MPIC income surges 76% to P5B

MANILA, Philippines - Infrastructure conglomerate Metro Pacific Investments Corp. (MPIC) reported a 76-percent surge in net income last year to P5.06 billion, driven by the robust performance of its power distribution, water utility and hospital businesses.

In a briefing yesterday, MPIC president Jose Ma. K. Lim said their core net income – which strips out derivatives and mark-to-market gains – grew 32 percent to P5.1 billion from P3.86 billion a year ago while operating revenues rose 18.9 percent to P22.07 billion.

MPIC chairman Manuel V. Pangilinan said the company’s units had a strong start and are in a good position to deliver another year of earnings growth this year amid a more favorable economic environment. “The economy appears to be stronger than anticipated. I think 2012 will definitely be better than 2011,” he said.

“Our positive results for 2011 reflected continuing strong operating efficiencies and focused customer service. Operating companies under our portfolio reported an aggregate core net income of P22.94 billion with core EBITDA standing at P42 billion,” Pangilinan said.

Maynilad Water Services Inc. contributed P3.1 billion, accounting for 48 percent of MPIC’s total core net income while Manila Electric Co. (Meralco) chipped in P1.69 billion or 26 percent. Tollways unit Metro Pacific Tollways Corp. contributed P1.46 billion or 22 percent of core earnings while the hospital group pumped in P250 million or four percent.

Aggregate core net income for the healthcare group climbed 17 percent to P560 million.

To ensure the group’s continued profitability, MPIC will pursue the expansion of its businesses with a total of P23.3 billion earmarked for its capital expenditures this year. Bulk of spending, or P12 billion, will go to Meralco while Maynilad will get P8.4 billion. MPTC, on the other hand, will get P1.1 billion while the hospitals will account for P1.8 billion. Around P75 million has been set aside for the head office.

“The equity-raising we undertook last July has been partly deployed into our investments in Asian Hospital and Meralco, and we are well placed to fund further investments from our existing capital base,” Lim said.

Pangilinan said Meralco is aiming to enter the power generation and retail electricity supply businesses when the open access scheme become effective later this year. It has formed a joint venture with Aboitiz Power and Taiwan Cogeneration to develop an aggregate 600-megawatt coal-fired base load plant in Subic, Zambales. The first 300-MW line is expected to be commissioned in the second half of 2015 followed by the remaining 300-MW six months later.

Lim said the group is keen on bidding for airport and toll road projects to be bid out by the government, which include the Mactan Cebu and and Clark international airports as well as the CALA expressway and LRT Line 1 south extension.

For the hospitals business, the group has set its sight on six medical institutions that may be included in the government’s Public-Private Partnership (PPP) program. Among these are the Philippine Orthopedic Center, Heart Center, National Kidney Institute, Philippine General Hospital, Lung Center, and Children’s Medical Center.

The group currently owns or controls four hospitals in Metro Manila – the upscale Alabang-based Asian Hospital, Makati Medical Center Cardinal Santos Medical Center in San Juan and Our Lady of Lourdes Hospital in Sta Mesa, Manila. It also has investments in Riverside Medical Center in Bacolod and Davao Doctors Hospital.

For Maynilad, billed volume is seen to rise 8.6 percent this year as it continues to improve its services to the public. The company now delivers 24-hour water supply to 84 percent of its customers while 96 percent of its customers also enjoy water pressure of at least seven pounds per square inch.

Given its strong 2011 results, MPIC has declared a final cash dividend of P0.015 per common share, bringing total dividends for the full year to P0.025 per share.

Lim said the company aims to gradually increase the dividend payout ratio toward 25 percent of core net income in the years to 2015.