Meralco’s net income up by a fifth last year

Manila Times.net
Published : Tuesday, February 28, 2012 00:00 Written by : Euan Paulo C. Añonuevo, Reporter




Manila Electric Co. (Meralco) reported a double-digit profit growth last year as a result of an increase in tariffs and sales over the previous year.




In a briefing, Manuel Pangilinan, Meralco president and chief executive told reporters that its net income rose 22 percent to P14.89 billion last year from P12.16 billion in 2010.


Despite the hefty profit hike, Pangilinan said that the company expects core earnings to slow down this year at about P15 billion because of the lower approved maximum allowable revenue earlier approved by regulators from 2012 to 2015.


”Our forecast for volume sales for the year will be approximately 3 percent on the basis of economic growth and customer count in the course of 2012. However, revenues will be at the pressure because of the almost flattish and slightly declining tariffs between 2012 up to 2015,” Pangilinan said.


”The guidance we’re providing a number we’re all be comfortable which is P15 billion of core for 2012 compared to P14.89 billion last year,” he added.


Meralco is the country’s largest private power distribution company with around 5.03 million service connections in Metro Manila and its environs.


Last year, the company posted consolidated revenues of P256.8 billion, up 7 percent over the previous year as a result of an increase in sales volume, transmission charges and distribution rate.


Meralco’s consolidated sales volume, in particular, rose 1.1 percent to 30,592 gigawatthours (GwH) from 30,314 GWh. Oscar Reyes, Meralco executive vice president, said that the increase was the result of growth in commercial and industrial sectors.


Sales to residential consumers, however, declined by 2 percent due to the cooler temperature last year.


Despite this, Reyes said that Meralco posted a record system loss of 7.35 percent last year, which generated savings of P2.4 billion or a reduction of P0.07 per kilowatthours for consumers. Meralco plans to spend around P11 billion this year for capital expenditure projects from P8.7 billion last year to further improve its distribution business.


Regulators prescribe that system loss, which arise from pilferage and technical consideration, be shouldered by consumers via an increase in tariffs if it falls above the 8.5 percent cap and the other way around if it falls below this level. Meralco approved cash dividends of P4.10 per share to shareholders of record at March 23, 2012 payable on April 23, 2012.