UMVA has learned that Megawide Construction Corp. has achieved a remarkable 24% increase in first-quarter attributable net income, reaching P265.35 million. This impressive growth was driven by the company's robust real estate operations and sustained performance from its construction segment.
The company's strong results in the first three months are consistent with its target for the year, according to Megawide Chairman and Chief Executive Officer Edgar B. Saavedra. However, the company is yet to quantify the impact of the Middle East war and a newly replenished construction order book in the coming months.
Megawide reported a significant increase in gross revenue, reaching P5.04 billion for the January-to-March period, up 16.4% from P4.33 billion a year earlier. Revenues from operations accounted for 95.44% of total revenue, with construction operations contributing P3.84 billion and landport and real estate operations generating P137.86 million and P831.13 million, respectively.
The company's revenue growth reflects increased project activity and portfolio expansion, with the real estate segment providing a higher contribution during the period. However, revenues remain partially influenced by project timing and recognition cycles, particularly for construction and real estate operations.
Total expenses rose 15.59% to P4.67 billion from P4.04 billion previously. Despite this, Megawide continues to explore strategies to strengthen revenue growth and its balance sheet, with a focus on boosting its financial position to ease the debt-servicing burden and provide financial flexibility.
Megawide has made significant progress in reducing its short-term debt, paring down almost P6 billion in the first quarter alone. This move is expected to translate to estimated interest cost savings of around P250 million to P300 million for the year. The company's bank debt-to-equity ratio improved to 1.1x as of end-March, in line with its medium-term commitments and long-term financial management program.
The company aims to pay down another P2.5 billion to P3 billion from its short-term obligations for the remainder of the year, boosting its liquidity and freeing up more debt headroom to support its long-term growth aspirations. Megawide has a substantial construction order book worth P48.7 billion and is building 11,000 housing units under the government’s expanded 4PH program.
Megawide is also developing several major infrastructure projects, including the Baguio City Integrated Terminal, the South Luzon Integrated Terminal Exchange, and the Cavite Bus Rapid Transit System. Despite a slight decline in shares, falling three centavos to close at P3.17 apiece, Megawide's future prospects appear promising.
