8990 Holdings forecasts yearβs revenues to hit P20 billion
8990 Holdings, Inc. is expecting to record revenues of about P20 billion for 2020, driven by the partial opening of its Urban Deca Homes Ortigas project by year’s end.
In a topping-off ceremony at the project’s site in Ortigas yesterday, 8990 Holdings Chairman Mariano D. Martinez, Jr. told reporters the company is expecting four of the 22 buildings that comprise the project to be completed within the year.
“This year, they’re going to turn over to us four buildings beginning August until December. Those four buildings will be more or less 3,800 units,” he said, noting the average price per unit is P2.5 million.
Including 8990 Holdings’ other projects, the company’s expected revenue by end-2020 is P20 billion, of which 40% or about P8 billion will be the net income.
Urban Deca Homes Ortigas is 8990 Holdings’ largest project to-date: a 13-hectare development along Ortigas Avenue Extension with 19,000 units across 22 buildings, a mall and a one-hectare open space. Once completed, the whole project is expected to generate close to P40 billion in sales.
Mr. Martinez said around six to eight more buildings are expected to be turned over next year, and the rest over the next three to four years.
8990 Holdings has set its capital expenditures for 2020 at P12 billion, where P8 billion will be allocated for construction, P2 billion for replenishment of land and P2 billion for advanced land development.
This will be supported through the company’s receivables, which stand at about P22 billion, plus an additional P16 billion to be raised from the Urban Deca Homes Ortigas project. In line with previous disclosures, Mr. Martinez said the receivables will be sold and securitized for financing.
Asked about other fundraising plans, Mr. Martinez said the company may issue bonds this year as the bulk of its P9-billion debt issuance in 2015 is set to mature.
“Since we’re approaching our fifth year, there’s an intention to raise again in order to pay off the maturing portion of that bond,” he said. “[W]e don’t really see a need to do a big fund-raise. This pretty much covered already the operational and cash requirements for the…big major projects,” he added, referring to sales from the Urban Deca Homes Ortigas project.
Moving forward, Mr. Martinez said 8990 Holdings may venture into new businesses such as commercial malls to diversify its portfolio. “It’s always been observed that 8990 does not have a strong value chain insofar as rentals are concerned… So that would be of interest to me if somebody wanted to sell their malls or anything like that. That would take up another leg,” he said.
But he noted the company is not actively looking into malls yet, as its focus is still on horizontal developments and building halfway houses. “We don’t want to veer too far away from that because that’s what we all need. We all need to sleep somewhere, and the nearer it is, the more we want,” Mr. Martinez said.
Earnings of 8990 Holdings in the first three quarters of 2019 increased 23% to P4.21 billion, driven by a 21% jump in revenues to P10.51 billion. Its shares at the stock exchange slipped four centavos or 0.27% to P14.70 each on Monday.
Source : https://www.bworldonline.com/8990-holdings-forecasts-years-revenues-to-hit-p20-billion/
