EEI Revenues, Income Up

November 17, 1998 PSE CIRCULAR FOR BROKERS NO. 2598-98 EEI Revenues, Income Up Publicly-listed EEI Corporation disclosed that its consolidated net income for the first three quarters of 1998 increased 51.89% to P200.5 million from P132 million in the same period last year. "We maintained our momentum in achieving healthy earnings growth as a result of robust and record-setting level of construction contracts and merchandise sales for the period," EEI president and chief operating officer Rogelio Murga said. LexLib EEI among the country's leading construction companies reported in a disclosure to the Securities and Exchange Commission consolidated gross revenues of a P5.58 billion for the period, up 31.88% from the P4.23 billion registered the previous year. Murga explained that this was driven by strong growth in contracts and orders obtained for the first nine months which went up to P9.94 billion from P8.09 billion in 1997. "The increase of 22.87% in orders reflects the continuing confidence of customers and international construction principals in the capability of EEI to delivery quality, on-time projects," he continued. Consolidated orders backlog reached a record high P9.64 billion, or an increase of 10.42% from P873 billion last year. The backlog, which represents the worth of the project cost that has to be completed in EEI's construction order book, is equivalent to 12 months production of the company. Murga added that the company benefited from foreign exchange gains due from its projects that are quoted in US dollars, principally its overseas projects and domestic construction work acquired from international contractors. This mitigated the increase in debt service costs and inflationary rise in expenses arising from the depreciation of the peso during most parts of the third quarter. Construction contracts accounted for P8.47 billion, or 85.21 %, of orders obtained by EEI during the first nine months. Sales and indent orders from engineering systems and machinery that it distributes as exclusive marketing agent in the Philippines contributed P761 million, while revenues from subsidiaries totaled P709 million during the period. aisadc The construction firm earlier acquired a US$40 million contract for the installation boilers and mechanical facilities at the Ghazlan (Saudi Arabia) 2,400 MW power project being constructed by Mitsubishi Heavy Industries and Bechtel Corporation. Mobilization for the project has commenced in the third quarter, and is expected to be completed in 37 months. EEI has been involved in at least 40% of all baseload power generating projects constructed in the Philippines since the start of the BOT program. The company has renewed its market expansion in the Middle East recently acquiring new projects in Qatar, Oman, UAE and Saudi Arabia, while penetrating the highly-competitive high-rise property development market in the country. "We remain confident about robust earnings for the year, despite the economic slowdown and continuing uncertainties on account of the financial crisis," Murga said. The company, he added, anticipates an excellent performance next year, and is poised to take advantage of its deepening market position in the Philippine construction industry.