EEI net income grows 15% to P418.7 million in 9 months

MANILA, Philippines - Construction giant EEI Corp. continued its upward trajectory in the nine months ending September this year, with its net income rising 15 percent to P418.69 million on the strength of its overseas operations.

In a financial report submitted to securities regulators, EEI said equity in net earnings of associates and joint ventures grew 19 percent to P460.99 million from P387.82 million while consultancy fees earned from overseas operations surged 61 percent from P59.23 million to P95.19 million.

On a per share basis, earnings amounted to 40 centavos or five centavos higher than the previous level. This despite a 32 percent drop in consolidated revenues to P7.85 billion.

Revenues from local construction contracts and services, which account for 83 percent of EEI’s total revenues, declined 37 percent and 33 percent to P2.91 billion and P1.56 billion, respectively.

Interest income, on the other hand, went up 12 percent to P53.76 million.

As a result of the decline in production from domestic construction projects/contracts, costs fell 37 percent to P4.15 billion. Interest expense also dropped to P177.82 million due to lower level of bank loans to P1.74 billion.

EEI said 74 percent of its total manpower complement of 14,680 is currently deployed in its various overseas projects, particularly in the Kingdom of Saudi Arabia (KSA), through its joint venture company, Al-Rushaid Construction Co. (ARCC), in Qatar and in New Caledonia.

During the period under review, EEI obtained domestic orders and contracts aggregately valued (at net selling price) at P3.62 billion, 67 percent higher than the previous level of P2.17 billion.

Backlog representing the value of workable balance of contracted domestic projects of the company as of September this year was computed at P4.80 billion, 50 percent higher than the P3.19 billion recorded a year ago.

For its foreign projects, EEI’s 49 percent-owned joint venture company ARCC acquired a $192million contract with JGC Corp. for the Saudi polymers project in the KSA in March 2009.

Orders backlog of ARCC representing the value of workable production from existing contracts stands at $265 million as of the end of September 2009. This backlog includes remaining works for the new ethylene plant of the Eastern Petrochemical Co. (also known as Sharq), Saudi Aramco’s flare tips project, the new Shuqaiq power and desalination plant, and the rehabilitation and modification works in the Qurayyah power plant, both for Mitsubishi Heavy Industries. These projects are all located in the Kingdom of Saudi Arabia.

EEI was also awarded by Gama Qatar Co. Wll a $12-million manpower services contract under the Chiyoda-Technip joint venture involving erection and electro-mechanical works for the new Qatar gas 3 and 4 onshore project in Qatar.

As a global contractor, the company is currently working on a major package for the fabrication of piperack modules for international engineering company Shaw Stone Webster Asia Inc. This fabrication project was awarded in September 2008, and is part of the Singapore Parallel Train (SPT) olefins recovery project in Jurong Island, Singapore being built for Exxon Mobil Chemical Asia Pacific.