AboitizPower: Q1 in line, defensive earnings profile intact
From AB Capital's The Opening Bell: Three Moves
Event
AP’s 1Q26 core income rose 62% YoY to P7.6 billion, driven by volume recovery and modest margin improvement, with headline growth supported by a low base following elevated outages in 1Q25. This came in at 22% of AB Cap’s FY26E, which we view as broadly in line given expected contributions from newly turned-over capacity in the coming quarters.
View
Generation volumes increased 30% YoY, reflecting improved plant availability, alongside incremental output from newly commissioned solar assets and the first full-quarter contribution from LNG plants.
Catalyst
Generation EBITDA rose 42% YoY to P18.5 billion, driven by higher output and a better contracted mix amid still subdued WESM prices. On a unit basis, we estimate EBITDA/GWh increased 9% YoY, indicating modest margin improvement.
Action
We maintain AP as our top pick, supported by its highly contracted generation base, diversified portfolio, and ongoing capacity additions, which underpin earnings visibility. More details are expected in the 11 May briefing.
Disclaimer: The information, analyses, and views contained herein is based on sources which we, AB Capital Securities, believe are reliable, but is not guaranteed by us and is not to be considered all inclusive. It is not to be construed as an offer or solicitation of an offer to sell or buy the securities herein mentioned. AB Capital Securities and its Directors and Officers and/or members of their families may have a position in the securities herein mentioned and may make purchases and/or sales of the securities from time to time in the open-market and otherwise.
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