First Gen Corp., the Lopez Group’s clean and renewable energy provider, said Monday recurring net income fell 8 percent in the first three quarters to $194 million from $211 million in the same period in 2021.
First Gen said income in peso terms stayed at P10.2 billion as it benefited from foreign exchange translation gains.
“First Gen’s third-quarter earnings saw EDC make a recovery from higher spot market prices and inflation-adjusted prices for its power purchase agreements,” First Gen president and chief operating officer Francis Giles Puno said.
“The natural gas platform, however, continues to be beset by fuel supply curtailment from Malampaya that required us to use more costly liquid fuel. The expected commercial operations of our LNG terminal in the second half of 2023 will help address fuel supply security issues,” Puno said.
First Gen said revenues from the sale of electricity increased 24 percent in the first nine months to $1.996 billion (P105.2 billion) from $1.606 billion (P78.1 billion) in the previous year.
The company attributed the higher revenues to elevated fuel and Wholesale Electricity Spot Market prices.
The natural gas portfolio accounted for 65 percent of First Gen’s consolidated revenues, while 31 percent came from Energy Development Corp.’s geothermal, wind and solar plants.
The remaining 4 percent came from the hydro plants.
First Gen said the natural gas platform suffered from reduced income as the natural gas plants were affected by higher taxes, interest expenses and various operational issues at the 420-megawatt San Gabriel Power Plant and 97-MW Avion Power Plant.
The natural gas platform reported a 13-percent decrease in recurring earnings in the first nine months to $142 million (P7.5 billion) from $163 million (P7.9 billion) in 2021.
The 420-MW San Gabriel Power Plant had to recognize lower capacity fees in January on insufficient gas supply from the Malampaya project.
The reduced performance was exacerbated by the need to buy replacement power for San Gabriel in the third quarter.
The 97-MW Avion Power Plant’s Unit 1 experienced unscheduled outages because of turbine damage in December 2021 and was brought back to operation in February.
High fuel prices also affected Avion’s margins for its merchant power sales. The gas platform also paid increased income taxes compared to the previous year.
The geothermal, wind and solar platforms under EDC enjoyed higher sales and operating income mainly from Unified Leyte’s increased WESM sales and higher electricity prices from its contracts.
This offset the curtailment at the start of the year as a result of Typhoon Odette, the Burgos Project’s lower wind generation and the expiry of the project’s income tax holiday.
EDC’s recurring and attributable earnings at $66 million (P3.5 billion) in the first three quarters grew 6 percent from $62 million (P3 billion) in 2021.
The hydro platform’s contribution to First Gen’s recurring and non-recurring earnings reached $6 million (P300 million) in the nine-month period, almost unchanged from last year.
The 132-MW Pantabangan-Masiway power plants generated lower revenues from a reduced volume of electricity sold but still delivered unchanged operating income on lower replacement power costs.
The hydro platform’s selling prices were also higher this year.
First Gen has 3,501 MW of installed capacity in its portfolio, which accounts for 19 percent of the country’s gross generation.
First Gen is a subsidiary of First Philippine Holdings Corp., one of the most established conglomerates in the Philippines with over 20 years of experience in power development. It is part of the Lopez Group.