EDC income surged 96% in Q1 to P2.71B

Energy Development Corp., the world’s largest integrated geothermal producer, recorded a 96 percent surge in its net income to P2.71 billion in the first quarter this year from P1.38 billion in the same period last year, due largely to increased revenues of its subsidiaries.

In a disclosure to the Philippine Stock Exchange, the Lopez affiliate said the growth can also be attributed to lower operating costs incurred during the period.

According to EDC, its subsidiaries Green Core Geothermal Inc., the project company managing the 305-megawatt Palinpinon-Tongonan power plants, and FG Hydro Power Corp. (FG Hydro), the project firm which owns the 132-MW Pantabangan-Masiway power plants, contributed an additional P700 million and P600 million, respectively, to the company’s net income.

Green Core Geothermal’s contribution mainly came from the additional power supply contracts it had forged with various electric cooperatives.

FG Hydro, meanwhile, continued to post strong earnings due to higher energy sales.

Richard B. Tantoco, president and chief operating officer of EDC, noted that 2010 and 2011 can be considered “our transition years during which we planted the seeds of growth and made our balance sheet stronger.”

“Investments in Tongonan and Palinpinon power plants have started to yield better results for the company. Our hydro asset is also performing exceptionally well this year, thanks to the high water levels stored in the reservoir,” Tantoco added.

For this year, EDC’s net income is expected to surge tenfold to about P6.8 billion to P7 billion, from only P615 million last year.

The hike in its net income is expected to come from the resumption of operations at the 130-MW Bacon-Manito geothermal facilities in Sorsogon and Albay later this year.

These power plants alone are seen generating some P4.3 billion in revenues annually starting 2013.

Green Core is also expected to significantly contribute to the company’s income growth this year.

The new power supply agreements signed last year are expected to contribute P1 billion to EDC starting 2013.