AboitizPower boosts nine-month profit by 24% to P15 billion
For the period, the company registered a non-recurring loss of P102 million mostly coming from the revaluation of consolidated dollar-denominated loans and placements net of recognized gain on acquisition (versus last year’s loss of P805 million). Adjusting for non-core items, the company’s core net income for the first nine months of 2016 amounted to P15.2 billion, up by 17% YoY.
AboitizPower’s profit increase was fueled by a higher income contribution from the company’s power generation business, led by the Therma South thermal power plant in Davao City.
“We recognize the importance of providing baseload capacity–such as our Therma South and Pagbilao thermal power plants– in ensuring reliable and affordable power for our consumers. In addition, we continue to employ new and more efficient technologies, operating our power plants at par with government standards as part of our commitment to a responsible power generation process,” said Antonio R. Moraza, AboitizPower President and Chief Operating Officer.
On a YTD (year-to-date) basis, the generation business accounted for 80% of earnings contributions from AboitizPower’s business segments, recording an income share of P12 billion, up 26% YoY. The growth was largely driven by Therma South’s new contribution. Netting out one-off items, the income contribution of AboitizPower’s generation business amounted to P12.5 billion for the period, which was 20% higher than last year.
For the first nine months of 2016, AboitizPower’s attributable net energy sold by 13% YoY, from 9,161 GWh (gigawatt-hours) to 10,308 GWh, as electricity sold through bilateral contracts, which made up 92% of total energy sold during the period, expanded by 15% to 9,501 GWh. On the other hand, spot market sales decreased by 11% from 907 GWh to 807 GWh. In terms of capacity, higher sales through bilateral contracts and ancillary services resulted to a 9% YoY increase in AboitizPower’s attributable sales from 1,866 MW to 2,026 MW. Meanwhile, ancillary sales remained unchanged.
In October 2016, the company disclosed that Therma Power, Inc. finalized the purchase and sale agreements for the acquisition of The Blackstone Group’s effective partnership interests in GNPower Mariveles (604-MW) and GNPower Dinginin (2×668-MW). The transaction is still subject to Philippine Competition Commission approval.
Also in the same month, RP Energy also signed a construction contract with Azul Torre and a supply contract with Doosan Heavy Industries for the construction of 2×300 MW thermal power plant in Subic. This project’s Unit 1 is expected to come online by 2020. Meanwhile, works are ongoing for Pagbilao Unit 3, Cebu Coal, Manolo Fortich, Aseagas, and Maris Mini Hydro.
“We are optimistic that we will realize our target of 4,000 MW capacity by 2020, from renewable and thermal sources. We will continue to strive for a balanced-mix portfolio to provide ample power when needed at a reasonable cost, keeping in mind our responsibility to the environment and to our host communities,” Moraza said.
The power distribution group’s earnings share increased by 11%, from P2.6 billion to P2.9 billion. Total attributable electricity sales increased by 8% YoY, from 3,546 GWh to 3,818 GWh. Meanwhile, the group’s gross margin during the period decreased by 3% YoY from P1.64 per kWh (kilowatt-hour) to P1.59 per kWh. The decline mostly came from the under-recoveries as a result of a shift in supply mix.