Megawide reverses losses as construction picks up

Owing to the strong performance of its construction business, infrastructure and engineering innovator Megawide Construction Corp. generated a consolidated net income of P332.5 million in the first nine months of the year.

In a stock exchange disclosure on Wednesday, the company said the strong comeback, which reversed the P970.4 million net loss last year, was attributable to the 47 percent revenue jump to P15.6 billion.

"Our growth trajectory remains intact, with our pursuit of big-ticket infrastructure projects, like the Malolos Clark Railway Project and soon the Metro Manila Subway, and high-value commercial developments, such as the Westside City Resorts Complex, materializing," Megawide President and CEO Edgar Saavedra said.

"We are confident that over the long-term, this direction will unlock a strong and steady earnings momentum for the EPC segment," he added.

Megawide's construction segment saw a 47 percent surge in revenue to P15.2 billion, which accounted for a whopping 97 percent of the company's entire revenue.

With this, the company's outstanding book to date was pegged at P42.1 billion— excluding its share in the Metro Manila Subway Project or MMSP.

Of these projects, more than half, or 56 percent are still between zero to 20 percent completion rate. The remaining chunks of the projects are in the 21 to 80 percent percent range.

During the third quarter alone from July to September, Megawide secured P2.3 billion worth of contracts in the commercial and industrial space through Hotel 101 in Libis and Citicore Renewable Energy Corp.'s Lumbangan Solar Power Plant in Batangas.

Megawide's land port operations through the Paranaque Integrated Terminal Exchange, on the other hand, logged 23 percent revenue growth year-on-year at P339.7 million. It accounted for 2 percent of consolidated revenues.

Commercial occupancy remained healthy at 80 percent, with average passenger spending reaching P36.9 in September. It was 61 percent higher than last year and the previous record of P35.5 was achieved in June.

Office occupancy rates jacked up to 65 percent as of end-September from 33 percent at the start of the year, which prompted optimism about finally attracting cycle-resilient businesses and a more stable tenancy.

In addition, revenue from recently consolidated real estate operations totaled P36.5 million for the period, representing the two-month share in the performance of PH1 World Developers, Inc., or PH1, which was acquired in July.

The segment is projected to contribute more substantially to consolidated revenues in the next two to three years, as new and existing developments steadily reach payment milestones and construction progress increases.

PH1 launched two new projects in September, one vertical and one horizontal.

The Modan Lofts in Ortigas Hills is valued at approximately P8.7 billion, and the Northscapes at San Jose del Monte, Bulacan, Phase 1 is valued at P1.9 billion.