Meralco books lower income of 16 B in H1

Manila Electric Co. (Meralco), the country's largest power distributor, saw its consolidated core net income dropping by two percent to R10.1 billion from R10.3 billion in the first six months of the year due to delay in some of its projects and lower prices caused by increased competition in retail electricity spot market.

The firm's income, on the other hand, fell to R6 billion from R6.2 billion.

“One of the reasons would be contribution of subsidiaries are lower because of delayed award of some projects and we had significant completion of subsidiary projects, largely construction from last year. Another one would be in respect of retail electricity income. It has become more… Competition has been intense and prices have actually come down,” Betty Siy-Yap, the company’s chief finance officer and senior vice president, said.

Meanwhile, Meralco’s revenues for the first half improved by 9 percent, hitting R141 billion compared to the previous R128 billion, while its energy sales for the period rose to 3.1 percent with 20,338 gigawatt hours (GWh) from the previous year’s 19,717 GWh.

Among the drivers of the sales volume growth mentioned by the company are the increase in organic sales from residential accounts as well as from semiconductors, basic metals, real estate, hotel, as well as food and beverage.

“The sustained growth and sound fundamentals of our economy, healthy domestic and foreign investor confidence and strong consumer demand have provided the underpinnings for further electricity sales volume growth in the first half of 2017, notwithstanding the high base effect of 2016,” Meralco chairman Manuel Pangilinan said.

During the same period, Meralco’s customer count reached 6.17 million, a 4.5 percent increase against last year’s 5.91 million.

Its peak demand, on the other hand, hit 6,973 megawatts (MW) on June 14, 2017; a 3-percent improvement from May 4, 2016’s 6,748 MW.