Meralco reports 9.3% hike in 1st quarter sales

Power distributor Manila Electric Co. (Meralco) reported yesterday that its sales volume for the first three months of 2003 has improved by 9.3 percent compared to the same period in 2002.

In a disclosure to the Philippine Stock Exchange (PSE), Meralco vice president and assistant corporate secretary Gil San Diego said the systems loss level also improved to 11.2 percent compared to 13.2 percent in the same period last year.

San Diego added Meralco, at this time, will not be able to report its financial results as a consequence of a significant event.

"In view of the April 30, 2003 decision of the Supreme Court rejecting Meralco’s motion for consideration pertaining to Meralco’s refund case, Meralco is currently adjusting its first quarter 2003 financial statements," he said.

He noted that the first quarter financial results may be affected by the refund that it has to implement.

"This is to reflect the pending refund to customers as a liability and to recognize losses as a result of the refund and a rollback of rates," he said.

"The company will provide the Securities and Exchange Commission and the Philippine Stock Exchange its first quarter financial statements as soon as the adjustments have been finalized," San Diego said.

Meralco chief finance officer Daniel Tagaza pointed out that the sales performance during the period was much better than the negative six- percent contraction in the same period last year.

Meralco president Jesus Francisco, on the other hand, said the company is also resolving another issue which can greatly affect their financial performance. "We have to find out how we can finance the $85-million worth of banked gas for 2002," he said.

He said based on their contract with First Gas Power Corp., there is a certain value of natural gas that was supposed to be used by Meralco for 2002.

But this level was not actually used by Meralco, due to transmission constraints from the National Power Corp. (Napocor). Meralco buys power from the 1,000 MW-Sta. Rita and 500-MW San Lorenzo gas-fired power plants of First Gas since the two went on commercial operations.

Under the contract, he said Meralco can only use the banked gas if the gas-fired power plants will run at its minimum energy requirement (MEQ) of 85 percent. But so far, he said they are just running at 50 percent MEQ.

Francisco said they will only use this banked gas if there is no excess capacity in the country. "So, we will not be able to use this banked gas until these factors are present," he said.