Power, banking units boost Aboitiz Equity 9-mo profits by 12%
MANILA, Philippines - Listed conglomerate Aboitiz Equity Ventures posted a 12% increase in net income to P18 billion in the first 9 months of 2012, boosted by strong performance of its power and banking units, as well as one-time gains.
In a disclosure on Wednesday, October 31, the holding firm of the Aboitiz group said its main cash cows, Aboitiz Power Corp. and Union Banking Corp., benefited from higher power demand and interest income, respectively.
The power unit contributed 78% of the group's profits while the banking and food unit, Pilmico Foods Inc. accounted for 16% and 4%, respectively. One-time gains during the period reached P894 million.
For the July-to-September period, the holding group earned P6.2 billion, up 7%.
Below is a summary of how the different business units performed in the first 9 months:
Aboitiz Power Corp
- Net income of P14.1 billion reflected a 16% increase from a year ago. When adjusted for the one-time gains from the revaluation of dollar-denominated debts and placements, recurring income reached P13.7 billion.
- Non-recurring gain of P894 million resulted from the revaluation of group-wide dollar-denominated liabilities and placements. Other one-time results were due to higher fuel cost booked by its geothermal plants; the ERC's ruling regarding ancillary services contract that pulled down revenues of a wholly-owned subsidiary, and the debt prepayments.
- Average power price sold increased 6%, largely due to 38% increase in average selling price of electricity at the Luzon Grid’s Wholesale Electricity Spot Market. Hotter climate pushed 5% higher the Luzon Grid's recorded peak demand to almost 7,800 MW.
- Attributable net generation rose by 10% from 7,175 GWh to 7,903 GWh, as electricity sold through bilateral contracts expanded by 15%.
- Volume sales to industrial clients grew 7%, while residential and commercial clients increased 5% and 3%, respectively
- System loss stood at 0.7 percentage points
- Net income reached P3.1 billion, a 15% increase, attributed to higher net interest income and hefty trading gains booked during the period. - Net interest income reached P5.5 billion, up 5%, while higher trading gains pushed "other income" by 10% to P8.2 billion.
- Asset base stood at P227.8 billion, with a deposit base of P155.9 billion and a loan book of P90.9 billion. Capital adequacy ratio (CAR) and Tier 1 ratios further strengthened to 20.5% and 17.7%, respectively.
Pilmico Foods Corp.
- Net income dipped 3% to P906 million as higher overall sales were countered by decreasing margins due to softer prices and costlier raw materials.