DMCI Holdings Inc. has doubled its capital spending to P40 billion this year, largely to fund its property development arm and power generation business. The company allotted P19.3 billion to capital expenditure last year. (reported by manilatimes.net)
“This is our biggest annual capex program to date. There is still considerable room for growth in the property market and power industry so we are focusing our resources on these areas,” DMCI Chairman and President Isidro Consunji said over the weekend. Real estate subsidiary DMCI Homes gets the lion’s share of P32.5 billion, of which P27.5 billion will finance the development cost of new projects and P5 billion for landbanking. Plans are underway for the mid-segment developer to expand outside Metro Manila and tap into the low-cost housing market.
Around P7.2 billion will go to Semirara Mining and Power Corp. and DMCI Power Corp. Semirara Mining gets P5 billion to buy equipment and improve its facilities. Off-grid supplier DMCI Power is spending P2.2 billion to build power plants as well as acquire equipment. D.M. Consunji Inc. and DMCI Mining Corp. are getting around P700 million also to buy equipment and machineries and support operating expenses. While parent DMCI intends to go for a number of infrastructure projects this year, as a bidder or direct contract, subsidiary DMCI Mining plans to weather the slump in metals prices by raising nickel output. Consunji said the DMCI is venturing overseas and into new sectors in the next five years as part of its medium-term development plan.
“One of the options is to go abroad or to expand into other industries. The agreement is to go for another level of growth in the next five years. So we will present before the end of the year, a five year plan,” Consunji said, noting that details of the plan will be discussed in subsequent board meetings. “It [the five-year development plan] is approved in principle,” he said. Consunji noted the country’s growth prospects and the surge in infrastructure spending are going to play a vital role in DMIC’s plan, given the sector’s ripple effect in favor of other industries. Leveraging on the company’s ties with Japan’s Marubeni Group, Consunji said DMCI may into other Southeast Asian countries within the next five years. DMIC has joined Marubeni in Southeast Asian sorties and is now taking a closer look at business prospects in Vietnam, Myanmar, and Indonesia, as well as East Timor.