Meralco income down 11% as weak demand hurts sales

Manila Electric Co.’s (Meralco) consolidated core net income fell by 11 percent year-on-year to P5.1 billion in the first quarter of 2020 as strict lockdowns depressed electricity demand.

In a briefing on Monday, Meralco officials said the slight recovery of sales in the industrial sector (4 percent) and the continued growth of sales in the residential sector (7 percent) were not enough to offset the steep drop in sales in the commercial sector (-18 percent).

The worst declines in demand were seen in the segments of education (-59 percent) and restaurants (-27 percent).

Meralco chief finance officer Betty Siy-Yap said consolidated sales volume decreased by 4 percent to 10,473 gigawatt-hours.

Siy-Yap said aside from the decrease in sales volume, the drop in income was attributed to higher operational expenses with the early settlement of real property taxes, higher labor costs and renewal of licenses.

Meralco chair Manuel Pangilinan expressed optimism that full-year performance would be better, even if the recent surge in COVID-19 cases and the delay in the arrival of vaccines were pushing back expectations of an early economic recovery.

“Meralco’s strong financial position amid regulatory challenges has allowed it to sustain the much-needed investments for a resilient and reliable network infrastructure,” Pangilinan said.

He said the digitalization of operations allowed Meralco to improve processes and provide opportunities to retool its workforce.

“We will continue to be agile and look at these challenges as opportunities for us to emerge as a better and even stronger organization,” Pangilinan said. INQ