Megawide nets P475M

The consortium of Megawide Construction Corp. and India’s GMR Infrastructure Ltd. took over the concession to operate and expand Mactan Cebu International Airport, the country’s second-busiest air facility, in 2014. INQUIRER.net FILE PHOTO

Engineering and infrastructure group Megawide Construction Corp. grew its attributable first quarter net profit by 8 percent year-on-year to P475.29 million, driven by in increased contribution by its Cebu airport operation business.

Including net income attributable to non-controlling interest, Megawide’s first quarter net profit rose by 16 percent year-on-year to P635.8 million.

The airport business segment now contributes 62 percent of consolidated net earnings while the construction business segment accounts for 38 percent.

Consolidated revenues amounted to P4.4 billion, with the construction business contributing 84 percent to total, while the airport accounted for the balance of 16 percent. First quarter revenues were 7 percent lower year-on-year, which the company attributed to the cyclical nature of the construction business segment.

Megawide chair and chief executive officer Edgar Saavedra expressed optimism on the year ahead. “We are optimistic about the company’s growth prospects in 2018 with the increasing contribution from our airport business and the expected pick up of our construction business towards the end of the year,” he said.

The construction business segment posted P3.7 billion in revenues, 11 percent lower than the comparable period. This was due to projects in varying stages of construction in the order book and the scheduled start of construction for new projects booked towards the end of 2017. These include: Hampton O&P, Cold Storage Caloocan, 8990 Ortigas, Ascott-DD Meridian Park, and Double Dragon Tower Phase 3.

New contracts bagged during the first three months of the year amounted to P13.3 billion, 124% percent of the total new contracts booked in the full year of 2017. Majority of awarded projects are from the private sector with one big-ticket infrastructure project to construct the expansion of Clark International Airport. New projects also include Gateway Mall 2 Hotel, Golden Bay Tower, Taft East Gate and Space Ubelt.

“The push of the government’s build, build, build program is a key revenue driver for our construction business. Given our competitive advantage as a quadruple A contractor, a concession operator and a fully integrated engineering company, we are in the best position to participate in these projects,” Saavedra said.

Meanwhile, airport operations posted P646.1 million in revenues, 13 percent higher year-on-year. This was on the back of an 11-percent growth in passenger volume, with international outperforming domestic in terms of passenger growth at 14 percent and 10 percent, respectively. Non-aero or commercial revenues – which contributed 33 percent to the total – grew by 18 percent to P212 million.

Passenger service charge, representing 55 percent of airport revenues, increased by 11 percent year-on-year to P357 million, driven by the double-digit growth in passenger throughput.

“The solid performance of our airport segment will be supported by the completion of Terminal 2 in June of this year,” spoke Saavedra. “This will open more opportunities to steer this segment to even greater heights. Thriving tourism will also help boost growth as we position MCIA (Mactan Cebu International Airport) as the country’s main tourist hub with its strategic geographic location at the center of the Philippines.”

At the end of the first quarter, MCIA handled 2.7 million passengers, with domestic passengers representing 65 percent and international passengers at 35 percent. Air traffic volume increased by 21 percent, with a 15-percent and 22-percent growth in international and domestic traffic, respectively.