MPIC income jumps 26% in first quarter

MANILA, Philippines - Metro Pacific Investments Corp., the local flagship of Hong Kong-based First Pacific Co. Ltd., said yesterday its reported net income rose 26 percent in the first quarter this year to P820 million, mainly driven by the strong showing of its water and electricity units.

Meanwhile, Consolidated core net income, net of exceptional one-time charges, stood at P1.13 billion, up 44 percent from P788 million the previous year due to increased ownership in power utility Manila Electric Co. (Meralco) from 14.5 percent in end-March 2010 to 17.4 percent in the same period this year, as well as increased volumes and tariff for Maynilad Water Services Inc. and the inclusion of income from Riverside and Lourdes Hospital.

Maynilad contributed P707 million or 45 percent of total core net income while Meralco chipped in P437 million or 28 percent. Metro Pacific Tollways added P353 million or 23 percent.

The hospital group, on the other hand, pumped in P64 million or four percent of total.

Consolidated operating revenues climbed 17 percent to P5.05 billion from P4.31 billion a year earlier. Earnings per share rose to P0.041 from P.032.

MPIC president president and chief executive officer Jose Ma. K. Lim said the company remains confident about its prospects for the rest of the year in spite of a challenging environment resulting from surging fuel prices, continued unrest in the Middle East, and a slowing US economy.

“The maturation of earlier investments has enabled us to improve performance even as we confront slower economic growth in 2011 compared with last year. Nevertheless, I remain positive as to the outlook for our full year earnings and we continue to pursue new investment opportunities to ensure our future remains bright,” Lim said in briefing yesterday.

MPIC chairman Manuel V. Pangilinan said the company could not give out its guidance for the full year pending the final determination of the Energy Regulatory Commission with respect to investment plans and tariffs at Meralco.

“Given the importance of Meralco in our results, we are not yet in a position, at this time, to provide our usual full year core earnings guidance. However, as Maynilad achieved its tariff increase only in the middle of the first quarter of this year and continues to expand billed volume, we anticipate improved income from it for the rest of the year. Meralco and MPTC historically achieve stronger second quarter volumes than the first quarter, and our hospital group is progressing well. On this basis, I believe our shareholders should enjoy a healthy increase in core net income for the year as a whole.”

Maynilad’s core net income rose 19 percent to P1.4 billion from P1.18 billion due to a drop in interest expense. Revenues increased seven percent to P3.09 billion as the volume of water sold to customers inched up four percent. Non-revenue water resulting from leakage and theft declined to 50 percent at end-March 2011 from 56 percent last year as a result of aggressive leak repairs.

Victorico Vargas, president of Maynilad, said the group continues to scout for alternative sources of water to ensure long-term supply for its customers. It will build a 21-23 million liter reservoir on Macapagal Ave. in Parañaque City which Vargas said could be the largest of its kind in the country.

“There will now be a second line of supply for the area in the south in case one fails,” Vargas said.

For tollways, MPTC posted core net earnings of P366 million, down eight percent from P397 million even as revenues increased 12 percent to P1.61 billion due to tariff increase and growth in pre-tax income.

MPTC president Ramoncito Fernandez said the takeover of the Subic-Clark-Tarlac Expressway concession has been delayed with the government seeking additional benefits.

Aggregate core net income of the hospital group reached P160 million, an increase of 44 percent from 2010, reflecting strong performances of its five full service tertiary hospitals: Makati Medical Center, Cardinal Santos Medical Center, and Our Lady of Lourdes Hospital in Metro Manila; Riverside Medical Center Inc. in Bacolod; and Davao Doctors Hospital Inc. in Davao.

“I believe that MPIC remains well positioned to pursue further infrastructure opportunities, which in turn will improve operational and service efficiencies and help boost the nation’s economy,” Pangilinan said.