CPG targets double-digit profit growth this year

By Arra B. Francia, Reporter
CENTURY Properties Group, Inc. (CPG) expects to see double-digit growth in net income this year, banking on its diversification into the affordable and leisure segments.
CPG Chairman, President, and Chief Executive Officer Jose E.B. Antonio said the company is projecting “mid- to high-teens growth” in 2018, noting it now has four segments that will generate income — vertical developments, affordable housing, leisure, and commercial projects.
“Because of that I’m positive the company will grow in much bigger annual rates than before because we now have four sources of income. Not only will it grow, you mitigate the risks that probably expose some sectors… you mitigate the risk of cyclicality by diversifying your portfolio,” Mr. Antonio told reporters on the sidelines of the company’s annual shareholders’ meeting in Makati on Thursday.
The property firm’s net income dropped by 13% to P630 million last year, which Mr. Antonio said was due to the accounting system for real estate properties.
This year, CPG plans to launch four in-city developments consisting of mid-rise, town homes, and mixed-use projects within Metro Manila. The projects will cater to the mid- to upper-middle class, and high-end market.
“There’s still a big demand for young couples to have their own homes that are bigger than the condominiums. So we’re talking of spacious projects that will really be family-oriented,” Mr. Antonio said.
The CPG chief said foreign firms are currently negotiating with the company for potential partnerships for in-city developments.
For the affordable segment, CPG will be launching three projects within the next 12 months. This brings to five the number of projects being undertaken by newly formed business unit.
In addition to CPG’s Phirst Park Homes Tanza in Tanza, Cavite, the company recently unveiled its affordable housing project in Lipa, Batangas carrying the same brand. The 20-hectare property will offer 1,867 units valued at P2.8 billion.
Meanwhile, Batulao Artscapes, one of CPG’s leisure and tourism developments, has already sold out its first phase valued at P1 billion. The firm expects to finish phase one of the P4.3-billion project within a year and a half. Mr. Antonio pointed to rising inflation and the weakening peso as factors that may affect the property business. The peso’s depreciation, however, could also spell a positive for the company as overseas Filipino workers (OFWs) account for around 30% of their total buyers.
“The positive is that there is a stronger purchasing power of OFWs because from P50 naging P53, going P54 na ngayon. Instead of paying $10,000 in amortization, it will be reduced by 6% na, so less na amortization mo kasi tumaas na peso-dollar rate,” Mr. Antonio said.
He also added that OFWs are buying “quite expensive” homes now compared before, noting that more Filipinos are getting paid higher salaries abroad.
“They are being hired in high salary jobs already. For example, Germany is a very strong market for us because they are being paid well,” Mr. Antonio said.
CPG’s net income rose by 2.38% to P300 million in the first quarter of 2018, lifted by a 45% jump in gross revenues to P2.86 billion for the period.