Meralco braces for slower sales growth

MANILA, Philippines — Manila Electric Co. (Meralco) is expecting tamer sales growth this year compared to last year on generally cooler temperature, its top official said yesterday.

In a briefing after the company’s stockholders’ meeting, Meralco president Oscar Reyes said the power distributor saw strong sales growth in the first quarter, but the trend was not sustained going into the second quarter.

“We had a very strong first quarter. We grew about 9.2 percent compared to the first quarter of 2017,” he said. “However, April and May are trending lower. For April 2018 against 2017, growth was in the order of about 3.6 percent.”

In the first quarter, sales volume rose nine percent to 10,145 gigawatt-hours (gwh), driven by increased consumption from existing customers and new customers as well as higher temperature during the period,

Meralco’s customer count increased by nearly five percent to 6.4 million during the period.

At the start of the second quarter, Reyes said April was cooler by half a degree centigrade, which is unusual during summer months.

Meanwhile, Meralco is projecting to close the month of May with a 4.5 percent increase in energy sales, he said.

This would pull down sales growth to 7.5 percent year-to-date, the Meralco official said.

For the full year, Meralco officials have declined to give out guidance for sales and profit.

“We have not yet set a guidance. I think we’d like to see how June (will fare). It’s rather volatile,” Reyes said.

“The way it is trending, we may be around not too far from what we saw last year. Last year over 2016, it is about 4.9 percent. So for this year, call it about 4.5 percent,” he said.

Last year, Meralco’s consolidated energy sales volume expanded by five percent to 42,102 gwh, translating to a five-year compounded annual growth rate of five percent.

This placed the company’s core net income higher by three percent from P19.6 billion in 2016 to P20.2 billion last year and reported net income up by six percent from P19.2 billion to P20.4 billion.