Meralco expects repeat of 2010 record net income

Manila Times.net

By James Konstantin Galvez, Reporter

MANILA Electric Co. (Meralco) on Tuesday said its first-half core net income would exceed that in 2010, which was a banner year for the utility.

In a media briefing, Manuel Pangilinan, Meralco chief executive, said the company’s first-half results would get a boost from cost management efforts undertaken to offset declining power sales in April and May.

“In terms of the financial position of the company, it is definitely ahead of last year. So, we also expect the full-year performance for this year to be ahead of 2010,” Pangilinan said.

Meralco’s electricity sales in 2010 rebounded to a record 14-year high, surpassing the two percent average growth registered in the past five years.

Pangilinan said the company is strengthening its core distribution business by improving efficiencies, and by upgrading and expanding the same.

The company is also looking at creating a “vertically integrated” business model with its entry into the power generation business, which would alleviate the anticipated supply shortage as reserves from existing power plants tighten.

“This will enable us to manage the perennial concern about high power rates. Our power generation portfolio carries with it a goal of building an aggregate capacity of 1,500 megawatts at a total estimated cost of approximately $2.3 billion over the next five years,” Pangilinan said.
He said the power generation package will consist of base load plants fueled by coal, liquefied natural gas, and aeroderivative gas turbines.