Supply shortage, penalties hurt Manila Water's profits in Q1 2019
MANILA, Philippines – The supply crisis and the hefty penalties imposed on Manila Water hurt the company's earnings during the 1st quarter of 2019.
Manila Water disclosed on Thursday, May 9, that its net income for the 1st quarter stood at P1.23 billion, 27% lower compared to the same period last year.
On a group level, Manila Water revenues grew 8% to P5.1 billion, driven by higher tariffs in the company's concession area.
Manila Water noted that the revenue growth was offset by the company's decision to waive the bills of customers severely affected by the water shortage.
The Ayala-led utility firm's operating expenses during the 1st quarter reached P2.5 billion, 39% higher due to the penalties slapped by the Metropolitan Waterworks and Sewerage System. (READ: MWSS slaps Manila Water with P1.13-billion fine for supply crisis)
"In all, Manila Water net income margin for the period stood at 24%. Excluding the effects of the water supply shortage in the Manila concession, core net income grew 22% to P2.1 billion," the company said.
Manila Water said 98% of customers are now able to get water for at least 8 hours per day, while 72% of households have water for 24 hours.
"The company continues to work on various distribution solutions to address pocket areas of less than 8 hours of supply," Manila Water said.
Its income outside the Manila concession climbed during the 1st quarter.
Manila Water Philippine Ventures' net income grew by 7% to P174 million. The good figure was led by Estate Water, which handles the water systems of Ayala properties.
Manila Water Asia Pacific, which houses Manila Water's international investments in the region, more than doubled its earnings to P135 million on the back of an acquisition in Thailand and additional income from operations in Indonesia. – Rappler.com