First Gen’s net income climbed 34% to P15.4 billion in 2019

Mar 19, 2020

First Gen Corp., the Lopez Group’s power generation company, said net income attributable to equity holders climbed 34 percent in 2019 to P15.4 billion ($296 million) from P11.6 billion ($221 million) in 2018 on higher electricity sales of clean fuel platforms, foreign exchange gains, lower interest expense and benefits from deferred income taxes.

It said recurring net income attributable to equity holders also increased 17 percent last year to P14.8 billion ($284 million) from P12.7 billion ($242 million) in 2018.

“Our steady financial results for 2019 [we hope] demonstrate to our shareholders that our strategy to catalyze the country’s movement towards a decarbonized future is feasible and continues to pay off. We will continue to focus on advancing decarbonization by constructing the country’s first liquefied natural gas delivery terminal. This will be completed before our contract from the Malampaya natural gas field expires in 2024, and provide for the continuing reliable operations and expansion of our gas-fired power plants,” First Gen president and chief operating officer Francis Giles Puno said in a statement.

First Gen operates 3,492 megawatts of clean low carbon and renewable portfolio.

“First Gen will play a catalyzing role to unlock the use of clean, low-carbon natural gas for the power and other industries in the Philippines. This will certainly complement the feasibility for more variable renewable energy projects throughout the Philippine archipelago,” Puno said.
First Gen said its natural gas-fired power plants delivered increased recurring earnings for the year.

The two newer gas plants—the 420-MW San Gabriel and 97 MW Avion—generated higher electricity sales from their respective customers. Avion provided a larger increase in earnings as the merchant plant enjoyed higher dispatch and higher selling prices in 2019.

The two older plants—the 1,000 MW Santa Rita and 500 MW San Lorenzo—performed steadily.

The gas platform generated P10.1 billion recurring attributable net income to parent in 2019, up 5 percent from P9.7 billion ($186 million) in 2018.

Energy Development Corp. contributed recurring earnings from its geothermal, wind and solar platform of P5.1 billion ($98 million) in 2019, higher by P1.2 billion ($24 million) from P3.9 billion ($74 million) in 2018.

First Gen said most of EDC’s geothermal plants performed better because of lower outages and higher average selling prices, particularly in the Wholesale Electricity Spot Market (WESM), the country’s trading floor of electricity.

Its hydro platform outperformed with a recurring earnings contribution higher by 118 percent at P700 million ($13 million) for 2019 from P300 million ($6 million) in 2018.

First Gen’s consolidated revenues from the sale of electricity increased by 8 percent to P111.8 billion ($2.151 billion) from P103.8 billion ($1.979 billion) in 2018.

The natural gas portfolio accounted for 62 percent of First Gen’s total consolidated revenues.

Revenues from natural gas went up 8 percent in 2019 on higher average natural gas prices coupled with improved plant dispatch.