PILIPINO TELEPHONE CORP. booked a 125-percent growth in net profit in the first nine months to P17.8 billion over a year ago, mainly due to a one-time gain from the sale of cellular phone operations to parent company Smart Communications.

Apart from the P7.6 billion net gain from the sale of assets to Smart, Piltel also generated mark-to-market gain from an exchangeable note that had been swapped for shares of power retailer Manila Electric Co.

Excluding these extraordinary items, Piltel?s core net income went up by 8 percent to P8.5 billion in the first nine months over a year ago, boosted by a reduction in the corporate income tax as well as the application of an optional standard deduction method in computing its net taxable income, the company disclosed to the Philippine Stock Exchange Thursday.

?This quarter marks the transition in Piltel?s transformation from being a cellular operator to a holding company whose primary asset and source of income will be its 20-percent holding in Meralco,? Piltel president Napoleon Nazareno said.

?We look forward to working together with Meralco in creating synergies that will add value to all shareholders,? he added.

Piltel booked P2.8 billion in net income from discontinued operations in the nine-month period ending September.

The company?s cellular assets, subscriber base and Talk N? Text trademark were transferred to Smart effective Aug. 17.

Treasury gains were booked from the exchangeable note issued by First Philippine Utilities Corp., with face value of P2 billion which Piltel exchanged for 22.22 million shares of Meralco. This brought Piltel?s total Meralco holdings to 223 million out of the 1.1 billion issued shares.

Piltel?s financial reports now included Meralco?s financial results under the equity accounting method. For the period July 15 to September 2009, the equity share in Meralco?s earnings accounted for P361.3 million of Pitel?s revenues.