Manila Water Co., Inc. reported a net income of P5.5 billion in 2019, which is 16% lower compared to its 2018 performance. According to the company, the impact of a regulatory penalty hurt its performance. One-time bill waivers and higher expenses due to the shortage of water in the first half of the year were also factors in the lower net income for the year. This Ayala-led company faced a lot of challenges during the year, combined with management of the constrained raw water supply and the increasing expenses.
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The operating revenues of Manila Water increase by 11% in 2019, or equivalent to P21.95 billion. Likewise, its operating costs and expenses jumped to P9.83 billion or 22% higher compared to the previous period. 75% of the company’s operating revenues came from the sale of water, net of bill waiver. Meanwhile, 16% of it was from environmental and sewer charges. The firm reported the increase in cost and expenses was due to the penalty given by the Metropolitan Waterworks and Sewerage System connected to water shortage during the first half of the year.
Manila Water still got support from its domestic subsidiaries in 2019. Manila Water Philippine Ventures, Inc. (MWPV) reported a net income of P450 million, which is 131% higher than the previous year. The main contributors to this net income increase were Boracay Water, Laguna Water, and Estate Water. On a consolidated MWPV level, the firm disclosed the revenues were higher by 45% to P4.85 billion. Estate Water got higher revenues because of its supervisions fees and project management services. Boracay Water and Laguna Water brought higher average tariff levels. Apart from MWPV, some of Manila Water’s subsidiaries reported an increase in billed volume in 2019.
President Duterte gave the threat to file economic sabotage cases against the two large water companies—Maynilad and Manila Water because of the supposed onerous provisions that are included in their contracts with the government. The revised version of the contracts for these two firms is targeted to be finished before December 2019 ends. With the revised contract, the government said that it is giving the two firms an opportunity to renegotiate the terms of their agreement. So far, the company is still hanging with this issue last year.