MPIC NET INCOME FALLS BY 10% IN Q2 | Marvin Germo

MPIC NET INCOME FALLS BY 10% IN Q2

By: Marvin Germo | August 4, 2019

Quarter 2 Earnings

Metro Pacific Investments Corporation (MPIC) reported a drop in earnings by 9.8% in the second quarter of 2019. The net income during this period reached P4.6 billion and it was seen lower than the P5.1 billion net earning posted in the previous year during the same period. Now that the second quarter of the year is done and all companies are reporting their performance for the said period, it’s a good thing for investors to know the current state of the firm they are investing in or planning to buy stocks from. Let’s take a look at the factors that affect the net income of MPIC.

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Foreign Exchange Losses

Along with the disclosure of the net losses, MPIC also told the public the reason behind these figures. According to the popular conglomerate, foreign exchange losses were one of the factors why the earnings dropped during this period. The firm said that the foreign exchange difference was compared to most companies wherein there was a reverse effect. When the peso was weakening, MPIC was getting foreign exchange gains and when the peso starts strengthening again, foreign exchange losses were generated. This was on foreign currency deposit of Meralco and some of its associate abroad. From gains last year, it turned out to be losses this quarter.

Meralco and MPTC Performances

To break down the P12.799 billion net income generated in the second quarter, here’s what MPIC has disclosed: its power business made up P6.1 billion of its core net income and its 4% higher year on year. All thanks to energy sales of Meralco that took a jump this quarter in spite of the Global Business Power Corporation’s slow contribution! 10% growth in total revenues or P165 billion was achieved if we take a look at the performance of Meralco alone. P2.4 billion core net income can be attributed to the toll road business operated through Metro Pacific Tollways Corporation (MPTC) and it’s 6% higher year on year.

MPHHI, LMRC, and Maynilad Water Services Performances

The recent news involving Metro Pacific Hospital Holdings, Incorporation (MPPHI) was about the extension of the tender offer to acquire stocks from Medical Doctors Inc. (MDI). This quarter, this hospital business of MPIC, reported a 21% hike in core net income. Outpatient visits improved by 10% while inpatient admissions grew by 6%. Light Rail Manila Corporation (LRMC) accounted for P168 million core net income and it was utilized again in order to improve the train operations. Lastly, Maynilad Services contributed P4.6 billion earnings, 9% higher than the previous year.

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