Philippines: Meralco profits surge by 6% at P4.6B for Q1

Philippines: Meralco profits surge by 6% at P4.6B for Q1

EDC retiring $100 M of Sinagpore Exchange-Listed Notes
Manila Electric Co. (Meralco) concluded its business operations with a 6%
gain, amounting up to P4.6B flat of core net income for the first quarter of
2017.

This update is slightly higher than 2016's Q1 P4.59B, said Meralco Chief
Finance Officer Betty Siy-Yap.

However, sales are consistently low as volume grew only 2.6% to 9.317
gigawatt per hour (GWh). According to Meralco President and Chief Executive
Officer Oscar Reyes, the quarter's slow growth is due to a number of
constraints including "(a) cooler temperature, the leap year effect, and the
effect of higher inflation, prices and retail rates which affect the
customers' ability to spend."

The energy provider cited that the recorded cooler temperature of 26.6
degrees celsius first three months in the year affected its lukewarm sales,
specifically in residential volume where the average retail price is P7.84
per kWh higher.

At the same time, the leap year absence brought in lower energy sales of
approximately 100 GWh.

The first quarter also saw Meralco's increase in electric revenues, which
are up by 12% with an average distribution rate of P1.40 per kilowatt-hour
(kWh), Business World reports.

Furthermore, Meralco sees growth opportunities through its expansion in
consumer base thanks to the additional spending backed by OFW remittances
and the sustained economic growth of the Business Process Outsourcing (BPO)
industry.

In line with this, Meralco's net profits soared to 5.9% with from P4.55B to
P4.82B.

"Despite global growth and geopolitical uncertainties, we remain confident
that the domestic economy will continue to expand at the current pace, or
potentially faster, as new drivers weigh in, such as more
government/public-private partnership projects with more bilateral funding
from regional powerhouses," said Meralco Chairman Manuel V. Pangilinan in a
statement.

"Meralco will continue to focus on the resultant growth opportunities for
its core electricity distribution business and on sustained operational
excellence, mindful of business and technology disruptors emerging in the
power industry. In respect of these, we will be engaged in a continuing
effort to get businesses and regulators aligned with these developments," he
added.

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Link to Original Article:
http://powerphilippines.com/2017/04/26/meralco-profits-surge-6-46-q1/

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John Diecker
APT Consulting Group Co., Ltd.

www.aptthailand.com