Published March 16, 2017, 10:00 PM by
Madelaine
B. Miraflor
Listed First Gen Corporation (First
Gen), a Lopez Group company, is expecting to see better income this year after
registering flat growth in 2016.
A disclosure to the Philippine Stock
Exchange yesterday showed that First Gen’s net income attributable to
equity holders of the parent stood at US$200 million in 2016, a 19 percent
increase from the US$167 million it made in 2015. But on a recurring basis, the
company’s attributable net income was actually flat at US$162 million.
“As most of the platforms’ power
plants in the portfolio benefited from higher dispatch, these were offset by
lower spot market prices. These likewise offset the gains made from
cost-containment initiatives,” the company told the Exchange.
First Gen President and Chief
Operating Officer Francis Giles B. Puno said that though 2016 was a challenging
year, “it was also the year First Gen achieved its highest net income.”
“We are optimistic that this trend
will continue with the addition of our two newest natural gas–fired plants –
the 414- megawatt (MW) San Gabriel Flex Plant and the 97 MW Avion Peaking Plant
– that will deliver full year operations this year, alongside marked
improvements in the operations of EDC’s 100 percent renewable portfolio,” Puno
said.
Likewise, First Gen’s consolidated
revenues from the sale of electricity decreased to US$1.56 billion for 2016
compared to US$1.84 billion in the previous year.
The 1,000 MW Santa Rita and the
500MW San Lorenzo natural gas-fired power plants, which accounted for 53
percent of First Gen’s total consolidated revenues, saw lower revenues of
US$827 million, 23 percent lower in comparison to their contribution of US$1.08
billion in 2015.
This, according to the company was
mainly due to lower fuel pass-through prices, worsened by the lower combined
dispatch of the gas plants at 75 percent in 2016 versus 81 percent in 2015.
To supplement Santa Rita and San
Lorenzo’s earnings, the Company’s newest natural gas-fired power plant, 414 MW
San Gabriel Flex Plant, recorded US$36 million of income from delay liquidated
damages that was partially offset by expenses, while its 97 MW Avion Peaking
Plant generated commissioning income in 2016.
The earnings contribution from the
natural gas portfolio increased by US$21 million to US$142 million in 2016, the
company emphasized.
Energy Development Corporation
(EDC), a part of the First Gen group, also saw its 140 MW BacMan geothermal
plant booked non-recurring income in 2016.
Accounting for 43 percent of its total
consolidated revenues, EDC’s geothermal, wind and solar saw lower revenues of
US$676 million last year from US$717 million in 2015 due to an unfavorable
effect of foreign exchange translation.
“The actual decline in revenues from
lower spot market prices was US$11 million (out of US$41 million). This was
despite the power plants’ higher dispatch,” the company specified in its
financial report.
EDC’s attributable earnings of US$89
million in 2016 came in higher from US$78 million in 2015 mostly due to drops
in operating, interest, and administrative expenses, augmented by a receipt in
insurance claims from its BacMan power plant.
FG Hydro, on the other hand, showed
a growth in revenues of US$7 million in 2016 versus 2015’s US$42 million due to
the higher dispatch of its power plants and higher ancillary service sales.
Consequently, the attributable
earnings contribution of FG Hydro was higher by US$5 million, or 60 percent at
US$14 million.
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