Manila Water posts 51% profit jump

Ayala-led utility firm Manila Water Corp. reported a 51-percent growth in net income last year to P2.01 billion from only P1.33 billion in 2004 on the back of higher revenues and a significant eight-percentage points reduction of system losses.

In a financial report filed with securities regulators yesterday, Manila Water said its revenues rose 35 percent to P5.68 billion from P4.21 billion as it managed to contain its expenses well within budget levels.

As a result, earnings before interest, taxes, depreciation and amortization (EBITDA) jumped 46 percent to P2.96 billion compared with P2.023 billion the previous year.

Manila Water provided water to an additional 45,167 households. Consequently, billed volume increased by 39 million liters per day (mld) to 864 mld as of end-2005.

Manila Water currently serves a total of more than 600,000 households with 95 percent of the covered population enjoying 24-hour water availability, compared to only 26 percent upon its takeover in 1997.

"With Manila Water’s sustained growth and strong cash generation, we were able to deliver our promises to our key stakeholders – improved services to our customers, strengthened commitment to sustainable development, and healthy returns to our shareholders," Manila Water president Antonino T. Aquino said.

Manila Water supplies drinking water to over five million customers in major business districts in the cities of Makati, Pasig, Taguig, San Juan, Mandaluyong and Quezon City and residential areas in Marikina,Pateros, Cainta, Taytay, Montalban and Antipolo.

"We will continue to pour significant investments to reach out more to the expansion areas within Mega Manila’s east zone. The financial flexibility we have realized through our IPO (initial public offering) puts us in a better position to pursue investment opportunities even beyond our present concession area," Aquino added.

For this year, the company has earmarked P4.6 billion for the improvement of its facilities, development of new water sources and its expansion in Taguig and Rizal, Manila Water chief financial officer and treasurer Sherisa Nuesa said.

Manila Water is awaiting the approval of the Metro Cebu Water District for its P2 billion water supply proposal project in Cebu.

With partner Stateland Inc., Manila Water plans to supply an average of 50,000 cubic meters per day or one-third of the water supply in Cebu.

Funding for the project will come from a combination of 60 percent debt and 40 percent equity.

Last year, Manila Water secured a $64-million loan from the World Bank to be used to fund the Manila Third Sewerage Project (MTSP).

The MTSP is an $85-million project which includes the construction of septage treatment plants and installation of sewer systems (MTSP). It is expected to triple the wastewater service coverage within the East Zone in five years, from the current 10 percent to around 30 percent of the population.

Outside the east zone concession, the company is eyeing the potential development of water projects in other provinces including La Union.

Manila Water earlier announced that it is eyeing projects in India, Vietnam and Thailand to boost profitability.

Manila Water is also part of a consortium that is evaluating the viability of taking over the rehabilitation of debt-saddled Maynilad Water Services Inc. of the Lopez family, the concessionaire for the west zone.