FIR FIRST ST HALF HALF 2019 2019 FIN FINANCIA ANCIAL L RESUL RESULTS TS ANALYSTS’ BRIEFING 01 01 AUGU UGUST ST 20 2019 19 1
TABLE OF CONTENTS Consolidated Financial Highlights Page 3 Stand-alone Portfolio Company Results and Key Page 14 Metrics POWER POWER Financial Highlights 4 MERALCO 1H 2019 Highlights and Key Metrics 15 Expansion Updates 5 GBPC 1H 2019 Highlights and Key Metrics 16 TOLL ROADS TOLL ROADS Financial Highlights 6 MPTC 1H 2019 Highlights 17 Expansion Updates 7 Key Metrics and Priorities 18 WATER WATER Financial Highlights 8 Maynilad 1H 2019 Highlights and Key Metrics 19 Metropac Water 9 HOSPITALS HOSPITALS MPHHI 1H 2019 Highlights and Key Metrics 20 Financial Highlights 10 LIGHT RAIL LIGHT RAIL, LOGISTICS AND OTHERS LRMC 1H 2019 Highlights and Key Metrics 21 Financial Highlights 11 Quarterly Highlights 22 Regulatory Matters 12 Statements of Financial Position 25 2
1H 2019 CORE INCOME UP 1% TO P8.7B Growth in operating income absorbs rising finance costs from increased investments CONSOLIDATED FINANCIAL HIGHLIGHTS 1H 2019 1H 2018 % Change In Millions of Pesos YTD MPIC share • Power distribution in Luzon ↑ 5% Power 6,062 5,822 4% • Power sold in Visayas ↑ 6% Toll Roads 2,425 2,281 6% • Domestic toll road traffic ↑ 8% Water 2,300 2,115 9% Hospitals • Water sold in West Metro Manila ↑ 400 338 18% 3% Light Rail 169 205 -18% • Hospital group census ↑ 10% Others (182) (145) -26% Share of operating income 11,174 10,616 5% 5% increase in Operating Income was driven by: Head office expenses (539) (557) -3% Interest expense (1,967) (1,459) 35% Substantial Core Income growth from MERALCO Core income 8,668 8,600 1% Non-core income (expense) (560) 341 -264% Continuing volume growth coupled with Reported income 8,108 8,941 -9% tariff increases at Maynilad and Metro Pacific Tollways In Centavos Diluted EPS on core income 27.48 27.25 1% Strong patient census in hospitals Dividend per share 3.45 3.45 0% Increase in interest expense is due to loan drawdowns EARNINGS CONTRIBUTION MIX amounting to P27.4 billion (proceeds were used to fund various investments of the group). Weighted average Hospitals and Hospitals and Others interest rate as at 30 June 2019 is 6.6% and weighted Others 3% average debt maturity is 7.7 years 4% Water Water Toll Roads Toll Roads 21% 20% 22% Non- Core Expense amounted to ₱560 million; the swing 21% from a gain in 2018 is largely due to foreign exchange translation losses Power Power 54% 55% 1H 2019 1H 2018 3
CONTRIB CONTRIBUTIO TION N UP BY UP BY 4% % TO O P6.1B 6.1B POWER Driv iven by y st strong result sults s at MERAL ERALCO CO In Millions of Pesos 4% increase in contribution from the Power business was CONTRIBUTION TO MPIC 1H 2019 1H 2018 % driven by: MERALCO (45.5%) 5,600 4,933 14% MERALCO GBPC (62.4%) 785 775 -1% Beacon/FV and accounting adj. 104 (313) -401% 5% growth in energy sales 6,062 5,822 4% Lower interest expense from lower debt balance and higher yield from investments in securities STAND-ALONE PERFORMANCE 1H 2019 1H 2018 % alue MERALCO Financial Highlights Offset by: Revenues 164,953 150,544 10% Core EBITDA 19,879 17,585 13% GLOBAL BUSINESS POWER CORPORATION Core income 12,317 10,851 14% 6% decrease in energy sales due to the end of various Reported income 12,007 11,973 0% power supply agreements Capital expenditure 10,706 6,600 62% Key Performance Indicators Rising depreciation and interest costs from Panay Energy Development Corporation’s 150 MW plant from 1 June 2018 Energy sales (in GWh) 21,665 22,823 5% GLOBAL BUSINESS POWER CORPORATION (GBPC) Financial Highlights Revenues 12,520 13,288 -6% Core EBITDA 4,592 4,384 5% Core income 1,242 1,259 -1% Reported income 1,130 1,276 -11% Capital expenditure 557 404 38% Key Performance Indicators Energy sales (in GWh) 2,306 2,461 -6% 4
POWER EXP EXPANSIO ANSION N UPD UPDATE TES MERALCO GLOBAL BUSINESS POWER CORPORATION 1x455MW (net) San Buenaventura Power, Quezon Alsons Thermal Energy Corporation ● Ongoing construction proceeding as scheduled ● 105 MW Expansion Plant, Saranggani – expected to ● Initial coal firing and synchronization with the grid in April 2019 commence operations in 2H 2019 ● In May 2019, the plant hit supercritical pressure (the first ever in the Philippines) and full 500 MW-gross load ● Target completion by 3Q 2019 ● Capacity is contracted under ERC-approved power supply agreement with MERALCO 2x600MW (net) Atimonan One Energy, Quezon ● Committed project with DOE, with Certificate of Energy Project of National Significance ● Ongoing competitive selection process ENERGY FROM WASTE Quezon City Waste to Energy Project (P15.3 billion project cost for Phase 1) ● Aims to convert approximately 3,000 tons of waste to 36 MW net of energy ● Granted original proponent status – no comparable proposals were submitted during Swiss Challenge ● Notice of Award expected to be received in 2H 2019 Biogas – Dole Project (P1.0 billion project cost) ● Aims to derive biogas from the anaerobic digestion of fruit waste from Dole’s canneries in South Cotabato ● Target to generate 5.7 MW of clean energy for Dole and contribute to reduction of CO 2 emission by 100,000 tons/year ● Target completion of facilities by 2Q 2020 5
CON CONTRIB TRIBUTIO TION N UP UP BY BY 6% % TO O P2.4B .4B TOLL ROADS Continu Co inuing ing t traffic fic growth in P in Phil ilipp ippine ine t toll ll roads s and toll ll rate inc increases ses In Millions of Pesos 6% increase in contribution from the Toll Roads 1H 2019 1H 2018 CONTRIBUTION TO MPIC % business was driven by: Metro Pacific Tollways (99.9%) 2,438 2,293 6% Fair value adjustments (13) (12) 8% Strong traffic growth on all domestic roads 2,425 2,281 6% Toll rate increases for NLEX (Open System: 20%; Closed System: 7%) in March 2019 and SCTEX STAND-ALONE PERFORMANCE 1H 2019 1H 2018 % (19%) in June 2019 METRO PACIFIC TOLLWAYS CORPORATION Financial Highlights Revenues 8,923 7,389 21% Core EBITDA 6,258 5,181 21% Offset by: Core income 2,440 2,296 6% Reported income 2,195 2,245 -2% Decline in regional roads traffic Capital expenditure 10,858 3,048 256% Key Performance Indicators Higher interest costs from borrowings used to partially Average Daily Vehicle Entries finance increased investment in PT Nusantara NLEX 268,275 254,791 5% CAVITEX 162,093 146,084 11% SCTEX 70,826 63,118 12% DMT / CII / NUS 404,891 439,333 -8% 6
TOLL ROADS EXP EXPANSIO ANSION N UPD UPDATE TES PHILIPPINES PROJECTS UNDER CONSTRUCTION / DEVELOPMENT PROJECTS Length Construction Cost Target Right-of-way Status Completion Progress (In Km) (In P Billions) EXPANSIONS TO EXISTING ROADS NLEX Harbour Link 2.60 6.70 2019 92% Ongoing construction (Radial Road 10) NLEX Lane Widening N/A Ongoing construction in Segment N/A 2.10 2020 7 (part of NLEX Lane Widening) (Phase 2) CAVITEX Segment 4 1.23 1.52 2021 85% Ongoing ROW acquisition 100% Ongoing construction (includes CAVITEX - C5 South Link 7.70 12.65 2022 recently opened Segment 3A-1 road) Ongoing ROW acquisition NLEX Citi Link 11.50 18.80 2024 0% NEW ROAD PROJECTS AWARDED NLEX-SLEX Connector Road 8.00 23.30 2021Section 1 (Caloocan) Ongoing procurement of contractor - 63%; (Manila) - 58%; Section 2 - 74% Cebu Cordova Link Expressway 8.50 26.60 2021 100% Ongoing construction Cavite Laguna Expressway 44.67 17.00 2022 49% Laguna segment - Ongoing construction; Cavite segment - Ongoing ROW acquisition TOTAL 84.20 108.67 C5 South Link Segment 3A-1 (2.2km) o Began operations on 23 July 2019 Unsolicited Proposal - Cavite Tagaytay Batangas Expressway (50.4 km, P25.0 billion project cost) o Granted Original Proponent Status o Awaiting clearance from NEDA to proceed with Swiss challenge 7
WATER CONTRIB CONTRIBUTIO TION N UP UP BY BY 9% % TO O P2.3B 2.3B Volume lume g growth and tarif iff inc increases ses In Millions of Pesos CONTRIBUTION TO MPIC 1H 2019 1H 2018 % 9% increase in contribution from the Water business Maynilad (52.8%) 2,428 2,232 9% was driven by: Fair value adjustments (102) (98) 4% MAYNILAD WATER SERVICES, INC. Metropac Water Investments Corp. (26) (19) 37% 2,300 2,115 9% 3% volume growth STAND-ALONE PERFORMANCE 1H 2019 1H 2018 % Tariff increases MAYNILAD WATER SERVICES INC. ● Inflation-linked: 5.7% in January 2019 Financial Highlights ● Basic: 2.7% in October 2018 Revenues 12,172 10,961 11% Core EBITDA 8,825 7,915 11% Core income 4,599 4,226 9% Reported income 4,557 15% 3,957 Capital expenditure 5,405 -14% 6,298 Key Performance Indicators Billed volume (In MCM) 261 268 3% *Non-revenue water % - average 31.1% 26.7% -14% *Non-revenue water % - period end 28.9% 24.6% -14% *Measured at the District Metered Area level 8
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