Geothermal and wind power leader Energy Development Corp. reported a consolidated recurring net income of P6.6 billion in the first nine months, down 6.5 percent from over P7 billion year-on-year.
EDC attributed the lower consolidated recurring net income attributable to equity holders of the parent to the impact of the magnitude 6.5 earthquake that struck Leyte island on July 6.
EDC’s Leyte business unit, the largest among the company’s operating units, was generating almost 540 megawatts of electricity at the time of the earthquake.
The company has since brought back to service all of its major units, except for two 60-MW units in the Mahanagdong geothermal plant.
“We expected the effect of that major earthquake in July on our third quarter results”, EDC chief financial officer Nestor Vasay said in a statement.
“However, we’ve successfully brought back to service our damaged units earlier than we originally forecasted, and at the same time strengthening our facilities. Our other business units have also been helping in cushioning the financial impact of the earthquake by way of cutting back on their forecasted OPEX for the rest of the year”, Vasay said.
EDC posted P24.6 billion in consolidated revenues during the nine-month period, down 3.1 percent from the P25.4 billion year-on-year.
EDC’s Bacman geothermal unit partly offset the reduced revenues from Leyte, with its topline figure increasing P500 million as it reduced its reliance on the spot market.
Consolidated net income attributable to equity holders of the parent stood at P6 billion, lower than P7.4 billion in 2016, primarily driven by lower reported revenues and reduced proceeds from insurance claims (P1.3 billion) and premium paid for the early redemption of the company’s US dollar-denominated bonds
EDC said these were partially offset by lower foreign exchange losses and financing costs.
“A recurring initiative the past couple of years has been our focus to deliver financial predictability to our shareholders. Notwithstanding the impact of the earthquake, we’ve seen our efforts to retrofit and improve the reliability of our older assets, increase the proportion of our contracted capacity, and reduce our opex and financing costs help us start delivering on this target”, Vasay added.