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Semirara weighs down DMCI earnings

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By James A. Loyola

Diversified conglomerate DMCI Holdings, Inc. reported a consolidated net income of P2.9 billion for the first three months of 2019, a 26 percent drop from P3.9 billion in the same period last year weighed down by the weak performance of Semirara Mining and Power Corp.

In a disclosure to the Philippine Stock Exchange, the firm said all its business segments, except for Semirara Mining and Power Corporation, delivered healthy returns for the period.

Despite the weak performance of SMPC during the first quarter of 2019, DMCI Holdings saw its consolidated revenues drop by only 3 percent from P20.3 billion to P19.7 billion due to the strong performance of its construction, off-grid power and nickel mining businesses.

Net income contributions from SMPC fell 49 percent from P2.6 billion to P1.3 billion, owing to an 18 percent decline in the average selling price of coal and a 21 percent drop in total power generation.

DMCI Homes contributed P481 million, a 5 percent improvement from restated first-quarter earnings of P460 million last year driven by lower cost of real estate development during the period.

Meanwhile, share in net income from affiliate Maynilad jumped by 39 percent from P315 million to
P438 million due to the combined effect of higher billed volume, a more favorable customer mix, inflationary adjustment on the basic charge beginning January 1, 2019 and tariff adjustment of 2.7 percent starting October 1, 2018.

Premier construction firm D.M. Consunji, Inc. delivered a 7 percent growth in net income share from P336 million to P359 million on the back of higher accomplishment of its ongoing infrastructure projects.

It posted a 74 percent surge in revenues from infrastructure projects to over P1.5 billion during the first quarter of 2019 from P883 million in the same period last year.

In February, the Department of Transportation also awarded the consortium of DMCI and Marubeni Corporation the P3.2 billion contract to install the trackworks and electromechanical system (EMS) of the LRT2 east extension.

“Hopefully, the LRT2 EMS contract is just the start of more infrastructure projects for DMCI. We want to focus on helping the government implement its Build, Build, Build program,” said DMCI President and Chief Executive Officer Jorge A. Consunji.

From January to March, DMCI recorded a 36 percent drop in revenues from building contracts to P1.1 billion from P1.7 billion last year as most of the projects near completion.

Revenues from energy projects expanded 202 percent to P602 million while revenues from plant and utilities projects improved 29 percent to P404 million.
Accounting for P540 million in revenues are the ready-mix business and other project support activities of DMCI, which more than doubled (122 percent) from last year.

Off-grid energy business DMCI Power saw its net earnings surge 32 percent from P76 million to P100 million. The double-digit growth was driven by a 20 percent increase in energy sales volume.

DMCI Mining registered strong growth in the first quarter of 2019 as its net income contribution climbed 129 percent from P45 million to P103 million. The increase was due to the 118 percent rise in nickel shipment volume during the period.

Contributions from Parent Company and other investments rose 86 percent from P37 million to P69 million due to higher interest income.

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