After strong 9-mo sales, Meralco raises profit target

MANILA, Philippines – Power distributor Manila Electric Co. (Meralco) raised its profit guidance for 2012 to P16 billion from an earlier estimate of P15 billion, after it recorded strong financial results in the first 9 months of the year.

Meralco’s core net income, excluding extraordinary items, grew 7.9% in January to September to P12.898 billion from P11.949 billion in the same period last year.

“We are upgrading our core guidance to P16 billion for the entire year,” Meralco chairman Manuel V. Pangilinan told reporters.

Boosting their expectations, Pangilinan said, are continuing strong demand in October and higher distribution charges.

In the first 9 months, the total volume of energy Meralco sold rose 8%. Electricity sales also grew 10%, buoyed by higher demand from the industrial, commercial and residential segments.

These pushed consolidated revenues up 14% to P214.7 billion.

Meralco’s capital expenditures amounted to P5.9 billion in January to September, a portion of which was spent for the commissioning of a new substation in Bulacan and the expansion of two existing substations in Laguna and Cavite.

Meralco president and CEO Oscar Reyes said, meanwhile, the company is targeting to build new, fuel-efficient and environmentally sound combined cycle baseload plants with capacity of up to 2,700 megawatts. The plants are slated for completion and operation by 2021.

Reyes said the 2,700 MW will be a mix of coal-fired and liquefied natural gas power.

“We also continue to look for opportunities in the grids outside Luzon, and potentially even outside the Philippines, to enhance our profitability and showcase the technical competency of our engineers, technical and customer service people,” he said. – Rappler.com