Philippine leisure estate developer Belle Corporation reported an 18.5% year-on-year drop in net income during the third quarter of 2018, even as profits went up slightly for the first nine months of the year.
In a filing with the Philippine Stock Exchange (PSE), the company reported a net income of PHP716 million ($13.4 million) for the third quarter, as well as gross revenue of PHP1.94 billion ($36.2 million), 7.5% lower than the third quarter of 2017.
Even so, year-to-date consolidated net income was up 1% from the same period last year, to PHP2.68 billion ($50 million). Recurring net income was PHP2.94 billion ($55 million), 19.1% higher than the first nine months of 2017. The disparity between the growth rates of consolidated and recurring net income was explained as “due mainly to one-time gains recorded in 2017 from sales of non-core investments and properties.”
Belle Corp, through subsidiary Premium Leisure Corporation (PLC), takes a share in earnings from City of Dreams Manila, operated by lessee Melco Resorts and Entertainment (Philippines) Corporation. Belle reported earnings before interest, taxes, depreciation, and amortization (EBITDA) from City of Dreams Manila operations from January to September, of PHP1.84 billion ($34.4 million), a 29.5% increase from the corresponding period in 2017.
EBITDA from real-estate businesses was PHP1.79 billion ($33.4 million), 7.9% higher year on year. Of this, PHP1.54 billion ($28.7 million) came from the lease of the land and buildings comprising City of Dreams Manila.
Year-to-date revenue for the company in the first nine months of the year was PHP6.46 billion ($120.5 million), 3.8% higher than January to September 2017. Of this, gaming revenue was PHP2.38 billion ($44.4 million), 10.2% higher than the same period last year.
Last week, Melco Philippines withdrew a petition to voluntarily delist from the PSE. However, major shareholder MCO (Philippines) Investments Limited said that it will proceed with a tender offer so as to increase its current 73% shareholdings. The purpose of the withdrawal of the petition to delist, according to Melco Philippines, was for “alleviating certain investors’ concerns that the potential delisting may exert undue pressure on their decision process related to the acceptance of the Tender Offer.”
The tender offer price of about $0.13, while higher than the current share price, was questioned by some traders for being nearly 50% lower than when the stock was first offered in 2013.
