DMCI Holdings, Inc.’s consolidated net income slid by two percent in 2018, weighed down by its coal mining unit’s prolonged plant shutdown despite the better performance of other business units.
The diversified engineering conglomerate said in a statement on Friday that consolidated net income stood at P14.5 billion last year, lower than the P14.8 billion it generated in 2017. This came amid a three percent increase in revenues to P83 billion.
“Our real estate, construction, off-grid power, mining, and water businesses delivered healthy returns in 2018 but the weaker-than-expected performance of Semirara Mining and Power Corp. (SMPC) tempered our consolidated profits,” DMCI Holdings Chairman and President Isidro A. Consunji said in a statement.
Mr. Consunji noted that SMPC suffered several challenges in 2018, including the nearly eight-month shutdown of Unit 1 of Southwest Luzon Power Generation Corp., unfavorable weather conditions, and China’s soft ban on coal imports.
“The biggest contributor is still Semirara, but its contribution went down from P8 billion in 2017 to P6.8 billion (in 2018) because of one-offs, for accelerated rehab, power plant rehabilitation, so the group was really affected,” DMCI Holdings Vice-President and Senior Finance Officer Brian T. Lim said in a press briefing in Makati City late Thursday.
“We expect a better year this year,” Mr. Lim added.
Without non-recurring items, SMPC’s core income attributable to the parent dropped eight percent to P7.4 billion for the year.
Meanwhile, DMCI Homes saw its net income rise by nine percent to P3.9 billion on higher revenues from the sale of land worth P715 million.
Excluding this one-time gain, core profit fell by 11% due to the higher cost of materials. The company also adopted a new accounting standard that changed the recording of broker’s commissions, prompting the increase in cost of sales.
Construction unit DM Consunji, Inc. delivered P1.2 billion in net income contribution to the parent, 16% higher year on year. The company attributed this to a 12% increase in revenue and recognition of variation orders from projects nearing completion.
DMCI Power Corp. benefited from a 25% increase in energy sales volume for the period, resulting to a 30% uptick in net earnings to P465 million.
For DMCI Mining, net income went up four percent to P117 million following a 22% increase in nickel shipment volume of higher grade nickel.
DMCI Holdings also booked a share of P1.8 billion from affiliate Maynilad Water Services, Inc.’s net earnings, seven percent higher year on year, as the water concessionaire posted a three percent increase in billed volumes.
Shares in DMCI Holdings went down by 0.34% or four centavos to close at P11.56 each at the stock exchange on Friday. — Arra B. Francia