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Cebu developer eyes higher spending, bigger profits

Updated: Apr 20, 2019

Artist's perspective of proposed Davao Global Township (Contributed Photo)

Developer Cebu Landmasters, Inc. (CLI) plans to spend P13 billion and launch P25 billion worth of projects this year to sustain its "outstanding" financial performance that saw its consolidated revenues and profits surge by 72% in 2018.

In a presentation to analysts, the Cebu-based developer said its consolidated revenues jumped 72% to P6.76 billion in 2018.

Consolidated net income also went up 72% to P2.17 billion while net income attributable to CLI increased 30% to P1.67 billion.

Sales were robust, growing 86% to P8.5 billion, which was 22% higher than its P7-billion target.

“We are very proud to report these exceptional 2018 results to our shareholders. We introduced a full range of developments in 2018 to fill opportunities offered by various VisMin markets – from residential condominiums and subdivisions to mixed-use projects and hotels. And, in the last quarter, we broke ground on the Davao Global Township (DGT), our first township project,” CLI president and CEO Jose Soberano III said in a statement.

The company targets to increase consolidated revenues by 25% to P8.4 billion in 2019.

Both consolidated (including subsidiaries) and parent net income after tax are also targeted to increase by 20% this year to P2.6 billion and P 2 billion, respectively.

Reservation sales, meanwhile, are projected to increase by 28% to P12.5 billion.

Its capital expenditures (CAPEX) projection for 2019, P13 billion, is about 27% higher than the P10.2 billion spent in 2018 for project development.

CLI attributed its impressive growth in 2018 to robust sales and the higher number of projects that were under construction. These projects include MesaTierra Garden Residences in Davao, MesaVirre Garden Residences in Bacolod, as well as Mivesa Garden Residences Phase 3, Casa Mira South, and Latitude Corporate Center—the last three are located in the company’s home province of Cebu.

About 64% of CLI’s total 2018 revenue came from projects in Cebu. Developments in Davao and Cagayan de Oro accounted for 12% and 11%, respectively, while new expansion sites in Bacolod and Dumaguete contributed the balance.

As of end-2018, the company’s landbank expanded to 915,204 square meters (sqm). CLI purchased 312,891 sqm of properties in 2018 and developed 275,569 sqm.

Total assets almost doubled to P25.4 billion as the company consolidated its subsidiaries with high-value assets.

The company also said it stands to collect P6 billion worth of project take-outs in 2019. Of the approved P5-billion corporate notes, P3 billion has been issued as of end-2018.

The company is undertaking about 50 projects in various stages of development in eight cities across the Visayas and Mindanao.

Its mid-market brand, the Garden series, made up the bulk of 2018’s revenue contributions at 45%, followed by its economic housing brand Casa Mira at 28% and the high-end Premier Masters at 19%.

CLI is scheduled to open its first hotel, the 180-room Citadines Cebu City in Base Line Center, in the second half of 2019. The development will be managed by The Ascott Limited of CapitaLand. CLI’s hotel portfolio is 950 rooms with properties in Davao, Bacolod and Mandaue. The Davao and Bacolod projects will also be operated by Ascott.

It is set to undertake its first township project, the P33-billion Davao Global Township in Matina District, Davao City, by transforming the Davao City Golf Course into what is envisioned to become Davao’s central business district. (Ventures Cebu)

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