Metro Pacific Investments Corp. expects core net income to reach P13.3 billion in 2017, nearly 10 percent higher than P12.1 billion last year after the conglomerate posted strong first-half earnings.
Metro Pacific said in a disclosure to the stock exchange net income in the first half of the the year climbed 17 percent to P7.8 billion from P6.6 million year-on-year on the back of an expanded presence in the power industry and strong contribution from the tollroads and hospital businesses.
The group’s power distribution and generation business accounted for ₱5.3 billion or 55 percent of income, followed by tollroads which shares ₱2 billion or 21 percent of the total.
Water distribution, production and sewerage treatment accounted for ₱1.8 billion of total revenues while the hospital group and rail, logistics systems group contributed ₱308 million and ₱104 million, respectively.
“Our earnings growth reflects our increased investment in the power sector together with strong volume growth at our tollroads and hospitals businesses,” said Metro Pacific and chief executive Jose Ma. K. Lim.
Lim, however, said the combination of years of capital expenditures and the failure to date to implement tariff increases in the water, tollway and rail businesses would eventually drag the growth of the company’s core earnings per share.
The group’s water utility unit Maynilad Water Services Inc. last month won its arbitration claim against the Philippine government in Singapore. The company is now in discussions with the government on settling the claims.
The Finance Department earlier said it would look for funding to settle Maynilad’s claims.
Metro Pacific’s tollways group is also in talks with the Transportation Department over foregone revenues from the non-implementation of tariff adjustments in North Luzon Expressway and Cavite Expressway, which now have a running balance of P7 billion.
Lim said the group was also in talks to invest in the logistics sector in the second half of the year.
He said the company was conducting due diligence on Air21 Express, the logistics company owned by businessman Alberto Lina. No other details were provided.
Lim said the company had been hiring consultants to help the company on which areas in the highly fragmented logistics sector the company would focus.
Metro Pacific earmarked P8 billion in capital expenditures for its planned expansion in the logistics business. Metro Pacific has made two small acquisitions worth around P2 billion since venturing into the business last year.