Our warmest greetings to all of you!                                                             

In 2015, we witnessed global events that have
reshaped the future of emerging economies.
The historic signing of a new climate deal at the
Paris COP21, the continued drop in oil price, the
geopolitical challenges in the Middle East, the refugee
crisis in Europe, the Federal Reserve’s increase of
interest rates, the slowing down of China’s economy
and its subsequent currency devaluation that created
a domino effect on the currencies of other emerging
economies. All of these prompted everyone to
recalibrate strategies on how to move forward in the
new global environment.

As an emerging economy, the Philippines is
poised to take on the challenges of the new
world order. Our economy is resilient, bolstered
by sound economic fundamentals and good
governance. The country successfully hosted the
Asia Pacific Economic Cooperation (APEC) Summit,
demonstrating its reputation as an alternative
trusted investment hub. The GDP in 2015 posted
a 5.8% growth, with analysts taking the optimistic
view that this growth trajectory will continue
in 2016 on the back of increased government
spending, and election-related consumption.

For us in the Aboitiz Group, we ride on the tailwind
that a growing economy brings. This is why we will
focus on positioning Aboitiz for the future as we
build a sustainable, responsible, and industry-leading
enterprise that promotes inclusive growth in sectors
where our core businesses operate. Our efforts to
pursue organic growth, invest in new assets, and
strengthen operational capabilities support our desire
to create long-term value for all stakeholders.

Celebrating Milestones
After over a century of doing business in the
Philippines, the Aboitiz Group today remains
steadfast in its role as a major contributor to
nation building. After we announced our entry
in the infrastructure and infrastructure-related
business, we partnered in 2015 with CRH, a
global building materials company, to acquire a
majority stake in the operations of Lafarge in the
Philippines. The new Republic Cement was born,
a 60-year-old brand and a leader in the cement
industry. With Republic Cement, we are securing
our foothold in the infrastructure sector, allowing us
to capture opportunities in the expanding housing,
construction and public infrastructure industries.
Our acquired assets will allow us to serve the needs
of a rapidly developing economy.

In 2015, AEV also acquired a majority stake in
PETNET, which has the largest network of Western
Union agents in the country. PETNET has great
potential for growth and development, with the
continued rise in remittances from overseas Filipino
workers and the strategic opportunity to distribute
complementary products of our banking and financial
services through its extensive network of outlets.

These new businesses will provide AEV with a more
diversified income stream while meeting our growth
criteria of scalability, compatibility with existing core
competencies, and the potential to provide strong
recurring profits and cash flow.

2015 was also a milestone year for our parent
company, Aboitiz & Company (ACO), which
celebrated the 95th anniversary of its incorporation.
Since 1920, ACO has undergone five smooth
transitions in top management, and each time,
leadership has been seamlessly passed on to a
family member. Looking at the bright horizon ahead,
we are optimistic that we will be able to sustain
our leadership in the businesses we are in, driven
by our teams’ passion to lead, excel and serve. We
face the future confident of our continued success,

"We nurture leaders from among our ranks, leaders who will
lead by example, mentor and foster teamwork, speak what’s
on their mind, and deliver results for sustainable growth. As
of 2015, about 72% of our senior leaders are homegrown,
and our target is to hit 80%. We want to groom team leaders
who share the same philosophy and who, ultimately, will not
only act with the same interest as owners, but will be able to
preserve the Aboitiz Way."

guided by our time-honored core values of integrity,                                       
teamwork, innovation and responsibility.

We also celebrated the golden anniversary of
City Savings Bank. After 50 years of serving niche
customers, its “Simple is Good” philosophy remains
an integral element of the bank’s day-to-day
achievements. From a small thrift bank in Cebu in
1965, CitySavings has today grown to 100 branches
nationwide, and it will continue to widen its reach,
demonstrating the value of financial inclusivity in
helping more people of moderate means.

To cap the year of milestones, AEV was recognized
as one of the top 50 publicly listed companies in
the region cited for good corporate governance
and was conferred with the first ASEAN Corporate
Governance Award. In the same week, AEV also
received the Bell Awards for Corporate Governance
from the Philippine Stock Exchange.

We believe in the crucial role of corporate
governance in building, enhancing and protecting
our reputation, which we consider as our most
important asset. Our continued transparency,
accountability and fairness will build stronger
trust from all our stakeholders, not only from our
shareholders, but also from our team members, our
customers, our lenders, the regulators, our partners,
our host communities, and the general public.

Sustaining Leadership
We recognize that without excellent people and
the right capabilities, no company can sustain
exceptional performance over time, and this is
where our strategic pillar on building human capital
plays a central role.

Crucial to our success is to attract top-caliber
professionals who will not only help us manage
our business, but will also upgrade the Group’s
capabilities and skills moving forward.

We nurture leaders from among our ranks, leaders
who will lead by example, mentor and foster
teamwork, speak what’s on their mind, and deliver
results for sustainable growth. As of 2015, about 72%
of our senior leaders are homegrown, and our target
is to hit 80%. We want to groom team leaders who
share the same philosophy and who, ultimately, will
not only act with the same interest as owners, but
will be able to preserve the Aboitiz Way.

Our Coaching & Mentoring Program is an initiative for
all officers across the Group, beefing up our capability
to truly optimize talent and support our A-people in
their quest for self-driven career development.

At the heart of our human capital-building efforts
is the nurturing of the Aboitiz Way, our time-tested
set of values of integrity, teamwork, innovation and
responsibility that has guided the way the organization
has been run for more than 100 years now.

Building a BetterWorld
We have been able to successfully expand our
sustainability efforts believing that the only way to
sustain the robust growth of our businesses is to
continue contributing to improving people’s lives                       
and the communities where they live, and to help                                                         
protect and preserve our planet’s resources.

Education remains at the forefront of our corporate
social responsibility programs. We have been
advancing efforts in this area because we believe that
a better-educated youth means a better Philippines.

In 2015, we opened the Aboitiz Cleanergy Park in
Davao City, fulfilling our commitment to provide a
sanctuary for the endangered hawksbill turtle or
pawikan, and the other 66 species that thrive in the
eight-hectare biodiversity haven.

The Aboitiz Group is now the biggest partner of
the Department of Natural Resources (DENR) in its
nationwide reforestation program. Our goal of planting
9 million trees by year 2020 under our A-Park program
has inspired us to sign a partnership with the DENR to
support its National Greening Program.

Through WeatherPhilippines, we beefed up our
climate resilience efforts through a partnership
with the Philippine Disaster Recovery Foundation
(PDRF). The partnership allows WeatherPhilipines to
provide localized weather information and access to
early warning systems to strengthen PDRF’s disaster
operations center. WeatherPhilippines will also
provide trainings and expert meteorological advice
to enhance the business continuity mechanisms of
the PDRF’s network.

In response to the call to implement measures
towards creating a climate-resilient nation, the
Aboitiz Group signed two accords in 2015 – the
Manila Declaration and the Water Alliance. In the
Manila Declaration, we joined local businesses in
drafting a concerted plan of action that will support
the Philippine government’s commitment to the
Intended Nationally Determined Contribution (INDC),
which was presented at the Conference of Parties

in Paris in December. Meanwhile the Water Alliance               
lead by Philippine Business for Social Progress (PBSP)
was launched to address the issues and provide
solutions to the looming water supply problems in
the country aggravated by the El Niño phenomenon.

Our Gratitude and Appreciation
While our journey to create a sustainable
enterprise, and ultimately live in a BetterWorld, will
not happen overnight, we are confident that we are
on the right track to propel our enterprise onto the
next exciting growth phase.

We thank you, our dear shareholders, for your
steadfast trust in the Aboitiz Group. We truly value
your trust and this has inspired us to continue to do
well and work towards the greater good of all our
stakeholders. We thank all our business partners,
our host communities, and our customers for their
partnership. Our deep gratitude goes to all our team
leaders and team members, driven by their passion
for better ways, for their invaluable contributions to
the Group’s success.

Moving forward, we will push ahead in our journey
to address and balance our economic, social and
environmental responsibilities with our business
priorities. By creating shared value, we are ensuring
that the Aboitiz Group will continue to be a strong
and sustainable business leader in the future.


Since we took AEV public over two decades ago,                                                
our successful execution of initiatives towards
achieving our growth goals has enabled our strategic
business units (SBU) to become leading players in the
industries we are in. As we pursue further growth,
we aim to sustain leadership in our core businesses
of power, banking and financial services, food, land,
and infrastructure by staying focused on our Group’s
strategic pillars.

In 2015, all of our SBUs successfully aligned to
these strategic pillars: to grow and expand our
business, increase stakeholder engagement, build
human capital, and carry on execution excellence in
everything we do.

We grew and expanded our business, venturing
into the infrastructure space barely a year after
we announced it was going to be our fifth leg.
We believe infrastructure is what will propel our
country’s economic growth and our investment in
this sector is a great opportunity for us to contribute
to nation building. We are pleased to have found a
solid and reliable strategic partner in CRH, a global
leader in building materials. With this partnership,
we successfully acquired Lafarge’s cement assets in
the Philippines, now renamed Republic Cement and
Building Materials, Inc. We view Philippine cement
consumption as a direct proxy to infrastructure
investment in the country.

We have also made a successful entry into the
international market with AboitizPower in Indonesia
and Pilmico in Vietnam. We continue to be on
the lookout for growth opportunities that fit our
investment and risk appetite parameters and where
we can add value based on our proven competencies
and experience. Equally important for us is to always
choose a local partner who shares our core values
and with whom we have mutual trust.

Our disciplined investment criteria focuses on
cashflow and growth from our investments. As
you may know, our dividend policy is to annually
pay out one-third of AEV’s profits and one-half of
AboitizPower’s profits from the previous year, with
the balance to be made available for reinvestment
to fund our expansion. We have been dutifully
delivering these dividends to you and at times
even exceeding the policy depending on our cash
position and investment requirements in the
foreseeable horizon.

We are very positive about our future as we see
many opportunities for growth. We recognize
that sustaining leadership and growth means not
putting at risk what we have built so far. We are
keenly understanding, mitigating and managing
our risk exposures so we can turn these risks into
opportunities and make informed decisions to ensure
we achieve our strategic goals.

Performance of our Strategic Business Units
AEV closed 2015 with a consolidated net income
of P17.7 billion, 4% lower than in the previous
year. The decline, which was anticipated, was due
to lower contributions from our banking and land
business units.

Power remains our largest income contributor,
accounting for 73% of consolidated net income,
followed by banking and financial services, food,
land, and infrastructure. We are confident that we
will start seeing a more diverse income stream as
full-year earnings from our infrastructure business
unit come in this year.

Overall, our stock price performed well and we see
this as a clear sign of the trust and confidence that
the investment community has on our future and
our ability to deliver on our commitments. As you


"Our disciplined investment criteria focuses on cashflow and
growth from our investments. As you may know, our dividend
policy is to annually pay out one-third of AEV’s profits and
one-half of AboitizPower’s profits from the previous year, with
the balance to be made available for reinvestment to fund our
expansion. We have been dutifully delivering these dividends
to you and at times even exceeding the policy depending
on our cash position and investment requirements in the
foreseeable horizon."

will learn from the various sections of this report,                                                                 
your company’s fundamentals remain strong and we
remain on track with our strategic pillars across all
our businesses.

AboitizPower’s income contribution to AEV amounted
to P13.5 billion, a 6% increase from the previous
year’s P12.7 billion, due to higher revenues from
the new capacities of Therma South, Inc. (TSI) and
Hedcor Sabangan. There was also higher ancillary
revenue from the large hydro plants, which more
than offset the decrease in revenue due to the steam
decline of the geothermal group.

Attributable net energy sales rose by 11% year-on-year
(YoY) from 11,272 gigawatt-hours (GWh) to 12,550 GWh.
The distribution business group’s earnings also grew
by 19%, from P3.2 billion to P3.8 billion, due to higher
electricity sales across all customer segments as well
as the full-year contribution from LiMA EnerZone,
which was acquired in 2014.

With the full commissioning of TSI’s 300-MW Davao
baseload plant and San Carlos Sun’s (SacaSun) 59-MWp
solar plant in Negros Occidental, AboitizPower’s
net sellable generating capacity will increase from
3,044 MW to 3,350 MW.

We are on track in achieving our goal to increase our
generating capacity to 4,000 MW by 2020. Other
power projects undergoing construction include the
68-MW Manolo Fortich hydro plant in Bukidnon, the         

8.5-MW Maris Canal hydro of SN Aboitiz Power and
the National Irrigation Authority in Isabela, the 8.8-
MW biomass power facility in Batangas, the 340-MW
Therma Visayas baseload plant in Cebu, the 420-MW
Pagbilao III baseload plant expansion in Quezon
Province, and the 600-MW RP Energy baseload plant
in Zambales.

Power supply in Mindanao continues to be a
challenge due to a lack of capacity, the effects of
El Niño, the bombing of NGCP’s transmission lines,
as well as the repairs and maintenance of power
plants. TSI’s full commissioning of its two units
in February 2016 is providing the much-needed
baseload capacity to help ease the power shortage
as it is not dependent on weather conditions.

Along with the increase in our non-renewable
capacity, we are also vigorously pursuing
and growing our renewable energy portfolio.
AboitizPower is currently one of the largest
producers of clean energy in the Philippines
generating 1,263 MW, or close to 40% of our
total net sellable capacity.

While the Philippines contributes to only 0.3%
of global GHG emission, we fully support the
government’s call to further reduce our carbon
footprint. To ensure that we keep up with the
growing demand and secure the country’s energy
mix target of 30% renewable, AboitizPower will
continuously invest and develop more Cleanergy, its
brand for clean and renewable energy.                               

We plan to build and operate an additional 200 MW                                                       
of run-of-river hydro plants by 2020. We are also
actively pursuing the expansions of geothermal and
biomass power plants.

Offshore, we are eyeing geothermal and hydropower
projects in Indonesia, as part of AboitizPower’s
growth strategy in the ASEAN region.

Given our balanced mix of renewable and non-
renewable energy sources, we are uniquely
positioned to provide our customers with their choice
of the right power solution that is reliable, reasonably
priced, and has the least impact on our environment.
With our available power technologies, we cater
to different power-demand types of the grid. This
means we address the power needs for baseload,
intermediate and peaking loads, as well as ancillary
services for grid stability and system management.

Core to our gentailer (generator-retailer) strategy is
Open Access, which empowers end-users to choose
their own electricity supplier. Only through Open
Access can they be given the power of choice that
will truly transform the power industry into a more
competitive marketplace. It also gives us the ability to
expand our reach to end-users beyond our distribution
utilities’ franchise areas and the spot market.

TAlthough there has been a delay in the implementation
of a mandatory transition to Open Access and retail
competition, we are hopeful that it will happen in the
near future. We foresee greater customer diversity as
the timelines are realized for reducing the threshold
for contestability from 1 MW to 750 kW and,
eventually, a further reduction to 500 kW and even
down to the household level.

Banking & Financial Services
IUnionBank’s income contribution to AEV in 2015
dropped by 22% YoY from P3.2 billion to P 2.5 billion
mainly due to lower trading gains, which was partially
offset by strong growth in interest income.
Following its FOCUS 2020 roadmap, the bank shifted
from proprietary trading to an interest accrual and fee-
based business model, focusing on customer centricity
and channel expansion, which yielded favorable
customer income growth that is among the highest
as compared to other listed peer banks. It remains
focused on its goal to build a great retail bank.

CitySavings ended the year on a high note by opening
its 100th branch on the occasion of its 50th year
celebration. The thrift bank serves the needs of
teacher-partners through simple and innovative
programs, and also introduces new product offerings
for its customers.

Money remittance firm PETNET, Inc., our newly
acquired company, began contributing to AEV’s
income in June 2015. We expect this new business
to open up opportunities for us to distribute
complementary banking and financial services via its
extensive network of outlets across the country.

Our food business recorded the largest increase
in 2015 with a 31% growth in NIAT (net income
after taxes) brought on by the performance of
its feeds business. Overall, the company was
consistent in delivering income growth across
all its divisions.

Feeds-Philippines’ income contribution more than
doubled while Feeds-Vietnam, which celebrated
its first anniversary in August 2015, is enjoying
an 8% market share of the Mekong Delta aqua
feeds industry.

Farms’ income contribution fell due to the
lower prevailing market selling price of live hogs.
The company has also entered the higher-margin
meat selling business, introducing carcasses and
boxed meat products to institutional customers, and
diversifying into the poultry industry with its chicken
egg layers farm.                                                           
Flour’s earnings contribution was flat but retained                                                        
a steady volume growth alongside industry levels.
Representative offices in Vietnam and Indonesia
anchored the successful start of the Flour Export
Program in those countries as well as in Hong Kong.

In pursuit of its 2020 goal, Pilmico is focusing its
growth not only in the Philippines but also in the
region, actively seeking opportunities to diversify
its portfolio. It will expand geographically through
mergers and acquisitions while continuing the
expansion of its flour plants, feed mills, and farm
unit capacities.

AboitizLand’s full-year income contribution to
AEV amounted to P536 million, 15% lower from
the previous year. This was mainly due to the
decline in revenue from residential division and the
higher manpower cost as a result of an ongoing
organizational expansion. Despite the increase in
residential unit sales, the corresponding revenue
recorded under the percentage of completion (POC)
method was lower because of the slower pace of
construction in 2015 than in the previous year.
AboitizLand will see income growth in the residential
sector as units sold are built and recognized as
revenue under the POC method.

AboitizLand ended the year with 52% of total revenue
coming from its industrial communities West Cebu
Industrial Park, Mactan Economic Zone 2, and LiMA
Technology Center.

Residential sales accounted for 43% of the company’s
total revenue. Amoa, AboitizLand’s 60-hectare mid-
end residential community located in Compostela,
Cebu, surpassed its annual sales target by 300%.

The rest of the revenue came from the company’s
commercial business and other revenue streams.
Commercial properties grew by 30% YoY as major
retailers joined AboitizLand’s expanding roster of
merchants, indicating increased confidence in the
company’s role in achieving their development goals.
AboitizLand’s first project under the Cebu District
Property Enterprise, Inc., its partnership with Ayala
Land, is set to launch in 2016.

The company will take advantage of this heightened
interest and continue pursuing an aggressive
investment plan in land banking activities in
strategic areas of the country to meet the growing
demand from across residential, commercial, and
industrial segments.

Newly-acquired Republic Cement and Building
Materials, Inc., which started in mid-September 2015,
contributed P194 million to AEV. Along with our
partner CRH, the Aboitiz Group is now invested in the
Philippines’ second largest local cement manufacturing
and distribution group. It has six facilities across Luzon,
Visayas and Mindanao producing over 25% of the
country’s cement requirements.

To sustain the economic gains that our country
has made over the past few years, the national
government has targeted to increase its expenditures
for infrastructure to 5% of GDP. We believe this
will sustain the growth we have seen in cement
consumption and support expansion opportunities in
our cement business.

Apo Agua, our other business unit under the
infrastructure group, is focused on starting the
construction of the country’s second largest
private bulk water treatment facility, which will use
renewable hydropower generated from the Tamugan
River. The P12-billion project will directly benefit
Davao City’s one million residents and its many
commercial and industrial establishments.

We foresee large public and private investments
pouring into the infrastructure space in the next 10
to 20 years, and we want to play a major role in this
sector. We are participating in various public-private                                                    
partnership (PPP) bids including the bundled regional
airports and the LRT 2 O&M bid.

Corporate Center
OWith a growing enterprise that has over 31,000
team members across the Group, the AEV Corporate
Center needs to step up on its crucial roles of being
the knowledge center, governance agent, and
business partner of our SBUs. It will continue to
introduce best-in-class knowledge, value-adding
services, leading governance practices, and systems
capabilities that could help us maximize Group
resources, optimize common processes, and improve
overall effectiveness.

We are committed to quality management systems.
AEV’s ISO 9001:2008 certification in 2015 and
AboitizPower’s Project Forward, key milestones in our
quality journey, are testaments to this commitment.

We believe that only a strong team with the right
leadership can deliver excellent performance. As we
continue to build our bench, we will nurture leaders
from among our ranks who will lead by example,
mentor and foster teamwork, speak what’s on their
mind, and deliver results for sustainable growth.

Towards Creating Shared Value
Today, the Aboitiz Group is at the cusp of creating
shared value. No organization can exist for very
long without a larger purpose. We constantly ask
ourselves whether there is a better way to create
long-term value for all our stakeholders.

Our enterprise will only be truly sustainable and
enduring if all our stakeholders, including our team
members, our host communities and society at
large, benefit from our value creation efforts. As the
Group pursues further growth, we are facing greater
expectations from our stakeholders to help address a
variety of societal challenges, while generating value
for our businesses.

We have identified existing shared value initiatives
across the Group, and we will expand them as well as
create new ones to ensure a more sustainable social
impact and deliver the promise of greater good. We
are guided by the Aboitiz BetterWorld sustainability
mindset: We can do well by doing good, always
making the right long-term decisions that balance the
interest of people, planet and profit.

Message of Thanks
All of our plans and strategies will not yield the
anticipated positive results without the dedication
and talent of all our team members, who are truly
driven by the Aboitiz Passion for Better Ways. We
thank them for their invaluable contributions to the
sustained success and strength of our organization.

To you, our dear shareholders, we deeply appreciate
your continued trust in the Aboitiz Group and our
people. We affirm our commitment to sustaining
your company’s leadership in business, corporate
governance, corporate social responsibility,
and sustainability.

An even more exciting future awaits us in our
continuing journey towards creating a truly sustainable
enterprise that we can entrust to future generations.




In 2015, your company posted a consolidated core net                                           
income of P18.3 billion, a 2% increase from the prior
year’s figure. This core income translates to earnings
per share of P3.29, and a Return on Shareholders’
Equity of 18%. Total core earnings contributions from
AEV’s strategic business units came from power, which
accounted for 74%, followed by banking at 13%, food
at 9%, land at 3%, and infrastructure at 1%.

Consolidated EBITDA (Earnings Before Interest, Taxes,
Depreciation, and Amortization) rose by 5% year-on-year
to P40.2 billion. Beneficial EBITDA, a more meaningful
metric for us, increased by 8% to P35.4 billion. By the
end of the year, cash balances stood at P63.6 billion.

For 2016, we have budgeted about P58.4 billion in
capital expenditures (capex), compared to the P38.7
billion in 2015. The bulk of this year’s capex will once
again go to AboitizPower’s continuing efforts, together
with its partners, to increase total capacity to 4,000 MW
by 2020. UnionBank will upgrade its infrastructure to
enable its digital banking ambitions while it continues
to expand its branch network, a similar thrust being

undertaken by our newest remittance business,
PETNET. Pilmico's initiatives will expand its customer
reach in ASEAN while diversifying operations in the
country. AboitizLand will acquire more industrial and
residential land, as it continues to expand its business
outside of Cebu, and onto the national arena.

The domestic economy saw another year of robust
growth under a low interest-rate environment, and
the Aboitiz Group successfully tapped the debt capital
markets to fund its own growth initiatives. In 2015,
we completed several debt transactions, the most
significant being our P24-billion retail bond issuance
- the largest ever issued for the Group, and the third
largest issued in the Philippines.

Despite all the additional debt, your company’s
balance sheet remains strong, with relatively low
gearing. At year-end 2015, net-debt-to-equity stood
at only 0.7x, with net-debt-to-EBITDA at 1.7x. AEV’s
consolidated debt maturity profile is well within the
parameters we have set to mitigate liquidity and
refinancing risk over the remaining life of this debt.

With the historically low interest rates currently                                                                   
prevailing, we have deployed a strategy of locking
in interest rates on almost all of our term debt, to
minimize interest rate risk.

Among our projects for 2016, we are seeking to
close the financing of our first bulk water project, the
country’s second largest private bulk water project to
date. We are well-positioned to finance acquisitions
as opportunities arise, as well as expansion and
greenfield projects in the coming years.

We continue to improve the company’s risk financing
initiatives by focusing on better risk mitigation and
quantification for both insured values and business
interruption exposures. This allows us to achieve
sufficient and effective Group-wide insurance
programs as well as ensure business continuity.

As our businesses evolve, we have also aligned our
programs to ensure that we have best-fit insurance
facilities that enable us to access competitive
markets with better coverage. This alignment
helped us achieve an optimal balance in retaining
and transferring risks, and lower our Total Cost of
Insurable Risks by 15% in 2015.

In addition, a Group Financial Risk Management
Framework has been put in place to cover interest
rate, foreign exchange, credit, refinancing and
liquidity risks.

In March 2015, your Board approved a total cash
dividend of P1.11 per share. Total dividends paid
amounted to P6.2 billion, in line with our 33%
minimum dividend payout policy. This translated to a
dividend yield at the time of 1.9%.

For 2016, we anticipate new opportunities for growth,
both at home and in the region but we also expect the
business landscape to continue to evolve on all fronts.
We are gearing up financially and preparing for these
changes, mindful of our mission to create long-term
value for all our stakeholders.

Thank you to our various stakeholders – including our
partners, financial institutions, and suppliers – for
your continued support to the Group. To you, our
dear shareholders, thank you for your unwavering
confidence and trust in your entire management team.



Earnings and Dividends
(in Php billions)

Dividend Per Share (DPS) and Dividend Yield

Share Price (Peso/Share)



In 2015, AboitizPower’s core net income                                               
increased by 9% to P18.4 billion from P16.8
billion in 2014. The increase in volumes across
the generation and distribution businesses,
coupled with lower expenses drove healthy
growth in 2015.

We experienced the full-year effect of Hedcor
Sabangan and the addition of Therma South’s
Unit 1 in the fourth quarter of the year. Capacity
sold from our generation business grew by 6%.
Contracted out of capacity sales went up to 93%
from 90% of the prior year.

Our thrust as a generator-retailer continues
to be a cornerstone of our strategy. We were
able to contract 14% of total attributable net
sellable capacity of 2,402 MW with contestable
customers amounting to 332 MW. We expect
to further grow this share in the coming years;
more so with the expansion of the Open Access
market to the 750 kW contestable customers in
2016. With our continuous push in this space, we
are able to further diversify our customer base
and stabilize cash flows.

Our distribution business expanded volume
by 6% to 4,759 GWh from 4,480 GWh of the
previous year driven by strong growth across
all customer segments as well as the full-year
contribution from LiMA EnerZone, which was
acquired in 2014. Gross margin on a per kWh
basis decreased from P1.71 to P1.61 due to the
continued operation of Davao Light's embedded
plant to meet the shortfall in the Mindanao grid.
Strong demand growth from our lower-margin
industrial customers also contributed to the
decline in per kWh margins.

In 2015, AboitizPower together with its partners
spent P34.4 billion for capital expenditure (capex)
as part of the company’s ongoing efforts to
increase total capacity. To continue its trajectory
to hit 4,000 MW by 2020, capex spend in 2016
will go up to P51.5 billion. We believe that being
able to provide our committed power capacity
at the right time is the key to our meeting
the country’s needs and growth initiatives.
Our sustained level of capex commitments
demonstrates this belief.

As Therma South was about to go online in 2015,
we had already closed the P32-billion syndicated
loan for Therma Visayas. This is the first transaction
that carries a back-ended equity feature, which is
a testament to the trust that our partner financial
institutions have bestowed upon us.

Our growing P&L and strong balance sheet
tell the story of grit and prudence combined.
This healthy balance allows us to have access
to innovative financing, which is vital for us to
sustain our growth story. Our consolidated net
debt-to-equity ratio is maintained at 0.6x for the
second year in a row while Equity Attributable
to Equity Holders of the Parent rose from P92.0
billion to P97.6 billion.

In 2015, our Return on Equity was maintained
at 21% for the second year in a row. This is
testament to the stable returns from the existing
legal entities as we continue to invest in our new
projects. We have maintained a healthy balance                                        
between strong dividend payments and funding
for growth.

In March 2015, your Board approved a total cash
dividend of P1.66 per share. Total dividends paid
amounted to P12.2 billion or 73% of the previous
year’s earnings. This translates to a dividend yield
of 3.7%.

We entered 2016 with a strong balance sheet and
healthy cash flows, coupled with our resolve to
grow our portfolio by sustaining investments in
greenfield and brownfield projects, both domestic
and overseas.

More importantly, we entered the year with an
organization that is fired up on all cylinders, ready
to drive growth and to deliver shared value in
every community, sector and society that we serve.

Sustaining leadership is crucial in a constantly
changing environment. As such, we continue
to develop leaders who are able to deliver with


deliberate intent while able to react to emergent          
realities. As your CFO, I am passionately committed
to deliver agile leadership as we continue to
traverse on the path of growth and better ways.

We wish to thank you, our shareholders, as well
as our customers, partners, lenders and suppliers
for the continued support. We look forward to
more years of partnership with all of you in our
AboitizPower journey.


Earnings and Dividends
(in Php billions)

Dividend Per Share (DPS) and Dividend Yield

Share Price (Peso/Share)

Share Price Performance