Manila Water inks P5 billion loans

MANILA, Philippines — Ayala-led Manila Water Co. Inc. has secured P5 billion in loans to help finance its capital investment program in the east zone.

In a regulatory filing, Manila Water said it signed a P5-billion five-year revolving term loan facility with BDO Unibank Inc.

The loan will be used to finance Manila Water’s capital expenditure projects and its general corporate requirements.

It will also be for refinancing the water firm’s existing concessionaire loans.

Under the rate rebasing 2018 approved business plan, the company is programmed to implement capital expenditure projects amounting to P79.4 billion until 2022.

Last September, the Metropolitan Waterworks and Sewerage System has approved the upward adjustment for its mandatory rate rebasing.

The MWSS board of trustees approved the recommendation of the MWSS-Regulatory Office for Manila Water’s increase of P1.46 per cubic meter starting Oct. 16, 2018.

The P1.46 per cubic meter increase is a portion of the total P6.22 to P6.50 per cubic meter increase to be staggered in the next four years as part of the mandatory five-year rate rebasing for the concessionaires.

With the board approval, Manila Water customers will see a P1.46 per cubic meter increase starting mid-October, another P2 each for 2020 and 2021 and another P0.76 to P1.04 per cubic meter by 2022.

The recent supply shortage in the east zone continued to take a toll on Manila Water as its net income fell 11 percent to P4.4 billion amid higher costs and expenses coupled with government penalties.

It chalked up a net income of P4.4 billion in January to September, down 11 percent year on year.

The lower bottomline was mainly due to the impact of the water supply shortage despite revenues improving 10 percent to P16.1 billion, driven largely by the higher contribution of the domestic businesses outside the east zone.