Power companies benefitted from new capacities and fewer outages in the first quarter to post a 17 percent combined profit growth on a recurring basis.
Online stockbroker Colfinancial.com said total volume rose 2 percent driven by the strong recovery in power demand from the commercial segment of the market, but offset by declines in both the residential and industrial segments.
“Meanwhile, average WESM (wholesale electricity spot market) prices declined by 5 percent to P6.23/kwh, on less supply disruption from power plant outages, as well as cooler overall temperature compared to last year,” Colfinancial.com said.
Despite the slight decline in WESM prices, however, it said several companies sold higher portion of their output to the spot market.
“The impact of lower coal prices and WESM prices was partially offset by higher sales volume driven by new capacities as well as fewer instances of unplanned outages and other technical issues,” the online stockbroker said.
Of the five companies it monitors, only ACEN Corp. delivered lower than expected results.
ACEN’s core profit of P2.03 billion was below forecast, noted Colfinancial.com, despite growing by 400 percent. The online stockbroker said ACEN’s reported profit was just 21.6 percent of market consensus.
“Management also noted that first quarter performance would have been higher if not for the unplanned outage of the South Luzon Thermal Energy Corp. (SLTEC), as some of the new merchant capacity was utilized to service the contract of the SLTEC,” Colfinancial.com said.
“While first quarter net income trailed forecasts, ACEN’s profits will continue to improve in the next quarters as the company will be in a higher net seller position in the WESM without the unplanned outage of the SLTEC and as more generation capacity is added to its portfolio,” it added.
Of the other four, First Gen Corp. (FGEN) grew its profit by 52 percent to $89.2 million, ahead of market growth consensus of 31.8 percent.
Colfinancial.com said the earnings contribution of FGEN’s gas plants — Sta. Rita, San Lorenzo, San Gabriel and Avion — rose 17 percent to $45 million.
Manila Electric Co. (Meralco), meanwhile, beat expectations on strong power generation with profit up 40.4 percent to P9.05 billion.
Meralco’s net distribution revenues, however, dropped 0.1 percent to P15.25 billion, as the 2 percent increase in sales volume was more than offset by a steeper decline in distribution tariff arising from the customer refund.
“The net distribution revenues during the first quarter represents 25.3 percent of our full year forecast. Meralco’s first quarter earnings beat Colfinancial.com’s forecast mainly due to the 300 percent jump in core net income of MGEN, Meralco’s power generation subsidiary, to P3.7 billion,” the stockbroker said.
Semirara Mining and Power Corp., whose profit declined by 40 percent to P9.03 billion, still beat estimate, according to Colfinancial.com.
“First quarter earnings declined mainly due to lower sales volume as well as average selling price for coal. We note, however, that both sales volume and average selling price for coal are still ahead of our full year forecasts,” it said. Semirara’s revenues were down by 24.2 percent to P23.1 billion.
Aboitiz Power Corp., on the other hand, posted a 158.1 percent increase in profit to P7.63 billion, driven by the fresh earnings contribution from unit GNPowerDinginin, higher capacity availability for power plants as well as higher water flow for its hydroelectric plants.
