MPIC core earnings up 17% in 2017

MANILA, Philippines — Metro Pacific Investments Corp.(MPIC), the infrastructure and tollways conglomerate chaired by Manuel V. Pangilinan, reported a 17 percent growth in core net income last year.

“Overall, it was a good year notwithstanding the tariff issues,” MPIC president and CEO Jose Ma. Lim said in a briefing yesterday.

The company’s core net income grew to P14.1 billion last year from P12.1 billion in 2016 on the strength of its increased presence in power and growth in the hospital group.    It raised its economic interest in Manila Electric Co. to 45.5 percent from 41.2 percent previously.

In terms of contribution to the company’s net operating income, the power business accounted for P9.4 billion or 52 percent of the total, tollroads (P3.9 billion or 22 percent), water (P3.7 billion or 21 percent), hospitals (P685 million or four percent), and the rail and logistics (P150 million or one percent).

MPIC posted a consolidated reported net income of P13.2 billion, up 15 percent from 2016.

“MPIC’s group-wide capital expenditure in 2017 was P38 billion, all of it contributing to the fabric of our nation and enhancing our capacity to serve the public. In addition, we invested P38.9 billion in deepening our participation in the power sector,” Lim said.

Lim, however, pointed out Maynilad’s five-year struggle to obtain contractual water tariffs against regulatory delay.

“I had thought we were close to resolution of most of our regulatory issues. However, the late and unexpected appeal by government to vacate the award Maynilad received months ago in the Singapore arbitration is, I am advised, without merit, and it may take up to six months to work this through,” he said.

For power, MPIC is committed to providing reliable and economic power generation throughout the Philippines.

“Coal, even with the clean coal technologies we are committed to, may not be popular with certain segments of society but remains for the time being the most efficient way to supply the essential base load to provide stable power to homes and businesses throughout the country,” Lim said.

The conglomerate’s power distribution arm Meralco posted a three percent growth in core net income to P20.2 billion.

Global Business Power, meanwhile, reported a one percent increase in core net icome to P2.9 billion.

Metro Pacific Tollways Corp. recorded a 20 percent jump in core net income to P3.9 billion.

MPTC will spend approximately P122.8 billion in the next five years to build highways and tollroads around the Philippines.

The amount of investment is an estimate that assumes the satisfactory resolution of various overdue tariff adjustments, now ranging between 20 percent and 48 percent on different parts of the network.

The water businesses under Maynilad and MetroPac Water Investments Corp. likewise performed well.

Maynilad’s core net income increased three percent to P7.4 billion due to tight control of operating expenses.

 Metro Pacific Hospital Holdings Inc., meanwhile, saw aggregate core net income surge by 17 percent to P2 billion, due to the contribution from new hospital acquisitions and organic growth driven by lower interest expense, cost savings from purchasing synergies and increasing patient numbers.

As of the end of December last year, MPHHI has grown to 14 hospitals with approximately 3,300 beds – eight hospitals in Metro Manila and six around the country such as in Bulacan, Tarlac, Bacolod, Davao, Zamboanga, and General Santos.

Pangilinan said the company continues with its mission to build and operate well run and needed infrastructure, offering good value for the public.

“We are doing our best to support the Build Build Build agenda of the government. However, our investors (many of whom are hard working Filipino savers and pensioners by the way) and our creditors need confidence that our various concession and franchise agreements will be observed,” he said, noting the need to resolve tariff issues as soon as possible.