Megaworld profit up 15%

MANILA, Philippines - Robust residential sales from several township projects and recurring income from its commercial portfolio boosted Megaworld’s profits higher in the first half of the year.

Megaworld, led by property tycoon Andrew L. Tan, said its first semester earnings hit P4.25 billion, up 15 percent from a year ago, while total revenues rose 12 percent to P17.28 billion during the same period.

The firm attributed the profit growth to “strong residential sales and (turnover)from the residential projects in townships... as well as strong leasing income from its business process outsourcing (BPO) and retail portfolio.”

Megaworld posted strong sales in its Newport City, Uptown Bonifacio, McKinley Hill and Eastwood City township projects.

Megaworld, its medium-cost housing arm Empire East Land Holdings and affordable housing unit Suntrust Properties Inc. recorded P38 billion in reservation sales in the first half, 27 percent higher from last year.

“We see continued significant growth in the Philippine property sector, especially in the residential, commercial and office segments,” said Tan, Megaworld’s chairman and CEO.

Megaworld is banking on good macroeconomic fundamentals, influx of overseas Filipino remittances and strong consumer sector, Tan said.

“Based on our first half performance, we are well on track to hit our target of P70 billion reservation sales for the year,” Tan said.

The Megaworld Group is looking to launch at least 25 residential projects this year offering 12,000 new residential units, up from 10,000 units last year. In the first half, Megaworld launched 14 projects.

In terms of recurring earnings, Megaworld said rental income from its BPO office developments and lifestyle malls surged 25 percent to P2.83 billion in the first six months from P2.26 billion last year.

“We will continue to build more office developments and lifestyle malls to support the growing demands of the BPO industry and the retail consumers,” Tan said, adding this will allow Megaworld to post a record rental income this year.