Aboitiz Power nets P25 billion in 2010

CEBU, Philippines - The increased capacity generated by Aboitiz Power (AP) in 2010 brought about a 342 percent increase to its full-year net income of P25 billion.

During the company’s 2010 Annual Stockholder’s Meeting, AP president and chief executive officer (CEO) Erramon I. Aboitiz reported that the generation business accounted for 93 percent of total earnings from AP’s business segments, as it shored in P24.4 billion of earnings in 2010, an increase of 424 percent from the previous year.

Aboitiz reported to stockholders that its increased capacity allowed the company to sell 9,762 gigawatt hours (GWh) of electlricity in 2010, up by 111 percent from the last year.

Full year contributions from assets acquired in 2009, coupled with fresh additions in net generation of completed Greenfield plants and purchased assets in 2010, accounted for the increase.

As of year-end 2010, AP’s attributable capacity was at 2,051 megawatt (MG), an 18 percent increase year-on-year.

According to Aboitiz, optimizing the output of the company’s generating assets was important because their availability allowed it to sell substantial quantities of power to the Luzon spot market when, in stretches during 2010, conditions drove spot prices to unexpectedly high levels.

“Our plants were available to play a crucial role in partially covering the power supply shortfall in the Luzon grid caused by higher demand growth, major outages of other plants due to either scheduled maintenance or equipment breakdown, and the effects of El Niño. Our two power barges in Mindanao and the commissioning of our Sibulan hydro also aided in assuaging the Mindanao power shortage,” he said.

The power distribution business contributed a total of P1.9 billion in income to AP’s 2010 bottomline, this is a 23 percent from 2009, and representing seven percent of earnings contribution to the company.

Despite the power supply deficits that hounded Visayas and Mindanao throughout last year, AP distribution utilities (Visayan Electric Company, Davao Light) enjoyed healthy growth in electricity sales, increasing by nine percent versus the 2009 levels, from all sectors, with consumption of residential and non-residential customers up by six percent and 10 percent, respectively.

“We remain excited about the prospects of the Philippine economy and will not stop developing generation projects to augment our economy’s generation capacity,” Aboitiz said.

“AboitizPower is more committed than ever to find a better solution to power our country’s growth with reliable and affordable energy with the least adverse effect on our environment. No single type of generation will address this challenge. We firmly believe that the better solution lies in a balanced mix of efficient base-load plants including fossil fuels, flexible intermediate facilities and to the extent possible, renewable those are economical and not reliant on excessive subsidiaries,” stressed Aboitiz.

He added that the company is now currently in various stages of development for two clean coal projects and some small hydros that are expected to break ground with this year.

Abotiz told the company’s stakeholders that AP will continue to participate in the privatization of targeted NPC assets that the Power Sector Assets and Liabilities Management (PSALM) Corporation bids out, and be on the look-out for acquisition opportunities in both generation and distribution sectors, like the company’s recent agreement with joint venture partner Pacific Hydro for AP to assume full ownership and control of Luzon Hydro’s 70-MW Bakun plant. (FREEMAN)