MPIC bottom line up 7%
Infrastructure holding firm Metro Pacific Investments Corp. posted a 7-percent increase in its net profit last year to P14.1 billion on higher earnings contribution across its energy, toll road, water and hospital businesses.
Excluding extraordinary items, MPIC’s core net profit also rose by 7 percent to P15.1 billion while group-wide revenue went up by 9 percent to P405.7 billion, the company disclosed to the Philippine Stock Exchange yesterday.
MPIC earnings have risen for the 10th consecutive year, driven by a 5-percent growth in energy sales in Luzon, 8 percent growth in energy sales in Visayas, 7 percent growth in domestic toll road traffic, 3 percent growth in water sales in West Metro Manila ands 8 percent growth in hospital volume.
“Our earnings growth reflects meaningful volume increases for all our businesses, supported by years of high investment and our continuing emphasis on operational efficiencies,” MPIC president and chief executive officer Jose Ma. Lim said.
MPIC chief financial officer David Nicol said growth in volumes at the toll road, water and hospital businesses would likely be sustained. The only area where volume is softening is power, he said.
“In terms of power, we had a good year last year. The start of this year is a little quieter…We will be below the 5 percent full-year growth that we had last year,” he said.
Last year, MPIC’s core net income was lifted mainly by an expanded power portfolio following further investment in energy holding firm Beacon Electric Asset Holdings Inc. in 2017; continuing traffic growth on all domestic roads, and steady volume growth coupled with inflation-linked tariff increases at Maynilad Water Service Inc.
Nonrecurring expense hit P930 million last year due to the net effect of a weaker peso, project write-downs, loan refinancing and provisions for asset impairment. In the previous year, nonrecurring expenses amounted to P953 million.
Power accounted for P10.8 billion or 55 percent of MPIC’s net operating income last year while toll roads contributed P4.4 billion or 23 percent. Water contributed P3.8 billion or 19 percent while the hospitals group provided P771 million or 4 percent. The newest business segment—the rail, logistics and systems group—incurred a net loss of P248 million.
“We are pleased with the performance of MPIC companies for 2018,” MPIC chair Manuel V. Pangilinan said. “We are seeing partial resolution of some of our long-pending tariff issues. That’s the good news. Regrettably, the shape of the resolution in the form of staggered tariff increases and concession extensions does not provide sufficient immediate cash flows to cover the upfront financing costs of our current expansion program.”
Last year, MPIC’s power business contributed P10.8 billion to core net income, an increase of 15 percent driven by the June 2017 purchase of the last 25 percent in Beacon Electric and good results at Manila Electric Co., which more than offset a decline at Global Business Power Corp.
The toll road business under Metro Pacific Tollways Corp. contributed P4.42 billion in 2018, marking a 13 percent increase from the previous year. System-wide vehicle entries averaged 916,886 a day, including road networks in the Philippines, Indonesia, Thailand and Vietnam. Average daily vehicle entries for all three domestic tollways system rose by 7 percent to 478,315.
The water segment’s contribution to core net income amounted to P3.8 billion in 2018, up by 2 percent.