First Gen income up 30% on higher sales

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Lopez-led First Gen Corp. booked in the first half of 2023 earnings of P9 billion, a 30-percent growth from last year, on the back of better operating income from its renewable energy unit despite higher interest expenses in its natural gas plants.

The geothermal plants of Energy Development Corp. (EDC), First Gen’s 100-percent renewable energy unit, enjoyed improved sales due to higher electricity prices, the company said in a stock exchange disclosure on Wednesday.

Overall, EDC contributed P4 billion to First Gen’s earnings, doubling the P2-billion recurring net income recorded in the same period last year.

On the other hand, First Gen said its natural gas platform saw a 5-percent decline in earnings to P5 billion, as depreciation costs and interest expenses rose for the 1,000-megawatt (MW) Santa Rita and 500-MW San Lorenzo plants in Batangas province.

The 420-MW San Gabriel and 97-MW Avion plants had better recurring earnings due to lower fuel costs and full operational availability within the period.

Earnings from the company’s hydroelectric platform slipped by 41 percent to P278 million as the 132-MW Pantabangan-Masiway power plants suffered lower reservoir levels, reducing the volume of electricity sold.

Over the next six months

First Gen’s net revenues rose to P71 billion from P66 billion due to elevated spot market prices.

“We hope to carry over the good performance of the first half in the next six months. We are looking forward to a number of significant milestones that are expected to happen for the remainder of the year,” First Gen president and chief operating officer Francis Giles Puno said.

Puno was referring to the company’s liquefied natural gas (LNG) terminal in First Gen Clean Energy complex in Batangas that is expected to receive its first cargo delivery by the end of September.

First Gen earlier announced it would set aside $90 million this year to fully operate the LNG terminal, which it would also lease to ports tycoon Enrique Razon Jr.’s Prime Infrastructure Capital Inc.

Global firm Shell Eastern Trading Pte. Ltd. was awarded a contract last month, requiring the company to deliver 154,500 cubic meters of LNG by Sept 30.

First Gen likewise said it was expecting the 165-MW Casecnan hydroelectric power plant in Nueva Ecija province to bring in more earnings in the second semester.

To recall, First Gen subsidiary Fresh River Lakes Corp. won the upstream Casecnan project in a competitive bidding led by the Power Sector Assets and Liabilities Management Corp. in May after submitting a $526-million offer.