MPIC first half profit surges 47 times

MANILA, Philippines - Metro Pacific Investments Corp. (MPIC), the local flagship of Hong Kong-based conglomerate First Pacific Co. Ltd. reported a core net income of P716 million in the first half of the year, more than 47 times the P15 million recorded the same period last year on the continued robust performance of its water, tollways and healthcare units.

Given the company’s strong financial performance, MPIC chairman Manuel V. Pangilinan said the group is upgrading its core income target for the year to P1.5 billion from the earlier projection of P1.2 billion.

 “As the first half results towards 2009 yielded higher revenues across all of MPIC’s businesses, the group’s strong financial position raised our level of confidence and prospect for our latest guidance number. We have not factored into this guidance number any impact of a possible investment in Meralco during the year,” said Pangilinan in a disclosure to the Philippine Stock Exchange (PSE).

MPIC said its reported net income, which included net non-recurring gains, grew five fold to P1.7 billion compared with a restated net profit of P339 million.

The 2008 numbers have been restated to reflect the deconsolidation of Landco Pacific Corp. as well as the adoption of International Financial Reporting Standards 12.

Maynilad Water Services Inc. posted a net profit of P2.31 billion, contributing P423 million to MPIC’s core net income while Metro Pacific Tollways Corp. posted in a net income of P608 million.

The Hospital Group, on the other hand, recorded a net income of P243 million, contributing P76 million to MPIC.

“Optimal overall performance, internal controls and system efficiencies have sustained the growth of Maynilad, Metro Pacific Tollways and the hospital group for the first half of 2009. This demonstrates that even in a challenging economic environment, the group’s strong operating income stream, proactive management and prudent measures will continue to exceed expectations and contribute higher margins to MPIC,” said Jose Ma. K. Lim, president and chief executive officer of MPIC.

During the period under review, Maynilad’s year-to-date NRW (non-revenue water) improved to 60.92 percent from 65.51 percent a year earlier. Billed services rose 7.2 percent to 777,160 accounts due to the 11.9 percent increase in billed volume coupled with an average effective tariff increase of around 10.8 percent.

The approved tariff increase for the year was composed of a 12.2 percent CPI or inflationary increase implemented on Feb. 20, 2009, and a rate rebasing increase of 22.6 percent effective May 4, 2009.

MPIC reported a core income of P636.4 million or an increase of six percent from P600.5 million a year earlier due to the higher than expected traffic reported by Manila North Tollways Corp. (MNTC) and the higher contribution of Tollways Management Corp.

MNTC holds the concession to operate and maintain the North Luzon Expressway (NLEX) and is owned 67.1 percent by MPTC. TMC operates the NLEX for MNTC and has an interim agreement to operate and maintain SCTEX, TMC is owned 46 percent by MPTC.