Meralco powers core income higher by 11 percent to P10.1 billion in Q1

MANILA, Philippines — Pangilinan-led power firm Manila Electric Co. (Meralco) reported a consolidated core net income (CCNI) of P10.1 billion in the first quarter, up by 11 percent from P9 billion in the same period last year.

The improvement in earnings was due to “higher energy sales volume of the distribution business and continuing contributions from power generation, retail electricity (supply) and the non-power related businesses,” Meralco chief finance officer Betty Siy-Yap said in a media briefing.

Meanwhile, its reported net income - adjusted to exclude the effect of foreign exchange gains or losses, impairment charges, mark-to-market adjustments and other one-time, exceptional transactions- also went up by 19 percent to P9.6 billion from P8.1 billion a year earlier.

The CCNI consists of the following: P5.8 billion from distribution business, P2.7 billion from power generation and P1.5 billion from retail electricity supply (RES) and non-power related businesses.

According to Meralco chairman and CEO Manuel V. Pangilinan, the financial results show their businesses “have been performing very well.”

“That performance continues with the balance of the year for the next three quarters, especially this time (in) April, and perhaps continuing through May, where warm weather is predicted to persist,” he said.

As a result, Pangilinan expects full year CCNI to reach over P40 billion.

Despite the increase in income, Meralco said its consolidated revenue went down by 1.04 percent to P104.5 billion due to lower pass-through charges and energy fees following the decline in prices at the Wholesale Electricity Spot Market (WESM), of Malampaya gas and international coal prices.

Average WESM prices in the Meralco franchise area decreased to P4.65 per kilowatt hour (kWh) from P6.57 per kWh due to improved supply situation in the grid during the quarter.

Capital expenditures in the first quarter stood at P9.4 billion, with P4.99 billion used for distribution network projects composed of new connections, asset renewals and load growth projects.

About 14 percent of the capex was spent on projects by Meralco PowerGen, namely Phase 2 of PH Renewables Inc.’s Baras solar power plant, 49 MWac of Greenergy for Global and 18.75 MWac of Greentech Bongabon.

The balance was allocated for Miescor Infrastructure Development Corp.’s (MIDC) purchase of additional 154 telecommunication towers from Globe and construction of build-to-suit towers.

“As we continue to deliver stable and reliable service to our customers, we reiterate our pursuit to bring in projects of scale that will boost available generation capacity which we direly need to ensure not just the immediate, but the long-term energy security of the country,” Pangilinan said.

For the full year 2023, Meralco reported its core earnings went up by 37 percent to P37.1 billion due to contributions from its power generation and retail electricity businesses, as well as the continued increase in energy sold by its distribution utility businesses.