Manila Electric Co. · PSE:MER
Manila Electric — Q1 2009 Earnings Presentation
28 slides from Manila Electric's earnings presentation, May 14, 2009
Slide 1: Letter to Philippine Stock Exchange
13 May 2009 MS. JANET A. ENCARNACION Head, Disclosure Department Philippine Stock Exchange, Inc. 4/F, Philippine Stock Exchange Center Exchange Road, Ortigas Center, Pasig City Dear Ms. Encarnacion, We are submitting to your office the attached report of Manila Electric Company (Parent Company only)
Slide 2: Operating & Financial Results 1st Quarter 2009
Manila Electric Company OPERATING OPERATING & & FINANCIAL FINANCIAL RESULTS RESULTS 1st Quarter ending March 31, 2009 Investors’ Briefing & Teleconference May 14, 2009, 2:30 PM Lopez Bldg - Meralco Mini Theater
Slide 3: Outline of Presentation
Outline of Presentation 1st Qtr 2009 Operating Highlights Jose P. de Jesus, President & COO Financial Results Rafael L. Andrada, FVP & Treasurer Regulatory Updates Ivanna G. Dela Peña, VP & Head, Utility Economics
Slide 4: Operating Highlights
Operating Highlights may liwanag ang buhay MERALCO
Slide 5: Energy Sales
Energy Sales Segment gwh % Growth 1Q 2009 1Q 2009 Total energy sales in 1Q 2009 Commercial 2,444 2.3 Residential 1,977 2.0 decreased 1.4% to 6,068 Industrial 1,613 (10.2) Streetlights 34 0.6 GWH over 1Q 2008. TOTAL 6,068 (1.4) 7,000 Strong Industries/ % Sales Growth 6,000 Classes 1st Qtr09 Comm 5,00
Slide 6: Energy Sales: New Customers
Energy Sales New Customers 150,000 100,000 Number of customers increased by 50,000 2.6% from 1St Qtr 2008 to 4.60 - million as of the 1st Qtr 2009. (50,000) 2009 New residential customers: 106,234 Residential 106,234 Commercial 9,163 New commercial customers: 9,163 Industrial (202) Hitachi Computer
Slide 7: Purchased Power Cost
Purchased Power Cost Generation Costs Average PPC/kWh 1Q 2009: P5.4432 4.25 IPPS 5.65 1Q 2008: P5.4827 4.22 NPC 3.94 WESM 6.04 3.02 2008 2009 Transmission Costs WESM WESM 18.0% 8.8% IPPS IPPS 0.66 IPPS 46.8% NPC 0.70 51.3% NPC 39.9% 35.2% NPC 1.42 1.05 WESM 2.10 0.98 1Q 2009 1Q 2008 POWER SOURCING
Slide 8: 1Q 2009 System Performance
1Q 2009 System Performance The 1st Quarter 2009 Cumulative Interruption Time improved by 6.7% to 1.26 hours. Similarly, Interruption Frequency Rate improved by 45.6% to 1.41 times. CIT Improvement Jan-Mar’09: 6.7% (1.26 hrs) 14 12 IFR Improvement 10 Jan-Mar’09: IFR CIT 45.6% (1.41 times) 8 6 4 2 0 1
Slide 9: System Loss performance
System Loss performance 12MMA system loss level as of 1Q 2009--- lower than 9.5 cap 12.0 11.51 Lower than the 9.5% cap 11.5 • Lower system loss charges to its customers 11.0 10.58 10.5 10.46 10.0 9.99 9.44 9.5 9.28 9.0 2004 2005 2006 2007 2008 1Q 2009
Slide 10: News Updates
News Updates: MERALCO empowers Cavite with new delivery point substation Anti-pilferage campaigns strengthened; MOA with LGUs Cainta-Feb 6, 2009 Taytay- March 25, 2009
Slide 11: Financial Results
Financial Results may liwanag ang buhay
Slide 12: Income Statements
Income Statements For For the the Quarter Quarter Ended Ended March March 31, 31, 2009 2009 and and 2008 2008 (Amounts (Amounts inin Million Million Pesos) Pesos) Q1 2009 Q1 2008 % Change REVENUES 44,270 43,636 1.5 EXPENSES (INCOME) Purchased power 37,428 37,945 (1.4) Operations and maintenance 3,00
Slide 13: Balance Sheet
Balance Sheet As As of of March March 31, 31, 2009 2009 and and 2008 2008 (Amounts (Amounts in in Million Million Pesos) Pesos) 2009 2008 % Change ASSETS Utility plant and others - net 97,839 94,975 3.0 Other noncurrent assets 30,447 33,932 (10.3) Total noncurrent assets 128,286 128,907 (0.5) Curren
Slide 14: Cash Flows
Cash Flows For For the the Quarter Quarter Ended Ended March March 31, 31, 2009 2009 and and 2008 2008 (Amounts (Amounts inin Million Million Pesos) Pesos) 1Q 2009 1Q 2008 % change CASH BALANCE, BEGINNING (Jan 1) 4,023 4,062 (1.0) CASH FLOWS FROM OPERATING ACTIVITIES Operating and other income 3,341
Slide 15: Debt Profile
Debt Profile As As of of March March 31, 31, 2009 2009 and and 2008 2008 (Amounts (Amounts in in Billion Billion Pesos) Pesos) 1Q 2009 1Q 2008 Foreign Local Total Foreign Local Total Long Term 0.13 13.62 13.75 0.22 11.90 12.12 Short Term - 2.29 2.29 10.25 10.25 Total 0.13 15.91 16.04 0.22 22.15 22.3
Slide 16: Capital Expenditures
Capital Expenditures As As of of March March 31, 31, 2009 2009 and and 2008 2008 (Amounts (Amounts in in Million Million Pesos) Pesos) 1,500 1,236 1,300 1221 1st Qtr CAPEX of P1.2 billion 1,100 952 918 reflected an increase of 29.8% 900 from last year’s amount of P1.0 700 billion. 500 1Q 2009 1Q 200
Slide 17: Regulatory Updates
Regulatory Updates may liwanag ang buhay MERALCO
Slide 18: Outline of the updates
Outline of the updates • Rate breakdown for March 2009 • Recent rate developments • Take-over of the Carmelray Industrial Park 2 • Congress developments
Slide 19: Rate Breakdown
Rate Breakdown As a result mainly of higher Generation Charges, the average Meralco rate in the 1st Quarter of 2009 was slightly higher than in 2008 Eligible industrial end-users continued to benefit from special programs, particularly the NPC-Meralco Ecozone Rate (in P/kWh) 1Q08 1Q09 Overal Res'l C
Slide 20: ERC approval of Meralco's tariffs under PBR
ERC approval of Meralco’s tariffs under Performance-Based Regulation (PBR) • Last April 23, ERC released an Order (dated April 13) approving Meralco’s tariffs under Performance-Based Regulation (PBR) • Implementation began in May 2009 • Affects only the distribution-related bill components • Meralco
Slide 21: ERC decision resolved pending motions for reconsideration
ERC decision resolved pending motions for reconsideration Date Event Sept. 1, 2006 Meralco submits proposed Annual Revenue Requirement (ARR) & Maximum Average Prices (MAP) Aug. 31, 2007 ERC approves Final Determination on the ARR & MAP Jan. 11 & Apr. Meralco files proposed translation into rate sche
Slide 22: Highlights of the ERC order (1/2)
Highlights of the ERC order (1/2) Amended the Maximum Average Price for regulatory year 2009 to reflect a zero income tax component Unconstrained MAP2009 Constrained MAP2009 MAP2009 w/o CIT (Oct 2008 Decision) (Oct 2008 Decision) (April 2009 Order) P1.3607/kWh P1.2280/kWh P1.2227/kWh Revised downwar
Slide 23: Highlights of the ERC order (2/2)
Highlights of the ERC order (2/2) • Revised the rates to align them closer to ‘cost- to-serve’ – Increased the differential between high- & low- voltage customers – Mandated a separate rate category for 69-kV end- users for regulatory year 2011 • In a separate Order, ERC directed Meralco to accelera
Slide 24: Rate developments for May 2009
Rate developments for May 2009 (IN PESOS PER KWH) 1. PBR implementation Approved MAP for RY 2009 1.2227 2008 Average Meralco Charges 0.9657 Estimated adjustment 0.2570 2. CERA refund acceleration (starting May) (0.1061) 3. Transmission Charge reduction (starting May) (0.1653) 4. Generation Charge re
Slide 25: Take-Over of Carmelray Industrial Park 2
Take-Over of Carmelray Industrial Park 2 Last April 11, Meralco took over the electric distribution service of Carmelray Industrial Park 2 (CIP2) CIP2 was one of two ecozones not being served by Meralco Other is Cavite Ecozone On April 17, the PEZA Peak demand of about 17-MW Board approved Estimated
Slide 26: Senate Bill No. 3148 – Electricity Rate Reduction Act of 2009
Senate Bill No. 3148 – “Electricity Rate Reduction Act of 2009” • Introduced by Sen. Pres. Juan Ponce Enrile – Filed last April 1, 2009 and subjected to a hearing by the Senate Energy Cte last April 21, 2009 • Proposes a Government Share reduction to three percent of the net proceeds from the sale o
Slide 27: Senate Bill No. 3147 – Uniform Franchise Tax on DUs
Senate Bill No. 3147 – Uniform Franchise Tax on DUs Introduced by Sen. Pres. Juan Ponce Enrile Filed last April 1, 2009 and subjected to a hearing by the Senate Ways & Means Cte last April 21, 2009 According to Sen. Enrile, the provision of public services should not be taxed, because it is the gove
Slide 28: End of presentation – Thank you
2007 Operating Results 2009 For the quarter ended March 31, 2009 Investors’ Investors’ Briefing Briefing & & Teleconference Teleconference End of presentation Thank you !
Manila Electric Company — Q1 2009 Earnings Presentation on 6ix