MPTC in talks with Japanese for NLEX-SLEX link-up project

MANILA, Philippines - Metro Pacific Tollways Corp. (MPTC) is in talks with potential Japanese partners for a possible joint venture in the construction of a new road that will connect the North and South Luzon expressways.

MPTC chief finance officer Christopher Lizo said talks on the NLEX-SLEX connector road also include access to long-term financing.

The company is currently conducting pre-feasibility technical studies on the 13-kilometer expressway that will connect Segment 10 of the Manila North Tollways Corp. (MNTC) to the Buendia segment of Skyway using the Philippine National Railways (PNR) road alignment.

MNTC president Rodrigo Franco earlier said that for the NLEX-SLEX connector road, they are exploring a loan from the Japanese government, particularly the Japan International Cooperation Agency (JICA). MNTC, which operates NLEX, is a unit of MPTC.

Franco said the loan negotiations have yet to start since the study for the construction of the 13-km expressway using the PNR’s railroad alignment still needs to be completed. The toll road is estimated to cost about P16.3 billion, including acquisition of the right of way.

Construction of the NLEX-SLEX Skyway is expected to begin next year. It will connect C3 in Caloocan City and the end of the Skyway in Buendia in Makati.

MPTC earlier reported that it registered a 26 percent drop in its reported net income, which includes exceptionals and non-cash provisions related to certain taxes, to P581.7 million in 2009 from P783.9 million in 2008.

On the other hand, the company’s core net income grew 24 percent to P1.22 billion last year from P986.9 million in 2008.

Company officials said the improvement in core net income is attributable to the higher than expected traffic reported by MNTC and the higher contribution of Tollways Management Corp.(TMC).

MPTC president and CEO Ramoncito Fernandez said with the scheduled completion and opening of Segment 8.1 by May 2010, which will provide motorists another access to NLEX, as well as increased mobility related to the May 2010 election, they are confident traffic volume for the period will reach new highs.

“We have also started the detailed engineering studies for Segments 9 and 10, the roads that connect NLEX to Western Metro Manila, with the objective of starting construction next year. This will bring us closer to our goal of connecting NLEX to the southern toll road network of Metro Manila,” Fernandez added.

For his part, Lizo noted that the strong operational performance of the company was driven by higher toll revenues and further rationalization of costs.

He added that the favorable fuel prices, the opening of SCTEX as well as their intense marketing efforts and focus on customer service have propelled traffic volume at record highs in 2009. “The first month of this year 2010 has seen traffic continue to increase, which provides us with some optimism about the prospects for the incoming year,” Lizo said.

MNTC holds the concession to operate and maintain NLEX and is owned 67.1 percent by MPTC. TMC operates the NLEX for MNTC and has an interim agreement to operate and maintain Subic-Clark-Tarlac Expressway (SCTEX) and is owned 46 percent by MPTC. The Bases Conversion Development Authority (BCDA) owns SCTEX.

MNTC reported a core net income of P1.5 billion for 2009, higher by 18 percent from the previous year’s P1.27 billion. After deducting non-recurring provisions, reported net income for the period stood at P256.3 million, lower by 73 percent from 2008’s P934 million.