Manila Water Company: Manila Water Posts 10% Net Income Growth in the 3rd Quarter

Manila Water Posts 10% Net Income Growth in the 3rd Quarter

Posted: Friday October 5, 2007

Manila Water announced today that its 3rd quarter net income grew to P641 million, or up by 10% over the same quarter last year, despite the expiration of its income tax holiday in 2007.

This quarterly momentum enabled the Company to recover from the last two quarters, which had been affected by the 35% income tax provision starting 2007. Thus, year-to-date bottom line improved to P1.8 billion, which already approximated the prior year’s net income level for the same three quarters.

Manila Water President Antonino T. Aquino explains, “We are pleased that our continuing capital expenditure program has resulted to significant improvements in our operating efficiencies which in turn translated to better service for our customers and sound financial results for our shareholders. To date, our investments have already exceeded P25 billion, and we intend to increase this by at least P30 billion over the next five years.”

Manila Water’s strong financial showing was backed by solid operational results. Average quarterly water sales (or “billed volume”) increased by 13% year-on-year to an average of 1,054 million liters per day for the 3rd quarter ending September 2007 as a result of the Company’s expansion program while the level of non-revenue water (NRW) was maintained at 25%, recording more than 5 percentage points improvement as compared with the level one year ago.

“Our stable cash flows and healthy balance sheet will prime us to continue our investments in the East Zone and explore new projects beyond our concession area. As I have said earlier this year, we are confident that we can sustain this positive momentum for the rest of 2007 and in the coming year,” Aquino added.

Manila Water is actively pursuing projects outside of its concession area. After the announcement of its pre-qualification, the Company is now preparing for the bidding for Ho Chi Minh NRW Reduction Project and Hongkong Wastewater Design-Build-Operate (DBO) Contract.

In early September, Philratings, a recognized Bangko Sentral ng Pilipinas (BSP) credit rating agency, affirmed Manila Water’s ‘PRS Aaa’ rating. The Company’s proven track record in operations and sustained earnings generation have been the major considerations for assigning this highest credit rating by Philratings.

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