Meralco to exceed 2013 profit target –official

Rappler.com

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The utility firm expects sales to be driven by more demand from residential, commercial and industrial customers

HIGH-POWERED YEAR. Meralco President Oscar Reyes says the utility firm will exceed previously set profit targets for 2013. Photo from Agence France-Presse/Jay Directo

MANILA, Philippines – The Manila Electric Company (Meralco) is optimistic its 2013 profit will exceed the previously set target of P17.5 billion.

“We are still on track to meet our guidance number but it seems it’s a little higher than P17.5 billion,” said Meralco president Oscar Reyes.

Meralco, controlled by Hong Kong-based First Pacific group and partly owned by Gokongwei-led JG Summit Holdings, said its earnings would be driven by higher electricity sales.

It said sales for the entire year are expected to grow 3% to 3.5% on the back of more demand from residential, commercial and industrial customers.

Meralco projects to end the year with 5.36 million customers, an increase of more than 3% from last year.

In 2012, Meralco earned P16.25 billion from 5.3 million customers, of whom 91% were residential.

Meralco’s bullish outlook comes amid uncertainty over its ability to raise electricity prices.

Meralco announced a record-high P4.15-per-kilowatt-hour hike in power rates this month, but this was stopped by the Supreme Court following strong opposition from various groups.

The company said the “pass-through” generation charge accounted for bulk of the rate hike. The charge spiked as the simultaneous shutdown of plants of Meralco suppliers forced the utility firm to buy more expensive power from the spot market.

2014 capex

In the meantime, Meralco is setting aside P15.6 billion for capital expenditures in 2014, higher than this year’s allotment of P13.5 billion.

Reyes said the company would pour in “heavy investments” to “ensure reliable, adequate and cost-effective power” for its customers.

He added that such investments are necessary to enable it to power major property projects like the PAGCOR Entertainment City in Manila. – Rappler.com

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