Manila Water rates to go up

Rappler.com
Manila Water rates to go up
Manila Water customers will see an increase in their bills in the first quarter of 2015 as the company accounts for fluctuating foreign exchange rates that arise from borrowings used for expansion

MANILA, Philippines – Customers of Manila Water Company (MWC) will see an increase in their utility bills in the first quarter of 2015 due to a Foreign Currency Differential Adjustment (FCDA) of P0.36 ($0.008*) per cubic meter.

On Friday, December 19, the Ayala Corporation subsidiary explained that the upward adjustment is based on the exchange rates of $44.7979 and JPY1 to P0.4156.

“The component of the water bill will be adjusted to 1.32% of the basic charge for the first quarter of 2015,” MWC said in a disclosure to the Philippine Stock Exchange.

FCDA is a mechanism tapped by Metropolitan Waterworks and Sewerage System (MWSS) concessionaires to deal with fluctuating foreign exchange rates that arise from borrowings used for service expansion.

MWC’s incoming rate increase comes after it cut its rates by P0.54 ($0.01) per cubic meter based on the exchanges rates of $1 to P41.14 and JPY1 per 0.4221 during the third quarter of 2013.

In September 2013, water regulator MWSS ordered the company to cut its rates by P1.45 ($0.03) per cubic meter. But the water firm, including Maynilad, said they will pursue legal options to assert the provisions in their contracts regarding rate-rebasing.

Unlike the MWSS order, MWC said it will likely implement the rate adjustment.

“FCDA is a contractual obligation separate from arbitration,” explained MWC spokesperson Jeric Sevilla.

Manila Water provides water and wastewater services in the east zone of Metro Manila, which covers Makati, Mandaluyong, Pasig, Pateros, San Juan, Taguig, Marikina, and parts of Manila and Quezon City, as well as Rizal Province. It also has projects through subsidiaries in Laguna, Pampanga, Boracay and Cebu.

The Ayala business unit booked an 8% growth in its net income for the first half of 2014, with reported net earnings of P3.16 billion ($70.66 million), up from P2.91 billion ($64.99 million) registered in the same period last year.

Its last trading price was P28.80 ($0.64) per share, as of December 19, up by 2.86% from its opening price of P28.05 ($0.63) on the same day. – Rappler.com

*$1=P44.7787

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