Alsons gets credit rating upgrade

MANILA, Philippines — Alsons Consolidated Resources Inc. (ACR), the publicly listed company of the Alcantara Group, received an issuer credit rating upgrade from the Philippine Rating Services Corp. (PhilRatings).

PhilRatings upgraded ACR’s credit rating advanced to PRS Aa minus (corp.) from PRS A plus (corp) in relation to the company’s issuance of up to P3 billion in Commercial Papers (CPs).

The debt watcher said a company with a PRS Aa rating “has a strong capacity to meet its financial commitments relative to other Philippine corporates.”

In upgrading ACR’s credit rating, PhilRatings cited the “planned expansion projects which will further diversify its generation mix, the company’s ability to establish joint ventures with strong partners for particular projects, and its strong profitability despite the ongoing pandemic.”

ACR listed its first tranche of CPs worth P1.4 billion with the Philippine Dealing and Exchange Corp. in July last year while the second tranche amounting to P600 million was listed in November.

Proceeds from the issuance are being used primarily for general working capital purposes, particularly to pay off short term obligations of the company.

ACR, which is Mindanao’s first private-sector power generator, has a portfolio of four power facilities with an aggregate capacity of 468 megawatts (MW) serving over eight million people in 14 cities and 11 provinces in the country’s second largest island.

In the nine months ending September last year, ACR’s core net profit grew by a fifth to P1.14 billion from P949 million in 2020   due to the improved performance of all its power plants.

Meanwhile, its core net income attributable to parent doubled from P162 million to P323 million.

The growth was still mainly driven by the improved performance of the Sarangani Energy Corp. (SEC) 1 and two coal plants, along with the continuing operations of Western Mindanao Power Corp. (WMPC) and Mapalad Power Corp. (MPC) diesel plants.

For the long-term, ACR is slated to focus on renewables with the company’s first renewable energy facility--a P4.5-billion, 14.5 MW hydroelectric power plant currently under construction at the Siguil River basin in Sarangani Province.

The Siguil Hydro Power plant, which is targeted for completion this year, will be the first of eight hydropower facilities that ACR plans to develop.

It will supply power to the Provinces of Sarangani and South Cotabato, General Santos City, and other areas in the Mindanao grid. ACR is also working on the 22-MW Siayan (Sindangan) Hydro plant in Zamboanga del Norte and the 42-MW Bago Hydro plant in Negros Occidental.