EEI profit jumps 76% to P363M in 9 months

Construction giant EEI reported a 76 percent jump in its net profit for the nine months ending September this year on the back of increased construction activities overseas.

In a financial report filed with securities regulators, EEI said its unaudited consolidated net income from January to September this year amounted to P363 million from P207 million in the same period in 2007.

The net income translates to an earnings per share of P0.35 as against P0.20 a year earlier.

Consolidated revenues reached P7.77 billion, up 41 percent from P5.52 billion as production from construction contracts rose 13 percent to P4.59 billion.

“The growth in consolidated revenues is attributable to the pickup of the overseas construction operations which reflects the company’s shift and concentration of its project assets and manpower to the international markets,” EEI said.

EEI said more than half of its total worforce of 18,000 people are deployed overseas. About 1,400 are in the Goro nickel mining project in New Caledonia and around 8,000 are in various projects of Al Rushaid Construction Co. in the Kingdom of Saudi Arabia (KSA).

Revenues from services, principally attributable to EEI’s 100 percent-owned company EEI New Caledonie (NC), amounted to P2.09 billion or more than twice the P790 million recorded a year earlier.

In KSA, EEI’s 49 percent -owned joint venture Al Rushaid Construction Corp. (ARCC) obtained additional work package for Eastern Petrochemical Company (also known as Sharq) which brings its total contract with Sharq to $318 million.

During the year, ARCC also secured new contracts with Saudi Aramco for the flare tips projects, the new Shuqaiq power and desalination plant of the Mitsubishi Heavy Industries (MHI) and another MHI project for the replacement of boiler tubes in the Qurrayah power plant. The total contract value of these new projects is approximately $275 million. This brings orders backlog to $391 million as of September 2008.

On the homefront, EEI bagged P2.2 billion worth of orders and contracts, lower than the previous level of P2.4 billion.

Orders backlog (excluding ARCC) declined from P4.6 billion to P3.2 billion, EEI said.

Among the significant orders acquired by EEI is the joint venture project with Hanjin Heavy Industries & Construction Co. Ltd. for the construction of Berth 6 of the Manila International Container Terminal of port operator International Container Terminal Services Inc. (ICTSI). EEI has a 30 percent stake in the P2.84 billion project while Hanjin has 70 percent.

Other contracts won include the piperack modules fabrication work for Stone Webster Asia Inc. worth S$57 million, the construction of the Biscom sugar refinery of the Chan group, additional work packages for the fly-over ramp IV-A of the NAIA 3 Expressway project of the Department of Public Works and Highways, the sub-structure and civil works for the GA Skysuites project and the Petro- FCC revamping and BTX projects for the petrochemical downstream facilities of Petron’s refinery in Bataan for Daelim of Korea.

Consolidated costs increased 36 percent to P6.58 billion from P4.78 billion. Finance costs likewise went up 56 percent to P194.03 million.

Moving forward, EEI said it is “cautiously optimistic about its prospects and is anticipated to perform according to over-all targets for this year” due to sufficient orders obtained.

To cope with an increasingly harsh economic downturn, EEI continues to exercise financial prudence and implement cost-management and productivity improvement programs.