Meralco profit rises 12%, P56.6B goal in sight
Driven by stronger power generation and retail electricity supply businesses, Manila Electric Co. (Meralco) is closing in on its P56.6-billion full-year earnings target after consolidated core net income rose 12 percent to P44.8 billion in the first nine months.
Meralco reported on Wednesday its core earnings increased from P40 billion a year earlier, putting the company nearly 80 percent of the way toward its annual target despite rising fuel costs, peso depreciation, and higher electricity procurement expenses.
The company needs to generate another P11.8 billion in core earnings in the fourth quarter to meet its full-year guidance.
“For full-year 2026, we are on track to achieve a consolidated core net income of approximately P56.6 billion, barring any significant unforeseen developments,” Meralco Chairman and Chief Executive Officer Manuel V. Pangilinan said.
Consolidated reported net income also climbed 21 percent to P44.7 billion from P36.8 billion, while revenues grew 19 percent to P443 billion.
Meralco's distribution business remained its largest earnings contributor, accounting for 45 percent or P20.1 billion of consolidated core net income.
Its power generation arm, Meralco PowerGen Corp. (MGEN), contributed 41 percent or P18.2 billion, reflecting a 24-percent increase in earnings as its liquefied natural gas and thermal power plants delivered stronger output.
The start of commercial operations of MTerra Solar's first phase in August also supported generation growth, while retail electricity supply and non-electricity businesses accounted for the remaining 14 percent of core earnings.
“We are realizing gains from investments made in previous years, particularly through MGEN that has been steadily increasing its earnings contribution, and the strategic integration and continued expansion of the RES business,” Pangilinan said.
Meanwhile, Meralco's distribution customer base expanded two percent to 8.4 million, supporting a modest increase in energy sales to 41,054 gigawatt-hours.
However, higher generation and transmission charges pushed the company's average retail electricity rate up 15 percent to P13.43 per kilowatt-hour from P11.63 a year earlier.
Purchased power costs consequently increased 20 percent to P338.7 billion, reflecting continued pressure from higher fuel prices and the weakening peso.
Despite these challenges, Meralco maintained its investment program as it invested P76 billion in capital expenditures during the nine-month period, primarily on renewable energy, battery storage and distribution network improvements.
The company also expects the Energy Regulatory Commission's recent approval of its long-delayed distribution rate reset to provide greater certainty for infrastructure investments through 2030.