Megaworld first quarter earnings drop 33%

Published May 17, 2021, 3:25 PM

by James A. Loyola

Megaworld Corporation, the country’s largest developer of integrated urban townships, reported a 33 percent drop in attributable net income to P2.4 billion in the first quarter of 2021 from P3.5 billion in the same period last year.

In a disclosure to the Philippine Stock Exchange, the firm said consolidated revenues reached P10.1 billion in the first three months of this year from P14.4 billion in the same period of 2020.

However, netting out the impact of interest and other income, the company’s core revenues registered at P9.3 billion.

This reflects a quarter-on-quarter growth of 10 percent due to improvements in the performance of the company’s real estate sales, as well as revenues from Megaworld Lifestyle Malls and Megaworld Hotels.

This marks the third consecutive quarter of improvement in the company’s core revenues since the second quarter of 2020.

“Gradually, we already see improvements in the numbers, which is a reflection of the recovery in most of our core businesses. With the eased restrictions and the increasing number of Filipinos getting vaccinated, we see better quarters ahead,” said Megaworld Chief Strategy Officer Kevin L. Tan.

Real estate sales for the first three months of 2021 amounted to P5.9 billion, down 39 percent year-on-year. However, this reflects a 2 percent improvement from the previous quarter due to increased construction activities.

Reservation sales also went up by 16 percent quarter-on-quarter to P20.7 billion, slightly higher than the P20.5 billion achieved during the same period last year.

Rental revenues decreased by 27 percent to P3.1 billion during the first quarter of the year compared to P4.2 billion during the same period last year.

However, rentals from Megaworld Lifestyle Malls slightly increased by 2 percent quarter-on-quarter as a result of the company’s digital transformation and innovations for al fresco dining.

“Our office business remains to be very stable and strong. For the first quarter of the year alone, we have already renewed more than 40 percent of our expiring leases for the year,” said Tan.

Hotel revenues also declined 39 percent to P335 million from P551 million during the same period last year due to travel restrictions.

However, compared to the previous quarter, Megaworld Hotels posted 7 percent increase in revenues, boosted by bookings from in-city hotels.