DMCI Holdings Inc. said bottom line fell last year as a result of the weak performance of its power and construction units.
The company said its net income was down by 43 percent to P10.77 billion for 2014, from the previous year’s P18.93 billion. During 2013, however, the company had a one-time gain of P8.35 billion compared with last year’s P519 million.
The one-time gain of P519 million in 2014 represents net gain on business combinations accounting for ENK Plc. and Toledo Mining Corp., the company said. Core net income, which strips out the one-time gains, was also lower by 3 percent to P10.25 billion, from the previous year’s P10.58 billion.
Revenues for the period, meanwhile, were slightly higher at P56.56 billion, from the previous year’s P55.97 billion.
Net income from power dropped by 42 percent to just P2 billion for the period from the previous year’s P3.5 billion.
“Technical problems and commissioning delays forced the extended outage of Power Unit 2 of SEM-Calaca Power Corp., which exposed the company to high Wholesale Electricity Spot Market prices for its replacement power during the first half of the year,” the company said.
Meanwhile, earnings from its construction subsidiary D.M. Consunji Inc. were dragged down by cost overruns in its engineering, procurement and construction contract for a power plant, and the delayed implementation of major public infrastructure projects due to right-of-way and utility relocation issues.
Net-income contributions from construction dropped 62 percent to P479 million from P1.3 billion the previous year, it said.
On the other hand, the mining, real estate and water businesses posted strong results in 2014, which helped to partly offset the income declines in the other segments.
The mining businesses rebounded from last year’s drop and showed significant growth in net-income contributions due to the combined effect of higher sales volume and better average prices.
In particular, Semirara Mining and Power Corp. posted a 125-percent increase to P2.3 billion last year, from P1 billion in 2013. Net-income contributions from DMCI Mining Corp. rose 114 percent to P362 million, compared to P169 million in 2013.
Real-estate subsidiary DMCI Homes posted a 22-percent increase in net income to P3.2 billion from the previous year’s P2.7 billion, mostly coming from gain realized on sale of lots.
Continued improvement in the operational performance of affiliate Maynilad Water Services Inc. pushed net earnings share from the water business to rise 6 percent to P2 billion compared to P1.9 billion the previous year, the company said.
“The resilience of our engineering diversification strategy was apparent in 2014. Despite the weaker-than-expected results of two business segments, we were able to stabilize the overall profitability of our investment portfolio,” DMCI Chairman and President Isidro Consunji said.
DMCI also reported a P173-million net loss in 2014, which represents its share in the net loss in initial operations of Private Infra Dev Corp., the project proponent and operator of the Tarlac-Pangasinan-La Union Toll Expressway.