Andrew Tan's Megaworld earnings rise 31% in H1

Real estate and spirits magnate Andrew Tan’s Megaworld Corporation reported a 31 percent growth in net income to P8.8 billion in the first half of 2023 from P6.7 billion in the same period last year.

In a disclosure to the Philippine Stock Exchange, the firm said higher profits were seen as the company continues to pull away from the pre-pandemic performance across most of its core businesses.

Megaworld The Upper East_Bacolod.jpg
Megaworld's The Upper East in Bacolod

Meanwhile, attributable net income rose by 34 percent to P7.9billion in the first semester of 2023 from the P5.9 billion posted in the comparative period last year.

Consolidated revenues grew by 17 percent to P32.0 billion from P27.5 billion as all core businesses registered robust performance during the period.

MREIT sets final IPO price at P16.10/share
Megaworld Chief Strategy Officer Kevin L. Tan

“Our steadfast focus on our township model allowed us to sustain our strong performance into the second quarter of the year,” said Megaworld Chief Strategy Officer Kevin L. Tan. 

He noted that, “With increasing demand for residential and commercial properties outside Metro Manila, we have properly positioned ourselves achieve growth through strategic land banking.”

“We also worked doubly hard in coming up with new, innovative, and sustainable product offerings in order to further strengthen our leadership as a pioneering real estate company,” Tan added.

Real estate sales for the period grew by 12 percent year-on-year to P19.1 billion, driven by the higher completion rate of various projects. 

Reservation sales increased by 49 percent to P76.1 billion. This figure already accounts for 59 percent of the company’s year-end reservation sales target of P130 billion.

During the first half of the year, the company saw a strong uptick in the demand for residential projects in two Taguig townships, particularly in McKinley West and Uptown Bonifacio.

From January to June this year, Megaworld already launched P28.2 billion worth of projects. In the second quarter alone, Megaworld launched four big projects in Pampanga, Iloilo, Rizal, and Palawan. 

These include Savoy Hotel Capital Town in the City of San Fernando, Pampanga worth P4.2 billion; Firenze Residences in Iloilo Business Park worth P4.2 billion; Bellara Tower 2 in Highland City, Cainta, Rizal worth P3.7 billion; and Oceanfront Premier Residences in Paragua Coastown, San Vicente, Palawan worth P2.3 billion.

Leasing revenues, on the other hand, grew by 17 percent to P8.8 billion on the back of the company’s stable office segment and the continued recovery of mall rental income.

Megaworld Premier Offices saw a 4 percent increase in rental income during the period to P6.3 billion from the P6.0 billion recorded last year as rental rates continue to escalate coupled with new signing transactions. 

BPOs remained as the top rental contributors of Megaworld Premier Offices, paving the way for a stable growth of the company’s rental income.

Megaworld Lifestyle Malls also continued its recovery momentum with a 71 percent revenue growth to P2.5 billion during the first half of the year, driven by increased spending and higher rents as the company started to collect full rents beginning this year.

Recently, Megaworld Lifestyle Malls announced it has created a company to enter into a multimillion-peso agreement with Finland-based SuperPark United to bring the global indoor activity park brand SuperPark to the Philippines.

Megaworld Hotels & Resorts likewise sustained its stellar performance with hotel revenues surging by 58 percent to P1.7 billion in the first half of the year.

This was largely driven by the promising growth of local tourism and mobility, especially in two Megaworld townships, particularly in the tourism areas of Newport City and Twin Lakes. 

As a result, Megaworld Hotels & Resorts saw improved average occupancy and room rates compared to last year.