Lopez-led power firm nets $167M

Lopez-led First Gen Corp. (First Gen) reported lower profit for 2015 year-on-year as subsidiary Energy Development Corp. (EDC) had higher expenses and lower extraordinary gains compared to 2014.

In a financial report, First Gen said it had posted a net income of $167 million in 2015. This was lower by 13 percent or $26 million than the $193 million it earned in 2014. The company noted that its unit EDC contributed lower earnings “as it reported higher extraordinary gains in 2014.”

First Gen’s recurring net income registered a 7-percent increase to $163 million from $153 million in 2014 as the natural gas-fired plants benefited from higher dispatch and lower expenses, as well as lower interest expenses at the parent company.

Company president Francis Giles B. Puno said 2015 turned out to be a “solid year” in terms of recurring income but overall results still did not meet targets. “Our financial results were still below our own expectations driven by the delay in the 97-MW Avion (power plant) and higher expenses incurred at EDC,” Puno said.

Consolidated revenue from the sale of electricity slightly decreased to $1.84 billion in 2015 from $1.9 billion in 2014. The Santa Rita and San Lorenzo natural gas-fired power plants accounted for $1.08 billion, or 59 percent of First Gen’s total consolidated revenue. Their revenues were 11 percent lower in comparison to their contribution of $1.2 billion in 2014 due to lower fuel charges, though partially offset by the higher combined dispatch of the gas plants in 2015 at 81 percent versus 70 percent in 2014.

In total, the recurring earnings contribution of the natural gas-fired plants increased by $11 million to $118 million in 2015 as the higher dispatch was supplemented by lower interest expenses.

EDC’s geothermal, wind and solar revenues accounted for $709 million, or 39 percent, while First Gen Hydro Power Corp.’s (FG Hydro) revenue was $42 million or 2 percent of total consolidated revenue from sale of electricity. EDC’s revenue rose by $57 million, or 9 percent from $652 million in 2014.

The growth was mainly due to full-year contributions from the new wind and rehabilitated geothermal projects, First Gen said in its report to the Philippine Stock Exchange.

On a recurring basis, EDC’s operations suffered from lower attributable earnings of $90 million, compared to $93 million a year ago, due to higher operating expenses.