EDC income rises 4-fold to P7.58B in 9 months

MANILA, Philippines - Lopez-owned Energy Development Corp. (EDC) pos-ted a four-fold increase in its net income to P7.58 billion in the first three quarters of 2010 from the year-ago level of P1.39 billion.  

EDC president and COO Richard Tantoco attributed the profit surge to a number of non-recurring items, primarily the writedown of about P3 billion in deferred tax assets in 2009 further to the implementation of the Renewable Energy Act and the P1.7 billion in other income reported in 2010 with the recovery of an impairment provision on the company’s input value-added tax claims.  

As stand-alone entities, EDC units Green Core Geothermal Inc. (GCGI), which operates the 305-megawatt Tongonan 1 and the Palinpinon power plants, reported a net loss of P270.1 million while FG Hydro registered a P1.14-billion net income for the period. 

For the nine-month period, EDC sold a total of 5,886.3 gigawatt-hours of steam and electricity with 3,548.3 gwh coming from the electricity production of its power plants in Leyte, Northern Negros and Mindanao; 665.5 gwh of steam from the Bacman Geothermal Production Field (BGPF); 1,372.6 gwh from GCGI; and 299.9 gwh from FG Hydro.  

“Over the last 15 months, we had grown our power generation portfolio by some 88 percent having successfully acquired all of the National Power Corp. (Napocor) Geothermal power plants EDC has been supplying steam to since the 1980’s, together with the successful turnover of the Mindanao plants operated by our BOT (build-operate-transfer) partners since late 1990s. EDC is presently 100-percent vertically integrated in the different areas where we operate,” Tantoco said. 

He said the company’s main agenda is to drive growth further while, at the same time, managing business risks.  

“We have been successful in reducing third currency risks by redenominating our yen debt to peso. With the positive results of our operational and financial management, we are confident that we can sustain this momentum for the balance of the year,” Tantoco said.

As of end-September 2010, EDC operates 12 geothermal steamfields in the five geothermal renewable energy service contract areas where it is principally involved in. EDC also provides drilling equipment and rig personnel to Lihir Gold Ltd. (LGL) in Papua New Guinea. 

On November 2008, EDC acquired a 60-percent equity stake in First Gen Hydro Power Corp. (FG Hydro), which runs the 110-MW Pantabangan and 12-MW Masiway hydroelectric power plants in Pantabangan, Nueva Ecija. 

With this development, the company has evolved into being the country’s premier pure renewable energy player, possessing interests in geothermal energy and hydropower.