DMCI Holdings 9-month net profit drops 30%

abs-cbnNEWS.com | 11/19/2008 6:03 PM

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DMCI Holdings Inc. reported a 30 percent drop in net profit for the nine months ending September this year due to accounting adjustments relating to its water business.

DMCI, the holding firm of the Consunji family, said its net earnings reached P1.21 billion compared with P1.73 billion a year earlier. Revenues amounted to P14.15 billion, up 52.3 percent from the previous year level of P9.29 billion.

In the third quarter of 2009, DMCI posted a net income of P659.45 million, reversing the P322.47 million recorded the same period a year ago, according to the firm's financial report filed with the Philippine Stock Exchange. Its gross profit increased 28 percent to P3.7 billion.

DMCI said its lower net income was due to adjustments made last year to reverse recognition of extraordinary income in the water business.

Cost of sales jumped 63 percent to P10.45 billion from only P6.4 billion. Operating expenses increased by 61.7 percent to P940 million.

DMCI, in partnership with Metro Pacific Investments Corp., has invested in the water sector in an operation under the former Lopez-owned Maynilad Water Services, Inc.

It reported a growth in operating level income from P1.1 billion to P2 billion due to higher-billed volume.

The adoption of a new concession accounting principle for 2008 accounted for a net charge of P787 million, of which the company’s share was P331 million.

DMCI said this net charge is mainly the result of the forex losses from the recognition of dollar-denominated future water concession fee payables.

With respect to its real estate business, DMCI Project Developers Inc., reported a 28 percent rise in net income to P748 million based on a 71 percent jump in revenues to P3.5 billion.

The firm said better sales volume from new projects, plus higher selling prices, led to an improved financial performance.

Its real estate sales came from existing projects namely, Manors at Celebrity Place, Raya Gardens Condominiums, Mahogany Place Subdivision, and Rosewood Pointe Homes, which accounted for 40 percent of all real estate revenues.

The completion of units in DMCI's new projects--Alta Vista Boracay, Dansalan Gardens Condominiums, Riverfront Residences and Cypress Towers--contributed a total of P950 million or 26 percent of real estate sales booked for the period.

Earnings of DMCI's construction business, under wholly-owned unit D.M. Consunji Inc., fell 5 percent.

The firm said higher costs offset the 37 percent increase in its revenues, This was caused mainly by change orders, increased works from outside contracts, and construction from the water business.

Meanwhile, the firm's coal mining business, operated by 56 percent-owned Semirara Mining Corp., reported a slight increase in net profit to P570.84 million despite a 40 percent hike in revenues.

At an average price of P2,342 per metric ton, coal revenues amounted to P6.414 billion at the end of September this year.

as of 11/19/2008 8:07 PM