Property giant Megaworld Corp. said its annual net income for 2015 jumped by 10.58 percent to P10.39 billion from the preceding year’s P9.40 billion on the back of strong recurring income.
Consolidated revenues, excluding non-recurring gains grew by 9.37 percent year-on-year to P44.81 billion from the P40.97 billion posted in 2014.
In a disclosure to the Philippine Stock Exchange, Megaworld said its leasing business was the fastest growing segment last year as its rental income grew by 23.46 percent to P8.73 billion from the P7.07 billion registered in the previous year. This accounts for the leasing income from malls, commercial centers and offices.
Megaworld Chief Finance Officer Francis Canuto said the firm’s high rental income in 2015 indicates the company will realize its P11 billion rental income target for 2016.
“Our rental business had been growing exponentially the last five years,” Canuto said. “We are confident that we will reach the P11 billion target by the end of this year, as we see continuous growth in consumer spending as well as further expansion of BPO companies, particularly in key growth areas in Visayas and Mindanao where Megaworld is already present.”
Earlier this year, Megaworld announced its goal of reaching P11-billion worth of rental income as it aggressively expands its mall and office portfolio.
The property developer said it expects to add 650,000 square meters of gross floor area to its portfolio, as it completes more office towers, malls and commercial centers by the end of the year.
“We already have a strong roster of townships across Luzon, Visayas, and Mindanao that are backed by adequate landbanking and carefully-thought masterplans,” Canuto said. “We have already mastered the art of township development. What we want to put focus on now is how to further grow our rental portfolio, which is integral to being a township developer. Malls and offices are key components of an urban township.”
In 2015, Megaworld launched five township developments bringing its total number of townships across the country to 20. The latest additions are the 31-hectare Westside City in Paranaque City; the 53-hectare Northill Gateway and the 34-hectare Upper East both in Negros Occidental; the 170-hectare Sta. Barbara Heights in Iloilo; and a 35.6-hectare property beside the City of San Fernando in Pampanga.
For 2016, Megaworld said it has earmarked P55 billion for its capital expenditures, a budget which will also be used for its subsidiary brands Global Estate Resorts Inc.(GERI), Empire East Land Holdings Inc., and Suntrust Properties Inc.
The property giant said 75 percent of the budget will be used for the development of projects, while the remaining 25 percent will be allotted for land acquisition and investment properties.