Manila Electric Co. · PSE:MER
Manila Electric — Q1 2022 Earnings Presentation
38 slides from Manila Electric's earnings presentation, Apr 25, 2022
Slide 1: First Quarter Ended March 31, 2022 Financial and Operating Results
FIRST QUARTER ENDED MARCH 31, 2022 FINANCIAL AND OPERATING RESULTS April 25, 2022
Slide 2: Financial Results
FIRST QUARTER ENDED MARCH 31, 2022 FINANCIAL RESULTS April 25, 2022
Slide 3: Q1 2022 Financial Highlights in PhP, Mn
Q1 2022 Financial Highlights in PhP, Mn With Q1 2021 comparative igures 3 f
Slide 4: Revenues in PhP, Mn
Q1 2022 Revenues in PhP, Mn Driven by growth in power generation, uptick in DU energy sales, and increase in pass-through charges with the global increase in fuel prices. 4
Slide 5: Cost and Expenses, Capital Expenditures in PhP, Mn
Q1 2022 Cost and Expenses, Capital Expenditures in PhP, Mn Purchased power cost accounts for the bulk of total costs and expenses, representing 76%. CAPEX spent on new connections, asset renewals, load growth projects, and support for BBB program. 5
Slide 6: Net Income and EBITDA in PhP, Mn
Q1 2022 Net Income and EBITDA in PhP, Mn 6
Slide 7: Power Generation Stand-Alone Core Net Income
Q1 2022 Power Generation Stand-Alone Core Net Income Paci icLight’s performance and contribution are due to the increasing demand in SG and the improved pool margin. San Buenaventura improved heat rate and 99.92% plant availability provided the positive contribution. BulacanSol added to the CCNI wit
Slide 8: Subsidiaries CCNI Contribution and Performance
Q1 2022 Subsidiaries CCNI Contribution and Performance Strong contribution from subsidiaries as Meralco continuously expands its non-regulated businesses. 8
Slide 9: Credit and Debt Profile in PhP, Mn
Q1 2022 Credit and Debt Pro ile in PhP, Mn 9 f
Slide 10: Earnings per Share in PhP per share
Q1 2022 Earnings per Share in PhP per share 10
Slide 11: Operating Results
FIRST QUARTER ENDED MARCH 31, 2022 OPERATING RESULTS April 25, 2022
Slide 12: Operational Highlights
Q1 2022 Operational Highlights BUSINESS DRIVERS SERVICE PERFORMANCE ELECTRICITY RATE per kWh Energy Sales System Loss Average Retail Rate 11,069 GWh 6.02% PhP 8.89 ▲ 6% vs. 2021 ▼ 0.12%PT, 12-MMA vs. 2021 ▲ 14%, vs 2021 Customer Count System Average Interruption Frequency Index 7.463 M 0.274 times ▲
Slide 13: Consolidated Energy Sales in GWh
Q1 2022 Consolidated Energy Sales in GWh Surpassed pre-pandemic levels as energy sales grew 6% driven by recovery across all customer segments 10,878 11,069 10,145 10,380 10,473 3,135 ▲ 6% 3,443 Industrial 3,077 3,212 29% 3,261 31% 31% 31% 30% Commercial 4,343 3,781 3,560 4,036 4,124 40% 34% 34% 40%
Slide 14: DU Energy Sales Profile and Drivers
Q1 2022 DU Energy Sales Pro ile and Drivers 2022 2021 2020 GWh RESIDENTIAL ▲ 5%, YTD GWh COMMERCIAL ▲ 6%, YTD GWh INDUSTRIAL ▲ 5%, YTD 2,000 2,000 2,000 1,500 1,500 1,500 1,000 1,000 1,000 500 500 500 0 0 0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov D
Slide 15: Consolidated Customer Count in M
Q1 2022 Consolidated Customer Count in M Increase in customer base driven by strong energization performance on PCA and OSA as LGUs and developers cleared backlog and operated at full capacity Project-covered Applications (PCA) 2021 7.463 2022 7.205 0.011 0.011 Industrial 912 0.559 8% Commercial 787
Slide 16: Consolidated NSI in GWh
Q1 2022 Consolidated NSI in GWh Higher vs. pre-pandemic Q1 2020 performance driven by recovery across all customer segments Power Fuel Sources Mix Special Solar 11,690 1% Contracts 1% 11,402 WESM 3% Liquid Fuel 10,767 10,993 10,981 7% ▲ 6% 24% New PSA 29% Multi-fuel 32% RES 32% Coal 36% IPP/ 35% Nat
Slide 17: Peak Demand in MW
Q1 2022 Peak Demand in MW Meralco and Luzon peaks above 2021 due to heightened activities amid Alert Level 1 Luzon 11,654 Meralco 10,543 ▲ 11% 7,816 7,115 ▲ 10% March 18, 2021 March 23, 2022 March 18, 2021 March 23, 2022 17
Slide 18: System Loss in %, 12-MMA
Q1 2022 System Loss in %, 12-MMA Improvement (0.12% points) vs. 2021 due to sales approaching pre-pandemic mix (i.e., higher C&I) and driven by initiatives to reduce system loss and unbilled energy sales 6.5% SYSTEM LOSS CAP 6.44 6.19 6.18 6.14 6.08 6.10 6.03 2021-2022 5.96 5.97 6.07 6.02 5.96 5.88
Slide 19: S-Factor Performance and Guaranteed Service Levels (GSL)
Q1 2022 S-Factor Performance and Guaranteed Service Levels (GSL) Continued to deliver within performance ceilings despite increase in SAIFI and SAIDI SAIFI times SAIDI CAIDI in minutes Rewards < 6.98 in minutes Rewards < 144.40 Network ▲ 16% ▲ 7% ▼ 8% • % Probability of Voltage Violation at 0 0.237
Slide 20: Networks CapEx in PhP, B
Q1 2022 Networks CapEx in PhP, B 18% of CapEx budget utilized with majority of spend in new connections, while continuing to support BBB and DPWH projects PhP 21.91B CapEx Budget 6.92 New Connections Pole Relocation Program BUILD, BUILD, BUILD (BBB) DPWH ROAD WIDENING 1.77 6.04 Asset Renewals 315 43
Slide 21: Networks Project Update: Calumpit Power Transformer Uprating
Networks Project Update Uprating of Calumpit Power Transformer Banks 1 and 2 to 1-50 MVA • Commissioned on January 25 to replace 25-MVA power transformer banks with new 50-MVA transformer as part of RY2019 CAPEX iling (PhP 195M) • Implemented to improve system adequacy and reliability in areas of Ca
Slide 22: BBB/PPP Pole Relocation: PNR North Rail Transit
BBB/PPP Pole Relocation Project Updates PNR North 1 Rail Transit • 38-km urban rail transit - Part of North-South Commuter Railway (NCSR) - Connects Malolos City, Bulacan with Tutuban, Manila - Consists of 6 stations for construction • Relocated 368 poles - In March: Relocated 27 poles for 3 tempora
Slide 23: BBB/PPP Pole Relocation: NLEX-SLEX Connector Road
BBB/PPP Pole Relocation Project Updates NLEX-SLEX Connector Road • 8-km, 4-lane, all-elevated expressway - C3 Road Caloocan Interchange to PUP Sta. Mesa, Manila - Connects to Skyway Stage 3 and mostly traverses PNR Rail Track • March 31: Retired 396 poles and installed 584 poles allowing NLEX Corpor
Slide 24: BBB/PPP Pole Relocation: Intramuros-Binondo Bridge
BBB/PPP Pole Relocation Project Updates Intramuros-Binondo Bridge • 680-meter, 4-lane steel arch bridge over Pasig River in City of Manila - Connects Intramuros (at Solana Street and Riverside Drive) and Binondo (at Rentas Steet, Plaza del Conde Street and Muelle dela Industria) with viaduct over Es
Slide 25: Average Retail Rate in PhP per kWh
Q1 2022 Average Retail Rate in PhP per kWh 13.6% higher than Q1 2021 average rate mainly due to higher generation charge Average Rate 8.89 • 21.3% increase in Generation: Higher fuel costs, higher WESM prices and kWh off-take, as well as Peso depreciation per Customer Segment 5.36 • 9.1% increase in
Slide 26: Performance Based Regulation (PBR) Updates: 5RP Reset Application
Performance Based Regulation (PBR) Updates 5RP Reset Application iled March 16, 2022 in PhP, B RY 2023 RY 2024 RY 2025 RY 2026 Return on Capital 25.9 30.6 34.1 36.4 (RAB x 13.2% WACC) Return of Capital 11.9 14.9 17.1 18.9 (Depreciation) OPEX (nominal) 27.8 28.9 31.0 33.2 Other Taxes 0.5 0.5 0.5 0.5
Slide 27: PBR Updates: 5RP Reset CAPEX Application
PBR Updates 5RP Reset CAPEX Application Forecasted CAPEX (in PhP, B) 43.5 37.5 36.4 32.2 12.4 3.6 RY 2023 RY 2024 RY 2025 RY 2026 Lapsed Period Carry-Over Capital Expenditure New 5RP Capital Expenditure 27
Slide 28: Rate Update: Distribution Rate True Up (DRTU)
Rate Update Distribution Rate True Up (DRTU) ERC Case No. 2020-043 RC Interim Average Excess Rate True-Up Period AWAT Refund Amount Rate (IAR) from IAR Jul 2015 – Nov 2020 1.3810 1.4414 0.0604 DRTU 1 = 13.9B Jul 2015 – Dec 2021 1.3810 1.4422 0.0612 DRTU 1 + DRTU 2 = 18.7B Difference DRTU 2 = 4.8B DR
Slide 29: Competitive Selection Process (CSP) Updates
Competitive Selection Process (CSP) Updates 850 MW Unsolicited Proposal from Terra Solar Philippines, Inc. (Terra Solar) • February 21, 2022: SMC Global Light and Power Corp. submitted letter informing TPBAC of its withdrawal of participation from CSP • April 5, 2022: On Bid Submission Deadline, Sun
Slide 30: CSP Updates
CSP Updates 180 MW covering contract period from February 26, 2022 to July 25, 2022 • March 31, 2022: On Expression of Interest (EOI) Deadline, TPBAC did not receive EOI from any prospective bidder and declared failure of bidding • April 4, 2022: Meralco submitted Final Invitation to Bid and Bid Req
Slide 31: #PoweringTheGoodLife: Anvil Awards
#PoweringTheGoodLife Meralco’s 2020 Annual Reports recognized at 57 Anvil Awards th The Anvil is awarded by the Public Relations Society of the Philippines (PRSP) to outstanding public relations programs, tools, and practitioners in the country Annual Report Sustainability Report OMF Annual Report G
Slide 32: #MBRACE Diversity & Inclusion Program: Women Technician Scholarship
#PoweringTheGoodLife #MBRACE Diversity & Inclusion Program Women Technician Scholarship in Partnership with Don Bosco • Women Technician Scholarship Program among key initiatives under Meralco’s Gender Diversity and Inclusion (D&I) Program, #MBRACE • Objective: Develop and nurture pool of Female Tec
Slide 33: #MBRACE: Diversity and Inclusion Policy Statement
#PoweringTheGoodLife #MBRACE Diversity & Inclusion Program Meralco puts in place Diversity and Inclusion Policy Statement - Meralco is committed to advancing Policy Highlights workforce diversity and to • Aligned with UN SDG 5: Gender Equality nurturing an inclusive and safe workplace for its employ
Slide 34: Power Generation Operating Results
FIRST QUARTER ENDED MARCH 31, 2022 POWER GENERATION OPERATING RESULTS April 25, 2022
Slide 35: Highlights
Q1 2022 Highlights • MGEN Group YTD energy delivered at 3,011 GWh, an 8% decrease Energy Delivered in GWh vs. 3,288 GWh from same period 2021 due to impact of Typhoon YTD YTD Odette, coupled with scheduled maintenance activities of PLP and % change SBPL. Month-on-month, however, total energy deliver
Slide 36: Renewable Energy Development
Renewable Energy Development • Target of 1,500 MW renewable energy (RE) capacity in next 5-7 years • RE Projects under construction: - 75 MWac solar in Baras, Rizal (in partnership with Mitsui) - 68 MWac solar in Ilocos Norte (in partnership with Vena) - 45 MWac solar in Cordon, Isabela (in partners
Slide 37: First Quarter Ended March 31, 2022 Financial and Operating Results
FIRST QUARTER ENDED MARCH 31, 2022 FINANCIAL AND OPERATING RESULTS April 25, 2022
Slide 38: Cautionary Statements
CAUTIONARY STATEMENTS This presentation is prepared for the parties presently invited for the purpose of discussion. This presentation has consequential limitations and is not a comprehensive discussion about MANILA ELECTRIC COMPANY AND ITS SUBSIDIARIES (Meralco). These materials are restricted to t
Manila Electric Company (Meralco) — Q1 2022 Earnings Presentation on 6ix