MEGAWORLD Corp. saw its first-quarter (Q1) net income rise by 16% to P5.83 billion, driven by leasing activity and growth across its residential, office, mall, and hotel businesses.
Consolidated revenue for the first three months grew by 11% to P20.93 billion on the back of strong contributions from its residential, leasing, and hotel operations, Megaworld said in a regulatory filing on Wednesday.
“This strong start to the year is a reflection of our clear strategy and the strength of our diversified portfolio. All of our core businesses — residential, office, malls, and hotels — grew during the first quarter. More than half of our township developments are in the provinces, and the opportunity for expansion and growth is there,” Megaworld President Lourdes T. Gutierrez-Alfonso said.
Real estate sales improved by 8% to P13.09 billion on project sales across Metro Manila and key growth centers in the provinces.
Leasing revenue went up by 15% to P5.34 billion due to tenant demand and synergy between Megaworld’s office and retail ecosystems.
Megaworld Premier Offices grew its revenue by 17% to P3.69 billion. It secured over 50,000 square meters (sq.m.) of new office leases during the quarter — the highest quarterly total in five years — driven by expansions and new tenants from business process outsourcing firms and multinational companies.
Megaworld Lifestyle Malls saw an 11% revenue increase to P1.66 billion on higher foot traffic, sustained consumer spending, and more than 13,000 sq.m. of new tenant openings during the quarter.
Megaworld Hotels and Resorts recorded a 27% increase in revenue to P1.43 billion due to higher room rates.
As of end-March, Megaworld held nearly half a trillion pesos in total assets. It has 35 townships nationwide and approximately 7,000 hectares of land bank.
The property developer aims to expand its office gross leasable area (GLA) to two million sq.m. by 2030 and its retail GLA to one million sq.m. by the same year.
These targets will bring Megaworld’s total leasing portfolio GLA to three million sq.m. by 2030.
Megaworld is the real estate arm of listed conglomerate Alliance Global Group, Inc. (AGI).
“Megaworld remains to be the top contributor to the revenue pie of the Alliance Global Group. This quarter’s results affirm the strength of the company’s township model, which thrives because of the unique connections it fosters between people, businesses, and experiences,” AGI President and Chief Executive Officer Kevin L. Tan said.
Meanwhile, AGI said in a separate disclosure that it plans to raise P26.7 billion from the issuance of warrants to fund expansion plans and settle debt.
The issuance covers up to 2.226 billion underlying common shares at a minimum price of P12 per share.
Warrants refer to derivative instruments that give holders the right — but not the obligation — to purchase or sell a stated number of shares of stock at a specified price and within a specific period.
“The proceeds of the offer will be used to finance capital expenditures, repayment of debt obligations, general corporate purposes, and transaction costs,” AGI said.
“The offering of the warrants to eligible stockholders will allow the latter to have the opportunity to maintain their ownership ratio prior to the issuance of the warrants,” it added.
On Wednesday, Megaworld shares rose by 1.11% or two centavos to P1.82 each, while AGI stocks climbed by 2.1% or 13 centavos to P6.32 apiece. — Revin Mikhael D. Ochave
