LOPEZ-OWNED Energy Development Corp. (EDC) said earnings in the first quarter rose 7 percent from year ago boosted mainly by higher energy sales from its Burgos wind project.
The country’s largest geothermal and wind energy company reported a consolidated recurring net income attributable to equity holders of the parent of P2.63 billion in the first quarter, up from the P2.46 billion posted during the same period last year.
Consolidated revenues amounted to P9.10 billion in the first three months, also up by 7 percent from the P8.50 billion recorded in the first quarter of 2015.
EDC said the improvement in its core income and revenues resulted primarily from higher energy sales reported by its Burgos Wind Project following the completion of the uprated Laoag-San Esteban transmission line last September 2015.
For the first quarter of 2016, Burgos Wind’s core income increased by P52 million following a P67 million increase in revenues.
EDC said revenue results for the balance of the portfolio were partially muted as some of the gains in sales volumes have been negated by lower spot prices.
The increased revenues from plants with largely contracted capacities—Burgos Wind, Unified Leyte and Palinpinon/Tongonan —were partly offset by lower reported revenues from plant capacities exposed to the spot markets such as the Bacman and Nasulo power plants.
EDC president and chief operating officer Richard Tantoco said the effects of low electricity spot prices, while significant, are being addressed by the company.
“We started deferring capex [capital expenditure]-intensive growth projects late in 2015 to instead re-focus investments on the existing asset base to boost overall output, reliability and cash generation. We are already seeing some of the gains come in,” Tantoco added.
Inclusive of non-recurring items, EDC’s consolidated net income attributable to equity holders of the parent stood at P3.25 billion, 31percent higher than the P2.49 billion recorded in 2015.
The company said the increase was primarily driven by higher revenues from Burgos Wind and higher foreign exchange gains amounting to P48 million following the realignment of US-dollar denominated loans, partly offset by higher plant operating expenses.
As of the first three months of 2016, EDC’s financial position remained strong with a cash balance of P17.85 billion.
The energy company maintained a comfortable gearing level with consolidated net debt to equity of 1.17 to 1 and consolidated net debt to earnings before interest, tax, depreciation and amortization (EBITDA) of 2.91 to 1.