Utilities fuel Metro Pacific surge in Q1

MANILA, Philippines — Conglomerate Metro Pacific Investments Corp.’s bottom line surged in the first quarter as its power generation and water concession businesses reaped the benefits of a reopened domestic economy.

In a disclosure sent to the Philippine Stock Exchange on Wednesday, the Pangilinan-led company posted a consolidated core net income of P4.3 billion in the January-March period, advancing 38% year-on-year. 

Disclosure broken showed that its power generation business accounted for 75% of the MPI’s net operating income. This segment consists of Meralco, the country’s largest power distributor, which saw total revenues jump 23% on-year to P105.6 billion in the first quarter. 

Its toll roads segment, consisting of a network of toll around the country and in Southeast Asia, pitched P1.3 billion to its net operating income in the first quarter. Higher traffic volumes and toll increases in the Philippines and in Indonesia fattened its toll revenues by 32% on-year to P6.4 billion in the same period.

Its water business, topbilled by Maynilad Water Services, saw revenues soar 18% on-year to P6.2 billion in the first quarter. Commercial demand rose 16% during the same period. 

MPI’s public transport segment, Light Rail Manila Corp, posted revenues that skyrocketed 73% to P595 million in the first quarter. Despite this, it posted a core net loss that was 53% lower at P83 million due to amortization and higher borrowing costs.

“Our strong performance for the first quarter reflects significant volume increases for our power, toll roads, water and healthcare businesses, bolstered by favorable tariff adjustments and savings resulting from operational efficiencies,” said MPI chairman, president, and CEO Manuel V. Pangilinan. 

Delisting concerns

That said, the conglomerate announced in April plans of going private as they looked to voluntary delist from the local bourse. To this end, the move reflected concerns of the conglomerate’s share price.

“Regarding our application for voluntary delisting, the Company’s Board of Directors and senior management echo the Bidders’ observation that the intrinsic value of MPIC’s core investments in infrastructure in the Philippines has not been fully reflected in MPIC’s share price for some time,” Pangilinan said.

Pangilinan noted the tender offer and voluntary delisting from the PSE will allow the conglomerate’s minority shareholders to rake in premiums over the historical share prices of the company. 

“This also potentially paves the way for finally unlocking the value of MPIC’s core businesses through individual IPOs, which could ultimately benefit shareholders,” he added.

Shares in MPI closed trading Tuesday up 0.23% at P4.42 apiece. — Ramon Royandoyan