J. Albert Gamboa l November 19, 2024 l Manila Bulletin
Earnings of major Philippine real estate companies have grown significantly over the past three years after recovering from the industry slump caused by the Covid-19 pandemic in 2020-2021. According to Sydney-based firm Sanlam Private Wealth Pty. Ltd., the combined net profits of property firms listed in the Philippine Stock Exchange (PSE) grew 18 percent annually in 2022-2024, while their sales revenues rose 19 percent per year during the same period.
Real estate consulting firms such as Colliers International and Santos Knight Frank have affirmed the recovery of the domestic property sector in their recent reports titled “Philippine Property Rebound in the Offing” and “New Paths and Opportunities,” respectively. The local market has been bolstered by increasing wealth creation, macroeconomic stability, and continuing investments in infrastructure.
The country’s real estate industry showed promising growth during the first nine months of 2024, driven by commercial and residential developments as well as retail and tourism-related projects. Some companies have even outperformed the industry, notably the PSE-listed Century Properties Group Inc. (CPG).
From January to September this year, CPG reported a consolidated net income after tax of P1.8 billion, up by 38 percent from the same period in 2023. Robust sales in the company’s first-home residential developments or PHirst segment contributed 64 percent of the P10.8 billion in total revenues. Contributing 24 percent was the premium residential developments segment, while the commercial leasing and property management segments accounted for the remainder.
In a disclosure to the PSE, CPG President and Chief Executive Officer Marco Antonio said: “Our initiatives prioritize innovation and strategic expansion, as we remain driven in providing quality, affordable housing in high-demand areas outside Metro Manila under the PHirst brand, as well as rolling out groundbreaking development concepts under our premium residential platform.”
CPG Chief Finance Officer Ponciano Carreon Jr. attributed the company’s strong performance to its expanded geographic and product footprint particularly in Luzon and the Visayas. “With the rapid and transformative infrastructure developments underway across the country, we remain focused on expanding our presence in key cities and municipalities outside the National Capital Region,” he disclosed.
Another bountiful harvest
Balai ni Fruitas Inc., the bakery operator and counter service arm of Fruitas Holdings Inc., recorded a 26 percent jump in its net income for the first three quarters of 2024 to P52 million compared to the same period last year. Both companies are listed on the PSE under the stock symbols of BALAI and FRUIT.
BALAI’s revenue for the nine-month period ending Sept. 30 reached P387 million, 26 percent higher than the year-ago level. With more than 100 stores throughout the country operating in three formats, the primary revenue driver of BALAI was its flagship brand Balai Pandesal. The company’s latest acquisition was the Sugarhouse restaurant chain, marking its entry into the lucrative cake business and subsequently attracting a broader customer base.
FRUIT is the Philippines’ leading operator of multi-format food and beverage stores. From a single Fruitas stall in 2002, it now operates over 25 brands under its portfolio. It reported record-breaking financial results for the first half of 2024 due to the broad-based growth of its key businesses, including Fruitas beverages and Ling Nam noodle bars.
It may be noted that FRUIT’S nationwide network had expanded to 833 stores by end-June 2024, and at least 20 more locations are projected to be added by the end of this year. President and CEO Lester Yu stated that the group’s solid growth reflects the resilience of its lines of business despite continued economic challenges—a testament to its ability to seize high-value opportunities across a diverse portfolio.
*** J. Albert Gamboa is a Life Member of the Financial Executives Institute of the Philippines (FINEX) and Vice-Chair of the FINEX Ethics Committee. The opinion expressed herein does not necessarily reflect the views of these institutions and the Manila Bulletin. #FinexPhils www.finex.org.ph