8990 posts 3% rise in 6-month profit

Mass housing giant 8990 Holdings Inc. said profit in the first six months of the year rose, as the company continued to benefit from strong demand for affordable housing, a company statement showed.

8990 Holdings said net income from January to June this year rose 3 percent to P2.18 billion. It said gross sales rose 6 percent to P4.73 billion. Net margin likewise increased to 46 percent, from its original estimate of 40 percent.

“Our buyers are deeply aspirational—they want to move up from being renters into property owners. But they are practical—they want value for money. And they are optimistic,” Januario Jesus Atencio, president and CEO of 8990, said in the statement.

In its statement, the builder also reported a 10-percent increase in direct cost to P2.01 billion due to the booking of resale accounts based on net realizable value and an 88-percent jump in finance costs to P411 million amid higher interest payment of the corporate bonds.

During the first semester, 8990 delivered 4,289 units worth P4.73 billion exceeding the target of 3,899 units worth P3.58 billion by 32 percent. Reservations inched up by one percent to P4.37 billion in the first half.

Atencio said the pre-cast technology allowed the company to build strong houses in as little as eight days.

Since the use of pre-cast wall panels in 2004 instead of hollow blocks in building houses, 8990 has produced 43,306 units in 39 completed projects.

He said the company was ramping up by an additional 56 forms with a capacity of 28,320 this year from last year’s 14,880.

Atencio said the company had built more than 43,000 homes worth between P450,000 and P1.4 million over the past 12 years for the average, working class, and lower-middle income Filipino families.

“It’s like a brand new home for the price of a good second-hand car or a monthly amortization equivalent to two cups of coffee everyday at Starbucks,” he said.

He pointed out ‘Millenials” aged between 20 to 35 were now the major buyers accounting for 55 percent of the total sales of 8990 last year from 50 percent in 2014.