First Gen income declines by 24%
LOPEZ-LED First Gen Corp. posted a recurring net income of $59 million in the first quarter, down by 24.4% from $78 million in the previous year, as its natural gas and geothermal energy platforms recorded lower operating profit.
In a media release on Monday, First Gen President and Chief Operating Officer Francis Giles B. Puno said the company generated more power in the first quarter compared with the same period last year, but its Avion gas-fired power plant and a geothermal unit Energy Development Corp. (EDC) were hit by unscheduled shutdowns.
“In EDC’s case, it led to high replacement power costs as Typhoon Odette debilitated transmission capacity despite the plants’ ability to produce power. EDC was able to wheel out its power by mid-January. As for the rest of the natural gas fleet, it was plagued by gas interruptions at the Malampaya field. This resulted in the importation of expensive liquid fuel,” Mr. Puno said.
In peso terms, the power generation company’s net income was down to P3 billion from P3.8 billion previously, using a weighted average rate of $1 to P50.938 for the period ended in March this year and $1:P48.12 in end-March 2021, the company said.
During the quarter, consolidated revenues from the sale of electricity rose by 18% to 570 million from $483 million.
First Gen said the revenue growth came from higher electricity sales that was supplemented by elevated fuel prices and wholesale electricity spot market prices. The natural gas portfolio accounted for 62% of total consolidated revenues, while EDC’s geothermal, wind, and solar revenues contributed 33%. The hydro plants made up 4% of the total.
Recurring earnings for the natural gas platform declined by 27% to $38 million. The 97-megawatt (MW) Avion power plant’s unit 1 was found to have incurred damage in December 2021, but was brought back to operations by February 2022 with a new turbine.
The 420-MW San Gabriel power plant recognized lower capacity fees due to its de-ration from gas supply restrictions.
“While all four natural gas fired plants benefited from greater electricity sales, higher fuel prices and operating expenses contributed to its lower earnings,” First Gen said.
Including non-recurring items, the gas platform’s attributable net income to parent decreased to $43 million from $57 million previously.
Mr. Puno said that to address the recurring gas issue, the importation of liquefied natural gas can happen by the fourth quarter of this year when First Gen’s LNG terminal operates.
Meanwhile, the EDC geothermal, wind, and solar platform suffered from outages, which was largely of Typhoon Odette. This led to transmission constraints and lower wind generation from Burgos wind farm.
EDC contributed both recurring and attributable earnings of $17 million, 38% lower than the previous year’s.
The hydro platform’s contribution doubled to $10 million from $5 million last year as the 132.8-MW Pantabangan-Masiway power plants generated higher operating income from its contract with Manila Electric Co. and merchant sales.
First Gen has 3,495 MW of installed capacity in its portfolio, which it said accounts for 19% of the country’s gross generation.
On Monday, shares in the company slipped by P0.55 or 2.66% to close at P20.10 each at the stock exchange. — Victor V. Saulon
