MINERVA BC NEWMAN
CEBU CITY – A leading developer in VisMin, Cebu Landmasters Inc. (CLI) reported a solid and healthy financial position with P54Billion in total assets as of first half of 2021 with net income to parent surging by 66 percent year-on- year which is backed by buoyant housing market in the Visayas and Mindanao area.
In a virtual CLI Investors’ and Analysts’ Briefing on August 16, Grant Cheng, CLI chief finance officer reported that from the flat base growth in 2020, the company grew by 46 percent during the first half of 2021 and he sees a broad-based recovery for this year.
Cheng said that this 46 percent growth in revenue is propelled by more construction progress and qualified units with CLI’s shifting markets from mid to economically viable OFWs, locally employed and businesses which are CLI’s major markets in Cebu.
According to Jose Franco Soberano, CLI-chief operations officer that the company is proactively launching new projects to ensure adequate inventory to serve strong market segments. Housing has proven to be resilient and sustainable since it is now, more than ever, considered a basic need especially with the extended pandemic.
He bared that the company showed strong resiliency in 2020 and into 2021, being able to thrive amid lockdowns and economic impact of the pandemic, quickly adapting to the new normal.
“We spot opportunities in the middle of all these challenges. The low-interest rate environment and tax measures that favor mid and economic home buyers inspire us to persist in executing our project plans with agility and excellence. We anticipate exceeding our year-end guidance by the end of the year,” Soberano stated.
CLI intends to continue benefiting from its core business—housing, while preparing for new opportunities that global recovery and tourism will bring. The company is confident VisMin will be at the forefront of this revival, Soberano said.
Cheng revealed that the company is set to surpass its growth targets for the year. Net income to parent rise from P792M to P1.32B in the first six months as the company continues its robust uptrend in financial performance.
The significant increase in profit, Cheng said was driven by exceptional revenue growth from P3.5B to P5.1B derived from real estate sales which covers a range of housing developments catering to buyers from various segments with 47 percent attributed to CLI’s economic brand Casa Mira which also posted the highest growth of 206 percent year-on-year propelled by solid sales and increases in construction progress.
Soberano confirmed that construction activity in its ongoing project sites is now on average 97 percent and is in full swing in major sites like Cebu, Dumaguete and Bohol while others post activity at 90 percent and higher, hampered only by quarantine restrictions.
Soberano continued that strong and stable demand for safe and quality homes due to the pandemic, from buyers across the spectrum pushed reservation sales up 12 percent to a record P8.3B from P7.4B year-on-year.
CLI’s Significant milestones
Soberano further said that CLI has achieved significant milestones with its presence in Cebu, Visayas and Mindanao areas continue to accumulate high value, over P10B worth of projects in 2021 and P4B in capital expenditures mainly for project development.
So far, Soberano reported that CLI has established 59 residential projects, six offices, eight hotels, eight mixed-use and two township projects. Six residential projects worth P11 billion bearing CLI’s economic, mid- and high-end brands were launched in in Cebu, Iloilo and Ormoc during the first half of 2021.
The six newly launched projects with 25 hectares at 3,555 units worth P11B in sales value with 56 percent sold as of first half of the year; 1,995 units worth P6.5B in sales value with P4.3B unrealized revenue, Soberano pointed out.
Soberano added that CLI has 24 projects in progress with 64 hectares, 12,779 units worth P44.6B in sales value and 94 percent sold out as of first half of 2021 with 11,999 units worth P37.3B in sales value with P16.6B unrealized revenue.
CLI’s residential portfolio completed projects with 78 hectares, 10,512 units worth P19.0B in sales value and 96 percent sold with 10,090 units worth P18.1B in sales value and P568M unrealized revenue as of first half of this year.
CLI is growing its hotel portfolio to 1,433 rooms by 2025 when the tourism industry is anticipated to already bounce back. Earlier this year, CLI launched Sofitel Cebu City, Mercure Cebu City and Abaca Resort Mactan which will account for a total of 487 rooms.
Latitude Corporate Center was also completed, which added 13,000 sqm. of gross leasable area. This enabled the company to report 29,051 sqm. in GLA for the first half of 2021, double of year-end 2020.
“In four to five years, the recurring business is projected to contribute 10 percent to CLI’s top line. To date, CLI has 40 completed projects while 36 are under construction and 14, in the pipeline,” Soberano revealed.
In the meantime, the completion of five projects in the first half of 2021 has also strengthened operating cashflows generating five billion pesos in collections upon take-out and turnover.
To further sustain its long-term growth, the VisMin company acquired four hectares in Panglao, Bohol and expansion sites for existing Casa Mira projects. Over 200 hectares of high valued sites are under negotiation and agreements are expected to be reached in the 2nd half of this year, Soberano concluded.