Gas-fired plants boost First Gen income

First Gen Corp. posted a 19-percent rise in net income attributable to equity holders to $113 million in the first six months of the year, from $95 million recorded a year ago.

This was attributed partly to the earnings contributions from the 414-megawatt San Gabriel and 97-MW Avion natural gas-fired power plants in the second quarter of the year and the company’s receipt of liquidated damages caused by the construction delay of the San Gabriel power plant.

The company’s consolidated revenue from the sale of electricity fell by 17 percent to $804 million in the first half from $965 million recorded a year ago. Total revenue generated by the natural gas plants, including the Santa Rita and San Lorenzo plants, fell by 25 percent to $442 million in the first half due to lower prices. This was despite a higher dispatch of 84 percent in the said period as against the 80 percent a year ago. The First Gas plants accounted for 55 percent of First Gen’s total consolidated revenue.

Meanwhile, revenue from Energy Development Corp., which accounted for 41 percent of the consolidated revenue of First Gen,  fell by 6 percent to $329 million due largely to lower spot market prices. The decline was partially cushioned by the higher dispatch of the Tongonan, Palinpinon and Burgos power plants.

EDC’s attributable earnings of $46 million in the first semester of 2016 hardly changed from $47 million last year as the drop in revenue was matched by declines in operating and interest expenses.

On a recurring basis, First Gen’s attributable net income for the first semester was flat at $88 million. It incurred higher interest expense as a result of a $200-million term loan contracted in September 2015.

“Given the current tightness in supply as evidenced by the alerts triggered in recent weeks, the timing of the 97 MW Avion and the 414 MW San Gabriel power plants’ commissioning is a positive development. Both plants have already demonstrated the ability to operate and produce power at full (or even above full) capacity, which has benefited consumers as they ease the current supply tightness,” First Gen president and COO Francis Giles B. Puno said.