Manila Water sets 2016 capex at P15B


Ayala Corporation’s Manila Water Co. is allotting P15 billion for capital expenditures (capex) next year, partly to finance ventures overseas, a top company official said Wednesday.

Other than its service contract in Metro Manila’s East Zone, the utility also supplies water in Cebu, Laguna, Boracay, Clark, and Vietnam.

Manila Water Chief Financial Officer Luis Juan B. Oreta said the P15-billion budget for 2016 was “already funded” as the firm raised ¥40 billion (about P15.57 billion) on September 30 via a seven-year long-term loan facility from three international banks—The Bank of Tokyo-Mitsubishi UFJ Ltd., Mizuho Bank Ltd., and Sumitomo Mitsui Banking Corp.

Of the 2016 capex, P12 billion would be spent for the firm’s East Zone concession, Oreta said on the sidelines of the Financial Executives of the Philippines’ annual CFO Awards where he was named CFO of the year for 2015.

The East Zone area covers parts of Manila, San Juan, Taguig, Pateros, Antipolo, Taytay, Jala-Jala, Baras, Angono, San Mateo, Rodriquez, Marikina, Pasig, Mandaluyong, Makati and most of Quezon City.

Asked if the company is looking for more overseas venture, Oreta just said, “We continue to, but I’m not at liberty right now to discuss. We’re still in the early stages [of negotiations].”

Oreta declined to give further details, but said the project is “non-PPP” or not under the public-private partnership scheme of the government.

To date, the company has three overseas ventures, one in Indonesia and two in Vietnam.
In Indonesia, the firm’s Singaporean unit, Manila Water Pacific Pte. Ltd. (MWAP), is pursuing a demonstration project in Bandung City, West Java, Indonesia, with PDAM Tirtawening Kota Bandung.

MWAP’s ventures in Vietnam consist of acquisition of a 4.5-percent stake in Cu Chi Water Supply Sewerage Company Ltd. for around $7 million (about P328.58 million), and a 49-percent equity stake in Thu Duc Water B.O.O. Corp. and 47.35-percent interest in Kenh Dong Water Supply Joint Stock Company.

For the first nine months of 2015, Manila Water booked P4.606 billion net income, hardly moving from P4.549 billion the same time last year, owing to flat sales volume.

Manila Water was incorporated in 1997 to enter a concession deal with the government’s Metro Manila Waterways and Sewerage System to supply most of Metro Manila’s (East Zone) water needs.

The agreement was renewed in 2009, stretching it another 15 years to 2022.


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