AboitizPower’s net income down 5% in H1

By Lenie Lectura – August 1, 2019
from Business Mirror

ABOITIZ Power Corp. (AboitizPower) reported a 5-percent drop in net income at end-June mainly on account of higher volume and cost of purchased power during the six-month period when the grid experienced thin reserves.

From January to June this year, the power firm posted P8.6 billion in reported net income, from P9.1 billion reported in the same period a year ago. Without one-off gains, the company’s core net income was P8.5 billion, 19 percent lower than the P10.5 billion recorded in the same period last year.

“The first half of 2019 was challenging for AboitizPower as Luzon faced supply issues leading to the elections. Nevertheless, we remained committed to serving our customers to the extent of providing them with replacement power that we bought from the spot market at rates higher than our contract prices,” said Emmanuel V. Rubio, AboitizPower chief operating officer.

However, spot market prices were exceptionally high during the first half of 2019. The company also explained that it purchased replacement power due to outages and contracting ahead in preparation for incoming capacity.

The power firm is engaged in power generation and distribution businesses.

Its generation and retail electricity supply business recorded consolidated earnings before interest, tax, depreciation and amortization (Ebitda) of P17.8 billion in the first half of 2019, or 12 percent lower than the P20.2 billion recorded during the same period last year.

Capacity sold for the first half of 2019 fell by 6 percent, from 3,213 megawatts in 2018 to 3,035 MW in 2019, due to Therma Mobile Inc.’s bunker C-fired diesel power plants being put on preservation mode in the first quarter of 2019.

“With supply stabilizing and with our new capacity coming in, we are positive about exceeding our 2020 target of 4,000 MW attributable capacity, which will allow for a steady and sustainable long-term growth momentum,” Rubio said.

The company’s distribution business, meanwhile, recorded a consolidated Ebitda of P3.7 billion, 5 percent lower than last year’s P3.9 billion due to lost margins from the decommissioning of the Bajada power plant.

Energy sales rose to 2,842 gigawatt-hours, a 5-percent increase from the 2,719 GWh recorded in the first half of 2018, primarily driven by the increase in new customers across all segments.