First Gen reports net income of $181 M in 2012

MANILA, Philippines—The Lopez-led First Gen Corp. increased its net income to $186.1 million last year from the $35 million the previous year on the back of the strong performance of its power business.

In a disclosure to the Philippine Stock Exchange on Friday, First Gen reported that its consolidated revenues rose by 12.5 percent to $1.53 billion in 2012 from $1.36 billion the prior year.

According to First Gen, its purchase of the BG Group’s 40 percent stake in the 1,000-megawatt Sta. Rita and 500-MW San Lorenzo natural gas-fired combined cycle power plants last May allowed it to generate an additional income of $35.8 million.  With both gas plants now already 100-percent owned  by First Gen, the total net income contribution of the facilities  reached $106.7 million.

“The year 2012 was an excellent year for First Gen, primarily due to the incremental 600-MW from the purchase of BG’s stake in the First Gas Plants. 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,” said First Gen president Francis Giles B. Puno.

The company’s affiliate, Energy Development Corp., contributed $76.4 million in earnings last year, a complete turnaround from the losses that arose in 2011. The losses booked in 2011 were due largely to the impairment of the 49-MW Northern Negros geothermal plant.

EDC’s 305-MW Palinpinon-Tongonan geothermal power plants likewise derived the full-year benefits of the price adjustments of its power supply contracts.

Meanwhile, EDC’s 132-MW Pantabangan-Masiway hydroelectric power plants showed a “stellar performance” last year due to higher sales of electricity, which was generated from ancillary services and bilateral contract sales. First Gen owned 40 percent of these hydroelectric plants while EDC held the remaining 60 percent.

First Gen noted that the hydro plants contributed  $59.9 million to the Company in 2012, significantly up compared with $25.5 million the previous year.

Total interest expense for 2012 fell to  $78.1 million last year  from $85 million in 2011  due to a series of refinancing exercises undertaken by the First Gen group in order to take advantage of the current low interest rate environment. These refinancing exercises allowed the company to prepay over $250 million in debt and pre-fund the remaining $57.0 million convertible bonds that matured in February 2013.