Lower coal, nickel prices bite DMCI
MANILA -Consunji-led DMCI Holdings Inc. saw net income fall by 28 percent to P20.02 billion in January to September after its mining arm registered a revenue dip as coal and nickel prices normalized.
Revenues for the period also slowed down by 19 percent to P92.4 billion. For the third quarter alone, the listed company’s bottom line slid by 44 percent to P4.09 billion.
The conglomerate noted that net income of Semirara Mining and Power Corp., its main revenue contributor, dropped by 37 percent to P12.8 billion in the first three quarters.
“We saw double-digit contractions in coal and nickel index prices because of the China economic slowdown and global oversupply,” DMCI Holdings chair and president Isidro Consunji said.
Last quarter, the average selling price of coal declined by 36 percent to P3,315 per metric ton, the company noted.
But Consunji said its power business had “acted as significant buffers,” whose net income grew by 15 percent to P632 million for the period. This was supported by higher electricity sales volume, lower fuel costs and improved margins.
DMCI Homes’ net income was flat at P3.8 billion as “lower percentage of completion was cushioned by better selling prices and higher income from sales cancellations.” Delivery of project milestones determines revenue recognition in real estate development.
Construction arm D.M. Consunji contributed P459 million in profits, a 32-percent decline from previous year because of “absence of new projects and completion of most infrastructure projects.”
DMCI Mining saw its net income fall by 38 percent to P569 million due to lower selling prices and higher costs.
Affiliate Maynilad Water Services Inc.’s contribution, meanwhile, surged by 51 percent to P1.7 billion on higher billed volume.
“Through the course of 2023, the DMCI Group has been navigating a complex economic landscape, marked by correcting commodity prices, sluggish construction and real estate demand, high interest rates, inflationary pressures and geopolitical tensions,” the company said.
“Improved operational efficiencies, cost-saving initiatives and prudent cash management have allowed its businesses to weather these challenges and position themselves for sustainable growth in the coming years,” it added. INQ
