First Gen raising P3 B from preferred shares

MANILA, Philippines — Lopez-led First Gen Corp. will issue P3-billion worth of new preferred shares to raise its authorized capital stock and provide increased financial flexibility for the company.

First Gen said its board approved the increase in its authorized capital stock from P8.6 billion to P11.6 billion.

The company said it will create 300 million Series “H” preferred shares with a par value of P10 per share.

The latest board approval superseded the March 12, 2015 board approval of raising the capital stock to P10.2 billion by creating 160 million Series “H” preferred shares with the same par value.

The proposal will require approval from stockholders and regulatory clearance from the Securities and Exchange Commission (SEC).

Last year, First Gen registered flat recurring net income of $163 million and lower net income of $134 million.

The company attributed last year’s performance to the one-time effect of break funding costs incurred as a result of a $500-million refinancing of the 1,000-megawatt (MW) Santa Rita power plant’s long-term debt in May.

It added that its hydroelectric platform also suffered from weak spot market prices while its geothermal plants in Leyte suffered from natural calamities that struck the province in July.

Moving forward, First Gen said it is gearing up its core business to strengthen its lead position in developing the country’s low-carbon energy future.

The company expects improved performance after closing power contracts for some of its assets, as well as higher spot market prices.

First Gen’s platform consists of four natural gas-fired power plants: the 1,000-megawatt (MW) Santa Rita, the 500-MW San Lorenzo,97-MW Avion peaking and 414-MW San Gabriel mid-merit gas power plants.

Its subsidiary FG Hydro owns and operates the 132-MW Pantabangan-Masiway hydroelectric power plant complex in Nueva Ecija.

Another subsidiary, EDC, owns and operates several geothermal power plants as well as a wind and solar power plant. It has 12 integrated geothermal power stations across Leyte, Bicol, Negros Island and North Cotabato, while its wind and solar farms are located in Burgos, Ilocos Norte.