Mass housing developer 8990 Holdings, Inc. said its real estate business remained strong as consolidated net income increased 13% to P4.67 billion as of end-2018 despite the inflation uptick and higher interest rates.
Consolidated revenues exceeded the 2019 target and grew 15% to P11.75 billion, with the Visayas projects contributing about a third or 32%.
“It comes to no surprise that momentum in our real estate business has remained strong throughout the year. Our company is built on solid ground and the excellent results in 2018 reflects the strong interest for our products even at a time when inflation has been moving up,” the company said in a statement on Wednesday, May 8, 2019.
“This only shows that when you offer good homes within reach of every Filipino, demand remains relatively immune to movement in interest rates,” it added.
This year, the company said it targets to further increase revenues to P13.5 billion. Capital spending will also be higher at around P12 billion compared to P8 billion in 2018.
The company is undertaking two projects in Cebu, the Urban Deca Homes Tisa 2 in Barangay Labangon, Cebu City and Urban Deca Homes H. Cortes in Mandaue City.
It is also acquiring a Cebu-based real estate company and its flagship project, a high-end mixed-use development in the highlands of Cebu City.
See related story: 8990 Holdings to acquire Monterrazas de Cebu developer for about P1B
The company is also undertaking five projects in Luzon, two in Iloilo, and one each in Bacolod and Davao cities.
The projects are: Deca Clark Resorts Residences in Pampanga; Urban Deca Homes Manila in Tondo, Manila; Urban Deca Homes Marilao in Bulacan, Urban Deca Homes Hampton and Urban Deca Homes Mahogany in Cavite; Deca Homes Pavia Resorts Residences 2 and Deca Homes Sta. Barbara in Iloilo; Deca Homes Bacolod in Bacolod; Urban Deca Homes Tisa 2 and Urban Deca Homes H. Cortes in Cebu; and Deca Homes Mulig in Davao.
Once finished, all 11 projects would have contributed a total of 37,715 housing units.
The largest project, Urban Deca Homes Manila in Tondo, is a 13-tower residential complex offering over 13,000 units with an estimated sales value of P20 billion.
The developer, which is listed on the Philippine Stock Exchange, said its projects in Luzon contributed more than half, or 56%, of revenues in 2018.
The projects in the Visayas contributed 32% while those in Mindanao brought in 11%.
Consolidated gross income for 2018 registered at P6.46 million, a 14% increase from consolidated gross income of P5.66 million in 2017.
In the past few years, the company has actively locked in on material costs, helping it enjoy a gross margin of 55% in 2018.
8990’s consolidated net income for the year ended December 31, 2018 was P4.67 billion, an increase of 13% from consolidated net income of P4.14 billion recorded for the year ended December 31, 2017.
The company’s consolidated net income margin for 2018 and 2017 were both 40%.\
8990 share closed at P14.40 apiece on May 8, 2019. (Ventures Cebu)