Manila Water posts 25% profit hike to P1.2B in first half

Manila Water Co., the water distribution unit of the Ayala group of companies, posted a strong 25-percent increase in its net income during the first six months at P1.233 billion, from P986 million in the same period last year.

"Our financial results were buoyed by improved water sales, an increase in customer base and continued operating gains," said Manila Water president Antonino T. Aquino.

From January to June, Manila Water’s revenues totaled P3.213 billion, up 12 percent from P2.857 billion last year,

Aquino said with better revenues and net income, the company will be investing an average of P4.5 billion this year and in 2007 for several programmed projects.

"For this year alone, P4.5 billion has been allocated for expansion projects in the high growth areas of Taguig, Antipolo, Taytay, Cainta, San Mateo, Montalban, Angono, Binangonan, Baras and Jala-Jala. We are also increasing our investments in wastewater treatment which we expect to be a major revenue earner for the company in the coming years. At the same time, we will pursue growth opportunities beyond our concession area where water and wastewater services are badly needed," said Aquino.

By the fourth quarter this year, Aquino said Manila Water expects to complete its water expansion projects in Antipolo, San Mateo, San Juan, Mandaluyong, Rodriguez and Baras wellfields.

Aquino also attributed the company’s continuous strong financial results to its recovery of its non-revenue water, or system losses, to 30.2 percent as of end-June from 63 percent since the company first took over the East Zone concession in 1997. The utility said its current non-revenue water level is comparable to that of Bangkok and Kuala Lumpur.

Consequently, billed volume has more than doubled to 933 million liters per day, from only 440 million when the company started operations nine years ago.

With increased water supply, Manila Water said it is now servicing an additional two million people within its concession area, raising its customers to over five million.

Aquino said the company has also formally submitted its bid for the government’s 84-percent stake in Maynilad Water Services Inc., the other provider of water supply and sewage service in the Philippine capital.

The government is seeking a minimum of $56.4 million for the stake. The bidding is scheduled on Oct. 24. A winner is expected to be named by December.

Sherisa P. Nuesa, chief finance officer of Manila Water, said the company, which expects to bag the Cebu bulk water supply project, will also be exploring investment opportunities in offshore markets.