Aboitiz Equity’s profit dips to P21b

by Jenniffer B. Austria


Cebu-based conglomerate Aboitiz Equity Ventures Inc. said Friday consolidated net income fell 3 percent year-on-year to P21.2 billion in 2011, on lower sales of its power and food businesses.


AEV said in a disclosure to the stock exchange power continued to account for bulk of the group’s earnings with 78-percent share, followed by the banking and food businesses with income contributions of 16 percent and 6 percent, respectively.


The power generation business contributed P15.6 billion to the group’s earnings in 2011, down 16 percent from a year ago, owing to lower average selling price of electricity and net generation during the period.


Aboitiz Power’s generation business saw a 7-percent drop in average selling prices, given the softening of the spot market prices at the wholesale electricity spot market.


“Both demand and supply conditions that prevailed during the year were responsible for the recorded 41-percent year-on-year decline in the average price of electricity in WESM’s Luzon spot market. Demand for electricity was relatively flat versus last year,” AEV said.


Aboitiz Power’s attributable capacity, however, rose 15 percent to 2,350 megawatt as of end-2011, after it took full ownership and control of the 70-MW Bakun hydro run-of-river plant and 242-MW Navotas power barges last year.


Other projects that increased the group’s total capacity were the rehabilitation of the Ambuklao hydropower facility, the completion of the 4-MW Irisan hydropower greenfield project, and partial rehabilitation of the Binga hydropower facility.


Income contribution from AEV’s banking units recorded a 31-percent increase in 2011 to P3.4 billion from P2.6 billion in 2010. Union Bank of the Philippines ended the period with earnings contribution of P2.9 billion, up 26 percent from a year ago while its non-listed thrift bank, City Savings Bank Inc. (CitySavings), contributed P531 million with a 69-percent growth.


Income contribution from the conglomerate’s food business SBU registered a 19-percent decline in 2011 to P1.2 billion from P1.5 billion in 2010 due to higher cost of inputs.


(Published in the Manila Standard Today newspaper on /2012/March/3.)