8990 eyes P5.4 B profit

MANILA, Philippines – Listed mass housing developer 8990 Holdings Inc. is eyeing a net income of P5.4 billion this year, up from P3.81 billion in 2016.

In a briefing yesterday, 8990 president and CEO Januario Jesus Atencio said net earnings are expected to grow more than 40 percent this year with the launch of 11 new projects.

Atencio also expects revenues to rise to between P10 billion to P13.5 billion.

He said 2016 profit went up by only two percent due to the delay in processing of permits.

Eight projects, totalling 2,706 units with a gross value of P2.4 billion, did not get permits on time. These projects are now part of the launches for 2017, Atencio said.

Atencio said the company’s thrust for 2017 is cash generation from increased take-out levels with the Home Development Mutual Fund, CTS (contract to sell) purchase of banks, securitization and issuance of preferred shares which will be used to pare down debt.

“Together with the board of directors in our last meeting, we are prepared to sacrifice some growth for cash generation in 2017, which would mean the stoppage of In-House CTS in most of the projects in favor of direct take-outs from the Pag-IBIG Fund, as well as the slow-down of purchase of rawland to expand the landbank,” Atencio said.

The company managed to reduce its expenses by 11 percent to P1.53 billion due to lower marketing and documentation costs as well as lower taxes and licenses paid.

In the fourth quarter, 8990 reported a 12 percent increase in net income to P674 million despite the two percent decline in gross sales to P2.23 billion.

Given its strong performance over the past few years, 8990 has been able to pay dividends to shareholders. It has approved a cash dividend declaration  of P0.25 per share next month, bringing the amount paid to shareholders to P1.28 per share since December 2014.