Good afternoon, everyone. Thank you for joining the Fourth Quarter 2024 Analyst Briefing of DMCI Holdings. My name is Hannah Chan, Investor Relations Officer. I'll be walking you through DMCI's financial and operational performance for the period before we open the floor for Q&A. Joining us today are members of the DMCI group's top management team, as shown on your screen, led by our Chairman and CEO, Mr. Isidro A. Consunji, and Executive Vice President and Chief Finance Officer, and Cemex Holdings Philippines Chief Executive Officer and President, Mr. Herbert M. Consunji. Before we begin, please take note of the following. This meeting is being recorded. Questions should be sent through the panelists box. Those who submitted questions in advance will be prioritized, but we will address as many as time allows. Any unanswered questions will receive a response via e-mail after the briefing.
This session is intended for analysts and investors to gain insights into DMCI's financial performance and strategic direction. Management may discuss forward-looking statements about our plans, expectations, and growth prospects. These statements are based on current assumptions and beliefs and are not guarantees of future performance. Actual results may differ due to various risks and uncertainties. With that, let's begin with the presentation. 2024 was a milestone year for the DMCI Group, marked by major expansions and record-breaking performances. The acquisition of Cemex Holdings Philippines signaled our entry into the cement industry, strengthening our ecosystem with the country's fourth-largest cement manufacturer. DMCI Homes also made a significant move into the Visayas with Kalea Heights, its largest project to date and the biggest condominium complex in Cebu City.
Operationally, DMCI Mining reinforced its presence with the commercial operations of Zambales Chromite Mining Company, ensuring the sustainability of its Zambales operations. Meanwhile, the DMCI Group set new benchmarks, achieving record highs in production, power generation, and sales. In the fourth quarter, the DMCI Group reported a net income of PHP 3.8 billion, reflecting a 13% dip from PHP 4.4 billion in the same period last year, mainly due to weaker performances from Semirara and DMCI Homes. However, strong results from the water utility and nickel mining segments helped offset the impact. For the full year, the DMCI Group posted PHP 19 billion in net earnings. Record high contributions from Maynilad and DMCI Power helped offset a 21% drop from previous year. Turning to our consolidated P&L.
Fourth quarter and full-year revenues reflected normalizing commodity and energy prices, project delays, and a sluggish real estate market. Record coal shipments and power generation in both on- and off-grid segments cushioned the decline. Despite rising debt levels due to expansion activities, the company generated a 17% return on equity. Following the December 2022 acquisition and consolidation of Cemex Holdings Philippines into the DMCI Group's books, total assets grew by 14% and liabilities by 25%, driven by additions in fixed assets, goodwill, trademark licenses, and loans. Additionally, total equity rose by 9% after the PHP 10 billion preferred share issuance used to fund the CHP acquisition. Despite nearly PHP 45 billion in disbursements for debt servicing, dividends, and capital expenditures, key liquidity and solvency metrics, along with book value per share, have remained strong over the past 12 months.
Now, turning to the standalone results of our businesses. Well, D.M. Consunji, Inc. saw Q4 revenues rise on higher building and joint venture recognitions. Full-year top-line declined due to fewer ongoing projects. Cost pressures from project delays, such as high labor and overhead costs, dragged margins. As a result, DMCI posted a PHP 109 million net loss in quarter four, but maintained a PHP 467 million net income for the full year. Despite these challenges, DMCI remained debt-free and in a net cash position, prioritizing balance sheet strength. DMCI's total revenues grew by double digits, driven by strong building revenues from new project progress and improved margins. However, infrastructure top-line declined due to prolonged project timelines. Joint ventures contributed positively, particularly with progress in the Metro Manila Subway and South Commuter projects.
While the ending order book dipped slightly, the building and JV segments remain key drivers of construction revenues. DMCI Homes posted PHP 2.8 billion in full-year earnings, down 31% from last year as lower project recognition and higher sales cancellations impacted revenues. These were driven by slower pandemic-era sales take-up and elevated interest rates. Real estate revenues are recognized based on construction progress and collection thresholds. At DMCI Homes' conservative 14.5% threshold, 2024 recognitions primarily came from sales made four-five years ago. Rising operating expenses from association dues for ready for occupancy units and higher sales and marketing costs also weighed on margins. However, other income from the rent-to-own program for features and in-house financing provided some relief.
As for the balance sheet, the company strengthened its balance sheet, improving its net debt to equity ratio from 99% to 73%. Additionally, the adoption of the significant financing component accounting standard contributed PHP 102 million to the bottom line in Q4. The real estate segment faced a tough market, with unit sales dropping 58%, partly due to the unavailability of parking slots for sale in ongoing leisure projects Solmera Coast and Monticello Crest. Average selling prices jumped 77% due to last year's sales, mostly being smaller units in Anissa Heights. On books, revenues grew to nearly PHP 75 billion, driven by steady sales over the past two years, including PHP 33 billion in 2024. Inventory. Total inventory reached PHP 92 billion, with 67% from pre-selling units and 33% from ready for occupancy units.
Notably, RFO units under the rent-to-own program grew 62%, rising from PHP 4.2 billion to PHP 6.8 billion over the past year. Moving to our energy businesses. SMPC's net income declined to PHP 3.9 billion in Q4 and PHP 19.6 billion for the full year period, impacted by weaker coal segment contributions and normalizing electricity prices. However, record high coal shipments and increased power sales helped cushion the decline. On the cost side, higher shipments in the full year period led to increased material costs, depreciation, Narra Mine amortization, taxes, and power plant maintenance, which slowed down the decline in cash costs while keeping the non-cash expenses elevated. Total debt dropped to a 16-year low, now at just 4% of total assets, with most linked to SEPC.
Higher strip ratio and lower production from pre-stripping new Narra Mine blocks resulted to PHP 1.35 billion in capitalized costs, expected to support operations until 2026. Meanwhile, total shipments declined due to lower production and limited inventory, with China accounting for 91% of exports. Average selling prices softened by 15% as HTR coal index has stabilized with increased proportion of lower grade shipments. Power generation and sales improved with SEPC unit to full capacity restoration. However, plant availability declined due to plant maintenance and Typhoon Kristine's impact. To reduce spot market reliance, the company shifted to bilateral contracts over the past year, boosting BCQ sales and cushioning the effect of the lower spot prices. DMCI Power was a bright spot for this period, setting a new profit records for both Q4 and full year.
Bottom line surged 33% to PHP 1.3 billion, driven by record high generation, lower thermal fuel costs, and steady demand growth in Palawan, Masbate, and Oriental Mindoro. CapEx also surged to support expansion projects, including the 12-megawatt Semirara wind project and the 16-megawatt Palawan bunker. Energy sales grew across all key service areas led by Palawan and Oriental Mindoro. Emergency power supply contracts also drove growth, contributing 7% of total sales. While ASP declined due to lower fuel costs across thermal bunker and diesel sources, market share expanded in Palawan and Oriental Mindoro, with DMCI Power remaining sole provider in Masbate. The nickel business bottom line rebounded in Q4, with higher ASP offsetting lower shipments, closing the year with PHP 214 million in net income. Full-year revenues declined due to weaker shipment volumes and falling nickel prices.
Meanwhile, total debt more than doubled to PHP 900 million to fund fleet expansion in GCMC and Long Point Mine, along with port development and exploration activities. Nickel production remained stable as GCMC's commercial operations in December offset weaker output from ZDMC. While shipments declined due to the limited beginning inventory, average selling price improved on better nickel grades sold and higher Philippine FOB prices. Maynilad posted record-breaking profits in Q4 and full year, reaching PHP 3.4 billion and PHP 12.8 billion respectively. This strong performance was driven by tariff adjustments, higher billed volume, and a slower rise in both cash and non-cash expenses. Cash costs grew at a slower pace than revenues, mainly due to lower utility and cross-border water purchases. Full-year non-cash expenses rose due to higher amortization from concession assets and increased capital expenditures.
Lower net finance costs also supported earnings as the company capitalized financing for ongoing projects, including the PHP 15 billion in blue bond issuance to fund water and wastewater infrastructure. Maynilad continued to optimize operations, achieving record high bill volume despite a slight dip in water production due to supply optimization and NRW reduction initiatives. The second tranche of the MWSS tariff adjustment took effect in January 2024, improving effective tariffs. Non-revenue water levels declined with increased demand and ongoing NRW reduction initiatives, while sustained infrastructure investments expanded sewer coverage and enhanced service reliability. Now turning to the cement segment. To provide a baseline for the new acquisition, we are presenting both December and the full year results. However, only December performance has been consolidated into the group's financials following the December 2022 effectivity under the DMCI management.
December core EBITDA declined due to lower selling prices and transition-related IT costs. Mainly due to finance costs, reclassification, and deferred tax asset recognition. In the same period, CHP recognized a goodwill revaluation that resulted to a write down amounting to PHP 19.6 billion. The amount stemmed from the difference between the $272 million purchase price and the fair valuation of its assets and liabilities, as assessed by an independent appraiser. As a result, CHP's December reported net loss widened to PHP 19.5 billion from PHP 416 million last year. This goodwill revaluation aligns with market conditions and is customary in such transactions, and is entirely non-cash and with no impact on CHP or DMCI's cash flow. It reflects DMCI's commitment to prudent financial management, ensuring clearer balance sheet.
In compliance with PFRS, the goodwill revaluation will not affect DMCI's consolidated net income. Industry headwinds with capacity utilization slipping from 58% to 56% due to raw material supply constraints following the Cebu provincial government's December two cease and desist order against affiliate limestone supplier, APO Land and Quarry Corporation. While installed capacity remains stable, lower utilization resulted in a 3% decline in production while sales volume stayed flat. However, ASP dropped 5% driven by a surge in cement imports, intense industry competition, and a weaker construction activity. To summarize our fourth quarter results, our diversified portfolio delivered mixed results this period, balancing challenges with key wins across our business segments. SMPC's fourth quarter performance was impacted by normalizing energy markets, lower production, and plant outages, while lingering pandemic effects and high interest rates weighed on DMCI Homes' performance.
On the upside, Maynilad and DMCI Power continued their growth streaks, driven by higher demand and improved average effective tariffs for Maynilad. Despite project delays leading to a net loss for DMCI, the company remained debt-free, ensuring financial flexibility for future opportunities. DMCI Mining recovered its nine-month losses, supported by higher nickel grades, better prices, and the opening of the GCMC mine. Meanwhile, CHP recognized a goodwill write-down to align with fair valuation following the December 2022 acquisition, reinforcing DMCI's commitment to prudent financial management. Before we proceed to the Q&A, let me share our updates and outlook. The DMCI group operates in a dynamic environment, balancing both opportunities and challenges across its construction, real estate, energy, mining, cement, and utilities businesses. While rising construction demand presents growth prospects, delays in funding, permitting, and right-of-way acquisitions remain key risks.
High real estate inventory levels continue to challenge DMCI Homes, while stable coal and power prices, along with gradual nickel price recovery, provide greater predictability for our energy and mining businesses. To navigate these challenges, DMCI group continues to strengthen market reach and operational efficiencies to drive growth and protect margins. DMCI secured PHP 2.7 billion in new contracts this quarter and remains cautiously optimistic about growing its order book with key infrastructure bids pending. The company's leveraging its expertise and financial strength to pursue large-scale projects and at the same time seek better opportunities through early contractor involvement to sustain order book. DMCI Homes is boosting sales and leasing income with flexible payment terms, restructuring options, and a rent-to-own strategy. It is also expanding its sales channels, focusing on the upscale market through enhanced in-house and international sales efforts.
With stable coal prices, SMPC is maintaining production and shipments while expanding its local and export customer base. To sustain output and improve coal quality, it is advancing exploration at the Acacia mine. The company is also integrating the wind energy into the mining operations to reduce costs and protect margins. In on-grid power, SMPC plans to secure contracts for 50% of its 756-megawatt net selling capacity by offering competitive rates and reliable supply. DMCI Power is expanding off-grid capacity with 43 megawatts of new projects in Palawan, Semirara Island, and Masbate. The 12-megawatt Semirara wind project and eight-megawatt Palawan bunker plant remain on track for commercial operations in the first half. With these additions, installed capacity is set to grow by 27% by year-end.
DMCI Mining is expanding from one to three active sites this year, with Long Point Mine nearing final MPSA approval. Its partnership with Nickel Asia Corporation on value-added processing feasibility study aims to enhance the value of low-grade ore and maximize resources. Maynilad implemented the third tranche of its five-year standard rate adjustment at the start of 2025. The company continues to invest heavily in water and wastewater infrastructure to enhance service reliability. Since DMCI Group's takeover on December 2, 2022, on the CHP, turnaround efforts at Cemex Holdings Philippines have been in full swing, prioritizing production efficiency, distribution expansion, and capacity growth. The 1.5 million ton Solid Cement expansion is set to begin commercial operations this month.
To accelerate recovery, CHP is targeting underserved markets, focusing on the institutional segment and retail markets in Visayas and Mindanao, where supply is less saturated and distribution is more accessible from the Cebu plant. This ends my presentation, and we open the floor for the Q&A. To open the floor to questions, let's start off with questions sent via email, and we'll start off with questions addressed to DMCI Mining. With us this afternoon from DMCI Mining is President Mr. Tulsi Das Reyes. Hi, sir, Sir KDCR. The first question goes, how have export prices trended so far in 2025, and what is your outlook on export prices this year?
2025 has been a pretty good start to the group. Surigao is usually closed during Q1. Therefore, our shipping costs tend to be lower, so we tend to share that margin. On top of that, we're seeing a shortage of supply in Indonesia. We're awaiting the opening of Surigao first week of April. Of course, we would like to think this should last till the year ends, but we'll wait and see. Just be sure that ZCMC is now operational, so we have flexibility with Grace right now. With the eventual opening of Long Point, hopefully before June, we can also take advantage. We're in a very good position this year.
That's very good to hear, sir. Next question po. What are your thoughts on the Palawan Council's proposed moratorium on mining permits? Are any of your mining tenements in danger of this moratorium, including Long Point and Morsung?
Well, of course, we're with the national government when the past few years have been pro-mining. Of course it's terrible news when we hear that this moratorium may happen. We'd like to see the dust settle first and then see if there's any legal options there. In terms of how this affects our tenements, Long Point and Dangla should not be affected because we already have our LGU endorsements, all of them. Parts of Morsung may be affected because we do not have all of our LGU endorsements. It's still a wait-and-see to see if how this will affect us, but we're continuing to further study and seeing how this affects us in the long run.
Thank you, sir, for the insightful answer. Sir, third question, can you please share more information about the nickel processing partnership with Nickel Asia in terms of technology and equity structure? Investments in nickel processing could require a great deal of capital and expertise. If you do push through with this venture, will DMCI Mining want to have control of the operating company, and will you also take on a foreign partner?
Well, just as a backstory, you know, we visited a very successful HPAL plant two years ago in Indonesia. Having this type of technology, you need very good experience. A perfect strategic partner for us would have been Nickel Asia, which we're happy about. They've already been in with the HPAL technology for many years. They're way ahead of us in terms of exploration and understanding this technology. Having partnered with them is truly a great benefit to our group. The most important for us is we can now explore together because we have a lot of assets that need further exploration. The whole deal or the whole idea for this partnership is also to utilize a non-sellable or marketable grades, which if you decide on the technology, if it were to be HPAL, that would greatly. This grade is perfect for HPAL.
We have not taken other technologies off the table, but it would be safe to say HPAL is probably on the top of the list. In terms of any foreign partners, we have friends in the industry who are happy and open book to share with us their experiences with the technology and the location. We'll still do some further studies there. In regards to equity structure, we haven't gone that far yet, but rest assured once we've fine-tune our numbers and get the exploration going, which is the most important. We'll be happy to share with all of you.
Thank you so much, sir. Sir, last question for DMCI Mining. DMCI Mining saw a major turnaround in Q4. What factors contributed to this? Is this momentum expected to continue to 2025?
We don't want this momentum to stop at all. Last Q4, we opened up our lot four asset in ZDMC. It unearthed a lot of high grades that we're no longer hand-to-mouth. We were hand-to-mouth for probably three quarters of last year, so it was nice to breathe a bit, and we had this flexibility. As you see now, ZCMC, we shipped out our first shipment before year-end, and we are also unearthing a great wide range of grades there. We're very excited to show you guys what's happening in Long Point. Again, hopefully later half of this year, we can share with you our flexibility there. It's all about flexibility for us. As the trend moves backwards or forward, I think DMCI Mining is in a great position to be flexible and pivot as needed.
These assets will tremendously help the growth of DMCI Mining. We can increase our ECC, we can get more tonnage out, open up Dangla, and hopefully more soon. With regards to this moratorium, we're in a very good position. We're very excited about the future.
Thank you. Thank you so much, sir, for answering, patiently answering our questions for this afternoon. Now we
Thank you.
Thank you, sir. Now we move on to questions addressed to D.M. Consunji, Inc. We have here this afternoon is Mr. Jeorge Consunji, president of DMCI, and JY Consunji-Locsin, technical assistant to Sir JAC. Hi, good afternoon, Sir JAC and JY and JCL. Sir, first question goes, what is your outlook for construction this year? Have you seen accelerated spending on the part of the government given the midterm elections?
Okay, if you look at the government budget now for construction, it's been highlighted as even higher than the education. Most of those budget are more for the regional construction. The way we see it is that 2025, because of this geopolitical uncertainties now, it's still early to say now which way it's gonna go. We still remain optimistic.
Thank you, sir. Sir, next question. DMCI's construction segment remains debt-free despite fewer projects and delays. What strategies are being implemented to rebuild the order book and drive future growth? Any key areas to win new projects?
Okay. First of all, we will still continue what we have started, the continuing improvement to cost mitigate and to protect our budget now and also profitability. The second one is, there are projects where we need some foreign partners for synergy and to be more competitive, you know, especially in the process of the utilities on water and sewer, and also on the big-ticket items that are now being or about to be bid out to the government. These are big-ticket items, and we'd like also to spread our risk. The third one is to have an early involvement now with the project owners so that we can help them realize also their project target cost.
Thank you, sir, for the insights. Sir, last question po. Is the lower margin in quarter four indicative of what we may see for 2025? Is the faster revenue growth in Q4 sustainable?
Okay. First, on the quarter four now last year, we took a more conservative position by recognizing some possible costs, but we believe that we will be able to have the entitlement of those costs as a revenue. We took a more conservative approach by recognizing the cost, not the revenue. Okay? Our margin went down. Okay? Now, moving forward for 2025, we would like to see how things are gonna go because there's so many moving parts now with so high uncertainties. Expect interest to go down. Still to be seen. You have now the realization from Sangguniang Lalawigan. Now, we have the local election on May. You've got a lot of risk. Political events are happening locally too.
We're in a very strong headwind right now. It's so hard to say whether it's gonna go up or it's gonna go down. Hopefully, after the May election, for the second half of the year, we should be able to see how things will be and still optimistic that all the big-ticket items will be bidded out before the year is over.
Thank you. Thank you so much, Sir JC, for the very insightful responses. Now we move on to questions addressed to DMCI Homes. The first two questions are addressed to Ms. Evangie Atchioco, Chief Finance Officer of our real estate segment. Hi, ma'am Eha. The first question goes: How much did revenue reversals account for the drop in revenues in the fourth quarter and in the full year period? Did cancellations get worse in the fourth quarter than in the previous quarters?
Hi, good afternoon, everyone. Hi, Hannah. Our revenue reversals for Q4 accounted for 32% of our gross revenue, making it the second highest quarterly revenue reversal in terms of value, you know, amount of cancellations or their reversal. While for the full year 2024, our total revenue reversals are at 27% of our gross revenue, which is 21% higher than our cancellations last year. We observe that cancellations typically occur when a building nears its completion. For the year 2024, we've delivered 11 buildings compared to just seven in 2023. That's why our cancellations are higher in 2024. Thank you.
Thank you, ma'am. Ma'am, next question. What is your outlook on the revenue bookings and margins for 2025?
Okay. For our 2025 projections, you've mentioned a while ago that our revenue recognition period typically takes four-five years now, you know, from project launch and pre-sale. Given this period and the weaker sales during the post-pandemic years, 2021 and 2022, we anticipate flat revenue and net income for 2025 under our latest assumptions based on the most conservative scenario. Thank you.
Thank you. Thank you so much, Ma'am Eha. Now, the next questions are addressed to Sir Alfredo, Mr. Alfredo R. Austria, President of DMCI Homes. Sir Freddy, the first question goes: DMCI Homes faced weaker sales and higher sales cancellations. How is the company addressing buyer concerns, and what initiatives are in place to boost pre-sales?
Yeah. Good afternoon, everyone. Higher cancellations are due mainly to our customers who do not proceed with buying, who cannot avail of loans on RFO. You know, so these are mainly from projects that are nearly ready for occupancy. For these projects, we are bringing prospective buyers to our project sites so that they can compare our offerings, you know, our projects with those that are being offered by other developers. Our experience is that many of these buyers realize that they will get much better quality and better value from us, and this is actually improving our sales. We've seen this in many of our projects that have just been recently completed, you know?
After completion, we brought a lot of the buyers to the site, and we saw that many of them are buying units, you know? It's just a matter of making them aware of our offerings versus what's being offered by our competitors. For the concern of the buyers, I think their number one concern is still getting best value for their money. Now, we've studied what our competitors are offering, and we continue to be confident that we're able to offer better value, you know? So we're continuously improving the quality of our projects, continuously enhancing the design and construction of our projects, you know? This has yielded good results, you know?
As I said, whenever we bring them to our sites, they're convinced that the quality is better. The value of the offerings of DMCI Homes is better than most of them. On top of that, we are expanding our sales channels and reinforcing our sales teams to have better sales results.
Thank you, sir. Sir, next question po. Reservation sales in the fourth quarter still fell a lot quarter-over-quarter and year-on-year despite the launch of Kalea Heights. Is it a fair assessment that the take-up of Kalea Heights was not so good? What do you think are the reasons for the large drop in sales during the last quarter?
The large drop in sales is because mainly because in the fourth quarter of 2023, we launched Anissa Heights, which sold very quickly, you know? There's more than 1,500 units sold in Anissa Heights during that quarter. This year we launched Kalea Heights, no, but in the fourth quarter, but that was just in November, no? I think it is. Well, we're quite happy with the results of Kalea Heights. We're selling around 60 units a month, no? Which is quite good considering that it is our first project in Cebu, and that our sellers are just getting familiar with our sales processes, policies and so on.
We're quite happy with the results of Kalea Heights in Cebu.
Thank you, sir. Sir, last question po. Given the weak residential market, what are you doing to reduce your inventory levels? Are you offering discounts to your buyers? If so, can you give us an idea, please, on the range of discounts you provide?
Yeah. First of all, we have not been launching any project. We have not launched any projects this year, and it has helped a lot to make our sellers focus on our existing inventory, no? So far, we've had good results. Big part of the current sales now is coming from RFO inventory, no? Also, we are now more aggressive in promoting our rent-to-own program, no? Before we were not so aggressive in the rent-to-own program because we prioritize outright sales, no? Now, since the start of the year, we've been more aggressive in the rent-to-own program. Actually, we have a lot of inquiries for the rent-to-own program and even the buyers who avail of the rent-to-own program are more and more.
We are bringing them to the sites of our completed projects. I think that's a very good thing because they're able to compare what they see actually on site versus what they can see from the other developers. I think because of this, you know, we have more and more people availing of our rent-to-own program. We believe last month more than 100 buyers availed of our rent-to-own program, and we see that this will continue to increase.
Thank you. Thank you so much, Sir Aria, for the very insightful responses po. Now we move on to questions addressed to Semirara Mining and Power Corporation. With us this afternoon is Miss Maria Cristina C. Gotianun, President and COO of SMPC, and Miss Carla Cristina T. Levina, CFO of SMPC. Ma'am CCG, the first question goes, when do you expect to get clearance from the DENR on the Acacia mine? When do you expect to start production in that mine?
Good afternoon. We have given all the documents required for this ECC for the Acacia mine to DENR some time ago, and they have reviewed it late last year. Now we're just waiting for them to act on it and to approve it. We don't see any problem why it will not be approved. Hopefully it will come out by about the second quarter of this year.
Thank you, ma'am. Ma'am, are there any updates that you could-
Sorry.
I thought-
Yes. About the, we intend to mine Acacia some time next year. We're doing exploration and development right now, and we hope to be able to have the production executed by, implemented by next year. Yeah, sorry. Mm-hmm.
Thank you, ma'am. Ma'am, next question po. Are there any updates you could share on the renewal of your gold operating contract?
Two years ago we met with DOE, and we have already started the discussion of how we will be able to have our term adjusted. They've agreed to that, and we've given them the papers, the documents last year. We're just waiting for DOE to act on them. Hopefully sometime during this year we will hear from them. We don't see any reason also for them not to be able to approve our term adjustment.
Thank you, ma'am. Ma'am, on the business development part po, how soon can you break ground on the Saint Raphael project?
We are right now revisiting the plans, especially the marketing plans for this SRPGC two by 360-megawatt. This will all depend on NGCP's completion of the transmission line. Initially they were going to complete it by December of this year. I think they're having some headwinds and will not be able to complete it until middle of next year. We'll have to middle of next year to complete everything. We will wait again and see how that one is done.
Thank you so much, Ma'am CCG, for the very helpful answers. Now we move on to questions addressed to Ma'am CTL. Ma'am, in the power segment, how are the spot prices so far in March, and how do the prices compare with January and February?
Hello. Good afternoon, everyone. For March, we are really expecting for the March spot prices to be higher than the January and February. As of yesterday, the March spot prices is already 100% higher than the January and February. Expect it to go higher this second quarter. Thank you.
Thank you. Thank you, ma'am CCG and ma'am CPL. We move on to questions addressed to DMCI Power. For DMCI Power, we have Mr. Tony E. Gatdula, President. Sir AEG, first question. What are your thoughts on reports about the plans of the Maharlika Investment Fund possible entry into the off-grid sector in Masbate and Palawan? How could this change the competitive dynamics of the prospects of your business? Sir, I think you're still on mute po.
Yeah, sorry. Good afternoon, everyone. The plans of Maharlika Investment Corporation to invest in transmission infrastructures in the off-grid areas is basically welcome news, as this will help us in two ways. First, the transmission problems that we are currently experiencing will be addressed, thus it will promote more stable and reliable operations of our power plants. Now, second, new connections will create new market, therefore it will increase further our energy sales.
Thank you. Thank you, sir AEG. Sir, next, last question po. Any update on the Semirara Wind Project?
For our 12-megawatt Semirara Wind, we are in the process of construction and erection works. Given ideal wind conditions, this will be followed by energization, testing, and commissioning of the two units, with the goal of commencing commercial operations hopefully by third quarter or fourth quarter of this year.
Thank you. Thank you so much, sir AEG. Now we move on to Maynilad. For Maynilad, we have Mr. Noel Marmol, AVP and Head of Corporate Planning. Hi, sir, Sir Noel. The first-
Good afternoon.
Good afternoon, sir. What is the carrying value of Maynilad as of end 2024?
The carrying value or the measured value of the company's assets ending 2024, it is PHP 198 billion. That's a significant increase compared to 2023 due to the company spending significantly in our water and wastewater assets.
Thank you, sir. Sir, next question. Please remind us how much you committed to spend on cash operating expenses from the rate rebasing years 2023 to 2027.
For the rate rebasing period 2023-2027, what we submitted in the business plan is that we're committing around PHP 48 billion in cash operating expenses. That will serve our customers and making sure we will be able to deliver our service obligations.
Thank you, sir. Sir, last na po. Net income in the fourth quarter, the PHP 3.4 billion, slower than in the third quarter at PHP 3.7 billion. Can you please give color on this?
The lower net income in Q4, that's mainly driven by the higher operating expenses that we incurred in Q4, mainly due to the higher accrual of salaries, wages, and benefits, contracted services, light and power costs, and scheduled maintenance programs, leading to higher R&M expenses.
Thank you. Thank you, Sir Noel, for the insights. Now we move on to questions addressed to Cemex Holdings Philippines. For Cemex Holdings Philippines, we have Mr. Herbert M. Consunji, CEO and President of CHP, and Mr. Bryan Lim, Chief Finance Officer and Treasurer. Hi, sir HMC and BTL. The first question: What is the status on the cease and desist order today and your inventory levels? How soon can you lift the order?
Yeah. Good afternoon. Well, the CDO is still in effect. It will expire March 19, Wednesday. Hopefully we will not receive another one, no, because this is the third CDO we received, you know. We're trying our best to settle it. The only thing, the reason for the CDO, I mean, it's so vague. It's so different every time she issues one, no? Anyway, we'll try to settle it as soon as possible. Now, for the inventory level, we have mostly one month inventory level, no, in our plant. We're limited to the capacity of our silos and, you know, terminals. As of now, I think we have something like 400,000 tons, no, of cement, no.
Hmm?
450.
450,000 tons.
Clinker and cement
Okay. Thank you, sir. Next question. What is the status of Solid Cement's expansion, and when do you expect to complete this? What is the cement equivalent clinker capacity today, and how will this change once the expansion is completed?
Well, it should have been turned over to us November or December of last year, you know. Due to some technical problems, we have solved the technical problem. Practically now, it's working consistently, you know, at 3,200,000 tons, no. Now, we were supposed to accept it, no, when. Yeah, yeah. I mean, it's working already. It's working, in other words. Because we were trying to make use of Semirara coal, no, the 5,800 kcal, because Cemex used to use petcoke, no.
This year, or when it was commissioned, they tried to use Semirara coal, no, the 5,800, which has been very successful and averaging 3,200 metric tons per day.
Thank you, sir. Sir, next question po. What is your outlook on the country's cement demand and capacity, and what is your outlook on prices given the provisional duty?
Well, I'll answer first the provisional. Well, I think magkano? PHP 16.
Yeah. Per bag.
PHP 16 per bag. I think that has affected the imported cement. We can feel that there is an increase in our cement production. Which means, I presume, they're not buying the imported cement. As of now, well, the total capacity now is something like some cement companies only produces 50% of their capacity, except Eagle. Eagle has a bigger efficiency, you know. I think it's something like 77%. But mostly, you know, Holcim, us, and CRH are more or less on the 50% capacity, you know. There's a big reduction in production capacity. The demand, I think, there is not much growth.
We feel that there is not much growth, no. I don't know in the near future, no. As of now, it's roughly level.
Thank you, sir. Sir, last question po for CHP. Since you acquired CHP, what is the cash cost per metric ton today, and where have you extracted these savings?
Well, ikaw na.
Well, last year, if you look at the results last year, the cash cost was about 4,200 or 168 PHP per bag. Removing the very low-hanging, which is the Mexico royalty and cost, that's about 10 PHP per bag. Roughly, you're at 158. Now, what we're trying to do is focus on the low-hanging, big impact, like the use of Semirara coal, the power, the fly ash, which has a big impact. Of course, the operational improvement will take some time, but those are expected to have a significant effect on production cost.
Thank you. Thank you so much, Sir HMC and BTL for the valuable insights. Now we move on to questions addressed to the Holdings. The first question is addressed to Mr. Joseph Legasto, Deputy Chief Finance Officer of DMCI Holdings. Sir, current net debt level as of the end of 2024.
Yes. Hi, good afternoon, everybody. Thanks for the question. The net debt of the parent company is essentially a net cash position. We don't have any debt at the parent company, but our cash position actually doubled from PHP 3 billion in 2023 to 2024. We maintain very prudent and very conservative attitude towards our debt profile for us to be able to optimize our capital structure and be able to pursue attractive opportunities when the opportunity arises.
Thank you, sir. Sir, next question. Can you share your thoughts on the likely dilution of your stake in Maynilad should the planned IPO push through? Would you like to be diluted in, if so, up to how much?
Okay. Regarding Maynilad, they're required by their concession agreement to offer at least 30% to the public investors. Basically, us at the holding company level, which is Maynilad Water Holding Company, we, the incumbent shareholders, are willing to be diluted pari passu. Assuming that, there would be primary and with an option of also selling secondary shares of up to 30%, then DMCI's stake can go down from 27% to around just about 20%, assuming a 30% public share sale.
Thank you so much, Sir JBL, for the very insightful answer. Now we proceed to questions addressed to our chairman and CEO, Mr. Isidro Consunji. Good afternoon, sir. First question. How does DMCI Holdings assess potential new businesses, new business opportunities or acquisitions? Are there any industries or sectors the company is actively exploring? After cement, are you looking to add more assets to your portfolio anytime soon?
Good afternoon, everyone. Thank you for your question. I think it's gonna take us some time to digest Cemex, the cement business. We're right now in the transition period. It's probably gonna take us 12-24 months to fully complete the transition. Our CDO is not helping much. In the Solid side, we think beginning next month, we'll go faster and faster. I think most people are on the same page as to what are the important things to be done. If we require efforts on Semirara, SEM-Calaca Power, DMCI, Cemex and Seri, another company of Dacon, to mix together, they may not happen immediately, but definitely before the end of the year, we expect very, very significant cost savings and a new strategy for distribution. Thank you.
Thank you, sir. Sir, next question. Given the mixed performance across your diversified portfolio, how does DMCI Holdings prioritize investments across its different subsidiaries?
Well, as you mentioned earlier, Maynilad did very well last year. It will even do better this year. DMCI Power did very well last year, and with the new capacity, it should do even better this year. Mining did not do so well last year. I think the forecast this year will be very much better than last year. We're now seeing the fruits of the production on Zambales Chromite in Zambales. If we get permits complete by before June for Long Point in Palawan, that should add dramatically to the profit or results of DMCI Mining. The slow economy is affecting our DMCI Construction. We don't see too much. We're trying to change our business model to do some changes in contracting, but that, again, will take some time.
Hopefully, the first sign will happen this year. DMCI Homes, we are seeing significant increases in cancellation as projects are turned over. Since we're turning over a lot of units this year, ironically, our cash position has improved dramatically. We're almost at PHP 10 billion in cash as of today, the highest ever. If the trend continues, our cash position by the end of the year should even be higher, so which may lead us to bring down our debt levels to a more reasonable level. Okay. Thank you. What else did I miss? Did I miss anything?
Yes. Subic Water extended its franchise-
Subic Water has extended.
To 2047.
Extended its.
Franchise.
Franchise.
Franchise.
Franchise. Semirara also will probably be able to produce more this year, hoping that we can get an increase in our allowed production, and that should mitigate the effects of lower coal prices. For the first time this year, all four plants are running. We have finally run unit number two with the help of Toshiba. The first two months of the year was very low electric prices, but this March bounced back dramatically, much higher than we expected. If this continues, we should see maybe equal results as last year or maybe somewhere there, depending on what the prices of WESM will stay over the rest of the year.
Sorry, dividend outlook po.
Well, as mentioned by Jobert, we have a very high cash position. We're expecting to declare our dividends next board meeting.
March.
Ah.
Next month.
Yeah, next month.
Next month. Should be good. Thank you.
Thank you, sir. Sir, now we've come to the end of our list of questions. May we also request, Sir IAC for his closing remarks.
Yeah. Thank you very much for attending our analyst briefing. As you know, we have a big fly in the ointment. This is called Mr. Trump, you know. So we don't know the effect he has on the economy and his vacillation is keeping people on edge, and the uncertainty is not very healthy. Together with what is happening in the political environment locally, the elections coming in and all the other developments, how these external factors will affect 2025. But I can assure you that your management and the rest of the employees are doing their very best to make sure that stockholder interests are taken care of. Thank you very much.
Thank you. Thank you, everyone, from our panelists to our attendees for joining us in our briefing. We will be uploading the final deck within the day in our website.