First Gen reports surge in 9-month net income

MANILA, Philippines—Lopez-led First Gen Corp. reported a surge in its net income to $147 million in the first nine months of 2012 from only $10.1 million a year ago.

In a filing with the Philippine Stock Exchange, First Gen attributed the profit growth to the higher earnings contributed by affiliates Energy Development Corp., currently the country’s largest geothermal producer, and FG Hydro Power Corp. (FG Hydro), which owns the 132-megawatt Pantabangan-Masiway power plants.

Subsidiaries First Gas Power Corp. and FGP Corp., operators of the 1,000-MW Santa Rita and the 500-MW San Lorenzo natural gas-fired power plants, respectively, were also major contributors to First Gen’s profit growth.

The rise in incomes was, however, partly offset by the increased administrative expenses of First Gen due to the additional costs related to the acquisition of the non-controlling 40-percent interest of the BG Group in the two natural gas plants in Batangas.

First Gen reported that its total revenue in the first nine months of 2012 rose by 15.2 percent to $1.179 billion from $1.023 billion a year ago.

The bulk of the revenue or $1.07 billion came from electricity sales.

In a separate filing with the PSE, geothermal producer EDC said it had posted a net income of P8.6 billion in the first nine months of 2012, a turnaround from the P488-million net loss it incurred a year ago.

EDC reported that net income attributable to equity holders rose P7.1 billion in the same period, from a net loss of P670.2 million last year.

Total revenue for the nine months ending September 2012 rose by 20.5 percent to P21.95 billion from P18.22 billion in the first nine months of 2011.

According to EDC, the company’s improved financial performance in the first three quarters of the year can be attributed mainly to higher electricity revenues of its subsidiaries. Also, last year’s level was lower because of the P5-billion impairment loss on the property plant and equipment of the 49-megawatt Northern Negros Geothermal power facility, which was recognized in June 2011.

NNGP was shut down last year due mainly to a mismatch in the geothermal resources in the area and the facility’s generation capacity. The equipment will be moved to another area on the island that can support a higher generation capacity, while a smaller facility may be put in place of the NNGP.

Revenue from the sale of electricity rose by 21 percent to P21.4 billion in the first three quarters of 2012 from P17.7 billion in the same period a year ago due to the better performance of Green Core Geothermal Inc., which manages the 305-MW Palinpinon-Tongonan power plants and FG Hydro.