Meralco grows profit from summer heat

Updated on July 30, 2024 at 10:27 a.m.

The intensified use of air conditioning amid El Niño heat waves in the first semester boosted the net income of Manila Electric Co. (Meralco) by 26 percent to P22.4 billion.

This was alongside greater demand from the commercial sector due to expansion activities and higher plant availability in the power generation business in the second quarter.

Excluding nonrecurring items, core net income also shot up by 21 percent to P23.2 billion in the first six months from the previous year’s level.

Meralco chair and CEO Manuel V. Pangilinan thus upgraded the core net profit guidance to P43 billion from P40 billion for the full year.

“With the steady growth trajectory of the economy, we are satisfied that Meralco will sustain its robust performance throughout the year. Beyond the core distribution business, we continue to invest in more generation capacity, which will help address, if not eliminate, instances of supply insufficiency in the country’s power grid, and support the growing demand for power,” he said.

At a briefing in Pasig City, Meralco chief financial officer Betty Siy-Yap said distribution business remained the biggest contributor to the bottom line at 55 percent or P12.8 billion.

Power generation provided P6.2 billion, while retail electricity supply and nonelectricity business contributed a combined P4.2 billion.

Consolidated revenues grew by 6 percent to P237.5 billion as consolidated energy sales gained 8 percent to 26,954 gigawatts per hour (GWh), led by residential and commercial markets. Commercial sales volume rose 10 percent to 10,068 GWh.

“The real estate sector [accounted] for the majority of the sales, owing to higher office space demand in business districts and a boost in commercial activities. Retail and restaurants saw a rise in sales from mall expansions and foot traffic, which required increased activities of heating, ventilation and air conditioning systems to manage the humid conditions,” it said.

“Hotels and leisure and entertainment venues benefited from the influx of tourists during the dry season, as well as increased demand from newly built establishments postpandemic,” Meralco added.

Residential sales jumped 13 percent to 9,715 GWh as hotter months forced Filipinos to spend more time at home, coupled with the shift to hybrid classes due to extreme heat conditions.

Meralco ended the first six months with 7.93 million customers, up 2 percent. Capital spending for the January-June period increased by 41 percent to P19.9 billion. INQ