FIRST Gen Corp. announced a 13% reduction in its recurring net profit in the first half of 2022 to 6.6 billion pesos from 7.1 billion pesos in 2021, mainly due to lower operating profit from its gas business units natural and geothermal.
In a statement, Francis Giles Puno, president and chief operating officer of First Gen, said First Gen’s first-half earnings were impacted by fuel availability issues that specifically affected natural gas, geothermal power plants. and wind turbines of the company.
“Our geothermal system was affected by typhoon ‘Odette’ in early 2022 and is currently catching up with maintenance activities. As for the natural gas fleet, it was weighed down by gas interruptions on the Malampaya field which forced us to import liquid fuel.” Pouno said.
First Gen said revenue from the sale of electricity in the first half of 2022 reached 65.7 billion pesos, an increase of 21 percent from 50.8 billion pesos in the same period last year.
The company attributed the rise in revenue to high fuel and electricity wholesale spot market (WESM) prices. The natural gas portfolio accounted for 65% of First Gen’s total consolidated revenue, while 31% came from Energy Development Corp’s geothermal, wind and solar power plants. (EDC). The remaining 4% came from hydroelectric plants.
During the six-month period, First Gen’s natural gas platform reported a 10% drop in its recurring revenue of 5 billion pesos from 5.2 billion pesos in 2021.
Including non-recurring items, net profit attributable to the natural gas platform’s parent company decreased to 4.8 billion pesos from 5.2 billion. The unit also paid higher income taxes than the previous year.
First Gen said its geothermal, wind and solar platform suffered from a decline in wind generation at the Burgos project in the first half of 2022, compounded by higher taxes as the Burgos project’s tax exemption expired. in November 2021. Although electricity generated from geothermal activity benefited from higher electricity prices, EDC’s earnings were impacted by outages at Bacman and Leyte, which were the reduction of production attributable to Typhoon Odette and the expiration of power contracts in Mindanao.
EDC’s recurring and attributable revenue fell 20% to 1.9 billion pesos for the first half of 2022, compared to its recurring revenue of 2.3 billion pesos. This figure was also 19% lower than its attributable income of 2.2 billion pesos in 2021.
The hydroelectric platform’s contribution to First Gen’s recurring and non-recurring revenue reached 0.4 billion pesos compared to 0.3 billion pesos last year. The company said its Pantabangan-Masiway power plants generated higher operating profit from its sales contract with Meralco, although it sometimes suffered from more expensive replacement power purchased from WESM.