Despite the crisis brought about by the COVID-19 pandemic, consolidated revenues of the leading residential developer in VisMin Cebu Landmasters remained strong at ₱3.5 billion for the first six months of 2020, closely matching its 2019 levels and validating its market and operational leadership in the region.
Residential developer Cebu Landmasters posts strong 3.5B H1 revenue despite COVID-19 crisis
While the mid-income and economic housing sectors, in general, were severely impacted by diminished OFW remittances and construction stoppages during the period, CLI posted record reservation sales of ₱4.613 billion in the second quarter and a 41% growth in sales to ₱7.436 billion in H1 2020 year-on-year. The firm’s economic housing brand Casa Mira contributed 65% of total sales.
The listed company also posted significant growth in its recurring business by 137% to ₱91.3 million from ₱38.6 million year-on-year. Hotel revenues of ₱38.2 million were attributable to the 180-room Citadines Cebu City, which maintained a high occupancy of 70% throughout the lockdown period. Booking largely came from the business process outsourcing companies that housed their employees during the community quarantine period. Rental income likewise improved by 16% and registered at ₱32.3 million.
CLI will continue to serve the undiminished demand for affordable housing in VisMin with a total of 14 projects in 2020 worth ₱19 billion. Four projects in Cebu, Bohol, and Iloilo were launched in the first half of the year supported by a wide network of partner brokers and sales agents and process improvement and digitalization.
“We are pleased to launch more projects in the second half as our markets have remained committed to their purchases. The pandemic has made many see that owning a home in a safe and secure community is a good way to secure their family’s future,” says Jose Soberano III, CLI Chairman, and Chief Executive Officer.
Soberano noted that most CLI buyers were local residents prodded by stretched payment terms and grace periods to invest in a home. OFWs accounted for only 20% of the sales in the second quarter, considered as CLI’s best sales performance to date. In previous periods, OFWs had taken up as much as 40% of sales. “We ourselves were surprised by how local demand compensated for the decreased share from OFWs. Homeownership will provide the best security during these times.”
CLI’s strong capital structure will enable the firm to maximize opportunities even in trying times. Planning and ongoing construction work for mixed-use development and hotel projects continue with target completion in 2 to 4 years.
To date, CLI has an undrawn ₱2.7 billion from corporate notes available at 3.45% fixed for five years and 3.56% fixed for seven years. Philippine Rating Services Corporation or Philratings issued a report earlier this month indicating that it maintained its PRS Aa with stable outlook rating to CLI, validating the firm’s strong financial position and stability.
Meanwhile, Soberano reported that even as net income attributable to parent dipped in the first half by 7% to ₱792 million year-on-year, he was confident that the firm was on track to meet its year-end revenue targets as the construction of its projects is catching up in the third and fourth quarters.
“Construction sites continue to progress despite the quarantine since Cebu Landmaster’s projects are mostly in cities with minimal quarantine restrictions. By imposing strict health protocols at the job site, we focused on keeping our workers safe and productive. We look forward to handing over units to many of our buyers in the next few months.”
A ₱20 million cash aid was provided by the company to support the families of construction workers and third-party contractors during the lockdown.
About Cebu Landmasters, Inc.
CLI was founded by Jose Soberano III in 2003. Located in Cebu City, their humble beginnings were guided by sincere family values, genuine real estate passion, and unrelenting faith. These same values remain an integral part of CLI operations to this day, as a commitment to both the customers and the community becomes the backbone of our success.
With 52 projects in different stages of development in 8 key cities, CLI is now the leading local residential developer in VisMin.