First Gen Corp. demonstrated resilience in the first nine months of the year, achieving a 4% increase in attributable net income, reaching $215.4 million. This positive trend emerged despite a challenging energy market and fluctuating fuel sources, showcasing the company’s adaptability.
Overall revenues experienced a slight dip, falling 3.3% to $1.79 billion, primarily due to reduced output from natural gas and geothermal facilities. However, strategic gains in other areas of the portfolio mitigated the impact of these declines.
A remarkable surge in hydropower performance fueled much of the company’s success. The hydropower segment saw a substantial 65% jump in earnings, climbing to $23 million, a testament to optimized operations and favorable conditions.
The Pantabangan-Masiway power plants were key contributors, generating $13 million – a significant increase from the previous $3 million. This boost was directly linked to a higher initial water level, maximizing energy production potential.
The recent acquisition of the 165-MW Casecnan hydropower plant proved immediately impactful, contributing $628 million to the company’s earnings during the nine-month period. This addition significantly bolstered First Gen’s renewable energy capacity.
While natural gas remains the largest contributor to First Gen’s earnings (65%), this sector experienced an 8% decline, reaching $138 million. Losses at the San Gabriel plant were a primary factor in this downturn.
However, other conventional gas plants – including Santa Rita, San Lorenzo, and Avion – showed improved performance, benefiting from reduced debt and associated interest savings. These plants demonstrated operational efficiency despite broader market pressures.
FGEN LNG Corp., operating the Batangas LNG terminal, delivered a solid recurring net income of $31 million, highlighting the growing importance of liquefied natural gas in the energy mix. This terminal plays a crucial role in securing fuel supply.
Energy Development Corp. (EDC), First Gen’s geothermal subsidiary, faced headwinds, with earnings dropping 36% to $38 million. Lower spot prices and increased expenses related to expansion projects contributed to this decrease.
Despite these challenges, EDC is actively expanding its capacity, currently completing 83 MW of geothermal projects alongside 40 megawatt-hours of battery and energy storage solutions. These investments signal a commitment to future growth.
First Gen’s President and Chief Operating Officer expressed satisfaction with the company’s steady income growth, acknowledging the difficult industry landscape of lower prices and reduced demand. The company is navigating these conditions effectively.
Ongoing negotiations with Manila Electric Co. regarding the extension of the power supply agreement for the Santa Rita gas plant are a priority. Securing this agreement is vital for maintaining a stable energy supply.
First Gen stands as a significant independent power producer, boasting a total installed capacity of 3,696 MW. This diverse portfolio spans natural gas, geothermal, hydroelectric, wind, and solar technologies, positioning the company for long-term success.
