Manila Water sets P30-B capex for 2016-17

MANILA, Philippines - Ayala-led Manila Water Company Inc., the water concessionaire for Metro Manila’s east zone, has allocated an estimated P30 billion capital expenditures for the next two years as it commences a “catch up year” in 2016, a ranking official said.

In an interview with The STAR, Manila Water chief finance officer Luis Juan Oreta said the company has set aside P15 billion for its 2016 capex and “very likely the same amount” for 2017.

Of the P15 billion, P12 billion would be set aside for the east zone and P3 billion for non east zone project.

“This year, we’ve finally settled our differences with MWSS so next year is a catch up year. Previously, we had no approved plans because we were in dispute with MWSS,” Oreta said.

The MWSS slashed by 29.47 percent the East Zone water concessionaire’s basic charge of P25.07 per cubic meter, a reduction of P7.25 per cubic meter for the rate rebasing period of 2013 to 2017.

This prompted Manila Water to dispute the rate reduction before the International Chamber of Commerce (ICC).

However, ICC slashed Manila Water’s basic water charge by 11. 05 percent, equivalent to a decrease of P2.77 per cubic meter. A reduction of P1.66 per cubic meter would be implemented in 2015, then P0.55 per cubic meter in 2016 and finally P0.55 per cubic meter in 2017, according to the ICC.

Oreta said the dispute stalled the company’s projects thus 2016 would now be a catch up year.

For overseas projects, the company is looking at doing projects in Southeast Asian countries such as Myanmar and Indonesia. It is also looking to expand its existing presence in Vietnam.

“In Indonesia, we’re looking for opportunities. In Myanmar, we have a demonstration project there. We’re finalizing the structure,” he said.

In the nine months to September, the company posted a net income of P4.60 billion, up from P4.54 billion in the same period last year.

The company said revenues grew four percent in the nine-month period to P12.69 billion from P12.20 billion a year earlier.

Total billed volume in all units, meanwhile, grew two percent to 515.3 million cubic meters from 503.8 million mcm last year year.