HONG KONG — Maynilad Water Services Inc., the water supplier in the west zone of Metro Manila, remains committed to upgrade and improve its services and cover 100 percent of its franchise area by 2020 despite unresolved regulatory issues that could weigh down on its financial performance.
Maynilad president Victorico Vargas told reporters that the company aims to hit 100 percent coverage by 2020 and reduce its non-revenue water (NRW) or water that has been produced and is lost before it reaches the customer, to 20 percent by 2022 from as high as 68 percent in 2006. It hopes to trim its NRW to 38.8 percent this year from 43.4 percent in 2012.
Among the contentious issues is the inclusion of corporate taxes as pass-on charges to consumers as approved by the previous management of the Manila Waterworks and Sewerage System (MWSS).
Under the concession agreement signed in 2008, the previous MWSS administration allowed Maynilad and Manila Water Corp.’s income taxes and other expenses to be included in calculation of water tariffs to be paid for by consumers until the end of the concession period or until 2037.
Metro Pacific Investments Corp. president Joey Lim said the recovery of income tax is a critical issue that needs to be threshed out.
“The outcome of the tax alone will swing,†he said.
Maynilad chief finance officer Randy Estrellado said the company is hopeful that the International Arbitration Committee will decide in in its favor, pointing out that the treatment of tax would have a significant effect on the company.
Nevertheless, Vargas said its business as usual for Maynilad as it embarks on a massive expansion program to ensure 100 percent water availability by 2014.
Vargas said the company expects to serve 11.7 million consumers by 2037, almost double from when the group took over.
Maynilad currently serves 8.2 million customers or about 85 percent of its concession area which includes Caloocan, Las Pinas, Malabon, Manila, Navotas, Valenzuela, Paranaque and some parts of Quezon City, Makati City and Cavite.province.