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Cebu airport drives Megawide earnings higher

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MEGAWIDE Construction Corp. delivered an 8% improvement in its attributable profit for the first three months of 2018, driven by the double-digit top-line growth from its airport business which offset the seasonally slow construction segment.

In a regulatory filing, the listed firm reported a net income attributable to the parent of P475.29 million, higher than the P439.98 million it posted in the same period a year ago.

Revenues, however, slipped by 6.67% to P4.45 billion, following the slowdown in contract revenues seen for the period. Its construction business accounted for 84% of total revenues, or P3.7 billion, 11% lower year on year. Megawide attributed this decline to the cyclical nature of the construction business segment.

The infrastructure and engineering conglomerate’s order book includes 8990 Holdings, Inc.’s Ortigas Extension project, and DoubleDragon Properties Corp.’s Ascott-DD Meridian Park and Double Dragon Tower Phase 3.

Megawide managed to secure P13.3 billion worth of new contracts during the first quarter, already 124% of the total new contracts it bagged in 2017. It has been tapped to construct the Clark International Airport’s expansion, while other projects are mostly in the private sector namely Gateway Mall 2 Hotel, Golden Bay Tower, Taft East Gate, and Space Ubelt.

“The push of the government’s Build, Build, Build program is a key revenue driver for our construction business. Given our competitive advantage as a Quadruple A contractor, a concession operator and a fully integrated engineering company, we are in the best position to participate in these projects,” Megawide Chairman, President, and Chief Executive Officer Edgar B. Saavedra said in a statement.




Meanwhile, the airport segment accounted for the remaining 16% of Megawide’s total revenues or P646.1 million, up 13% year on year. Passenger volume picked up by 11% for the period, with international arrivals accelerating by 14% and domestic passengers by 10%. This resulted to a 37% increase in net income to P369.7 million, with profit margin reaching 57% from 48% the prior year.

Mactan-Cebu International Airport (MCIA) handled 2.7 million passengers in the first quarter, 65% of which were domestic while 35% were international arrivals. The company benefited from its addition of new airlines, international flights to Busan and Guangzhou, and domestic routes to Ormoc and Catbalogan (via Biliran) for the period.

By the end of the quarter, MCIA had a total of eight local and 17 international airline partners, plying 32 domestic and 22 international destinations.

“The solid performance of our airport segment will be supported by the completion of Terminal 2 in June of this year. This will open more opportunities to steer this segment to even greater heights. Thriving tourism will also help boost growth as we position MCIA as the country’s main tourist hub with its strategic geographic location at the center of the Philippines,” Mr. Saavedra said.

GMR Megawide Cebu Airport Corp. (GMCAC) is set to start commissioning the new passenger terminal of the MCIA on June 22. MCIA is targeting a 12% increase in passenger traffic to 11.2 million this year, from 10 million in 2017.

GMCAC won the contract for the P17.52-billion MCIA Passenger Terminal Building project under the Aquino administration’s flagship public-private partnership program, and the concession to develop MCIA for a period of 25 years.

Shares in Megawide went up by P1 or 4.8% to P21.85 each at the Philippine Stock Exchange on Monday. — Arra B. Francia

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