Costs bite into Vivant’s H1 results

Listed firm Vivant Corp. (Vivant) posted a sharp decline in earnings for the first semester as its expenses took a bite from its profit.

In a disclosure Tuesday, the Cebu-based energy and water company said the net income attributable to the parent dropped by 40 percent to P877.4 million from a year ago’s P1.46 billion.

Cash flow as measured by earnings before interest, taxes, depreciation and amortization also fell by 18 percent to P1.5 billion from P1.8 billion.

This happened even though Vivant generated a higher top line from January to June.

Total revenues climbed 42 percent to P5.6 billion against the P3.9 billion booked in the same period last year, propelled mainly by the increase in the sale of electricity.

Power sales surged by 77 percent to P4.4 billion, thanks to the group’s expanded investments in oil-fired power plants, retail electricity supply, and solar rooftop businesses.

Its bunker-fired power plant Delta P contributed P1.1 billion to revenues. Isla Norte chipped in P450.5 million while Calamian Island Power Corp. had P354 million.

Stronger revenues, however, failed to offset the rise in costs of services and operating expenses, which ballooned by 92 percent to P4.5 billion from P2.3 billion due to high electricity generation costs.

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According to Vivant, costs of services alone doubled to P3.8 billion. Another factor contributing to the jump in expenses was salaries and employee benefits, which increased by 36 percent to P329 million.

The group said it has several projects on the pipeline, which covers power generation and water infrastructure. These projects include an on-grid 15-megawatt (MW) bunker-fired power plant in Pampanga; a solar power plant facility in Bulacan; a 206-MW wind power project in Northern Samar; and a utility-scale seawater desalination plant in Cebu.

“The company, through its subsidiaries’ business development group, continuously looks for opportunities in the power, whether it be via greenfield, brownfield or acquisition,” Vivant said.

“The growth horizon of the company [also] focuses on developing more bulk water supply (utilizing seawater desalination technology) and expanding its wastewater treatment and water solutions businesses,” it added.