D.M. Wenceslao profit rose 9% in Q1 to P507.1M

Integrated construction and property development firm D.M. Wenceslao & Associates Inc. (DMW) grew its attributable net income by 9 percent year-on-year to P507.1 million in the first quarter, driven by higher earnings from its leasing portfolio and residential development.

Total consolidated revenues increased by 12.8 percent year-on-year in the first three months to P595.6 million, 83 percent of which consisted of recurring income.

DMW’s recurring income included rentals from land, building and other revenues such as common use service area fees.

Earnings from the leasing of land increased by 4 percent to P255.2 million. Rentals of buildings and other revenues related to leasing rose by 17 percent and 7 percent, respectively, to P193.5 million and P45.1 million, respectively.

Despite having no new commercial buildings programmed for completion this year, the office segment sustained a double-digit growth on favorable pricing of negotiated lease renewal rates. Average lease rate at Aseana One, which was delivered in 2012, increased by 40 percent year-on-year to P870 per square meter from P620 per square meter.

“Current and long-term trends continue to move our way and we are positioned to capture the opportunities behind them,” DMW chief executive officer Delfin Angelo Wenceslao said.

Meanwhile, revenues from the sale of condominium units surged by 749.6 percent to P100 million. This was due to the increase in the number of units that are qualified for revenue recognition in 2019 compared to units for the same period in 2018. Furthermore, percentage of completion in 2019 increased from the year-ago level.

“Our residential segment will remain the main growth driver for the rest of the year following the steady progress of our project completion and ongoing preselling activities. As of April 30, our pre-sales of MidPark Towers have reached P3.6 billion from P2.8 billion reported in mid-February. Growth momentum will also come from land sale,” he said.

During the quarter, the company began vertical construction of Parqal and MidPark Towers. Parqal is part of Aseana City’s greenway, a pedestrian park and promenade that stretches from Diokno Avenue to Macapagal Avenue with a 67,000-square meter leasable floor area.

MidPark Towers is a four-tower residential project with 42,000 square meters of saleable area. It was launched in November 2018.

Meanwhile, total construction revenues decreased by 97.2 percent year-on-year to P1.7 million in the first three months, due to the decline in construction activities rendered to external customers. In 2019, the group started refocusing its construction resources to complete internal projects.