Aboitiz Equity posts 37% income growth in 9 months

Aboitiz Equity Ventures Inc. (AEV) reported a 37-percent jump in net income to P2.48 billion in the first nine months of 2005, buoyed by the strong performance of the investment holding company’s power, food and banking businesses.

In a press statement, AEV said its earnings before interest, taxes, depreciation and amortization (EBITDA), rose 20 percent year-on-year to P5 billion.

The group’s electric business pumped in P1.76 billion to the holding company’s earnings in the first nine months, up 50 percent from the same period last year.

Its power distribution utilities contributed P834 million of that amount or an improvement of 56 percent, while power generation chalked in revenues of P931 million, 44 percent higher than the previous level.

AEV’s banking units, meanwhile, contributed P731 million in earnings in the nine-month period, up 28 percent from a year earlier.

Pilmico Foods Corp., food manufacturing unit, posted a 17-percent year-on-year rise in earnings contributions, amounting to P312 million, as its flour, feeds and swine businesses registered improved operating margins.

The transport division on the other hand, incurred a net loss of P87 million in the first nine months of the year. While the sector’s revenue rose during the period, higher operating costs due mainly to fuel and depreciation expenses, more than offset any revenue gain, AEV said.

AEV needs between P5 billion and P6 billion for the construction of power plants over the next two or three years.

It hopes to start construction of a hydroelectric power plant in Davao which is expected to start commercial operations by 2008 in anticipation of a power shortage in the Visayas and Mindanao.

The company earlier teamed up with the Norwegian company, SN Power Invest AS, to jointly bid for and develop hydroelectric power projects in the Philippines. AEV’s subsidiary, Hedcor, owns the 3.5-megawatt Talomo plant in Davao, the first power plant to be privatized by the government. The partnership will allow the companies to share resources and bid for more than one of the assets being privatized by the government.

AEV owns and operates power distribution utilities and generation facilities such as Davao Light and Power Co. Inc., Cotabato Light and Power Co. Inc., Visayan Electric Co., San Fernando Light and Power Co., Philippine Hydro Power Corp., Hydro Electric Development Corp., Luzon Hydro Corp., Northern Mini-Hydro Power Corp., Southern Philippine Power Corp. and Western Mindanao Power Corp.