First Gen reports 64% rise in 2014 profit

Business World Online
Posted on March 13, 2015 07:24:00 PM
By Claire-Ann Marie C. Feliciano, Senior Reporter

HIGHER EARNINGS from its power plants boosted First Gen Corp.’s profit by 64% last year, the Lopez-led energy firm said in a statement on Friday.

The company’s income attributable to the parent reached $193.2 million in the January to December period, up from $118.1 million in 2013.

“The improved financial performance was driven by higher earnings contributions from the Santa Rita and San Lorenzo natural gas power plants and Energy Development Corp.’s (EDC) geothermal plants,” First Gen said in its statement.

First Gen’s 1,000-megawatt (MW) Santa Rita and 500-MW San Lorenzo plants contributed $121.5 million to profit, higher than the previous year’s $81.9 million.

EDC, meanwhile, accounted for the $136.1 million attributable earnings, which is higher from the previous year’s $76.6 million in 2013.

First Gen’s consolidated electricity revenues, however, slipped by 0.10% to $1.903 billion from $1.905 million.

Of the total, the gas plants accounted for 63.3% of the revenues or $1.205 billion.

The gas plants’ revenues were lower mainly due to the shutdown of Santa Rita plant’s 250-MW unit after its transformer was damaged in February last year.

The unit was re-commissioned in July 2014 following the installation of a new transformer.

The upgraded capacity of the San Lorenzo plant, as well as the receipt of insurance claims and full-year contribution of one of its units contributed to the improved performance.

Of the total revenues, EDC -- which is in charge of the geothermal plants -- had a share of 34.3% or $651.7 million.

This was higher by $81.3 million, according to First Gen, which it said was mainly due to electricity generated by the BacMan (Bacon-Manito) and Nasulo power plants.

Reduction of foreign exchange losses and receipt of insurance claims also pushed EDC’s revenues.

The favorable performance of EDC was partly dragged by higher administrative expenses incurred due to tax payments, costs related to project development and interest expense due to fresh borrowings.

The strong performance of the geothermal and gas plants was able to offset the weaker earnings of First Gen Hydro Power Corp. (FG Hydro), which was hurt by lower water levels.

FG Hydro contributed $36.6 million or 1.9% of First Gen’s revenues.

First Gen President Francis Giles B. Puno said the company’s thrust to grow its clean and renewable platform gained significant momentum last year.

“The Bacman and Nasulo geothermal projects of EDC were positive turnaround stories for 2014 and, together with the new 150 MW Burgos wind project, will increase revenues moving forward,” Mr. Puno said.

“We are eager to deliver the fast-track 97 MW Avion natural gas-fired project this year to address the power supply shortage and are progressing well with the construction of the 414 MW San Gabriel natural gas plant to be operational in the summer of 2016,” he added.

Mr. Puno said despite lower earnings from the Pantabangan hydro plant, First Gen wants to pursue its run-of-river hydro projects this year.

Incorporated in 1998, First Gen is the holding firm for the power generation businesses of the Lopez Group.

Its shares ended trade at P29.60 apiece on Friday, up 10 centavos or 0.34% from Thursday’s closing price of P29.50. source