DM Consunji expects to end 2018 with higher orders

By VG Cabuag- August 30, 2018

https://businessmirror.com.ph/dm-consunji-expects-to-end-2018-with-higher-orders/

DM Consunji Inc., the construction arm of DMCI Holdings Inc., said it expects to end the year with higher booked orders compared with last year’s despite the lackluster performance of government infrastructure projects.

As of June 30, the company’s order book was at P29 billion, mostly in buildings and infrastructure, and these are likely to be higher by the end of the year, the company said.

DMCI’s construction arm posted a revenue of P7.2 billion for the first half of 2018, driven by the performance of the building and infrastructure business units. The figure is 13 percent higher compared to the P6.4 billion posted in the same period last year.

This can be attributed to the increase in the number of completed projects during the earlier part of the year, it said.

For the first half, its net income reached P676 million, higher compared with the P497 million made during the same period last year. This was brought about by higher gross- profit percentage of the business units due to late approval of variation orders already accomplished in the previous period.

Buildings grew their revenue by 48 percent in the first semester, due to more projects completed during the first half of 2018, as compared to last year’s first six months.

“Better performance is expected from the business unit due to ongoing projects, as well as newly awarded projects that will commence later this year,” it said.

“The building business unit also continues to actively participate in ongoing bids and negotiations. The company is confident \ these developments will further strengthen the portfolio for the coming year,” it said.

Revenues of the infrastructure unit fell by 9 percent compared to the same period last year, due to delays brought about by right-of-way issues. However, the recent development in the availability of right-of-way will help improve the company’s revenue for the rest of the year.

The ongoing bids and negotiations of privately funded projects, and the government’s rollout of the “Build, Build, Build” program, will help the company increase its order booking for next year.

The energy business unit generated higher revenues during the first semester due to the start of the JG Summit Petrochemical expansion, which was awarded at the beginning of this year.

The immediate resolution of government energy-related issues will improve the business unit’s order book.

Utilities and plants business unit also experienced a drop in revenue due to delays in the award of bidded projects earlier this year. The business unit is looking at improving revenues towards the end of 2018.

“Overall, we still maintain a positive outlook for DM Consunji Inc. for the second semester of this year,” company president and CEO Jorge A. Consunji said.

“We intend to be one of the major players participating in the rollout of infrastructure projects under the Build, Build, Build Program of the government, as well as in private construction projects.”

DMCI said earlier it is in talks with a Japanese firm to submit its unsolicited bid to construct the P50-billion, 38-kilometer Tutuban to Malolos stretch commuter train.