Megawide profit surges by 69 percent in 9 months

MANILA, Philippines — Earnings of Megawide Construction Corp. surged by more than half in the nine months ending September on the back of higher revenues coupled with lower costs.

Megawide reported a 69-percent jump in net income to P562 million as revenues grew by five percent year-on-year to P16.3 billion.

The firm’s construction segment delivered P15.5 billion and contributed 96 percent to consolidated revenues during the three quarters.

Megawide said the construction business continued to benefit from increased economic activities and the government’s infrastructure build up.

“Strong macro-economic growth, coupled with easing interest rates, were supportive of business expansion and bode well for construction. In addition, we are also benefitting from the government’s infrastructure development and renewable energy capacity build-up, which we hope to capitalize on moving forward,” Megawide president and CEO Edgar Saavedra said.

The company secured eight new contracts during the nine-month period amounting to P8.91 billion.

The new contracts brought Megawide’s order backlog to P42.6 billion as of end-September, representing two to three years of revenues. 

Megawide said that the manufacturing side of the construction business comprising of the pre-cast and construction solutions segment also sustained its momentum with significant growth in external sales.

For the period, revenues from the segment more than doubled to P2.8 billion due to robust external sales. 

“Our pre-cast and construction solutions business is an emerging segment for the company. We are confident that the wide application of pre-cast products in infrastructure, residential and commercial developments will be attractive growth areas for our pre-cast and construction solutions business and the company overall,” Saavedra said.

Megawide’s landport operations, meanwhile, booked revenues of P386 million and contributed two percent to the group’s topline.

 Operation revenues came largely from rental of retail spaces at the terminal area and improvement in office leasing.

 Revenue from PH1 World Developers likewise contributed two percent to consolidated revenues, amounting to P377 million. 

Reservation sales booked by PH1 as of end-September reached P11.8 billion, which are expected to translate to revenues over the next two years as construction progress on these projects accelerate.

 Megawide said PH1’s unsold inventory worth P11 billion, which still excludes projects to be launched early next year, would provide a healthy stock of future sales and revenue.