Aboitiz Power nets P24.4 B

MANILA, Philippines—Aboitiz Power Corp. posted a 13-percent hike in its consolidated net income last year to P24.4 billion from P21.6 billion in 2011, due largely to an increase in electricity sales, the company announced Wednesday.

In a statement issued, APC reported that it registered a non-recurring gain of P705 million last year. A major contributor to this gain were the foreign exchange gains resulting from the revaluation of consolidated dollar-denominated loans and placements amounting to P1.5 billion, which was then offset by the recognition of one-time expenses.

When adjusted for these one-offs, APC still posted a 12 pecent increase in its core net income to P23.7 billion last year.

“2012 was another good year for Aboitiz Power, with both distribution and generation segments experiencing strong electricity growth on the back of a vibrant economy. We believe that we have the right strategy and initiatives in place to sustain our growth over the long term. We are confident we have the required management team in place to ensure successful execution of these plans,” said APC president and CEO Erramon Aboitiz.

APC explained that its power generation business accounted for 89 percent of its earnings, with an income share of P22.8 billion for in 2012, reflecting an 11-percent year-on-year growth. In terms of core earnings, APC’s generation business contributed a total of P21.7 billion in 2012.

According to the power giant, its average price for its power rose by 3 percent last year due mainly to a tight supply situation, brought about by higher outage levels, and due to an increase in demand given the hotter climate and increased economic activity.

Its net generation for 2012 registered a 13 percent year-on-year increase to 10,660 gigawatt-hours last year from 9,422 gWh in 2011. The increase can be attributed to the 17-percent expansion in power sales through its bilateral contracts.

As of end-2012, APC’s attributable capacity stood at 2,353 megawatts, which saw a marginal increase given the partial completion of the rehabilitation of the Binga (2 of 4 units) hydropower plant and the commercial operation of the 4-MW Irisan greenfield hydropower plan, which were the main contributing factors to this growth.

“We have a number of greenfield and brownfield projects that are currently in various phases of development and construction that will continue to mold our portfolio of renewable and non-renewable assets into what we think will be the right-mix of base load, intermediate and peaking facilities. We expect to add another 1,700 MW of capacity over the next four years, which should keep us busy over this period,” Aboitiz said.

Meanwhile, the power distribution group registered a 16 percent year-on-year earnings expansion to P2.8 billion last year from P2.4 billion a year ago, on the back of increased electricity sales and improved average gross margin.

“We expect 2013 to be another exciting year for our distribution business. The growth in electricity demand follows the Philippine economy. We have therefore been gearing up our distribution networks and services to make sure we don’t fall behind. We have improvements in our systems, processes, infrastructure, and services scheduled,” Aboitiz explained.

As of end December 2012, APC’s total consolidated assets amounted to P164.1 billion, 7 percent higher than the end -2011 level of P153.5 billion. Its consolidated cash and cash equivalents stood at P30.7 billion, while total consolidated interest-bearing loans reached at P66.9 billion.