Metro Pacific core profit jumps 10% in 1st half

By Arra B. Francia, Reporter
METRO PACIFIC Investments Corp. (MPIC) delivered a 10% growth in consolidated core profit during the first six months of 2018, fueled by the growth across its portfolio and increased investments in the power sector.
The infrastructure conglomerate said in a disclosure to the stock exchange on Thursday that consolidated core net income climbed to P8.6 billion from January to June, higher than the P7.8 billion it generated in the same period a year ago.
Systemwide revenues grew by nine percent to P200.3 billion, including revenues from power distribution unit Manila Electric Company (Meralco).
“This was basically driven by strong volume growth across the various operating units and the increased investment we have in the power sector… traffic has been strong in our domestic roads, we have contributions from overseas investments as well. And for Maynilad (Water Services, Inc.) we had both volume and tariff increases for inflation during the first half,” MPIC President and Chief Executive Officer Jose Ma. K. Lim said in a media briefing in Makati City on Thursday.
Meralco contributed 55% to MPIC’s net operating income, followed by toll roads at 21%, and water at 20%. The hospital group accounted for three percent, while the rail, logistics, and systems group accounted for one percent.
MPIC’s power business, through Meralco and Global Business Power Corp., increased its contribution to the parent by 10%. Meralco alone generated P150.5 billion in revenues, seven percent higher year-on-year on the back of higher energy sales and increased pass-through generation charges. Core net income accordingly grew by seven percent to P10.9 billion during the first half.
Global Power meanwhile increased its core profit by seven percent to P1.3 billion through its volume expansion.
Metro Pacific Tollways Corp. (MPTC) reported a 12% core profit increase to P2.1 billion. The toll roads operator benefited from the 57% increase in the number of systemwide vehicle entries to 924,364 on average per day, which was mainly due to the contribution of its recent investment in Indonesian firm PT Nusantara Infrastructure Tbk.
MPTC is the operator of the North Luzon Expressway, the Subic-Cavite-Tarlac Expressway, and the Cavite Expressway inside the Philippines. Overseas, it operates DMT in Bangkok, Thailand and CII B&R in Vietnam.
MPIC’s water business, which consists of Maynilad Water Services, Inc. and MetroPac Water Investments Corp., booked a P2.1 billion core profit for the period, with the former contributing bulk of the earnings. Volume of water sold in the west part of Metro Manila went up by three percent, mainly due to the higher temperatures experienced in the metro during summer time, leading to higher water usage.
Metro Pacific Hospital Holdings, Inc. saw a 12% increase in out-patient visits and 15% uptick in in-patient admissions, given its acquisition of Jesus Delgado Memorial Hospital in Quezon City and St. Elizabeth Hospital in General Santos City last year.
Meanwhile, its logistics firm MetroPac Movers, Inc. said it has yet to contribute to MPIC’s earnings during the period given that it is still pursuing several projects to expand its warehousing and distribution units.
MPIC spent P21.3 billion in capital expenditures during the first half of the year, excluding investments for acquisitions.
For the rest of 2018, MPIC continues to expect growth among its units. The company however noted the impact of the delay in tariff increases as well as right-of-way acquisition to its operations.
“Volume will remain strong. We need to work hard with the government to accelerate rights of way delivery so we can get construction started and funds deployed on our current tollways projects,” MPIC Chairman Manuel V. Pangilinan said in a statement.
“I remain optimistic that settlement will be reached at the end of the day. Uncertainty is felt by investors in our financial market and by counterparties unsure of such resolutions,” Mr. Pangilinan added.
MPIC is one of three key Philippine units of First Pacific, the others being Philex Mining Corp. and PLDT, Inc. Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has a majority stake in BusinessWorld through the Philippine Star Group, which it controls.
Shares in MPIC gained 3.09% or 15 centavos to close at P5 each at the stock exchange on Thursday.