Manila Water profit up 16% in first half

MANILA, Philippines - Manila Water reported yesterday a net income of P1.5 billion in the first half, 16 percent higher than the P1.3-billion it posted for the first half of 2008, according to president and chief operating officer Rene D. Almendras.

In an interview with The STAR, Almendras explained that the higher net income of P1.5 billion, however, is not due to operating income but as a result of lower tax adjustments and financing income.

Almendras revealed that Manila Water is currently earning a lot from the placement of its P10.7 billion in funds which it will use for its capital expenditures once it secures approval for the extension of its concession agreement.

Almendras explained that Manila Water’s sales are actually down due to the economic downturn. Consumption by both commercial and industrial costumers in the East Zone concession has been weak due to the economic slowdown.

The 16-percent net income increase in the first half, Almendras admitted, may not be sustained for the whole of 2009 although the utility firm is still projecting a “high single digit or a low double digit growth.”

Commenting on the controversial Laiban Dam project, Almendras assured that Manila Water “has nothing against the Laiban project, but we have other options that can be considered.”

Manila Water chief financial officer Luis Juan B. Oreta admitted that over the long-term, it would be best for the Manila Waterworks and Sewerage System (MWSS) to develop an alternative water source from the current Angat Dam supply.

However, Oreta admitted that there are other options that are being studied including a water treatment plant for Laguna Lake.