Megaworld profit up 16%

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Megaworld Corp. operates several lifestyle malls such as Uptown Mall in Uptown Bonifacio, Taguig. Company handout

MEGAWORLD Corp. grew its attributable profit by 16% in the first quarter of 2019, driven by the strong performance of its residential, leasing, and hotel businesses.

In a statement issued Wednesday, the property arm of tycoon Andrew L. Tan said net income attributable to the parent rose to P3.8 billion, versus P3.3 billion in the same period last year.

Consolidated revenues were also up 15% to P14.9 billion. Of this, about 64% came from the residential business while 26% were from the leasing segment. Hotel operations accounted for four percent, while the balance came from non-core businesses.

“It is always encouraging to see all of our core businesses exhibiting positive growth during the first quarter as this sets our pace for the rest of the year. We will be working towards maintaining the growth momentum until year-end,” Megaworld Chief Strategy Officer Kevin Andrew L. Tan said in a statement.

Residential projects continued to see high demand as revenues gained 11% to P9.5 billion. The business segment realized about P48 billion in reservation sales during the quarter, after launching around P24 billion worth of new inventory.

The rental business also saw a 16% uptick in revenues to P3.9 billion, thanks to leasing revenues from office spaces and lifestyle malls. Megaworld targets to complete over 230,000 square meters (sq.m.) of leasable spaces from office and mall spaces to bring the total to 2.14 million sq.m. by the end of the year.

Meanwhile, revenues from the hotel segment advanced 56% to P574 million, after the opening of Savoy Hotel Manila in Pasay City and Twin Lakes Hotel near Tagaytay last year.

This year, Megaworld is set to add more than 1,000 hotel rooms with the opening of Belmont Hotel Boracay, Hotel Lucky Chinatown, and Savoy Hotel Mactan Newtown.

“We are confident that stronger numbers will be achievable given our pipeline of projects this year,” Mr. Tan said.

Megaworld earlier said it will be spending P65 billion in capital expenditures this year, 80% of which will be for property development across its 23 townships. The remaining 20% will be used for land acquisitions and investment properties.

The capital spending will support Megaworld’s plan to launch 28 new residential towers seen to generate P90 billion in sales. It will also unveil five new office towers covering 116,000 sq.m. in gross leasable area (GLA). The commercial segment will add five malls this year, spanning about 9,000 sq.m. in GLA.

These new projects will be located inside its existing townships. Megaworld had a total of 24 masterplanned estates across the country by end-March.

Megaworld is part of holding firm Alliance Global Group, Inc., which also has core interests in liquor, gaming, and quick-service restaurants.

Shares in Megaworld fell 1.29% or seven centavos to close at P5.37 each on Wednesday. — Arra B. Francia