Trans-Asia earnings decline 26% in Q1

MANILA, Philippines - Trans-Asia Oil and Energy Development Corp. said its first quarter earnings declined by a quarter as higher expenses offset an increase in revenues.

Total comprehensive net income fell 26 percent to P40.65 million from P55 million a year ago, the company said in a financial report.

“Consolidated revenues rose to P283.94 million during the first quarter of 2012 from P181.03 million in the same period last year due to higher energy sales as the company’s generating capacity from power plants under administration increased to 186.4 megawatts (MW) from 55.4 MW,” Trans-Asia said.

The bulk of energy sales came from contract customers, with excess output sold to the spot market.

However, costs and expenses almost doubled to P200.38 million in the first quarter from P117.32 million in the same period last year, cutting the company’s profits.

Specifically, cost of power generation spiked to P103.52 million from P42.32 million while general and administrative expense climbed to P17.3 million from P5.67 million.

Trans-Asia Oil is looking at a 20-percent growth in net income this year to a record P489 million through new customers and higher electricity output. Last year, its profit surged to P408 million from P14.74 million in the previous year on the back of higher trading revenues from its power business.

To date, the company owns and operates four plants with an aggregate production capacity of 186.4 MW.

“The company’s energy revenues will be supported as Trans-Asia will be diversifying its power generation portfolio, thus allowing flexibility to allocate its energy production for both base and peak demands,” the firm said.

Trans-Asia will enter into P33 billion worth of new projects in the next five years.

In the next three years, generating capacity is projected to increase to 347.4 MW as three scheduled projects go onstream – the CIP II Power Plant (2012) in Laguna, 20-MW Maibarara Geothermal Inc. renewable energy project also in Laguna (2013) and 135-MW South Luzon Thermal Energy Corp. circulating fluidized bed power plant in Batangas (2014).

“To further support the growth strategy of the company, investments in more cost-competitive power generation facilities are currently under study,” Trans-Asia said.

Trans-Asia holds Service Contract (SC) 6A and 6B in Northwest Palawan, SC 14 (Tara Block) and SC 14B-1 (North Matinloc) in Northwest Palawan, SC 51 in the East Visayan Basin, SC 55 in Southwest Palawan and SC 69 in the Visayas Basin.

Each service contract has a predevelopment term of three years and a 25-year development stage, which may be extended for another 25 years.

Trans-Asia, which is 54.8-percent owned by Phinma Corp., is also into oil exploration, cement manufacturing and coal trading.