DMCI sees signs of recovery in construction
Premier contractor D.M. Consunji, Inc. (DMCI) reported a 20 percent growth in its order book to P42.4 billion in the first quarter of 2023 from P35.2 billion in the fourth quarter last year as demand starts to recover.
In a disclosure to the Philippine Stock Exchange, the firm said the increase was largely due to the awarding of the South Commuter Railway Project (Contract Package 02), a joint venture with Acciona Construction Philippines.
Costing over P28 billion, the project involves the construction of railway tracks and stations along España, Sta. Mesa and Paco, and will take roughly four and a half years to complete.
“DMCI’S participation in the joint venture is around 35 percent. In addition to construction revenues, we also expect to generate collateral business for our ready-mix concrete, equipment rental and steel fabrication units,” said DMCI President and CEO Jorge A. Consunji.
Year-on-year, the DMCI order book declined by 9 percent from P46.7 billion owing to the completion of several projects and descoping of North South Commuter Rail (NSCR) Contract Package 01, a joint venture with Taisei Corporation of Japan.
Current obstructions prevented access, possession, and handover of the NSCR construction site, which resulted in the exclusion of work valued at P7 billion from the project pipeline.
“We’re expecting equitable compensation for the descoping, which is a standard contract condition in construction projects. Negotiations are underway, and a resolution should be reached in the next few months,” added Consunji.
Aside from South Commuter Railway Contract Package 02, other projects in the DMCI order book include Dinapigue Causeway expansion, Xavier Junior High School Building, YCO Manila site early works and dredging and hauling of lagoon in the La Mesa Water Treatment plant.
For the first quarter, DMCI reported a standalone net income of P263 million, a 26-percent drop from P355 million because of lower construction accomplishment and fewer projects in the pipeline.