First Gen 2016 net income climbs 19% to $200M

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LOPEZ-LED First Gen Corp. (First Gen) reported on Thursday the company ended 2016 with $200 million in net income attributable to the parent, up 19 percent or $32 million from $167.3 million posted the previous year.

In a disclosure to the Philippine Stock Exchange (PSE), the energy company said consolidated revenues from the sale of electricity decreased to $1.56 billion for 2016 compared to $1.84 billion in 2015.

First Gen said its newest natural gas-fired power plant, the 414-megawatt (MW) San Gabriel Flex Plant, and Energy Development Corporation’s (EDC) 140-MW BacMan geothermal plant, booked non-recurring income in 2016.

“Though 2016 was a year not without its challenges, it was also the year First Gen achieved its highest net income. We are optimistic that this trend will continue with the addition of our two newest natural gas–fired plants—the 414 MW San Gabriel Flex Plant and the 97 MW Avion Peaking Plant—that will deliver full year operations this year, alongside marked improvements in the operations of EDC’s 100% renewable portfolio,” First Gen President and COO Francis Giles B. Puno said.

First Gen said the 1,000-megawatt (MW) Santa Rita and the 500-MW San Lorenzo natural gas-fired power plants accounted for $827 million or 53 percent of total consolidated revenues.

“Their revenues were 23 percent lower in comparison to their contribution of US$1.08 billion in 2015 mainly due to lower fuel pass-through prices, worsened by the lower combined dispatch of the gas plants at 75 percent in 2016 versus 81 percent in 2015,” it said.

To supplement Santa Rita and San Lorenzo’s earnings, San Gabriel recorded $36 million of income from delay liquidated damages that was partially offset by expenses, while the 97 MW Avion Peaking Plant generated commissioning income in 2016, the company said.

First Gen said the earnings contribution from the natural gas portfolio increased by $21 million to $142 million in 2016.

EDC’s geothermal, wind and solar revenues accounted for $676 million, or 43 percent of total consolidated revenues. From $717 million in 2015, EDC’s revenues declined by $41 million mainly due to an unfavorable effect of foreign exchange translation.

Meanwhile, it said the 132 MW Pantabangan-Masiway hydroelectric plants’ revenues were 16 percent better at $48 million, or 3 percent of total consolidated revenues. FG Hydro showed a growth in revenues of $7 million for 2016 versus 2015’s $42 million due to the higher dispatch of its power plants and higher ancillary service sales. Consequently, the attributable earnings contribution of FG Hydro was higher by $5 million, or 60 percent at $14 million.

On a recurring basis, First Gen’s attributable net income for 2016 was flat at $162 million. “As most of the platforms’ power plants in the portfolio benefited from higher dispatch, these were offset by lower spot market prices,” it said. These likewise offset the gains made from cost-containment initiatives, it added.

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