By Arra B. Francia, Reporter
D.M. Wenceslao & Associates, Inc. (DMW) is allocating P4 billion for capital expenditures this year, following a double-digit profit growth in 2018 due to the strong demand for properties in the Bay Area.
DMW Chief Executive Officer Delfin Angelo C. Wenceslao said this is part of the property firm’s plan to spend about P3-5 billion annually to ramp up its expansion in the next five years, or a total capex of P21 billion until 2023.
This year’s capex is double DMW’s actual spending of close to P2 billion in 2018.
The listed property and construction firm is set to break ground on two projects in its mixed-use estate Aseana City this year. Construction on Midpark Towers is expected to start in the second quarter. It is seen to generate P9 billion in sales.
DMW will also break ground for Parqal in the second quarter, where retail spaces covering 135,292 square meters (sq.m.) will be available for lease.
At the same time, the company targets to finish its commercial project in Makati, and residential project called Pixel Residences in Aseana City within the year.
The company will also continue the construction of 8912 Aseana Ave., its office tower in Aseana City as it looks to further take advantage of the demand for commercial spaces in the area.
“Right now it’s all about location. Everything that we’re doing in the Manila Bay Area, we’re confident within the next five years that we’re going to do well,” Mr. Wenceslao told reporters during a roundtable interview in Makati City on Monday.
The company’s continued investments followed its 23% profit growth in 2018, as net income attributable to the parent reached P1.91 billion, versus the P1.56 billion it posted the year before.
Revenues, however, dropped to P2.15 billion, 23% lower than the P2.78 billion it generated in 2017, which the company attributed to the absence of land sales for the year.
Mr. Wenceslao noted DMW will continue selling land starting this year, with about 2,000-2,500 sq.m. programmed to be sold in 2019. This will cost about P1 billion, based on a price of P400,000 to P500,000 per sq.m.
Bulk of revenues came from recurring income projects at P1.9 billion, thanks to land leasing which rose by five percent to P965.2 million and building rentals that gained 77% to P762.1 million. Other revenues related to leasing also jumped 90% to P173.8 million.
Meanwhile, sales of residential units stood at P119.4 million, 153% higher year on year.
The company looks to achieve its annual target of growing profit by 10% to 20% this year.
Shares in DMW dropped 2.5% or 26 centavos to close at P10.14 apiece on Monday.