Meralco core income hits P10.9B in first half
MANILA Electric Co. (Meralco) saw its unaudited core net income — which excludes one-time gains and charges — climb by 7 percent to P10.9 billion in the first half from a year earlier as higher energy sales and generation charges boosted revenues for the period.
Consolidated January to June revenues totalled P150.5 billion, also 7 percent higher from last year and attributed to a 7-percent rise in electricity sales and a generation charge boosted by fuel price increases, a weaker peso and higher prices at the Wholesale Electricity Spot Market (WESM).
Energy sales hit 21,665 gigawatt-hours (GWh), with June — historically the strongest sales month — accounting for 3,969 GWh, which the company said was “the highest ever volume wheeled in a month in Meralco’s 115-year operations”.
The average generation charge for the period, meanwhile, was P4.94 per kilowatt-hour, 49 centavos/kWh or 11 percent higher from last year. This accounted for 56 percent of Meralco’s retail price, which averaged P8.83/kWh.
Meralco Chairman Manuel Pangilinan said the company was looking forward to a “better year” but said they would remain “vigilant and cautious” given “economic headwinds from higher fuel and commodity prices, higher exchange and interest rates, and inflation…”.
President and CEO Oscar Reyes concurred, saying “Meralco has been keeping a close watch on [the]potential of emerging headwinds, their possible implications on the country’s current robust growth trajectory and targets and any resulting impact on electricity demand and sales.”
These include “frictions in the global cooperation investment and trade environments,” he added.
Industrial sales were up 9 percent to 67,249 GWh year on year but Meralco noted that revenues from the semiconductor sector slowed to 4 percent with companies in “wait and see” mode over proposed changes to government incentives and Charter change talks.
Residential sales also rose, by 6 percent to 6,712 GWh but organic sales slowed due to lower summer temperatures and higher June inflation.
Reported net income for the period was P12 billion, 14 percent higher, while consolidated earnings before interest, taxes, depreciation and amortization was P17.6 billion, up 2 percent year on year.
Costs and expenses for the six-month period increased by 7 percent to P136.9 billion, with power purchases accounting for 85 percent.
Capital expenditures hit P6.6 billion, 25 percent higher with electrical capital projects taking an 83 percent share.
Consolditated debt as of end-June amounted to P39.9 billion, Meralco reported.
In a meeting on Monday, the company’s board approved cash dividends of P5.311 per share for all shareholders of record as of August 29, 2018, payable on September 24 or this year. The total outlay will account for 55 percent of core earnings for the period.
Shares of Meralco were up P2 or 0.53 percent to P380 apiece at the close of trading amid a larger 0.93 gain for the benchmark Philippine Stock Exchange index.
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