Saturday, 22 August 2009

Megaworld parent firm reports 29% profit rise

by Jenniffer B. Austria
Manila Standard
http://www.manilastandardtoday.com/insideNews.htm?f=/2009/august/21/news4.isx&d=2009/august/21

ALLIANCE Global Group Inc., the holding company of tycoon Andrew Tan, reported a 29-percent rise in profits in the first half, powered by strong sales in its real estate and McDonald’s fast food operations.

Net income for the first six months came to P3.2 billion, up from P2.67 billion in the same period last year, the company said in a filing with the stock exchange.

Alliance Global said revenue jumped 12 percent to P17.3 billion from P15.4 billion with its real estate subsidiary, Megaworld Corp., contributing 50 percent, followed by its fast food business with 27 percent, and its food and beverage subsidiary accounting for the remaining 16 percent.

Alliance Global’s major subsidiaries include Golden Arches Development Corp., the local master franchise holder for McDonald’s, and Emperador Distillers Inc.

Megaworld’s revenue rose 19 percent in the first half as a result of aggressive property development. Real estate sales grew 15 percent while property rental income jumped 41 percent due to high occupancy rates for office and retail space.

Revenue from McDonald’s grew 16 percent to P4.7 billion while revenue from franchised restaurants increased 30 percent.

The company opened 12 stores this year, bringing its total number of stores nationwide to 289.

Revenue from its food and beverage unit, Alliance Global Brands, dropped 18 percent following a 24.9-percent slide in sales of alcoholic drinks.

“The demand for the alcoholic drinks, being premium items, was affected by competition and inflation. Nevertheless, The Bar, a new flavored alcohol drink launched this year, is selling very well,” Alliance Global said.

In its report, Alliance Global said it remained bullish on its joint venture with Star Cruises, through its subsidiary Travelers International Hotel Group Inc., to build Newport City as the country’s first integrated tourism city.

Newport City, located across the Terminal 3 of the Ninoy Aquino International Airport, is expected to open before the end of the year.

Star Cruises is part of the Malaysian conglomerate Genting Berhad and is the world’s third largest cruise line operator.

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