Meralco net income plunges 51% to P465.2-M in 1st half

The Manila Electric Co. (Meralco) reported yesterday a 51.2-percent drop in its net income for the first half of 2002 to P465.24 million, from P952.99 million in the same period last year.

Last week, Meralco head of financing, planning and control Antonio Varela said the earnings of the power distribution firm would likely drop by more than 50 percent in the first two quarters of 2002 due to lower revenues for the period and the absence of rate adjustment up to now.

The company attributed the decline mainly to lower sales. For the first six months this year, Meralco sold 10.95 million kilowatthours (kwh) compared to 11.16 million kwh in the same period in 2001, or a decline of 2.2 percent.

For the first six months of the year, the company’s operating revenues stood at P60.66 billion from 2001’s P64.83 billion or a drop of 6.3 percent.

The power distribution utility’s net income for the second quarter alone went down by 3.7 percent, from P558.6 million in 2001 to P538 million in 2002, due to decreased margins arising from delays in obtaining a rate adjustment, and a 109-percent decline in equity in net earnings of investee companies.

Meralco had a pending rate increase application of 30 centavos per kwh before the Energy Regulatory Commission (ERC) since April 2000.

Earnings per share for the second quarter decreased by 5.6 percent from P0.84 in 2001 and to P0.79 this year.

Although systems loss was higher at 12.14 percent for the six months ended June 30, 2002, versus 11.23 percent last year, the expenses related to this declined for the second quarter 2002 because of lower purchased power cost.

Total capital expenditures for the second quarter of 2002 amounted to P1.62 billion and P2.77 billion for the first semester of 2002.

About 95 percent or P2.62 percent of year-to-date capex was spent for electric system projects while the balance of P148 million was utilized for non-electric projects and other capitalized items.

A total of 68,319 new customers were added to Meralco’s customer base as of end-June 2002, bringing the total number of customers to 3,873,436. This represents an increase of 1.8 percent from the Dec. 31, 2001 count of 3,805,117.