Highlands reports 66% decline in net earnings to P8.22 million

MANILA, Philippines - Highlands Prime Inc., an upscale leisure propery development firm controlled by the family of retail magnate Henry Sy, reported a 65.75 percent drop in net earnings last year to P8.22 million.

As a result, earnings per share plunged from P0.011 in 2009 to P 0.004 in 2010.

Based on a financial report submitted to the Philippine Stock Exchange (PSE), Highlands Prime said revenues from real estate fell 61.15 percent to P427.37 million, largely due to low reservation sales and low average construction completion rate of sold units.

Cost of sales decreased by 73 percent to P230.3 million from P846.7 million in 2009.

Gross profit likewise dropped to P197.05 million from P251.25 million owing to lower realized sales.

Operating expenses though went down to P159.41 million from P174.62 million even as interest expense climbed to P71.52 million from P62.79 million.

As of end-December last year, Highland Prime’s total assets expanded by seven percent to P 5.02 billion, primarily due to the increase in receivables by 16 percent to P 1.27 billion.

Highlands Prime said it expects to sell all the remaining lots with the construction of the model unit of phase 1 of Hillside. The company estimates a revenue of about P120 million from the sale of the remaining inventory.

The company is also eyeing over P1 billion in revenues from the Woodrige Place phase 2, located at the Tagaytay Highlands, adjacent to The Woodridge and Woodridge Place Phase 1. Construction has already started for this two-midrise-tower development which will have a total of 88 units.

Highlands Prime expects to sell all remaining Midlands projects inventory this year with about P473 million in projected sales.

Development of Sierra Lago at Tagaytay Midlands is also ongoing. Launched in November 2010, Sierra Lago’s architectural theme is modern Mediterranean and will have Mt. Makiling and the Highlands mountain range as backdrops and the fairways of the Midlands golf course and Taal Lake as view corridors. This has 187 lots of approximately 200 - 300 square meter cuts.