The profitability of Lopez-led First Gen Corporation has improved by 11 percent to P10.3 billion ($212 million) in nine months this year from P9.9 billion ($196 million) within the same period in 2020.
The company said it “benefited from higher electricity sales,” and among its income driver is its 97-megawatt Avion gas-fired power plant, because that generating asset robustly supplied the grid during ‘constraint periods’ — primarily in the summer months. That was in spite of the fact that one of its generating units sustained damage as uncovered during a routine inspection in August and the repair was just completed last month.
Other contributing factors to First Gen’s income growth had been lower interest expenses and taxes due to the enforcement of the Corporate Recovery and Tax Incentives for Enterprises (CREATE) law, according to the company.
On the whole, revenues from sale of electricity within the nine-month stretch had been higher by 18-percent to P78.1 billion from P68.6 billion at the duration of last year’s three quarters.
First Gen President and COO Francis Giles B. Puno emphasized that “our clean and renewable energy platforms generated higher revenues for the nine months of 2021 as power demand recovered to pre-pandemic levels.”
He similarly noted that “revenue growth reflected the higher fuel commodity prices experienced all over the world,” with him adding that “we witnessed our gas-fired plants increasingly running on liquid fuel due to gas supply restrictions from the Malampaya field.”
Given such dilemma on skyrocketing fuel prices, Puno indicated “we expect to address this volatility and uncertainty once our LNG (liquefied natural gas) import terminal operates in the last quarter of next year.”
In particular, First Gen’s gas platform yielded 20-percent hike in recurring earnings within January to September this 2021 to P7.9 billion ($163 million) from the prior year’s level of P6.8 billion ($135 million).
The Lopez firm specified that while its older plants – 1,000MW San Rita and 500MW San Lorenzo gas-fed generating facilities had been levied with lower taxes under the CREATE Act, that was partially offset by higher taxes paid by its 414MW San Gabriel plant, as that project’s income tax holiday (ITH) already lapsed in March last year.
By far, the attributable net income of First Gen’s gas platform climbed to P7.7 billion ($159 million) in this year’s nine-month period from P6.9 billion ($137 million) in a parallel period in 2020.
For subsidiary Energy Development Corporation (EDC), it chipped in recurring earnings of P3.0 billion from operations’ outcome of its geothermal, wind and solar platforms, although that was 6 percent lower from last year’s P3.3 billion.
On the hydro assets of First Gen, this contributed P300 million in the group’s earnings, an escalation from the year-ago level of P200 million; and considered as income driver is its 132.8MW Pantabangan-Masiway hydro facility.