MANILA – The Philippines' biggest power distributor, Meralco, expects its performance to improve to near pre-pandemic levels in 2021 as it sees recovery across its different business segments.
"We've seen that there has been some uptick in consumption, particularly in March and also this month of April. And I would associate that with the fact that the (enhanced community quarantine), as it were, is not the same ECQ that we had in 2020," said Meralco president and chief executive officer Ray Espinosa.
The integrated power distributor and producer suffered an 11 percent drop in its core net income to P5.11 billion in the first quarter of 2021.
That's as gross revenues slipped 7 percent to P64.71 billion with energy sales decreasing by 4 percent to 10,483 gigawatts per hour (GWh).
The drop was primarily led by an 18 percent drop in energy sales to its commercial customers which offset a four percent and seven percent recovery in sales to industrial and residential customers, respectively.
Despite this, Espinosa said "the sales across the segments are recovering. Residential, very strong, industrial, very strong. Now in commercial, it's still down, but it's down in March, 14 percent only."
"And that actually represents a significant recovery from the 20 percent average decline in the previous months," he added.
He also shared, as of last week, their net system input which indicates the build-up of electricity was already higher by 21 percent from April 2020.
"If you examine the IATF (Inter-Agency Task Force on Emerging Infectious Diseases) and DTI (Department of Trade and Industry) guidelines, you will see that the ECQ today is not as restrictive as the ECQ last year," Espinosa noted.
In fact, he said many commercial establishments like Business Process Outsourcing (BPO) companies, have already been allowed at higher operating capacities compared to a year ago.
Likewise, Meralco chairman Manuel Pangilinan said the group's acquisition of Global Business Power Corporation (GBPC) would help improve income.
"It should raise its profitability for the year, albeit, it's only for nine months. We continue to be optimistic," he explained.
He also noted the second-quarter gains of Meralco this year "should be better than the second quarter last year" as that was the time when all businesses were hit by the strict lockdown against the COVID-19 pandemic.
"I think the laggard will be the commercial sector because of the lockdown; you've impeded the mobility of people it affects transportation-related business, and of course, the malls," Pangilinan said.
"Having said that, of course, we remain guarded; this is what we see today. This is what we can foresee from where we are today, but that's where it is," Espinosa also admitted.
"We are guarded in our optimism only because we do not know whether there will be a next wave of surge again and what the restrictions will be," he added.