MANILA, Philippines - Tycoon Andrew Tan's Megaworld Corp. reported a 60% increase in net income to P8.16 billion last year, on the back of robust real estate sales, from P5.1 billion in 2010.
In a report to the stock exchange, Megaworld said its consolidated total revenues, which includes real estate sales, rental income, hotel income, and other revenues, grew by 39.3% to P28.6 billion in 2011 versus P20.5 billion recorded in the previous year.
The property developer attributed the strong revenues to property sales, higher leasing income and nonrecurring gain from sale of shares. Most of its revenues came from sales of condominium units and residential lots, totalling P15.9 billion in 2011, 21.2% up from last year's P13.1 billion.
Sales came from Megaworld's projects such as Eight Forbestown in Fort Bonifacio Taguig; Eastwood Le Grand in Eastwood City; McKinley West, Morgan Suites and The Venice Luxury Residences in Mckinley, Taguig City; Manhattan Heights in Quezon City; Newport Palmtree Villas, 81 Newport Boulevard and Newport City in Pasay.
Rental income reached P3.8 billion in 2011, a 42% increase from P2.7 billion last year. This is mainly attributed to the completion of additional leasing properties and continued demand for office space from business process outsourcing companies.
Megaworld's hotel operations grew by 68.5% to P392.2 million in 2011, due to a jump in its number of hotel rooms and improved occupancy rates.
Despite the jump in net income, CitisecOnline said Megaworld's core income grew by a slower than expected 37.75% to P5.79 billion. While its realized gross profit on residential sales exceeded expectations, CitisecOnline said operating expenses were higher than expected.
Cost and expenses jumped by 32.3% to P20.45 billion in 2011, compared to P15.4 billion in 2010. This was attributed to increase in recognized real estate sales, and marketing and selling expenses.
This year, Megaworld is planning to spend as much as P25 billion in capital expenditures for its new projects.