First Gen profit down 10% on weaker geothermal biz

Pulled down by its geothermal business, the Lopezes’ energy firm First Gen Corp. reported weaker earnings in the first half.

In a disclosure on Monday, the company said its attributable recurring net income reached $150 million, 10-percent lower from last year’s $167 million.

At the same time, revenues during the period also dipped by 0.7 percent to $1.278 billion due to lower volumes of electricity sold from January to June across its power businesses, excluding its hydro unit.

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First Gen generated the bulk or 67 percent of its top line from its natural gas portfolio; 30 percent came from Energy Development Corp.’s (EDC) geothermal, wind and solar plants; while the rest came from its hydro plants.

The group said EDC’s recurring earnings dropped by 42 percent to $44 million, which it blamed on lower power prices and electricity sales coupled with more expensive operating costs.

The company said it expected to see the completion of 83 megawatts (MW) of new geothermal plants before 2024 ends.

First Gen’s natural gas operations, meanwhile, finished strong with a 26-percent increase in recurring earnings to $115 million, as three of its power plants showed robust operating income amid cost-cutting efforts.

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“Though First Gen started the year slow with the expiry of San Gabriel’s contract with Meralco, it is making some headway in recovery through WESM (Wholesale Electricity Spot Market) sales … All of our natural gas plants were operating and providing vital power during the summer months when both yellow and red alerts were occurring,” First Gen president and chief operating officer Francis Giles Puno said. Yellow and red alerts are issued when there is not enough supply to cover demand for electricity.

On the other hand, the hydro platform’s contribution to the group’s profit stood at $5 million during the period in review.

First Gen, a subsidiary of conglomerate First Philippine Holdings Corp., has an installed capacity of 3,668 MW. It targets to expand the capacity to 13,000 MW by 2030. INQ