Aboitiz Equity’s income jumps 163% to P21.9b

Manila Standard Today

Cebu-based conglomerate Aboitiz Equity Ventures Inc. said net income in 2010 jumped 163 percent to P21.9 billion mainly due to strong performance of its power, banking and food units.

Aboitiz Equity said in a disclosure to the stock exchange that the company’s power subsidiary accounted for 85 percent of the conglomerate’s net profit while the banking and food units contributed the balance.

“Our businesses at AEV turned in strong operating results. We continue to be guided by our investing discipline and strict adherence to our agreed cost of capital,” Aboitiz Equity president and chief executive Erramon Aboitiz said in a statement.

Aboitiz Power, which is 76 percent owned by Aboitiz Equity, posted an income of P19.1 billion in 2010, up sharply from P4.3 billion in 2009.

The power generation business contributed P18.6 billion for the year, up 424 percent year-on-year, on the back of improved pricing and volume sales.

The average selling prices for bilateral contracts and transactions in the spot market rose 13 percent and 181 percent, respectively, while total attributable power sales grew 111 percent in 2010 from 4,619 gigawatt-hours in 2009 to 9,762 GWh in 2010.

Full-year contributions from assets acquired in 2009, coupled with fresh contributions from completed greenfield plants and assets bought in 2010, also contributed to Aboitiz Power’s attributable net generation for the year.

Aboitiz Power’s attributable capacity as of end-2010 stood at 2,051 megawatts, up 18 percent on year. The holding company attributed the expansion to the takeover of the two 100-MW Mindanao power barges; the commissioning of the 42.5-MW Sibulan hydropower plant in Davao del Sur, and the start-up operations of two units of the 246-MW coal-fired power plant in Cebu.

Another source of earnings growth for the power generation business were the Binga and Magat hydropower plants.

“We are executing our strategy to sign more bilateral contracts that will result in more predictable and less volatile earnings,” said Aboitiz said. Jenniffer B. Austria