DMCI expects net earnings to double to P4 billion this year

MANILA, Philippines - DMCI Holdings Inc., the investment holding firm of the Consunji family, expects its net earnings to double this year to P4 billion, mainly driven by sustained strong performance of Maynilad Water Services Inc. and higher contributions from its coal mining and real estate businesses.

In a chat with reporters following the company’s annual stockholders meeting yesterday, DMCI president Isidro Consunji said a big chunk of the projected net income will come from Maynilad, contributing P1.6 billion followed by DMCI Homes Inc. (P916 million), Semirara Mining Corp. (P700 million to P800 million), and construction unit D.M. Consunji Inc. (P400 million).

Consunji said net earnings of Semirara are forecast to reach over P1 billion by the end of the year or an increase of 25 percent from the 2008 level, mainly due to higher sales volume. Sales are seen to grow 41 percent to P12 billion.

In the first half of the year, Semirara posted a net profit of P750 million on the back of revenues of P6.5 billion.

Consunji said Semirara expects sales to reach four million to 4.5 million tons this year, as much as 1.8 million of which will be exported to new markets like Thailand, Taiwan and Japan to expand its client base.    

Last year, Semirara’s export sales grew 24 percent to 992,749 metric tons from 798,806 metric tons the previous year. Total exports claimed a 30 percent market share, posting an improvement over the 2007 share of 22 percent.

Consunji said DMCI is also studying options on how to fund its entire bid price of $361.7 million for the 600-megawatt Calaca coal-fired plant in Batangas. The group needs around $147 million to pay the 40 percent downpayment required by the Power Sector Assets and Liabilities Management 270 days after the awarding of the contract which is scheduled to take place by the end of this month.

DMCI bested the only other bidder, Banpu Power Ltd. of Thailand, which submitted a $280-million bid. 

Consunji said DMCI was supposed to bid together with San Miguel Corp. but the latter backed out as it was more interested in acquiring independent power producers (IPPs).

He said San Miguel had indicated its interest in taking an equity stake in Calaca but nothing has been formalized at the moment.