METRO Pacific Investments Corp. (MPIC) said its core net income rose 8 percent during the first nine months of the year to P12.2 billion, from last year’s P11.3 billion, but it warned it will have a flat growth in the last quarter of the year.
David J. Nicol, the company’s chief finance officer, said the company’s core income may end the year at P15 billion, or slightly higher than last year’s P14.1 billion. “We think that the fourth quarter will be flat on a year ago,” Nicol said in a briefing.
Jose Ma. K. Lim, the company’s president and CEO, said increasing funding costs are likely to be a drag on MPIC’s fourth-quarter core income, which would continue through next year.
He said the company’s volume growth for most of its businesses in the third quarter slowed due to a combination of rising inflation and unusually damp and cool weather, “to which our residential customers in the power sector are especially sensitive.”
“I expect volumes to recover to more normalized levels in the last three months of the year, but more fundamentally, our extensive investment program is leading to rising finance costs,” he said.
“It will be some time before our new road, water and logistics projects are completed, and able to make a contribution to earnings. In the meantime, the immediate debt costs incurred to support these investments during their completion period would likely have an effect on near-term profit outlook,” he said.
Power accounted for P8.5 billion, or 55 percent, of net operating income; toll roads contributed P3.3 billion, or 21 percent; water contributed P3 billion, or 20 percent; the hospitals group provided P586 million, or 4 percent; and the rail, logistics and systems group delivered P26 million.
MPIC Chairman Manuel V. Pangilinan said volumes in the succeeding quarters should be better than in the third quarter.
“I expect minimal growth in fourth-quarter core net income compared with the same quarter last year. We are working hard but constructively with the government to resolve pending issues involving tariffs and rights of way,” he said.