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DMCI Holdings trims Q3 profit decline to 34%

Diversified engineering conglomerate DMCI Holdings Inc. recorded a 34-percent drop in consolidated third-quarter net income from P2.8 billion to P1.9 billion owing to weak contributions from its integrated energy, construction and water businesses.

Real estate arm DMCI Homes accounted for 55 percent of the consolidated profits as its third-quarter contributions surged 70 percent year-on-year to P1 billion.

Over the nine-month period, DMCI Holdings booked P3.9 billion in consolidated net income, 58 percent down from P9.3 billion last year.

Excluding P592 million in losses from sales cancellations for a DMCI Homes project, core net income declined by 52 percent from P9.3 billion to P4.5 billion.

“Among our businesses, Semirara and DMCI were hit hardest by the Covid-19 (coronavirus disease 2019) pandemic. We saw sharp drops in demand and prices for both coal and electricity because of the economic slowdown,” DMCI Holdings chairman and president Isidro Consunji said.

Consunji attributed the deterioration of construction earnings to lower productivity and extraordinary expenses related to the coronavirus.

Core income contributions from Semirara Mining and Power Corp. plunged by 64 percent from P4.7 billion to P1.7 billion primarily due to anemic market conditions and the imposition of coal import quotas in China last August.

DMCI Homes contributed P1.1 billion core income, 40 percent lower from P1.8 billion last year, because of lower revenues due to the imposition of lockdowns which slowed down construction productivity.

From P664 million,

D.M. Consunji Inc. booked a net loss of P97 million because of expenses related to Covid-19, lower construction accomplishments due to the lockdowns, and higher costs due to right-of-way issues for infrastructure projects.

DMCI Power posted an 18-percent growth in earnings contributions from P341 million to P403 million on the back of higher electricity sales and upward tariff adjustment for its Aborlan power plant.

Strong China nickel demand coupled with a 41-percent jump in production and the prevailing Indonesian nickel ore export ban allowed DMCI Mining to boost its income contributions by 190 percent from P87 million to P252 million.

Contributions from affiliate Maynilad fell 22 percent from P1.6 billion to P1.2 billion owing to lower commercial sales and average effective tariff, aggravated by higher amortization and depreciation expenses.

Lower interest income led to a P54-million net loss for the parent and other investments compared to a net income of P185 million during the same period last year.