By Elizabeth Sanchez-Lacson
Philippine Daily Inquirer
First Posted 04:44:00 11/22/2008
Eton Properties Philippines Inc., of the tobacco tycoon Lucio Tan, reported a three-quarter net loss of P212.96 million, up 95 percent year-on-year from of P109.18 million.
In a filing with the stock exchange, the company blamed increased selling expenses and adoption of a new accounting standard in recognizing revenue.
In a text message to the Philippine Daily Inquirer, company president Danilo Ignacio said, “The net loss is due to the non-recognition of revenue since construction of residential projects is just starting. Revenue recognition will start in 2009 when there is already substantial percentage completion of residential projects.”
The company adopted Philippine Accounting Standard (PAS) 18 on recognizing revenue, using the percentage-of-completion method, under which revenue and costs will be recorded only if there has been substantial progress in construction and the stage of completion can be reasonably estimated. While awaiting recognition as revenue, collections received from buyers are recorded in the balance sheet as deposits from customers.
Deposits from home buyers reached P1.8 billion as of Sept. 30.
The company said investment and other income rose 3.0 percent to P27.43 million due to additional money market placements that resulted in higher interest income. It said selling expenses expanded 198.0 percent to P179.99 million because of an increase in sales commissions and advertising and promotion.
General and administrative expenses swelled 123 percent to P83 million, with increased personnel costs and increased expenses for communication, light and water, depreciation and office supplies.
Eton said its Eton Cyberpod Centris would be ready for occupancy by yearend and construction of Eton Cyberpod Corinthians was in full swing to be ready by the second quarter of 2009. These projects are the company’s first two office buildings for business process outsourcing companies.
Eton Emerald Lofts, a high-rise residential condominium building in the Ortigas business district, started excavation work in the third quarter, as did The Eton Residences Greenbelt in the Makati business district. Belton Place, also in Makati, will start construction by the first quarter of 2009. Edited by INQUIRER.net
