Megaworld Q3 profit edges higher on strong leasing and hotel growth
By Ashley Erika O. Jose, Reporter
MEGAWORLD CORP. posted a modest rise in third-quarter earnings as its office, mall and hotel businesses continued to deliver steady gains, offsetting higher costs and softer residential margins.
Attributable net income climbed 1.16% to P5.23 billion in the July-to-September period, while consolidated revenues rose 4.34% to P19.96 billion, the listed property developer said in a stock exchange filing on Tuesday.
“Our year-to-date performance continues to reflect the strength of our recurring income portfolio and the sustained demand across our residential and hotel offerings,” President Lourdes Gutierrez-Alfonso said.
Real estate sales, which make up the bulk of Megaworld’s business, inched up 0.84% to P13.13 billion, while rental income increased to P5.51 billion and hotel operations contributed P1.32 billion. Total expenses rose 1.62% to P12.54 billion.
For the first nine months, attributable net income jumped 16% to P15.93 billion, driven by a strong recurring income base. Revenues for the period climbed 8.91% to P60.61 billion, supported by real estate sales worth P40.24 billion, rental income worth P16.24 billion and hotel revenue worth P4.13 billion.
The company said growth in its office leasing segment was buoyed by sustained rental escalations and new take-ups from business process outsourcing and multinational firms. It has closed almost 140,000 square meters in new leases and 120,000 square meters in renewals this year, underscoring continued demand for spaces within its integrated townships.
Megaworld Lifestyle Malls booked P5.1 billion in leasing revenue, lifted by rising foot traffic and consumer spending across its major developments.
“This performance was supported by sustained momentum in retail activities and continued tenant expansion, particularly in food, fashion and home categories,” the company said.
Toby Allan Arce, Globalinks Securities head of sales trading, in a Viber message said Megaworld’s fourth-quarter growth would hinge on leasing strength, holiday-driven mall and hotel activity and project completions that drive residential revenue.
Elevated interest rates and inflationary pressures may temper housing demand, he said in a Viber message. “Even so, recurring income growth, particularly from offices and retail, should remain the primary growth driver into 2025, helping the company maintain stable profitability and cash generation,” he added.
Megaworld operates 36 township developments nationwide covering about 7,000 hectares. It plans to launch another township outside Metro Manila by year-end and aims to expand its office gross leasable area (GLA) to 2 million square meters and retail GLA by a million square meters by 2030.
Megaworld stocks rose 0.5% to P2 each.
