Power firms’ bottomline declined 3.1 percent in the first quarter of the year, yet they posted better-than-expected results, according to online stockbroker Colfinancial.com.
This performance is against the backdrop of “higher sales volume growth boosted by higher demand and available capacity – new capacities as well as fewer average outage hours of power plants – offset by lower commodity and power prices,” Colfinancial.com said.
“Despite the overall decline in earnings, four out of the five companies in the sector delivered better- than- expected results, and only one company posted lower- than-expected profits,” it added.
Colfinancial.com has Aboitiz Power Corp., First Gen Corp., Semirara Mining and Power Corp., ACEN Corp. and Manila Electric Co. in its basket of energy stocks.
Sales volume grew 9 percent, driven by the strong uptick in power demand from the residential and commercial segment of the market, it noted.
Colfinancial.com said higher temperatures due to the El Niño as well as the overall increase in business activities in the economy contributed to the strong demand growth.
Colfinancial.com noted a decline in average Wholesale Electricity Spot Market (WESM) prices by 27 percent to P4.6 per kilowatt-hour, mainly due to the sharp decline in coal prices as well as higher power supply due lower outage hours during the period.
Aboitiz Power sold 14 percent of its output to the WESM, up from 10 percent last year, while Semirara Mining and Power sold 71 percent of its output to the spot market compared to 61 percent last year.
Colfinancial.com, meanwhile, noted a decline in the Newcastle Coal Index by 49 percent, while the Coal (ICI4) Indonesian Coal Index dropped 26 percent for the period.
“Aboitiz Power said it benefited from lower fuel cost as its gross profit rose 14 percent despite a 12 percent decline in overall revenues,” Colfinancial.com said.
