Manila Electric Co. · PSE:MER
Manila Electric — 9M 2013 Earnings Presentation
40 slides from Manila Electric's earnings presentation, Oct 25, 2013
Slide 1: Financial and Operating Results
Investors and Analysts’ Briefing and Teleconference Financial and Operating Results for the Nine Months ended September 30, 2013 October 25, 2013 Pasig Room, 14th Floor, Lopez Building Ortigas Avenue, Pasig City
Slide 2: Operating Results
Investors and Analysts’ Briefing and Teleconference Operating Results for the niine months ended September 30, 2013 Oscar S. Reyes President and Chief Executive Officer
Slide 3: Performance as at Sept. 30, 2013
3Q 2013 ENERGY CUSTOMER Highlights SALES COUNT Sept 2013 YTD Sept 2013 YTD 4.8% 3.3% +1,168 GWh +169,063 NSI Sept 2013 YTD 4.3% EVENTS OF +1,130 GWh INTEREST MPOWER VOLUME Jul - Sept 2013 REGULATORY 59.2% share STANDARDS (RCOA market) Performance as at Sept. 30, 2013 Sept 2013 YTD AVE. RATES ALL REW
Slide 4: 3Q 2013 Highlights
3Q 2013 Highlights Energy Sales, Sept. YTD 4.8%* 4.8%* +1,168 GWh Customer Count, Sept. YTD 3.3%* +169,063 customers Net System Input, Sept. YTD 4.0%* 4.0%* +1,130 GWh MPower Volume Jul-Sept 2013 59.2% of Contestable Customers S-Factor ; GSL Indicators Within Rewards/ Within Regulatory Limits** Ave.
Slide 5: Performance as at Sept. 30, 2013
Performance as at Sept. 30, 2013
Slide 6: Energy Sales, September 2013 YTD
Energy Sales, September 2013 YTD Movers Up 4.8% vs. 2012 at 25,616 GWh (+1,168 GWh) KWH SALESDetails: Share of Sales*: 24,448 4.8% 25,616 Total, in GWh 22,660 22,725 20,392 3.1% 7,778 Industrial 7,546 30.4% 38.9% 5.5% 9,965 Commercial 9,442 30.4% 7,361 5.6% 7,775 Residential *Sales volume for Flat S
Slide 7: Customer Count, September 2013 YTD
Customer Count, September 2013 YTD Up 3.3% vs. 2012 to 5.33 million customers Total of 136,401 new customers* in 2013, majority Residential Details: Share of Count*: CUST COUNT 5.16 5.33 Total, in Million Indl 3.3% 0.2% 4.98 4.67 4.82 0.440M 2.4% 0.450M Commercial 8.4% 4.70M 3.4% 4.86M Residential 9
Slide 8: Net System Input (NSI)
Net System Input (NSI)* Sept 2013 YTD up 4.3% vs. 2012 Meralco peak demand of 5,928 MW , all-time high Meralco YTD Peak Demand, MW: 5,928** 5,633 5.2% Sept 2013 YTD, GWh: 26,475 27,605 4.3% 2012 2013 Luzon YTD Peak Demand, MW: 8,305** 2012 2013 7,889 5.3% Performance as at Sept. 30, 2013 *2013 NSI i
Slide 9: Clark Electric (CEDC), September 2013 YTD
Clark Electric (CEDC), September 2013 YTD Strong growth in Energy Sales and NSI vs. 2012 Energy Sales, GWh Customer Count 279 1,731 1,781 225 24.1% 2.9% 2012 2013 2012 2013 NSI, GWh 295 234 Sales, Share Count, Share 26.3% Commercial 41.2% 56.9% Industrial 57.4% 6.2% Performance as at Sept. 30, 2013
Slide 10: Power Supply Sourcing, September 2013 YTD
Power Supply Sourcing, September 2013 YTD Meralco Captive & Contestable Customers Sept 2013 YTD Sourcing Sept 2013 YTD SOURCE GWh Share PSAs-Total 14,795.8 54.7% SEM-Calaca 2,011.0 7.4% MPPC-Masinloc 2,055.1 7.6% PSAs * TLI-Pagbilao 1,671.8 6.2% 54.7% SMEC-Sual 2,578.3 9.5% SPPC-Ilijan 5,561.4 20.6%
Slide 11: Power Plant Fuel Source Mix, September 2013 YTD
Power Plant Fuel Source Mix, September 2013 YTD Majority of supply used Natural Gas Sept 2013 YTD Mix Sept 2013 YTD SOURCE GWh Share Nat Gas Coal 42.2% Natural Gas 13,658.4 50.5% 50.5% Coal 11,408.3 42.2% Multi-fuel* 1,995.2 7.4% TOTAL POWER SOURCED Multi-fuel (includes Captive, MPower & 27,061.9 10
Slide 12: Contestable Market Share, Jul-Sept 2013 Billings
Contestable Market Share*, Jul-Sept 2013 Billings MPower takes 59.2% of available contestable volume Other RESs 543.3 GWh 40.8% 99 CCs RESs TOTAL ENERGY SOLD 1,332.0 GWh* Performance as at Sept. 30, 2013 MPower 788.6 GWh 59.2% 155 CCs *Contestable Volume 151CCs
Slide 13: Ave. Rates Jul-Sept 2013
Ave. Rates Jul-Sept 2013* Generation Charge, largest component in customer’s bill, 53.2%; Meralco 19.7%; NGCP 9.5% Meralco’s Captive & Contestable Customers (MPower) share System Jul-Sept 2013 Transm. Loss BILL COMPONENT Overall Ave, Charge 5.0% P/kWh (NGCP) Gen. Charge 9.5% Generation Charge 4.66 5
Slide 14: S-Factor Performance: Sept 2013 YTD
S-Factor Performance: Sept 2013 YTD All indicators well within rewards* range; vs. 2012, all indicators improved SAIFI, Forced and PAI (Times) Ave. Time to Process App. (Days) Deadband: 6.98-8.24 Deadband: 7.91-12.28 2013 2.64 2013 4.58 12.9% 3.0% 2012 3.03 improvement vs. 2012 4.72 improvement vs.
Slide 15: System Loss Performance
System Loss Performance 12-MMA ending Sept 2013 at 6.71% Lower by 0.48%pts vs. Sept 2012’s 7.19% LOWEST EVER YEAR AGO 12-MMA (OCT '11-SEPT '12) LATEST 12-MMA (OCT '12- SEPT '13) Chart Title 8.5% SL CAP, 2010-PRESENT 1.79% 7.44 7.14 7.19 6.71 (lowest to-date) Performance as at Sept. 30, 2013 OCT NOV
Slide 16: RY 2014 GSL Performance: Jul-Sept '13
RY 2014 GSL Performance: Jul-Sept ‘13 All GSL performances are well within set limits GSL1 : Customer experiencing a Actual RY2014 5,322 customers cumulative duration of sustained service interruptions in a Regulatory No. of Violations for 373,658 Year that exceeds the threshold RY2014 (Ceiling) GSL
Slide 17: Performance as at Sept. 30, 2013
Performance as at Sept. 30, 2013
Slide 18: Impact of TS Maring-intensified Habagat
Impact of TS Maring-intensified “Habagat” August 19-20, 2013 Circuits tripped 37 Facilities de-energized due to flood • Circuits 12 • Portion of circuit 110 • Distribution transformer 123 • Substation (Las Pinas) 1 Total Customers affected 288,445 Est. Equivalent Damaged Facilities Count Amount Pole
Slide 19: Business Updates: Completed Major ECPs
Business Updates: Completed Major ECPs Sept 27: Commissioning of Calamba Premiere Industrial Park (CPIP) 115 kV Line, Calamba City, Laguna • The new CPIP 115 kV line will serve Air Liquide and the proposed CPIP substation. • It will provide higher reliability of service to Air Liquide once the latte
Slide 20: Business Updates: Events of Interest
Business Updates: Events of Interest Sept 27, 2013 Signing of Meralco-Therma Mobile, Inc. Meralco Electric Vehicle Power Supply Agreement Ceremonial signing of Charging Station Launch Distribution Wheeling Service • Initial contracted capacity of 150 MW (up to 234 MW as determined by capacity Agreem
Slide 21: Business Updates: Initiatives
Business Updates: Initiatives Smart Grid • High-level engagement e-Vehicles with ERC on next steps • Discussions with DOE on the deployment plan of 3,000 eTrikes by 2014 Franchise Asia Philippines. Meralco • Understanding the Meralco Bill Advisory Performance as at Sept. 30, 2013 • Monthly news advi
Slide 22: Business Updates: Events of Interest
Business Updates: Events of Interest Meralco Top Management Updates on Subsidiaries Sends-off Nigeria Team Bayad Center Establishes 2 Regional Hubs MGen Acquires 20% of GBP • Bayad Center, brand leader in over-the- • Signed the Share Sale and Purchase counter payment collection, established 2 Agreem
Slide 23: Business Updates: Events of Interest
Business Updates: Events of Interest Meralco Bags 2013 Human Capital Award • Meralco recognized as Grand Winner in the Asian Human Capital Awards (AHCA) Sept. 12, 2013 • Conferred by Singapore Ministry of Manpower and Human Capital Leadership Institute. • Recognizes Meralco’s innovative and impactfu
Slide 24: Financial Highlights
Investors and Analysts’ Briefing and Teleconference Financial Highlights for the Nine Months ended September 30, 2013 Betty C. Siy-Yap Senior Vice President and Chief Finance Officer
Slide 25: 9M 2013 Financial Highlights
9M 2013 Financial Highlights • Consolidated Core Net Income grew by 5% • Distribution revenue up 13% reflecting increase in energy sales volume across all customer classes and impact of energy sales mix • Pass-through charges to customers lower by 7% reflecting prices of competitively structured Pow
Slide 26: 9M 2013 Financial Highlights
9M 2013 Financial Highlights % (Amounts in Million Pesos, Nine months ended Except Per Share Data and Margin) September 30 Increase/ (Decrease) 2013 2012 Gross Revenues 208,097 214,749 (3.1) Electric 205,321 213,093 (3.6) Non-electric 2,776 1,656 67.6 Costs and Expenses 188,672 199,410 (5.4) Purchas
Slide 27: 9M 2013 Financial Highlights
9M 2013 Financial Highlights Consolidated Core Net Income Consolidated Reported Net Income In Million Pesos In Million Pesos +5% 13,558 -0.01% 12,892 13,646 13,644 9M 2012 9M 2013 9M 2012 9M 2013 Net Income level remains strong driven by Core Distribution • Reflects the effect of 5% increase in volu
Slide 28: 9M 2013 Financial Highlights
9M 2013 Financial Highlights 9M 2012 Consolidated Revenues 9M 2013 Consolidated Revenues P214.8B P208.1B RES Non-Electric P3.7B Subsidies Non-Electric Subsidies & P2.8B P1.7B Others P23M P38M Distribution Distribution P42.3B P37.5B System Loss System Loss P13.2B P11.6B Transmission Transmission Gene
Slide 29: 9M 2013 Financial Highlights
9M 2013 Financial Highlights Purchased Power Cost 2012 2013 23,129 25,565 162,263 175,369 139,134 149,804 Generation Transmission Purchased power cost lower by 7% due to significantly lower average price of purchased power under five (5) new Power Sales Agreements (“PSAs”) implemented shortly before
Slide 30: 9M 2013 Financial Highlights
9M 2013 Financial Highlights CAPEX and Distribution Revenues Commissioning of Laguna Bel-Air Substation (In Million Pesos) 42,285 37,467 16% 14% Commissioning of CPIP 115 kV Line 5,967 6,126 9M2012 9M2013 CAPEX Distribution Revenue Robust network withstood environmental challenges in 3Q2013 and cont
Slide 31: Credit Profile
Credit Profile Cash, Total Debt and Net Debt Solid Credit Position at 9M2013 (In Million Pesos) • Negative net debt position 55,807 58,795 • Free cash flow as at September 30, 2013 at P11.1 B, net of the investment in PacificLight Power Pte. Ltd. in 1Q2013 • Total cash dividends of P11.5B paid durin
Slide 32: Debt Profile
Debt Profile Total Debt Debt Repayment Schedule (In Million Pesos) (In Million Pesos) 4,845 4,115 24,886 24,207 91 -3% 2,366 1,790 7% 2,984 10% 2,756 2,331 10% 2,054 1,790 1,820 1,565 1,019 766 90% 22,429 20,156 83% 374 189 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Long-Term Debt Notes Payab
Slide 33: Investments in Power Generation
Investments in Power Generation Strategic investments in power generation through MGen expected to provide returns starting 2014 • In March 2013, FPM Power Limited, in which MGen has a 40% equity interest acquired a 70% equity in PacificLight Power Pte. Ltd., which is in the final stages of developm
Slide 34: Summary
Summary Strong results through the first three quarters of 2013 Sustained growth in energy sales across all customer classes Competitively sourced power for captive and contestable customers Cost containment and prudent spending support overall operating performance A new business platform through M
Slide 35: Meralco PowerGen Project Updates
Investors and Analysts’ Briefing and Teleconference Meralco PowerGen Project Updates As at September 30, 2013 Aaron A. Domingo Executive Vice President and General Manager, Meralco PowerGen Corporation
Slide 36: Quezon Power 2
Quezon Power 2 Joint Development Agreement (JDA) was signed on Aug 29, 2013 between New Growth BV and Meralco PowerGen for the development of a 460 MW (net) supercritical coal-fired power plant in Mauban, Quezon. Full development activities are currently underway. Invitations to Bid to a shortlist o
Slide 37: Global Business Power Corporation Aquisition
Global Business Power Corporation Aquisition On 22 October 22 2013, Meralco PowerGen acquired 20% stake in Global Business Power Corporation (“GBPC”). Other shareholders in GBPC are GT Capital Holdings, First Metro Investment Corporation and ORIX Corporation. GBPC is the largest Independent Power Pr
Slide 38: PacificLight Power
PacificLight Power On March 28, 2013, FPM Power Holdings Limited, a 40-60 joint venture company between Meralco PowerGen and First Pacific Co. Limited, officially acquired a 70% stake of GMR Energy Singapore, which owns an 800-MW LNG-fired power plant in Jurong Island, Singapore. Petronas is the rem
Slide 39: Cautionary Statements
Cautionary Statements This presentation is prepared for the participants of the MERALCO Investors and Analysts’ Briefing & Teleconference held on October 25, 2013. This presentation has consequential limitations and is not a comprehensive discussion about Manila Electric Company and Subsidiaries (ME
Slide 40: Performance as at Sept. 30, 2013
Performance as at Sept. 30, 2013
Manila Electric Company (Meralco) — 9M 2013 Earnings Presentation on 6ix