MANILA, Philippines - Aboitiz Equity Ventures (AEV) said posted a 20 percent decline in consolidated net income in the first half of the year, as its power and banking units reported drop in profits.
In a disclosure to the stock exchange, AEV said its consolidated net income fell by 20 percent to P9.5 billion in the January to June period, from P11.9 billion a year ago.
AEV had incurred a non-recurring gain of P785 million in the first half due to the revaluation of Aboitiz Power Corp.'s consolidated dollar-denominated liabilities and placements, as well as a one-off gain of P634 billion from the sale of some of the group's investments. Aboitiz Power also booked a non-recurring cost of P89 million to account for its acquisition of Lima Utilities Corp.
Aboitiz Power's income contribution for the first semester stood at P6.8 billion, a 7 percent drop from a year ago. This was due to the implementation of the geothermal resources sales contract for the Tiwi-Makban plants and weaker performance of Magat plant.
Union Bank of the Philippines' income contribution also declined by 46 percent to P1.5 billion in the first semester, from P2.8 billion a year ago.
On the other hand, Aboitiz Land's income contribution grew by 63 percent to P181.3 million in the first semester, while AEV's non-listed food subsidiary Pilmico Foods Corp. reported a 3 percent increase in its income contribution to P647.8 million.
AboitizPower profit falls
Meanwhile, Aboitiz Power said its net income in the first half of the year fell by 6 percent to P8.9 billion from P9.5 billion a year ago.
Adjusting for the one-time gain, AboitizPower's core net income for the first 6 months of the year fell by 21 percent to P8.6 billion.
"The dip in AboitizPower’s earnings does not affect our confidence in the power industry, as shown in our P80-billion capital expenditures this year. We remain firmly committed to meeting the country’s growing power requirements and offering competitive solutions to our customers,” said AboitizPower Chief Executive Officer, Erramon Aboitiz, in a statement.
The generation business, which accounts for 84 percent of AboitizPower's earnings, posted an income share of P7.6 billion for the first semester of 2014, down 6 percent.
On the other hand, the power distribution group's earnings share also fell by 11 percent to P1.4 billion.
"We are on track with making sure we increase our power capacity by an additional 2,000 MW over the next five years, amid the challenges of tightening supply. We just inaugurated the Tudaya hydropower plants in Davao del Sur last May 13, which will contribute 14 MW of net sellable capacity, while the 14 MW Sabangan hydro plant in Luzon and the 300 MW Therma South baseload plant in Davao will be completed early next next year. Construction of the 69-MW Manolo Fortich hydro plant in Bukidnon has started, while the 300-MW Therma Visayas baseload plant in Cebu and the 420-MW Pagbilao 3 plant in Luzon will break ground later this year”, Aboitiz said.