DMCI keeps 20% profit growth forecast in 2011

business mirror

WEDNESDAY, 27 JULY 2011 18:34 MIGUEL R. CAMUS / REPORTER

DMCI Holdings Inc., the listed holding company of the Consunji family, is keeping its 20-percent profit growth outlook for 2011, given the favorable trajectory of most of its core units.

In an interview with reporters following the annual stockholders’ meeting on Wednesday, DMCI president Isidro Consunji said net income this year is on track to reach between P9 billion and P10 billion, versus the PP7.89 billion booked in 2010.

Last year’s profit was buoyed by the one-time gain from the sale of steel manufacturing unit Atlantic Gulf & Pacific Company of Manila Inc. in December.

Consunji said 2011 earnings will be led by its water, real estate, mining and power businesses through Maynilad Water Services Inc., DMCI Homes and Semirara Mining Corp.

Construction unit D.M. Consunji Inc., however, expects flat growth or even post a decline by up to a fifth given the slower-than-expected rollout of government infrastructure projects, which typically provide higher margins versus private sector contracts.

Growing contributions have been coming from coal mining and power firm Semirara which has benefited from higher coal prices and electricity sales.

Consunji said Semirara has a “good chance” of exceeding the upper end of its full-year profit target of P5.6 billion, which was equivalent to a 40-percent gain from the 2010 earnings.

He said Semirara will go solo with the expansion of its 600-megawatt (MW) coal-fired plant in Calaca, Batangas. The first phase will involve the construction of 300 MW of new capacity starting early 2012 at a cost of $450 million.

Consunji said half of that amount will be financed through borrowings, reiterating earlier statements. He said talks are ongoing with lenders.   

Semirara is already in talks with Chinese groups that will supply the equipment to build the said power plant, which is expected to be completed in 36 months.

The company has also obtained board approval to build another 600-MW facility in Calaca, but Consunji said plans to build the remaining capacity will depend on future demand.

DMCI shares added 0.54 percent to P46.10 each on Wednesday trading while Semirara slid 2.75 percent to P233.40.