Manila Electric Co., the biggest retailer of electricity, registered a consolidated net income of P5.7 billion in the first quarter of 2017, up 7 percent from P5.312 billion year-on-year, on the positive contribution of units, improvement of retail supply units and slightly higher energy sales.
Meralco said consolidated core net income, which excluded one-time, exceptional charges, rose 14 percent to P5.6 billion from a year ago.
“The financial results for first quarter 2019 are quite encouraging albeit the first quarter volume, while better than the comparative period, is showing signs of slowdown. This could be a point of concern, moving forward,” said Meralco chairman Manuel Pangilinan.
Meralco’s consolidated energy sales in the first quarter reached 10,381 gigawatt-hours, up two percent from 10,145 gWh in 2018, mainly due to the “high base effect” of the volume attained in 2018 and the slightly cooler average temperature throughout the quarter.
Meralco said while economic indicators were relatively stable, the overhang from the slightly lower economic growth of 6.2 percent in 2018 compared with the government’s target range of 6.5 percent to 6.9 percent, the spill-over effect of the fourth quarter spike in inflation and the weaker peso in the first quarter of 2019 all contributed to tempering the increase in electricity consumption.
Of total sales volumes in the first quarter, 40 percent, 31 percent, and 29 percent were from the commercial, industrial and residential sectors, respectively. Streetlight volumes accounted for less than one percent of total volumes.
“The lower-than-expected sales growth during the first quarter of 2019, particularly in the residential and commercial sectors, were attributable to concerns on higher interest rates, the weakening of the… peso… and their impact on fuel and commodity prices, exacerbated by the recent red and yellow alerts caused by the coincident forced outages of several plants,” said Pangilinan.
He said the yellow and red alerts being experienced today might eventually lead to a serious power supply shortage in the next few years “unless immediate action is done to resolve the root cause of the problem, by adding more generating capacity and taking decisive action on the much-delayed construction of new power plants.”
Meralco’s customer base grew by over 4 percent to 6.7 million customer accounts, with 285,000 net new accounts since March 2018. The residential customer base, which rose by close to 5 percent, remains at 92 percent of the total.
Consolidated electric revenues, representing 98 percent of total sales, rose 7 percent in the first quarter to P73.63 billion from P69 billion a year ago.
A major driver for the increase in electric revenues is the higher pass-through charges, which increased 8 percent to P59.4 billion resulting from the combined effects of the higher costs of gas and coal, the further weakening of the peso and higher prices in the Wholesale Electricity Spot Market.
