Aboitiz allots P27B to boost power segment

CEBU, Philippines - Aboitiz Equity Ventures (AEV) announced to spend  P59 billion this year, about 50 percent or P27 billion of which is going to its power generation investments including the setting up of new power plant in Toledo City to address the power scarcity problem in Cebu.

In a recent stockholders meeting, AEV president and chief executive officer (CEO) Erramon I. Aboitiz said that as part of AEV’s efforts to augment earnings and the growth potential of its core business, "we are looking at other investment opportunities that we can build into sizeable businesses," referring to the company's acquisition of AboitizLand  from Aboitiz  and Company this year.

AboitizLand has an inventory of existing and potential projects, as well as access to a land bank that will ensure the continuity of development projects. It also has strong recurring income from its industrial estates.

In 2012, AboitizLand formed a consortium with Ayala and ADC & HAS Airports to bid for the Mactan-Cebu International Airport terminal project, AEV's first attempt for a public-private partnership (PPP) project.

"It provides us with the opportunity to enter into new business segment with significant growth potential that is crucial to developing the country's transportation, infrastructure and tourism potential," said Erramon, adding that the company will continue to be on the lookout for other PPP projects.

AEV booked consolidated revenues close to P81 billion in 2012,  13 percent higher than the previous year.

The power group provided the lion's share contributing P18.8 billion, up by 14 percent from the previous year, or equivalent to 78 percent of the total earnings contributions from AEV’s operating businesses.

The banking units turned in P3.9 billion or 16 percent of AEV's total income while the food group contributed the balance of P1.3 billion.

"The year 2012 proved to be a good year for the company. The strong GDP growth of 6.6 percent, coupled with relatively benign inflation during the year, has placed the country in what many are calling the 'economic sweet spot'," Erramon said. /JMD (FREEMAN)