Meralco expects profit to exceed P11.6B

MANILA, Philippines—Manila Electric Co., the country’s biggest power distributor, expects its income at the end of the first nine months of the year to be higher than the P11.6 billion in consolidated core net income it posted in the same period last year, according to a ranking company official.

“Overall, for the first nine months, we would expect (net income) to be still better than last year. But the increase, when you compare it to the first half of this year might be flat,” said Betty C. Siy-Yap, senior vice president and chief finance officer of Meralco.

Yap explained to reporters that sales during the third quarter are normally the lowest in the year because of the rainy season, when customers do not use as much air-conditioning and business activity slackens.

Yap, however, declined to disclose figures, noting that the official third quarter financial statements will be released on Oct. 29.

Earlier this month, Meralco president and CEO Oscar S. Reyes said that electricity sales volume in the third quarter alone grew 7.6 percent compared with the same period last year. But this figure was lower than the first half sales growth of about 10 percent given cooler temperatures during the period.

For the full year 2012, Meralco is targeting to hit a core net income of P15.5 billion, to be driven by rising sales volume growth and stringent cost discipline.

“We are confident that the remaining half of the year will see a continuing rise in electricity sales, albeit at lower growth rates considering the higher comparative base in the second half of 2011,” Meralco chairman Manuel V. Pangilinan earlier said.

The distribution utility had also committed to pursue its capital expenditure program worth a total of P37.2 billion from 2011 to 2015. For the first half of 2012, Meralco spent P4 billion with power-related capital projects amounting to P3.9 billion. The company’s electricity capital projects included new substations, which are expected to decongest critical loads, provide additional capacity for load growth and improve network reliability.