MPIC profit jumps to P7 billion in Q1

MANILA, Philippines — Metro Pacific Investments Corp., the listed tollways and infrastructure conglomerate led by Manuel V. Pangilinan, reported a net income of P7 billion in the first quarter, up 272 percent from the same period last year.

The increase in consolidated income reflected gains recognized from the sale of Global Business Power and Don Muang Tollways as part of MPIC’s commitment to optimizing its portfolio and realizing value for its stakeholders.

MPIC transferred its ownership stake in GBP to Meralco PowerGen Corp. following a share sale and purchase agreement signed in late 2020. As a result, MPIC recognized a net gain of P4.6 billion from this transaction and retained an economic interest in GBP via its investment in Meralco.

Last February, MPTC sold its entire 29.45 percent indirect stake in Don Muang Public Company Ltd. in Thailand for P7.2 billion. Proceeds from the sale will be used to fund toll road expansion projects.

Consolidated core earnings, however, declined by 26 percent to P2.5 billion due to the economic contraction as a result of the COVID-19 pandemic.

The pandemic resulted in reduced toll road traffic, light rail services and commercial and industrial demand for water and power, officials said in a briefing yesterday.

As a result, contribution from operations dropped 19 percent to P3.8 billion.

Power accounted for P2.5 billion or 66 percent of the total while toll roads contributed P800 million or 21 percent. Water contributed P500 million or 14 percent.

On the other hand, other businesses, mainly hospitals, light rail and logistics incurred an overall loss of P49 million.

However, MPIC president and CEO Jose Ma. K. Lim said the company reported improvements quarter on quarter.

“Navigating through a pandemic would have been even more challenging had it not been for the relative strength of our balance sheet. Consequently, while we remain committed to our ongoing priority projects, we have also recalibrated our capital expenditure plans for the year and have decided to defer or discontinue previously announced discretionary investments. This will allow us to focus more on investments that will enable economic growth from infrastructure development without putting additional strain on future our cash flows,” Lim said.

“There is still much work that needs to be done to help our country recover so we will continue to proactively partner with the government and offer our hand wherever needed – from the handling and storage of vaccines, to increasing COVID-19 bed capacity in our hospitals, and the conversion of our facilities into quarantine centers – we are now studying how we can be instrumental in the development of our own vaccines and help better equip our nation for a crisis such as this,” he said.

MPIC expects to benefit from the recently signed Corporate Recovery and Tax Incentives (CREATE) Law, which lowered income tax rates to 25 percent from 30 percent.

The law eases the company’s future tax liabilities and consequently allows reallocation of resources to further improve operational efficiencies.