First Gen posts fivefold net income growth

Business World Online

Posted on March 15, 2013 07:39:39 PM

LOPEZ-LED FIRST Gen Corp. posted a fivefold net income growth last year buoyed by strong performance of business assets, the company said in a statement yesterday.

The company said net income attributable to equity of the parent firm ballooned to $186.1 million from $35.0 million in 2011 "resulting from the solid performance of each of the asset portfolios; namely, natural gas, geothermal, and hydro."

During the same comparative period, consolidated revenues added $163.3 million or 12% to $1.53 billion from $1.36 billion.

The company said that it booked $35.8 million in additional income from the acquisition and operation in May 2012 of BG Group’s 40% stake in two power projects in Batangas province.

The projects are the 1,000-megawatt (MW) Santa Rita and 500-MW San Lorenzo natural gas-fired power plants, which was acquired through First Gen unit First Gas Corp.

This led to a $106.7-million contribution of First Gas to the parent company’s attributable net income in 2012.

Meanwhile, affiliate Energy Development Corp. (EDC) brought in $76.4 million, a turnaround from losses incurred in 2011 due to the shutdown of the company’s 49-MW Northern Negros geothermal power plant.

It also noted that EDC’s 305-MW Palinpinon-Tongonan geothermal power plants realized the full-year benefits of price adjustments from power supply deals.

"These positive developments were combined with the stellar performance of the 132-MW Pantabangan-Masiway hydroelectric power plants as higher sales of electricity were generated from ancillary services and power sales," the statement read.

The said hydroelectric plants -- which are 40% owned by First Gen and 60% by EDC -- contributed $59.9 million to the company’s earnings, a two-fold growth from the $25.5 million in 2011. 

The total interest expense of the company for 2012 was lower by 8.12% to $78.1 million from $85 million in the previous year due to the refinancing of loans amid the low interest rate environment.

The loan refinancing allowed the parent firm to prepay over $250 million in debt, and pre-fund the remaining $57 million convertible bonds that matured last February.

"In 2013, we continue to pursue more opportunities for growth in each of our platforms with the intention of bringing these projects to market starting 2014," the statement quoted First Gen President Francis Giles B. Puno as saying.

First Gen, which was incorporated in December 1998, is the primary holding company for the power generation and energy-related businesses of the Lopez group. The company’s parent and controlling shareholder is First Philippine Holdings Corp. 

Shares of First Gen on Friday shed 40 centavos or 1.67% to P23.50 apiece from P23.90 apiece on Thursday. -- C. M. C. Feliciano   source