AboitizPower posts P17.3B net income in 2019

AboitizPower earned ₱17.3 billion in net income for 2019, 20% lower compared to the ₱21.7 billion recorded in 2018.

The company recognized non-recurring gains of ₱702 million, versus 2018’s losses of ₱2.1 billion; due to net foreign exchange gains from the revaluation of dollar-denominated debts and derivatives, and former business unit Aseagas’ value-added tax recoveries and gains on land appraisal.

Without these one-off gains, AboitizPower’s core net income for 2019 was ₱16.6 billion, 30% lower than the ₱23.8 billion recorded in 2018. This was mostly due to the outages experienced during 2019, higher replacement power costs, lower spot market sales, increased interest expense, and increased depreciation expense.

“While market conditions had an effect on our 2019 financial result, we acknowledge that it was primarily driven by operational issues. Having done all the necessary measures to address these technical realities, we are positive about a much stronger operational performance and attaining our targets this year,” said Emmanuel V. Rubio, AboitizPower President and Chief Executive Officer.

“We are also confident that our incoming capacities from GNPower Dinginin and full-year operations of Therma Visayas and Hedcor Bukidnon will contribute to our 2020 bottom line,” Rubio added.

AboitizPower’s generation and retail supply business recorded earnings before interest, taxes, depreciation, and amortization (EBITDA) of ₱36.2 billion in 2019, 16% lower than the ₱43 billion recorded for 2018.

This was primarily due to the outages experienced by the company’s coal facilities during 2019 and exacerbated by the need to purchase replacement power at higher spot market prices. Replacement power was also purchased from the spot market as the company had contracted ahead in anticipation of TVI’s incoming capacity. Decreased spot market sales further eroded year-on-year earnings.

Capacity sold for 2019 increased by 1% to 3,184 megawatts (MW) from 3,154 MW in 2018.

AboitizPower’s distribution business recorded EBITDA of ₱8.2 billion, which was flat YoY.

The company saw energy sales increase in 2019 to 5,851 gigawatt-hours (GWh), 6% higher than the 5,540 GWh recorded in 2018. The increase in earnings, however, was mitigated by lost margins from the decommissioning of Davao Light’s Bajada power plant.