Meralco sees lower sales in Q2

By Lenie Lectura – May 29, 2018
from Business Mirror

THE Manila Electric Co. (Meralco) expects lower energy sales in the second quarter compared to the first three months of the year.

“April and May are trending lower.  For April this year, the growth was in the order of about 3.5 percent to 3.6 percent partly because it was half a degree centigrade cooler, which is unusual for summer. April was cooler. For May we are seeing about 4.5 percent. That could bring down our year-to-date May sales to a little over 7.5 percent. The second quarter will be lower than the first quarter,” Meralco President Oscar S. Reyes said after the company’s annual meeting on May 8.

Energy sales for the first quarter of the year stood at 10,145 gigawatt hours, up 8.9 percent from 9,317 GWh in the same period a year ago. The higher temperature, which averaged 27.1 degrees Celsius, also drove the increase in volume during the period.

Meralco reported earlier that unusually strong sales from January to March this year pushed Meralco’s net income higher by 10 percent to P5.3 billion, while core net income rose 7 percent to P4.92 billion.  Revenues also went up by 6 percent to P70.09 billion.

Reyes said sales volume for the second quarter, albeit lower than the first quarter, would still be driven by increased consumption from existing customers and new customers. At end-March Meralco’s customer count increased to 6.4 million accounts.

He said subscriber base is growing at a rate of 4 percent to 4.5 percent every year. Load growth is expected to register at a conservative rate of 3.5 percent.

“It’s a function of how the economy does well,” Reyes said.

Meralco reiterated that it remains committed, and has always been ready to invest in capital expenditures (capex) for a highly resilient, customer-responsive, digitally enabled distribution business, and fuel-efficient, reliable and environment-friendly power-generation plants.

As such, the utility firm is contemplating on a four-year capex of P72 billion for a four-year period covering June 30, 2019, to July 1, 2023.

“We will probably stick with that range, about P18 billion per year,” Reyes said. He added that the capex “will track more or less the same” as the P72.9-billion capex from 2015 to 2019.  Meralco, he also said, has yet to spend the remaining P35 billion programmed for the period mid-2017 to 2019.

“Our capex is mainly to finance our distribution network, to make it more resilient also,” Reyes said.