Energy unit boosts Lopez Holdings’ second-quarter earnings

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LOPEZ Holdings Corp. reported a net income of P1.03 billion in the second quarter, higher by 43% compared with year ago’s P721-million profit attributable to the equity holders of the parent firm, with the stable showing of its energy unit boosting the quarterly results.

“The stable performance of the energy group under associate First Philippine Holdings Corporation (FPH) accounted for the results,” the company said in the statement.

In the first half, Lopez Holdings said net income reached P2.17 billion, up 23.3% from P1.76 billion in the same semester last year.

Lopez Holdings serves as the holding firm of the Lopez family for its investments in major development sectors.

FPH recorded a net income attributable to the parent firm’s equity holders of P1.95 billion, more than three times higher than the P607 million posted a year ago.

In the first six months, FPH registered a net income of P4.05 billion, up 60.7% from P2.52 billion a year ago.

“Unfavorable forex movement during the period partially offset the effect of growth in the recurring earnings of the FPH Group. ABS-CBN [Corp.] revenues declined by 2% while expenses increased by 4%,” Lopez Holdings said.

ABS-CBN recorded a 41% decrease in net income during the period, the holding firm added. As of mid-2018, Lopez Holdings owned 47% of FPH and 56% economic interest in ABS-CBN.

Energy unit First Gen Corp. posted a net income of $45.19 million, nearly three times more than $16.70 million in the same quarter last year. The company reports its figures in dollars, its functional currency.

In a statement, the company said its first half reported recurring net income attributable to the equity holders of the parent reached $115 million, up 35% from a year ago.

“The gas portfolio thrived during this period, especially San Gabriel and Avion that have been able to achieve remarkable turnarounds this year as they delivered much needed power to the grid,” said First Gen. President and Chief Operating Officer Francis Giles B. Puno in a statement.

“For the second half of 2018, San Gabriel shifts to being a contracted provider of electricity to Meralco (Manila Electric Co.) allowing it to achieve stable earnings. This contract proves the price competitiveness of natural gas-fired power versus coal-fired power even at baseload and more so at mid-merit levels of dispatch,” he added.

First Gen said the natural gas platform’s performance offset the soft showing of the other platforms. It said the period’s “strong numbers” were also boosted by lower interest expenses as a result of its deleveraging initiatives.

During the first half, the natural gas platform delivered recurring earnings of $88 million, up from $51 million previously.

On Tuesday, shares in Lopez Holdings fell 2.06% to close at P4.27 each, while those of FPH declined by 0.32% to P63.20 apiece. First Gen shares slipped by 0.38% to P15.90 each. — Victor V. Saulon