Manila Electric Co. · PSE:MER
Manila Electric — Q1 2021 Earnings Presentation
43 slides from Manila Electric's earnings presentation, Apr 26, 2021
Slide 1: First Quarter 2021 Financial and Operating Results
FIRST QUARTER ENDED MARCH 31, 2021 FINANCIAL AND OPERATING RESULTS April 26, 2021
Slide 2: Q1 2021 Financial Highlights
Q1 2021 FINANCIAL HIGHLIGHTS
Slide 3: Financial Summary Q1 2021 vs. Q1 2020
FINANCIAL SUMMARY Q1 2021 vs. Q1 2020 Amounts in million Pesos COSTS & EXPENSES, NET INCOME & CASH & REVENUES CAPITAL EBITDA BORROWINGS EXPENDITURES Q1 2021 Q1 2020 Q1 2021 Q1 2020 Q1 2021 Q1 2020 Q1 2021 Q1 2020 Core Net Income Gross Revenues Purchased Power Cost Cash and Cash Investments 5,113 5,7
Slide 4: Revenues Q1 2021
REVENUES Q1 2021 Amounts in million Pesos, except percentages Gross Revenues Electric Revenues 67,348 62,484 15,015 7% 7% 14,387 14,387 69,466 64,712 48,097 52,333 48,097 2,228 Q1 2020 Q1 2021 Distribution Generation and Non-electricity other pass- Q1 2020 Q1 2021 through Generation and other pass t
Slide 5: Costs & Expenses, Capex Q1 2021
COSTS & EXPENSES, CAPEX Q1 2021 Amounts in million Pesos, except percentages Capital Expenditures Costs and Expenses Breakdown 4,242 4,152 1% 5,230 2,050 542 17% 66,652 55,304 47,482 Q1 2020 Q1 2021 Salaries and Depreciation Other Purchased Q1 2020 Q1 2021 contracted and Expenses Power services amor
Slide 6: Net Income and EBITDA Q1 2021
NET INCOME AND EBITDA Q1 2021 Amounts in million Pesos, except percentages Core and Reported Net Income Difference Net Income and EBITDA 52 Margins 8% 8% 4% 7% 12% 19% 7% 18% 207 333 12,021 11,784 705 8,408 43% 5,113 5,724 5,113 5,095 4,334 4,334 131% 11% 2,619 65% Core Gain on Foreign Accretion of
Slide 7: GBPC Acquisition
GBPC ACQUISITION Amounts in billion Pesos On March 31, 2021, the Share Purchase Agreements for the acquisition of 86% of GBPC was closed. The assets and liabilities of GBPC were consolidated in the books of MGen, including the following: 6.65 Property Plant and Equipment 41.9 7 Intangible Assets 13.
Slide 8: Debt and Credit Profile Q1 2021
DEBT AND CREDIT PROFILE Q1 2021 Amounts in million Pesos, except percentages Total Debt Breakdown Long-Term Debt Repayment Schedule 10,878 27,654 6,912 118% 13,467 6,639 6,107 89,172 3,998 48,051 2,484 40,812 1,559 1,649 621 925 171 186 203 220 Q1 2020 Q1 2021 Notes Payable Interest Bearing Interest
Slide 9: Earnings Per Share
EARNINGS PER SHARE Amounts in Pesos per share, except percentages Core and Reported Earnings per share 5.08 4.54 3.85 11% 2.32 66% Core Earnings per share Earnings per share Q1 2020 Q1 2021
Slide 10: Q1 2021 Operational Results
Q1 2021 OPERATIONAL RESULTS
Slide 11: Performance Highlights First Quarter 2021 vs. 2020
PERFORMANCE HIGHLIGHTS FIRST QUARTER 2021 VS. 2020 BUSINESS DRIVERS SERVICE PERFORMANCE ELECTRICITY RATE CONSOLIDATED ENERGY SALES SYSTEM LOSS AVE. RETAIL RATE 10,473 GWh 6.14% 7.82 PhP/kWh ▼4% VS. 2020 ▲0.72 %PT, 12-MMA ▼3% CONSOLIDATED SYSTEM AVE. INTERRUPTION CUSTOMER COUNT FREQUENCY INDEX 7.205
Slide 12: Q1 2021 Consolidated Energy Sales
Q1 2021 CONSOLIDATED ENERGY SALES (in GWh) Strong growth from Residential and Industrial, but Commercial still lagging due to impact of pandemic 10,879 10,473 ▼4% 10,145 10,381 3,135 29% 31% 9,317 3,261 Industrial ▲ 4% 4,343 40% 3,560 Commercial 34% ▼ 18% 35% 3,365 31% 3,616 Residential ▲ 7% Sales v
Slide 13: Q1 2021 DU Energy Sales Profile and Drivers
Q1 2021 DU ENERGY SALES PROFILE AND DRIVERS RESIDENTIAL ▲ 8%, YTD COMMERCIAL ▼18%, YTD INDUSTRIAL ▲ 4%, YTD 2,000 2,000 2,000 1,500 1,500 1,500 1,000 1,000 1,000 500 500 500 0 0 0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun
Slide 14: Q1 2021 Consolidated Customer Count
Q1 2021 CONSOLIDATED CUSTOMER COUNT (in M) Increased customer count driven by service applications and energization returning to pre-ECQ levels 7.205 6.956 0.011 ▲3.6% Industrial 0.011 0.545 8% Commercial 0.533 6.644 Residential 6.408 92% Customer count of Parent is 99.9%, CEDC is 0.1% Flat streetli
Slide 15: Other Customer Updates: Summer Campaign
OTHER CUSTOMER UPDATES: SUMMER CAMPAIGN PRIMING 1 February 27 - March 27 (5 weeks) via PR, FB, IG, HOA Viber Groups, Meralco Advisory, Bill Ads, BC Pullup Banners Facebook Art Cards March Default Residential Bill Ad AWARENESS 2 March 28 - June 5 (9 weeks) via FB, IG, YouTube, Website Articles, HOA V
Slide 16: Q1 2021 Consolidated Net System Input
Q1 2021 CONSOLIDATED NET SYSTEM INPUT (in GWh) Lower vs. 2020 due to impact of community quarantine 11,402 ▼4% 10,993 10,981 10,767 9,968 Parent is 99%, down by 4% vs. 2020 YTD CEDC is 1%, down by 8% vs. 2020 YTD 2017 2018 2019 2020 2021 16
Slide 17: Q1 2021 Consolidated NSI Breakdown
Q1 2021 CONSOLIDATED NSI BREAKDOWN (in GWh) 10,981 GWh NET SYSTEM INPUT IPPs/Old PSAs Natural Gas 5,468 4,644 50% 42% POWER SOURCES FUEL MIX Coal New PSAs 3,136 10,981 29% 2,539 23% Other RES Multi-fuel 1,825 3,157 17% 29% WESM Special Contracts 1,028 Solar Liquid Fuel 120 9% 37 6 1% 17
Slide 18: Q1 2021 Peak Demand
Q1 2021 PEAK DEMAND (in MW) Meralco and Luzon peaks lower vs. 2020 driven by COVID-19 and cooler weather 11,103 ▼5% 10,54 3 ▼7% 7,614 7,115 MERALCO LUZON 2020 Mar 10 2021 Mar 18 2020 Mar 9 2021 Mar 18 18
Slide 19: March 2021 System Loss Performance
MARCH 2021 SYSTEM LOSS PERFORMANCE (in %, 12-MMA) Higher by 0.72% points vs. 2020 due to shift in sales mix towards higher loss-to-serve Residential segment 6.5% SYSTEM LOSS CAP starting January 2021 6.44 6.19 6.18 6.10 6.14 6.08 6.03 5.96 5.97 5.85 5.72 5.74 5.65 5.60 5.56 5.55 5.55 5.55 5.54 2019-
Slide 20: March 2021 S-Factor Performance (Network)
MARCH 2021 S-FACTOR PERFORMANCE (NETWORK) Rewards levels* across all performance indicators SAIFI SAIDI CAIDI Forced and Pre-arranged Forced and Pre-arranged Forced and Pre-arranged times in minutes in minutes ▼4% 104.531 ▼2% 100.059 24.157 ▲3% 0.2370 23.714 0.2311 2020 2021 2020 2021 2020 2021 Rewa
Slide 21: March 2021 S-Factor Performance (Customer)
MARCH 2021 S-FACTOR PERFORMANCE (CUSTOMER) Rewards levels* across all performance indicators AVERAGE TIME TO AVERAGE TIME TO CALL CENTER PROCESS APPLICATIONS CONNECT PERFORMANCE in days in days in seconds ▲6% ▲16% ▲19% 8.90 3.57 1.81 8.41 3.07 1.52 2020 2021 2020 2021 2020 2021 Rewards < 7.90 Reward
Slide 22: March RY2021 Guaranteed Service Levels (GSL)
MARCH RY2021 GUARANTEED SERVICE LEVELS (GSL) Continued to deliver well within performance ceilings* GSL 1 GSL 2 GSL 3 GSL 4 Customers experiencing Customers experiencing a Restoration of supply to a Connection not provided on cumulative duration of number of sustained customer after a fault on the d
Slide 23: Q1 2021 Networks Capex
Q1 2021 NETWORKS CAPEX (in PhP, B) 17% of full year CapEx utilized with spend across all project types, particularly asset renewals PhP 19.08B CAPEX BUDGET 7.31 New Connections 1.37 4.83 Asset Renewals 0.88 3.76 Load Growth PhP 3.314 17% UTILIZATION 0.72 1.84 Non-Network 0.27 Electrification 0.11 0.
Slide 24: Networks Project Updates
NETWORKS PROJECT UPDATES EXPANSION OF SAN PABLO 2 115 KV-34.5 KV SUBSTATION (BANK 2) • Commissioned on January 10, 2021 • Resolves critical loading of existing 83 MVA transformer bank • Provides much-needed flexibility and reliability in: - San Pablo and Alaminos in Laguna - Dolores, Tiaong, Candela
Slide 25: Networks Project Updates
NETWORKS PROJECT UPDATES EXPANSION OF PULILAN 69KV-13.8KV SUBSTATION (2ND BANK) • Commissioned on February 24, 2021 • Addresses critical loading of existing Pulilan 33 MVA Bank No. 1 through additional capacity of new 50 MVA Bank No. 2 • Provides switching flexibility during maintenance and continge
Slide 26: Networks Project Updates
NETWORKS PROJECT UPDATES EXPANSION OF LISP 115KV-34.5KV GIS SUBSTATION (2ND BANK) • Commissioned on February 26, 2021 • Addresses forecasted critical loading of existing LISP Bank No. 1 • Provides additional capacity to accommodate new load requirements of Light Industry and Science Park (LISP) loca
Slide 27: Networks Project Updates
NETWORKS PROJECT UPDATES REPLACEMENT OF TAGAYTAY 115KV- 13.8KV POWER TRANSFORMER BANK • Commissioned on February 27, 2021 • Replacement of 22-year-old transformer bank which failed in November 2018. It was temporarily replaced by 41-year-old transformer bank pulled out from Los Baños Substation. • N
Slide 28: Networks Project Updates
NETWORKS PROJECT UPDATES UPRATING OF CRUZ NA DAAN (CND) 69KV-13.8 KV SUBSTATION TO 50 MVA • Commissioned on March 28, 2021 • Replaced existing critically loaded two 10 MWA transformers • Provides operational switching flexibility and helps reduce technical losses • Improves voltage regulation in San
Slide 29: Networks Project Updates
NETWORKS PROJECT UPDATES ENERGIZATION OF VACCINATION FACILITIES Meralco remains committed to #KeepTheLightsOn in support of COVID-19 Vaccine Roll-out Program • February 28, 2021: Inspection of distribution facilities serving MetroPac Movers, Inc. (MMI) in Marikina City which serves as storage facili
Slide 30: Networks Project Updates
NETWORKS PROJECT UPDATES MERALCO ELECTRIFICATION PROGRAM PROJECTS (PRIORITY 2 AND 3)* MEP Priority 2 & 3 Over-all Completion Status per Province Bulacan 124 sites (91%) For Construction 536 P2 and P3 Sites Energized Cavite 80 sites (66%) 72% Laguna 59 sites (68%) 28% Php 1.1 Billion project cost est
Slide 31: Q1 2021 Average Retail Rate
Q1 2021 AVERAGE RETAIL RATE PhP 0.29 reduction vs. 2020 • 5.6% decrease in Generation charge due to implementation of new PSAs starting February 2020 billing, lower WESM and fuel prices, and peso appreciation 8.11 • 0.5% decrease in Transmission charge due to ERC-approved transmission over- PhP/kWh
Slide 32: Other Regulatory Updates
OTHER REGULATORY UPDATES MERALCO-MPPCL PSA • Per NGCP, “Thin operating margin is forecasted in the Luzon grid from April to August 2021 due to multiple power plants on extended outage, thereby providing limited power supply.” • This is aligned with MERALCO’s forecast that shows upcoming scheduled ou
Slide 33: Meralco's Sustainability Committee
MERALCO’S SUSTAINABILITY COMMITTEE ESTABLISHED AT THE BOARD LEVEL OBJECTIVES COMPOSITION • Oversee Meralco’s sustainability • Chairman strategy, policies, and programs • 4 Directors (with 1 independent) • Monitor Company’s economic, environmental, and social performance vis-à-vis United Nations Sust
Slide 34: Sustainability Initiatives Recognized at 18th Philippine Quill Awards
MERALCO’S SUSTAINABILITY INITIATIVES RECOGNIZED AT 18TH PHILIPPINE QUILL AWARDS Sustaining the Future: 2019 Meralco Sustainability Report Excellence Awardee POWER PLANET PEOPLE PROSPERITY Meralco’s Revitalized Renewable One For Trees: Engaging Employees CovidComms 2020: CovidComms 2020: Energy Push
Slide 35: Q1 2021 Power Generation
Q1 2021 POWER GENERATION OPERATIONAL HIGHLIGHTS
Slide 36: San Buenaventura Power Limited Co. (SBPL)
San Buenaventura Power Limited Co. (SBPL) 500MW (gross) Supercritical Coal-Fired Power Plant in Mauban, Quezon ▪ First operational supercritical coal power plant in the Philippines, commercial operations started on September 26, 2019. ▪ Joint venture of MGen with New Growth, B.V., a wholly owned sub
Slide 37: Atimonan One Energy, Inc. (A1E)
Atimonan One Energy, Inc. (A1E) 2x600 MW (net) Ultra Supercritical Coal-Fired Power Plant in Atimonan, Quezon Total Project Cost: <PhP160 Billion (<USD 3.0 Billion) ▪ Other offtake options for the plant’s capacity are currently being explored, including participation in the next round of Meralco’s C
Slide 38: Global Business Power Corp. (GBPC)
Global Business Power Corp. (GBPC) ▪ On December 23, 2020, MGen acquired the holdings of Beacon Power Holdings, Inc. (56%) and JG Summit Holdings, Inc. (30%) in GBPC through separate Share Purchase Agreements. ▪ Transactions closed on March 31, 2021; MGen now owns 100% of GBPC. ▪ GBPC is the largest
Slide 39: MGEN Renewable Energy, Inc. (MGreen)
MGEN Renewable Energy, Inc. (MGreen) ▪ MGreen targets around 1,500 MW of renewable energy projects over the next 5 to 7 years. ▪ The focus is on the development of a portfolio of utility scale solar, wind and hydro power projects to supply Luzon grid and electricity consumers with competitive tariff
Slide 40: PowerSource First Bulacan Solar, Inc. (PFBSI)
PowerSource First Bulacan Solar, Inc. (PFBSI) 50MWac/80.9MWdc Solar Power Plant in San Miguel, Bulacan Total Project Cost: PhP4.25 Billion ▪ MGen’s first solar investment covering a total land area of 72 hectares ▪ In January, MGreen increased its shareholding in PFBSI to 60% following the buyout of
Slide 41: Solar PV Farm
Solar PV Farm 41 i) eae
Slide 42: Substation and Main Control Building
Substation and Main Control Building 42
Slide 43: Cautionary Statement
CAUTIONARY STATEMENT This presentation is prepared for the parties presently invited for the purpose of discussion. This presentation has consequential limitations and is not a comprehensive discussion about MANILA ELECTRIC COMPANY AND ITS SUBSIDIARIES (Meralco). These materials are restricted to th
Manila Electric Company (Meralco) — Q1 2021 Earnings Presentation on 6ix