NextGen Day

Manila, Philippines – The diversified engineering conglomerate DMCI Holdings reported a 9% decline in consolidated net income for the second quarter, with figures dropping from PHP 9 billion to PHP 8.2 billion. This dip is attributed to reduced contributions from the coal, nickel, and construction sectors.

After excluding a nonrecurring gain of PHP 37 million in 2022 stemming from DMCI’s land sale and a nonrecurring loss of PHP 12 million in the current year due to donations by Maynilad and net foreign exchange losses, the consolidated core net income fell by 8% from PHP 9 billion to PHP 8.3 billion.

In a statement released on Wednesday, DMCI Holdings Chairman and President Isidro Consunji noted that while the coal and nickel industries faced significant drops in pricing and construction volumes observed a downtrend, the firm managed to achieve its second-highest Q2 ever. Consunji attributed this resilience to the robust recovery of DMCI’s power and water businesses.

During the first semester, DMCI Holdings reported a consolidated net income of PHP 15.9 billion, marking a 22% decrease compared to PHP 20.3 billion from the previous year. The reduction was due to diminished contributions from coal, nickel, real estate, and construction businesses.

The company’s core net income aligned with its reported net income, as nonrecurring items remained minimal.

Financial Overview by Business Segment

Semirara Mining and Power Corporation: Net income contribution from Semirara Mining and Power Corporation saw a 5% decline, dropping from PHP 6.1 billion to PHP 5.8 billion between April and June. This decline was attributed to weakened coal prices, although it was partially offset by higher coal shipments, power generation, electricity sales, and average selling prices.

DMCI Homes: DMCI Homes contributed PHP 1.4 billion, marking an 8% increase from PHP 1.3 billion. This growth was propelled by higher finance and other income sources.

Maynilad: The affiliate company, Maynilad, reported a 21% improvement in contribution, increasing from PHP 393 million to PHP 474 million. This positive shift resulted from improved billed volume, a favorable customer mix, and an average effective tariff.

DMCI Mining: Contribution from DMCI Mining plummeted by 51%, dropping from PHP 510 million to PHP 250 million. This decline was primarily due to lower selling prices, foreign exchange gains, and higher costs.

DMCI Power: DMCI Power saw a 13% increase in contribution, rising from PHP 205 million to PHP 231 million. Higher electricity sales and reduced fuel costs drove this growth.

D.M. Consunji, Inc.: Contribution from D.M. Consunji, Inc. decreased significantly, plunging by 73% from PHP 516 million to PHP 139 million. This drop was attributed to slower construction accomplishments, decreased projects, and delays in major projects.

Despite these challenges, DMCI Holdings remains resilient despite market fluctuations. The company’s ability to navigate these hurdles and maintain a strong performance in its power and water businesses demonstrates its adaptability and strategic focus. While a concern, the decline in net income reflects broader market challenges affecting several sectors, not just DMCI Holdings.

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As DMCI Holdings grapples with a 9% dip in its Q2 net income due to a range of market challenges, the company’s capacity to sustain strong performances in certain segments while managing the impacts of market fluctuations underscores its resilience and adaptability in a dynamic economic landscape.

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