AboitizPower ups income by 15% to P12.2-B

PROPELLED by higher demand for power, particularly in the Luzon area, AboitizPower, a subsidiary of Aboitiz Equity Ventures (AEV), reported on Monday a net income of P12.2 billion for the first half of 2012, representing a 15 percent growth as compared to the same period in the previous year.

In a disclosure to Philippine Stocks Exchange, AboitizPower claimed to have contributed 89 percent of AEV's earnings from January to June, with P11.3 billion, 12 percent higher than last year.

AEV is listed in PSE in 1994 as the public-held holding company of the Aboitiz Family. AboitizPower, on the other hand, is the holding company for the Aboitiz Group's investments in power generation, distribution, retail and power services.

In Mindanao, AboitizPower recently announced the signing of US$546-million worth of contracts to the builders of its 300-megawatt (MW) clean coal power plant to be set up at the boundary of Davao City and Sta. Cruz town in Davao del Sur.

Another subsidiary Hedcor also broke ground for the construction of the P1 billion, 7-MW Tudaya 2 run-of-river hydro power plant.

"We remain committed to build the right mix of generating assets in our portfolio that are competitive, diversified and have the least possible effect on our environment. We aim to do this through a combination of traditional sources of power and renewable wherever feasible," AboitizPower president and CEO Erramon Aboitiz said.

In a press statement, AboitizPower disclosed that hotter climate, particularly in Luzon, was one of the factors that led to the increase in the demand for power. The company’s average price for its power increased by seven percent year-on-year during the first half of 2012 propelled primarily by growth-driven demand.

This affected the 42 percent year-on-year rise in average selling prices at the Luzon Grid's Wholesale Electricity Spot Market (WESM) which was also affected by power curtailments in Luzon.
Growth in the Luzon grid also meant more demand for power, as the island's peak demand rose by 5 percent to 7,800 MW.

By the end of June 2012, AboitizPower’' attributable net generation grew by 10 percent compared to last year 4,640 GWh to 5,096 GWh.

On a capacity basis, AboitizPower's attributable sales increased by 13 percent year-on-year, from 1,351 MW to 1,532 MW, given the rising capacity sales through bilateral contracts and improved levels of ancillary services.

The completion of the rehabilitation of the Ambuklao (all three units) and Binga (one of four units) hydropower plants, coupled with the commercial operation of the 4-MW Irisan Greenfield hydropower plant, resulted to a marginal increase in AboitizPower's attributable capacity to 2,350 MW as of the end of June 2012.

AboitizPower's attributable electricity sales for the quarter ending June 2012 was at 999 GWh, an 8 percent improvement from last year's 925 GWh.

Growth was mainly accounted for by the strong showing of the industrial segment, which posted a year-on-year increase of 10 percent. Gross margin on a group-wide basis improved by 12 percent year-on-year, as the approved rates under the PBR scheme were implemented.

"“Across our distribution utilities, our focus remains anchored on two principles: firstly, to improve customer service and at the same time lower costs by improving efficiencies and productivity; and secondly, to keep our networks updated at all times and ready to handle growth in the franchises we serve," Aboitiz said.

As of June 30, AboitizPower's total consolidated assets amounted to P157.6 billion, 3 percent higher than year-end 2011's level of P153.5 billion.