Megawide recalibrates to curb pandemic losses

Megawide Construction Corp. said new building projects and its land port business softened the blow from financial losses dealt by the COVID-19 pandemic.

Calling 2020 “a year of recalibration,” Megawide said it was ready to tap new avenues of growth despite the health crisis and even setbacks such as the abrupt loss of its rights to redevelop Manila’s Ninoy Aquino International Airport (Naia).

“We are cognizant of the changes in the operating landscape and the company’s dynamism, coupled with a diverse portfolio, allowed us to navigate and shift more quickly to fresh opportunities,” Megawide chair and CEO Edgar Saavedra said in a statement.

Losses last year came mainly from its airport business, with operations at the Mactan Cebu International Airport suffering along with the broader aviation sector due to travel restrictions.

Megawide said this resulted in a net loss of P389 million in 2020, a reversal of profits recorded the previous year.

Not all of the company’s infrastructure projects sank as its Parañaque Integrated Terminal Exchange (PITX) saw revenues rise 7 percent to P902 million.

PITX, which serves as a public land transportation gateway to southern Metro Manila, booked a profit of P222 million last year.

“We now see the inevitability of an organized public transport system, housed inside a first-world terminal like PITX and its necessity under any circumstance, including this pandemic,” Louie Ferrer, Megawide executive director for infrastructure development, said in the statement.

The company’s traditional construction business also boosted earnings in the latter half of 2020 after strict quarantine rules were eased.

Megawide’s construction business contributed P10.8 billion or 84 percent to total revenues. The segment ended 2020 with 21 live projects compared with 30 at the start of the year with negotiations with clients ongoing.

The company also won new contracts in the final quarter of 2020 amounting to P34.8 billion. It ended the year with orders worth P68.4 billion, an indicator for future revenues.

New projects included the North-South Commuter Railway North Phase 2, the Aglipay Sewage Treatment Plant, Sun City West Side City Project and the Newport Link.

Megawide last year was granted the original proponent status to undertake the massive rehabilitation of Naia after Naia Consortium withdrew from the project. The status was taken away after a few months, with the Department of Transportation saying the government may develop the project on its own.