Meralco on track to hit P50-B core income
Expectations of unfavorable weather conditions prompted Manila Electric Co. (Meralco) to temper its energy sales forecast this year despite delivering a strong financial performance in the nine-month period.
Meralco senior vice president and chief revenue officer Ferdinand Geluz said the listed power giant now expected “flattish to negative 0.4 percent to 0.8 percent” energy sales by the end of this year.
This marked a downgrade from its earlier forecast of a modest 1 to 2 percent energy sales growth.
“We were hoping for a normalization of weather patterns, but we see worsening weather patterns. In fact, in the third quarter alone, we had 10 more suspension of classes and even government offices,” Geluz said during Meralco’s financial briefing on Monday.
Geluz said heavy rains and flooding “impeded the mobility” of both residential and commercial customers.
“By way of temperature, the industrial segment is more resilient because normally, their environment is more controlled. Unlike commercial (segment), the bulk of the power requirements is really on cooling,” he said.
“If the weather is colder and the customer mobility is impeded, the requirement for cooling power decreases. The same goes for residential customers,” he added.
Meralco, the listed utility giant led by tycoon Manuel Pangilinan, said its consolidated reported net income had climbed 9 percent to P36.82 billion as of end-September. Consolidated core net income settled at P40 billion, up 14 percent.
The core income of its distribution utility business contributed P21.9 billion to earnings, equivalent to 37 percent of the total.
The contribution of power generation business reached P14.7 billion, while the retail electricity supply and nonelectric businesses brought in a combined P3.4 billion.
During the period, consolidated revenues stood at P371.77 billion, up 5 percent.
Meralco chief finance officer Betty Siy-Yap said the top line had been driven by higher pass-through generation and transmission charges, improved revenues of power generation due to its participation in the reserve market and higher sales volume from retail electricity.
Energy sales in the January to September period slightly increased to 50,880 gigawatt-hours from 50,641 GWh.
The distribution utility business accounted for 81.3 percent or 41,358 GWh of overall volume.
On the other hand, consolidated energy sales stood at 40,719 GWh, relatively unchanged from 40,872 GWh, due to the extended period of inclement weather affecting the electricity demand in residential and commercial segments.
“Based on the growth of our power generation business and the steady performance of our core distribution business in the past nine months, we stay positive that we will achieve our full-year core profit guidance of P50 billion,” Pangilinan said.
Siy-Yap said the listed firm was counting on the earnings contributions of Meralco subsidiaries to attain the 2025 profit target.
