EEI profit rises 10% to P172.23 million in 1st quarter

MANILA, Philippines - Construction giant EEI Corp. posted a net income of P172.23 million in the first quarter this year, up 10 percent from the same period in 2009 mainly due to lower provisioning for income tax.

In a financial report submitted to securities regulators, EEI said consolidated revenues amounted to P1.64 billion, down 13 percent from the P1.88 billion recorded a year earlier on lower earnings from its overseas associate and joint venture, and decreased interest income and other income.

Likewise, revenue by virtue of the company’s share in the income of its overseas associate and joint venture, interest income and other income all registered declines during the period in review compared to previous year’s performance.

Total domestic consolidated orders fell 74.7 percent to P221.39 million, of which P131.54 million was contributed by EEI’s local subsidiaries.

EEI’s production from domestic construction contracts rose 31 percent from P855.44 million to P1.12 billion, reflective of the recovery of the domestic construction activity from the slowdown caused by the global recession that prevailed last year.

However, revenue from services fell 59 percent to P279.78 million and real estate dropped 26 percent to P14.76 million.

During the quarter under review, EEI acquired a contract for manpower supply for the Parallel Train olefins recovery project in Singapore for Shaw Stone & Webster Asia Inc. worth P38.14 million; and the negotiated contract for NAIA Expressway and its related road project CP IVC Phase I for Department of Public Works and Highways (DPWH) amounting to P26 million.

Domestic projects completed include the 60-story St. Francis Shang Towers of the Shang Grand Tower Corporation in Mandaluyong City and the 18-story Acacia Grove Hotel and Condominiums project of CHMI Hotels and Residences Inc. in Alabang, Muntinlupa City.

Projects nearing completion include the NAIA 3 Nichols Skyway interchange project Package 4C of DPWH, the 39-story Mandarin Square building of Manila Tower Corp. in Binondo, Manila, the Beacon Tower 1 project of New Pacific Resources Management Inc. in Makati City, and One Serendra, Phase 2B and Two Serendra CII Phase 2B, both for Ayala Group, in Fort Bonifacio, Taguig City.

Currently under construction are Phase 2 of the GA Skysuites project of Globe Asiatique Realty Holdings Corp. in Quezon City, the Sunlife Financial Philippine headquarters project of Sunlife of Canada in Fort Bonifacio, the Princeton Residences project of SM Development Corp., the SM 2ECom Building project of SM Land Inc. and the BSP Pampanga Branch building of the Bangko Sentral ng Pilipinas.

Likewise, the company is undertaking the P2.84 billion joint venture project with Hanjin Heavy Industries & Construction Co. Ltd. for the construction of Berth 6 of the Manila International Container Terminal of global port operator International Container Terminal Services Inc. (ICTSI). EEI has a 30 percent stake in the project.

EEI is also providing construction services for overseas clients in its ISO 9001certified steel fabrication plant located in Sta. Maria, Bauan, Batangas. In-progress is the package for the fabrication of piperack modules for Shaw Stone Webster Asia Inc. worth Sing $57 million for the Singapore Parallel Train (SPT) olefins recovery project at Jurong Island, Singapore being built for Exxon Mobil Chemical Asia Pacific.

Other overseas projects of the Company are the Inco Goro nickel mining project in New Caledonia, involving on-site piping, electro-mechanical and structural erection of the plant; and the $12 million Qatargas 3 & 4 onshore project for GAMA Qatar Co. WLL under the Chiyoda-Technip Joint Venture for pipe erection works of inlet facilities covering electro-mechanical works for utilities, offsite and off-plot areas. These are expected to be completed towards the end of the current year.

The total company’s domestic backlog as of end of March 2010 had a net selling price of P5.33 billion, including the backlog of subsidiaries worth P371.91 million.

As of end-March this year, EEI’s overseas joint venture firm Al Rushaid Construction Co. (ARCC) amounted to P14.77 billion. Included are the Southern Area flare system upgrade project for Saudi Aramco, which involves the replacement of flare tips in 28 gas oil separation plants to environmentally sound, smokeless flare tips; the Shuqaiq II independent water power plant project of the Shuqaiq Water Electric Co. under Mitsubishi Heavy Industries (MHI); Qurayyah power plant project of Saudi Electricity Co., also under MHI; JGC Arabia ethylene plant north plot project for National Chevron Philips (NCP); and Saudi Aramco’s Manifa central processing facilities project under JGC Corp. All of these projects are in the Kingdom of Saudi Arabia.