Maynilad in Q3: Earnings up on lower non-revenue water, financing costs

From AB Capital's The Opening Bell: Three Moves

Event

Moderate 3Q26 earnings growth: Revenue increased 2.1% YoY to P9.5 billion, while net income grew 3.1% to approximately P4.1 billion. Earnings before interest, taxes, depreciation and amortization (EBITDA) was broadly flat at around P6.4 billion, reflecting slower operating earnings momentum compared with 2Q26.

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Solid nine-month performance: 9M26 revenue rose 3.5% to P28.6 billion, EBITDA increased 5.1% to P20.1 billion, and net income grew 10.2% to P12.6 billion. Growth was supported by a 2.8% increase in billed volume, the 2.85% tariff adjustment and continued customer additions.

Catalyst

Improving network efficiency supports margins: Non-revenue water (NRW) declined to 29.3% from 32.8% a year ago, helping lift 9M26 EBITDA margin by 110 basis points to 70.3%. Wastewater coverage likewise improved to 95.7% from 90.4%, supported by P19.5 billion in infrastructure investments.

Action

Earnings growth increasingly supported by financing savings: Net income growth outpaced EBITDA growth, benefiting from lower interest expense and higher interest income. However, flat 3Q EBITDA highlights the need to monitor operating cost pressures, particularly from elevated oil prices and newly commissioned facilities.

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