Meralco 9-month income up 25 percent

Business Mirror
WEDNESDAY, 02 NOVEMBER 2011 18:54 MIGUEL R. CAMUS / REPORTER


MANILA Electric Co. (Meralco), the Philippines’ biggest electricity retailer, said net income in the nine months through September rose 25 percent to P9.95 billion. Removing one-time and exceptional gains, core profit grew 27 percent to P11.66 billion.
For the third quarter, Meralco said reported net income rose close to 24 percent to P3.86 billion while core net income was up 14.7 percent to P3.84 billion.


“As the year comes to a close, we are prepared to announce a higher core net income guidance for the full year of 2011 of P14.5 billion,” Meralco president and chief executive officer Manuel V. Pangilinan said in a statement. 


The profit forecast, which is about a fifth above Meralco’s full-year core earnings in 2010, falls short of some analyst estimates.


“We were expecting full year core earnings at P17.2 billion,” George Ching, equities analyst with stock brokerage firm CitisecOnline, said in a phone interview on Wednesday.


Meralco shares declined 2.89 percent to P235 each ahead of the release of its earnings results.


The power retailer said third-quarter revenues rose 11 percent to P68.11 billion as sales to the industrial segment improved. Total revenues for the nine month period, 97 percent of which comes from electricity sales, rose 2 percent to P192.94 billion.


The company said core earnings before interest, taxes, depreciation, and amortization (Ebitda) during the nine months to September was up 13 percent to P21.64 billion for an Ebitda margin of 11 percent. Total costs and expenses rose 0.5 percent to P177.7 billion.


“We are inspired by the resilience of the distribution business and aim not only to build on this legacy but also to re-shape the business by competitively re-entering the power-generation business and building our other subsidiaries,” Pangilinan said in the same statement.   


Meralco recently acquired a controlling interest in a venture with Aboitiz Power Corp. and Taiwan Cogeneration International Corp. to build a 600-megawatt thermal power plant in the Subic Freeport Zone in Zambales.