March 26, 2015

Megaworld Corp announces P9.4b in 2014 core net income

In a press statement, Megaworld Corp (MEG) yesterday said its net income reached P21.6b but this is inclusive of P12.1b in non-recurring gain.

Stripping out the latter, core net income would have been at P9.4b, up 13.6% YoY. This came on the back of a 15% rise in consolidated revenues to P41b with real estate sales growing 16% YoY to P24.6b while rental income increased 17% yoY to P7b.

Our take: MEG’s core net income fell short of the P9.7b market consensus forecast. However, while we estimate 4Q14 net income to have dropped by about 24% QoQ (in keeping with previous quarterly trends), this nonetheless reflect a 15% YoY growth which implied an acceleration from the 13.3% growth in the first nine months of the year.

Going forward, we expect MEG to draw additional momentum from its subsidiary Global-Estates Resorts Inc (GERI) which has been accelerating the development of key projects such as Alabang West and Southwoods City. We will write more on the results pending tomorrow’s investors’ briefing. – WealthSec