By Richmond Mercurio (The
Philippine Star) | Updated April 4, 2016 - 12:00am
MANILA, Philippines – Diversified
engineering conglomerate DMCI Holdings Inc. has set aside its biggest capital
spending to date this year as the Consunji family kicks off a five-year program
aimed at accelerating growth and transforming the company into a regional
player.
DMCI is earmarking over P40 billion
for its capital spending this year, more than doubling its capital commitment
of P19.3 billion in 2015.
DMCI Holdings chairman and president
Isidro Consunji said this year’s budget allocation is already fully funded
through a combination of previous debt and internally generated funds.
The higher budget for 2016 is mainly
to support the growth of DMCI’s real estate and power generation businesses,
the company said.
“This is our biggest annual capex
program to date. There is still considerable room for growth in the property
market and power industry so we are focusing our resources on these areas,”
Consunji said.
DMCI has decided to join the “2020
vision” bandwagon of most large companies as it starts this year its own
five-year program.
“We are projecting where we will be
in 2020. If we don’t do anything different, we will be stagnant so the goal is
to go on a different level of growth. We will present before the end of the
year our five year plan, our 2020 program,” Consunji said.
Over the past decades, DMCI has
diversified into other businesses to expand the company’s revenue sources.
“20 years ago 95 percent of our
business is construction. Now it’s only five percent. Power and coal mining are
now our biggest businesses. But we see construction growing again in the coming
years,” Consunji said.
“Philippines is growing six to seven
percent a year so there’s still a lot of opportunity. I think infrastructure
will still be big in the coming years. Once infrastructure becomes better,
corresponding businesses such as real estate, power, water, will also go along
with its development,” he added.
Consunji said part of DMCI’s target
over the next five years is to go regional.
He said venturing outside the
country has been among the plans of the group for a few years now but nothing
has come into fruition yet.
“It’s hard to start. What we want is
to have a Japanese partner, we don’t want to start from ground zero,” Consunji
said.
Consunji said DMCI has done oculars
in countries such as Myanmar, Vietnam, and East Timor for its possible
international expansion.
For this year’s record high capital
spending, the listed conglomerate said real estate subsidiary DMCI Homes would
corner the lion’s share at P32.5 billion.
Of the amount, P27.5 billion will be
used to total development cost of new projects to be launched in 2016 while the
remaining P5 billion will fund land acquisitions.
Among the big projects of DMCI Homes
for this year is a high-end condominium located in Asia World, Parañaque which
will be the company’s first luxury residential development as well as its first
mixed-use building in Makati.
Plans are also underway for the
mid-segment developer to expand outside Metro Manila and enter the low-cost
housing market.
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