Meralco sees 2016 sales growing 3.5%

by Alena Mae S. Flores – December 20, 2015 at 11:45 pm

from Manila Standard

Power retailer Manila Electric Co. expects sales volume to grow 3 percent to 3.5 percent in 2016, slower than the 5.3-percent to 5.4-percent increase in 2015, a company executive said over the weekend.

Meralco president Oscar Reyes told reporters the 2016 sales volume projection took into account the “high base effect” this year.

“I think for 2016, we’re still looking at maybe 3 to 3.5 percent specially that we are working from a high base already. There’s a high base effect,” Reyes said.

He said a number of factors helped drive electricity sales to a growth of more than 5 percent this year, which was faster than the historical average of 3 percent to 3.5 percent.

Reyes said inflation fell to an all time low this year, giving Filipino consumers more disposable income and purchasing power. Inflation rate dropped to as low as 0.4 percent in October.

“Even businesses, because of the low inflation, the cost of doing business is lower. It leaves people with more money to spend on things that drives electricity,” he said.

He said the “very peculiar” warmer weather in June to November also drove demand for air-conditioning.

“This is the first time that peak demand happened not during summer months but [in August],” he said.

Reyes said the ample liquidity in the banking system also fueled demand as “there is so much money available for construction of vertical and horizontal housing units.”

He said electricity sales in November surged by an unprecedented 8 percent from a year ago.

Reyes expressed confidence that the company would hit its P18.5-billion full year core net income target this year, on the back of higher sales volume.

Meralco posted P18.1 billion in core net income in 2014, up 6 percent from 2013.

Meralco said in the first nine months of 2015, core net income rose 11 percent to P15.8 billion from P14.286 billion in the same period last year.

The company said net income also grew 13 percent to P16.1 billion from a year ago. The figure is adjusted to exclude the effect of foreign exchange gains or losses, mark-to-market adjustments and other one-time, exceptional transactions.

Meralco’s billed customers increased by 209,000 to 5.7 million as of end-September, reflecting an increase of almost 4 percent year-on-year.