MANILA Water Co., Inc. on Monday said its Laguna subsidiary has inked a P2.5-billion term-loan facility with Bank of the Philippine Islands (BPI).

In a disclosure to the stock exchange, the Ayala-led company said Laguna AAAWater Corp. signed the 10-year, term-loan facility with BPI.

“The loan will be used to partially finance Laguna Water’s capital expenditure program,” the company said.

Laguna Water is a joint venture of the Provincial Government of Laguna and Manila Water Philippine Ventures, Inc. (MWPV). It has a 25-year contract for the construction, management, operation and maintenance of the water and wastewater facilities in the concession area.

MWPV holds 70% of the company’s shares, while Laguna government owns the rest.

Aside from Laguna Water, MWPV’s subsidiaries include Boracay Water, Clark Water and Estate Water.

According to Manila Water’s first-quarter financial report, Laguna Water’s net income dropped 16% to P85 million in the first quarter of 2019, as billed volume slipped 3% to 10.4 million cubic meters due to lower consumption of several LTI locators who felt the effects of the US-China trade war.

Revenues inched up 1% to P379 million in the first three months of 2019, “on the back of a 25% improvement in average effective tariff to P33.45 per cubic meter.”

Cost and expenses jumped 4% to P186 million “due to higher direct costs related to meter reading services, partially offset by lower systems costs and concession fees.”

In January, Laguna Water inked a joint venture agreement with Pagsanjan Water District to handle, among others, the maintenance and upgrade of the town’s water supply and sanitation facilities.