First Gen profit up 11% on strong power sales

FIRST Gen Corp. recorded an 11% increase in its first-half recurring net income attributable to equity holders to P7.1 billion carried by stronger electricity sales and prices.

The Lopez group’s power generation said in a stock exchange disclosure on Friday that its consolidated revenues from the sale of electricity in the first half rose 12% to P50.8 billion.

Francis Giles B. Puno, First Gen president and chief operating officer, said power demand returned to pre-pandemic levels amid the limitations caused by the slow recovery of the economy.

He added that brownouts experienced in the second quarter have shown the importance of keeping the company’s portfolio properly maintained and operational.

“We are steadily progressing with constructing the country’s first liquefied natural gas (LNG) terminal for delivery in fourth quarter of 2022. We are also working to deliver more power projects across our portfolio despite the uncertainty surrounding the market and its accompanying business risks,” Mr. Puno said.

In its disclosure, First Gen said its natural gas portfolio accounted for 58% of total consolidated revenues. The geothermal, wind, and solar revenues of subsidiary Energy Development Corp. (EDC) accounted for 36%, while the hydro plants accounted for 5%.

First Gen said its natural gas platform posted a P5.2-billion attributable net income for the first half, higher than the P4.5 billion net income posted in 2020.

“The 97-megawatt (MW) Avion power plant enjoyed higher electricity sales as it supplied the grid with supplemental power during constraint periods while the other natural gas-fired plants reaped the benefits of lower income tax rates under Republic Act No. 11534 or the Corporate Recovery and Tax Incentives for Enterprises Act (CREATE) law,” the company said.

“These were slightly offset by the 420 MW San Gabriel power plant’s lower generation due to repair work that was completed in the first quarter of the year,” it added.

First Gen said the attributable net income of EDC for the period barely changed at P2.2 billion.

However, EDC’s recurring attributable earnings from its geothermal, wind, and solar platform dropped 3% to P2.3 billion.

“EDC incurred higher power plant and steam field maintenance expenses and foreign exchange losses in the first half. These were offset by lower interest expenses and income taxes,” the company said.

First Gen’s hydro platform posted an increase in its attributable earnings during the first half to P300 million from P200 million in the same period last year.

“The 132.8 MW Pantabangan-Masiway power plants generated higher revenues due to the commencement of its contract with the Manila Electric Co. (Meralco) that was augmented by merchant sales,” the company said.

On Friday, shares of First Gen at the stock exchange fell 4.24% or P1.15 to end at P26 apiece. — Revin Mikhael D. Ochave

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