Megawide Construction Corporation reported a 69 percent jump in net income to P562 million in the first nine months of 2024 from the P332.5 million it earned in the same period last year.
In a disclosure to the Philippine Stock Exchange (PSE), the firm said the performance was driven by higher consolidated revenues at P16.3 billion from P15.6 billion in the first three quarters of 2023.
Complemented by lower costs and expense management, this led to a 126 percent growth in operating profit to P1.98 billion and improvement in operating margin to 12 percent from six percent last year.
This also brought consolidated earnings before interest, taxes, depreciation and amortization (EBITDA) to P3.65 billion, 29 percent higher than the same period in 2023.
The construction segment delivered P15.5 billion and contributed 96 percent to consolidated revenues, as the 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,” said Megawide President and CEO Edgar Saavedra.
He added that “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.”
The company secured eight new contracts during the period amounting to P8.91 billion, six of which were solar power plants of newly-listed affiliate Citicore Renewable Energy Corp. This brought the company’s order backlog to P42.6 billion as of end-September, representing two to three years of revenues.
The manufacturing side of the construction business – representing the pre-cast and construction solutions (PCS) segment – likewise continued to sustain its momentum with significant growth in external sales.
During the review period, revenues from PCS more than doubled to P2.80 billion from P1.10 billion last year, driven by robust external sales, which comprised 65 percent of its revenues from 35 percent previously.
“Our PCS 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 PCS business and the Company overall,” Saavedra added.
Landport operations, on the other hand, delivered revenues of P386 million and contributed two percent to consolidated revenues.
This came largely from rental of retail spaces at the terminal area – which was boosted by consistently increasing foot traffic at an average of 136,000 daily in the first nine months of the year – and improvement in office leasing.
Occupancy in the terminal further rose to 92 percent as of end-September while occupancy at the office towers improved to 41 percent, which were all leased out to traditional tenants, like logistics hubs, government offices, transport services, and travel agencies.
Meanwhile, revenue from PH1 World Developers (PH1) steadily rose to P377 million from P36.5 million last year and contributed two percent to consolidated revenues.
As of end-September, total reservation sales booked by PH1 already reached P11.8 billion, which are expected to translate to revenues over the next two years as construction progress on these projects accelerate.
In addition, unsold inventory worth P11 billion – which still excludes projects to be launched early next year – will provide a healthy stock of future sales and revenue.