; Rosewood Pointe in Taguig; and The Manors at Celebrity Place, a mixed townhouse-medium rise community project adjacent to the Celebrity Sports Plaza in Quezon City.

In line with efforts to liquidate its landbank, DMCI-PDI has entered into a joint venture with Crown Equities Inc. to jointly develop a high-rise condominium building along C-5 Road in Taguig. The project will be called Cypress Towers.

As for its coal-mining business, DMCI through 58 percent-owned Semirara Corp. reported a 31 percent drop in net profit during the nine-month period this year to P571.21 million from P828.83 million. Its third quarter net profit, however, increased to P215.6 million from P207.73 million.

Revenues fell to P3.73 billion from P3.77 billion due to higher costs. Third quarter revenues likewise declined to P962.7 million from P1.46 billion.

General and administrative expenses fell 40 percent from P83.28 million to P49.96 million.

The sizeable jump in income taxes and the higher costs of coal sales were the main drivers in the cutback of Semirara’s operations for the period.

The slower than expected development in the domestic market propelled Semirara to reevaluate its selling and marketing strategies and start exploring the global and export market.

Considering that the expanded capacity is already in place, the availability of coal and the advance stripping performed at the pit, Semirara is now in talks with prospective buyers from the Asia-Pacific region.

Semirara is also strongly pursuing expansion into the power sector as it recently submitted its bid in the National Power Corp.’s off-grid Small Power Utility Group (SPUG) project in Masbate Island. Likewise, the company is also in the application stage for its plan to build and maintain a coal-fired power plant in Concepcion, Iloilo.

Semirara is hoping that the diversification will provide for a more stable domestic consumption for its coal.