Higher costs gnawed on ACEN’s 9-month profit

Acen Corp., the power business of the Ayala Group, reported a slight decrease in its bottom line despite higher sales in the first nine months of 2022.

In a disclosure, ACEN said net income attributable to equity holders of the parent firm had reached P4.1 billion, down by 3.5 percent from P4.3 billion in the same period last year.

Net income in the third quarter, however, gained by 22 percent to P1.9 billion from P1.6 billion. Revenues for the quarter surged by 70 percent to P9.2 billion.

For the nine-month period, revenues stood at P25.2 billion, an increment of 33.7 percent from P18.9 billion.

Electricity sales comprised the bulk of the company’s revenues, rising 34 percent to P25.1 billion.
Amid higher revenues, Acen saw its costs and expenses swell by around 49 percent to P24.6 billion from P16.5 billion.

Cost related to selling electricity accounted for most expenses as it ballooned by 60 percent to P23.4 billion.

Attributable output increased by 11 percent to 3,740 gigawatt-hours, buoyed by the contribution of its new wind farms in Vietnam and solar plants in India.

“The Philippine market continues to be challenging given the tight power supply situation and high fossil fuel prices. However, we expect a significant increase in our renewables operating capacity by the middle of 2023, which will not only help address the country’s energy needs, but also significantly improve the company’s financial performance,” said Acen president and CEO Eric Francia.

At present, Acen has 4,000 megawatts (MW) of attributable capacity in the Philippines, Vietnam, Indonesia, India and Australia. The share of renewables in its portfolio stands at 87 percent, among the highest in the region.

It aspires to be the largest listed renewables platform in Southeast Asia and reach 20 gigawatts (GW) of renewables capacity by 2030.

As part of its plan of becoming a 100-percent renewables platform by 2025, Acen announced earlier its full divestment from South Luzon Thermal Energy Corp., operator of a thermal power plant in Batangas. This will pave the way for the early retirement of the 246-MW coal-fired power plant in Calaca town, with its operating life of up to 50 years reduced by half.

Through the energy transition mechanism transaction, Acen generated P17.4 billion, of which P7.2 billion would be reinvested in ACEN’s renewable projects.

Currently, ACEN has an 18-GW development portfolio throughout the Asia Pacific region.