Lopez-led renewable energy firm First Gen Corporation reported that its net income and revenue dropped in the first nine months of the year due to lower electricity sales and reduced geothermal revenue.

In a disclosure to the Philippine Stock Exchange on Tuesday, Nov. 12, First Gen reported that its attributable recurring net income was P11.6 billion, a 17 percent decline from P13.8 billion in the same period last year. Revenues for the first three quarters also decreased by two percent to P104.6 billion.

The company's geothermal subsidiary, Energy Development Corporation (EDC), also posted a decline in revenue and an increase in cash operating expenses.

Despite the performance of its geothermal business, First Gen registered higher profits from its natural gas operations and the Casecnan Hydroelectric Power Plant, which was turned over to the company last February.

The Casecnan hydroelectric plant generated approximately P651 million in net income during its first seven months of operations. This offset lower earnings from the 132 megawatt (MW) Pantabangan-Masiway power plants (PMHC), which fell from P305 million to P161 million.

PMHC earnings declined due to reduced electricity generation caused by lower water levels in reservoirs. Additionally, the price of electricity in the Wholesale Electricity Spot Market declined.

Meanwhile, the 420 MW San Gabriel Power Plant and the 1,000 MW Santa Rita Power Plant both generated higher operating income due to savings in operating expenses (OPEX) and high spot market prices for San Gabriel.

First Gen's natural gas portfolio, including the company’s liquefied natural gas (LNG) terminal, accounted for 65 percent of the firm’s total consolidated revenues, while 33 percent came from EDC’s geothermal, wind, and solar plants. The company's hydro business contributed the remaining revenue.

The LNG terminal also generated revenue from pre-commercial operations, including testing and startup phases, and terminal fees.

However, the 97 MW Avion Power Plant experienced a decline in net income due to lower kilowatt-hour sales and higher OPEX.

For the first nine months of 2024, EDC’s recurring earnings decreased by 43 percent to P3.3 billion, compared to P5.7 billion in 2023.

“The geothermal power plants under EDC generated lower sales and operating income due to a reduction in electricity prices and electricity sold, and higher OPEX from steamfield maintenance and workover activities. The unit also incurred higher interest expenses from new debt,” First Gen explained.

The hydro platform’s recurring earnings were P800 million for the first three quarters of 2024.

Francis Giles Puno, First Gen president and chief operating officer, explained that the earnings performance was impacted by lower electricity volumes from Leyte due to unexpected power disruptions.

“Though EDC's net income is lower compared to last year's, it is generally in line with what we were forecasting this year. For the first nine months of 2024, there were lower volumes from Leyte due in part to unplanned outages and from our Burgos wind farm due to weaker wind,” he said. “There were also considerable expenses related to our massive drilling program.”

Puno believes that earnings will rebound next year through geothermal project developments.

“We see additional baseload renewable energy to come in from our ongoing 40-well drilling program and from the 83 MW of additional geothermal plants that we are commissioning currently,” he added.