The core profit of the Manila Electric Company (Meralco) dropped by 14.8% to P15.73 billion in January-September 2020, though it saw an improvement as restrictions eased and sees the trend continuing.

Meralco chairman Manny Pangilinan expects to marginally reduce the gap by the 4th quarter, with full-year core income seen to decline within the 10% to 11% range to about P21 billion.

“We expect the 4th quarter to be better than the 2nd quarter or the 3rd quarter, given the rising volume of power sold,” Pangilinan told reporters on Monday, October 26.

Meralco’s net income, however, plunged by 38.6% to P11.25 billion in the first 9 months, against the P18.423 billion in the same period last year.

Energy sales peaked in September at 4,007 gigawatts per hour (GWh). Meralco attributed the higher sales to the residential segment, which took up 39% of the mix due to increased work-from-home arrangements and online classes.

The power distributor is also optimistic about the growing energy requirements for the commercial and industrial segments, as hotels and factories increase operational capacity given the easing of restrictions.

“The commercial [segment] showed some recovery in September versus August under the MECQ (modified enhanced community quarantine).… The industrial sector continued with its good performance,” said Meralco president Ray Espinosa.

For the past 9 months, total power sold was 7% lower at 32,539 GWh compared to a year ago.

The initial sales for the month of October showed a 4.7% decline from September, which Meralco attributed to colder temperatures. While there is a dip in sales, Espinosa said they are expecting higher demand by hotels in the coming months given that the government allowed these to operate at full capacity.

Meralco has yet to set a target for 2021, but Pangilinan said the firm is expecting to see a rise in profits for its electricity business.

Operating expenditures from January to September increased by 4.8% to P20.27 billion, while capital expenses declined by 30.5% to P10.92 billion.

Capital expenditures, meanwhile, were down by 30.5% to P10.92 billion. Operating expenses reached P20.27 billion, up 4.8%.

For the 9-month stretch, the average retail rate stood at P8.04 kilowatts per hour, 11% lower than last year’s P9. – Rappler.com