Cebu Landmasters banks on rate cuts to boost income

LISTED property developer Cebu Landmasters, Inc. (CLI) is banking on lower interest rates to boost earnings and support its capital-raising efforts this year, according to an official.

“The rate cuts that we are anticipating will help not only in our ability to raise capital, but it should improve our margins too,” Cebu Landmasters Chief Finance Officer Beauregard Grant L. Cheng said told an online news briefing last week.

“Lower interest rates can help spur more demand and more buyers who want to be homeowners,” he said.

Last week, the Philippine central bank kept its key rate at 6.5% for a fourth consecutive meeting after inflation quickened to 3.7% in March from 3.4% in February.

Mr. Cheng said one of the risks being monitored by the company is inflation, which could affect the prices of construction materials.

“If the prices of commodities and raw materials go up as the prices of fuel go up, that’s always a risk for us,” he said. “Delivery and shipping costs are always a big part of our input costs, whether it is for cement or any other construction material.”

Mr. Cheng said Cebu Landmasters posted high reservation sales in the first quarter and is expected to exceed the company’s P20.6 billion worth of reservation sales last year.

“We’re anticipating that in 2024, when all is said and done, we should be able to exceed the reservation sales that we had from last year,” he added.

In 2023, Cebu Landmasters’ net income rose by 29% to P4.64 billion last year as consolidated revenue increased by 20% to P18.8 billion.

Its shares were last traded on April 12 at P2.93 each. — Revin Mikhael D. Ochave