Manila Electric Co. · PSE:MER
Manila Electric — 9M 2014 Earnings Presentation
30 slides from Manila Electric's earnings presentation, Oct 27, 2014
Slide 1: For the months ended September 30, 2014
For the months ended September 30, 0, 2014 4th Floor, Lopez Building, Lighthouse, 14 g Ortigas g, as Avenue, Pasig City October 27, 2014
Slide 2: Investors' Briefing October 27, 2014
For the months ended September 30, 0 2014 0, Investors’ Briefing October 27, 2014
Slide 3: Highlights
Highlights Ç2.5%* Ç3.9%* Ç3.3%* Ç1.8%* +2207,279 +207,279 07,2 7 279 customers u t ustom +193 MW +5066 GWh +637 GWh (>5 million Residential) P9.37/kWh Within Regulatory Business Limits Updates Gen.Ch. 56.3% Dist. Ch. 16.8% *vs. previous year **RY2015 Period (July 1, 2014-June 30, 2015)
Slide 4: Details 9M 2014
Details 9M 2014
Slide 5: Energy Sales, 9 Months 2014
Energy Sales, 9 Months 2014 o Up 2.5% vs. 2013 at 26,253 GWh (+637 GWh) Details: 26,253 Total, Tota al, in GWh Share of Sales*: 2.5%é 25,616 25, ,616 4.8%é 3.9%é 8,081 Industrial Indu ustr 24,448 7,778 7.6%é 30.8% 22,660 0.3%é 22,725 39.1% 9,965 3.1%é 10,278 Commercial Com mme 29.7% 7,775 0.3%é 7,79
Slide 6: Ave. Temperature (°C) monitoring
Ave. Temperature(°C) monitoring ØMay 2014 (30.6 °C) temp highest since May 2010 (31.1°C) ØJanuary 2014 (24.7°C) coldest in 11 years or since Jan 2003 (24.9°C) 2013 2014 Ave Temp (Sept YTD) 28.19°C 27.83°C Max Temp (Sept YTD) 34.72°C 34.79°C 29.90 30.26 29.84 29.42 29.05 29.15 28.51 27.74 27.90 28.01
Slide 7: Customer Count, 9 Months 2014
Customer Count, 9 Months 2014 o Up 3.9% vs. 2013 to 5.53 million customers CONSO Details: Share of Count*: Indl 5.53 Total, in Million 5.16 5.33 3.9%ã 0.2% 4.82 4.98 3.5%é 3.3%é 0.45 0.46 Commercial Comm mmerci 3.4%é 2.5%ã 8.3% 4.86 4.0%ã 5.06 Residential Resid 91.4% *For 9M2014, Industrial (9,812)
Slide 8: Clark Electric (CEDC), 9 Months 2014
Clark Electric (CEDC), 9 Months 2014 o Strong growth vs. 2013 Energy Sales, GWh 323.2 15.6%é 279.5 24.1%é 225.1 203.1 1.5%é 206.0 9.3%é 9M 2014 Sales, Share Count, Share Commercial 38.6% 57.6% 2010 2011 2012 2013 2014 Industrial 60.3% 6.5% Residential 0.9% 32.7% Flat Streetlights’ sales and count sh
Slide 9: Net System Input (NSI) & Demand, 9 Months 2014
Net System Input (NSI) & Demand, 9 Months 2014 o NSI up 1.8% vs. 2013 (+506.4 GWh) o Meralco Peak Demand up 3.3% vs. 2013 (+193 MW) CONSOLIDATED NSI, in GWh: Meralco YTD Peak Demand, MW: 6,121 * 5,928 3.3%é 27,605.2 1.8%é 28,111.6 2013 2014 2013 2014 Luzon YTD Peak Demand, MW: 8,717 * 8,305 5.0%é CE
Slide 10: Power Supply Sourcing, 9 Months 2014
Power Supply Sourcing, 9 Months 2014 Volume, 9M M 2014 Sourcing SOURCE % Share GWh PSAs-Total 12,095.6 43.0% SEM-Calaca 1,321.5 4.7% MPPC-Masinloc 1,619.3 5.8% TLI-Pagbilao 1,248.1 4.4% IPPs SMEC-Sual 2,158.7 7.7% PSAs 33.9% SPPC-Ilijan 5,278.5 18.8% 43.0% Others 469.6 1.7% IPPs-Total 9,542.2 33.9%
Slide 11: Power Plant Fuel Source Mix, 9 Months 2014
Power Plant Fuel Source Mix, 9 Months 2014 o Indigenous Natural Gas and Coal were the main fuels for power generation 9M 2014 Mix Natural Gas 46.4% SOURCE Volume, GWh % Share Natural Gas 13,056.0 46.4% Coal Coal 10,969.8 39.0% 39.0% Multi-fuel* 4,085.9 14.5% NET SYSTEM INPUT 28,111.6 100.0% *Coal, H
Slide 12: Average Retail Rates, 3Q 2014
Average Retail Rates, 3Q 2014* o Generation Charge, largest component in customer’s bill, 56.3%; Meralco 16.8%; NGCP 10.3% Overall Average BILL COMPONENT P/kWh Transmission Generation Charge 5.27 10.3% Generation Distribution Charge System Loss 1.57 56.3% (MERALCO) 4.7% Transmission Charge 0.96 (NGC
Slide 13: System Loss Performance
System Loss Performance o 12-MMA ending September at 6.67% − Improved by 0.04%pts vs. September 2013’s 6.71% − Lower by 1.83% vs. SL cap of 8.5% 8.5% SL CAP, 2010-PRESENT YEAR AGO 12-MMA (Oct '12 - Sept '13) LATEST 12-MMA (Oct '13 - Sept '14) 1.83% 7.14 6.86 6.71 6.67 6.46 (lowest to-date) Oct Nov D
Slide 14: Performance Incentive Scheme
Performance Incentive Scheme § S S-Factor -F -Fa Faactor a acttor : 9M M 2014 201 0114 § GSLL : July 20144 – September 2014 (RY 2015 ) o All A S-Fact S-Factor tor and GSL indicatorss aree all al wwell within regulatory limits vs. 2013 SAIFI,, Forced S o ced aand d PAI ((Times) es) GSL1 : Customer ex
Slide 15: Other Business Highlights 9M 2014
Other Business Highlights 9M 2014
Slide 16: Impact to Meralco of Typhoons 'Mario' and 'Glenda'
Business Updates: Strengthening the Core Distribution Business Impact to Meralco of Typhoons ‘Mario’ and ‘Glenda’ SUMMARY OF IMPACT OF MAJOR WEATHER DISTURBANCES TO MERALCO 'MARIO IO' 'GLENDA DA' Inclusive Dates (including completion of restoration) September 19 only July 15-20, 2014 91 627 Circuits
Slide 17: Assistance Beyond our Borders after 'Glenda'
Business Updates: Assistance Beyond our Borders after ‘Glenda’ BICOL ‘Express Restoration’ Albay Gov. Joey Salceda with a Meralco crew § August 3 – 24, 2014 § Meralco sent total of 10 crews consisting of 53 Line Personnel SCOPE OF WORK ALBAY SORSOGON # of Poles restored 311 76 # of Span of Wires str
Slide 18: Strengthening the Core Distribution Business
Business Updates: Strengthening the Core Distribution Business SORECO 2 THANKS MERALCO FOR HELPING COMMISSIONING OF AIR LIQUIDE’S 115 kV SOURCE RESTORE POWER FACILITIES IN SORSOGON Connected 115 kV line Disconnected temporary 34.5 kV service from CPIP circuit 41CPP § Sorsogon II Electric Cooperative
Slide 19: New Electric Distribution Initiatives
Business Updates: New Electric Distribution Initiatives MERALCO-COMSTECH POWERS PAMPANGA II ELECTRIC COOPERATIVE, INC. (PELCO II) § Aug. 13, 2014: PELCO II handed over the management of the cooperative to Meralco-Comstech partnership in a ceremony at its main office in Guagua, Pampanga. § Supported
Slide 20: Strengthening the Core Distribution Business
Business Updates: Strengthening the Core Distribution Business e-SERVICE APPLICATION PROGRAMS § To improve application process by offering an additional channel § To facilitate 4,000 service application by end-2014 through e-mail §MManage anage customers’ custtomers’’ expectations expecttattions by
Slide 21: Strengthening the Core Distribution Business
Business Updates: Strengthening the Core Distribution Business SMART/ INTELLIGENT GRID (ROUNDTABLE) ILP FORUMS (Interruptible ( Load Program) § Makati Business Club | Sept 8 § American Chamber of Commerce | Sept 26 Objective: • As A off October O t b 23, 23 Meralco customers/ ILP participants have §
Slide 22: Strengthening the Core Distribution Business
Business Updates: Strengthening the Core Distribution Business ATENEO EV SHUTTLE LEASING EBIKE SHARING PROGRAM Accomplishments: § Secured general approval of Ateneo on the EV Charging Station design, allowing MServ* to work on the permits needed for construction. (Sep 26) § Delivery of the procured
Slide 23: Financial Highlights 9M 2014
Financial Highlights 9M 2014
Slide 24: Revenues, EBITDA and Net Income
Revenues, EBITDA and Net Income CONSOLIDATED REVENUES (in P mn) EBITDA (in P mn) AND MARGINS & ENERGY SALES (in GWh) CORE REPORTED 30,000 26,600 26,547 208,122 24,518 24,355 210,000 30,000 25,000 202,890 200,000 190,000 20,000 180,000 29,000 13% 13% 15,000 12% 170,000 12% 160,000 10,000 150,000 28,0
Slide 25: Costs and Expenses
Costs and Expenses BREAKDOWN OF COSTS & EXPENSES (in P mn) CAPITAL EXPENDITURES (in P mn) 7,514 6,126 538 23% 7,645 Purchased Power 4,096 154,489 Generation (85%) 127,941 14,381 Transmission 26,548 9M 2013 9M 2014 • Construction of Araneta-Cubao-Kamuning 115 kV Line • Installation of Additional Bank
Slide 26: Credit Profile
Credit Profile ASSETS (in P mn) (in P mn except ratios) 9M 2013 9M 2014 64,757 80,289 Cash 58,819 64,757 117,822 Total Debt 24,207 30,159 Cash Utility Plant & Equipment Other Assets Net Debt (34,612) (34,598) LIABILITIES & EQUITY (in P mn) Total Debt/EBITDA .75 .85 30,159 Net Debt/EBITDA (1.07) (0.9
Slide 27: Debt Profile
Debt Profile TOTAL DEBT (in P mn) DEBT REPAYMENT SCHEDULE (in P mn) 11,860 30,159 24,207 25% 7,000 27,714 20,086 3,960 2,785 2,072 373 373 373 360 360 360 360 4,121 2,445 9M 2013 9M 2014 Q4 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2014 Current Maturities Non-current Maturities Long-ter
Slide 28: Earnings per Share and Cash Dividends
Earnings per Share and Cash Dividends REPORTED AND CORE EARNINGS PER SHARE CASH DIVIDENDS PER SHARE (in P) (in P) AND DIVIDEND YIELD 4.90% 14.00 5.00% 9M 12.69 2014 12.68 12.00 4.10% 9M 12.11 4.00% 2013 12.03 3.60% 10.00 3.20%3.10% 3.00% 3.00% 8.00 2013 15.27 15.10 6.00 12.36 2.00% 10.20 10.20 2012
Slide 29: Cautionary Statements
Cautionary Statements This presentation is prepared for the participants of the MERALCO Investors and Analysts Briefing & Teleconference held on October 27, 2014. This presentation has consequential limitations and is not a comprehensive discussion about Manila Electric Company and Subsidiaries (MER
Slide 30: Thank You
Manila Electric Company (Meralco) — 9M 2014 Earnings Presentation on 6ix