Manila Water Company: Manila Water Posts 19% Revenue Growth

Manila Water Posts 19% Revenue Growth

Posted: Thursday April 12, 2007

Manila Water reported strong first quarter performance with 19% revenue growth to P1.72 billion. Earnings before interest, tax, depreciation and amortization (EBITDA) posted a faster growth at 33%, to P1.13 billion by the end of March 2007, owing to the effective management of operating expenses. This robust growth at the topline helped cushion the impact of the expiration of the company’s income tax holiday. The Company provided a total of P234 million for income tax payments, thus resulting in a 15% decline in net income year-on-year, to P509 million in the 1st quarter 2007.

The Company attributes its revenue performance to the increase in its sales (billed volume) which reached 992 million liters per day, as of end of March 2007. This is its highest billed volume level recorded to-date, and reflects a 12% growth over the same period last year. Consequently, non-revenue water level was further reduced to 27%, setting a new record for the Company since it started operations in 1997.

“We are pleased to note that our first quarter results exceeded our business plan. We are now seeing the initial results of our aggressive expansion initiatives, particularly in the areas of Taguig, Antipolo, Cainta, Taytay, Rodriguez, San Mateo, and even up to Baras and Jala-jala,” said Manila Water President Antonino T. Aquino. “We are confident that we can sustain this positive momentum for the rest of the year, as we continue our aggressive capital investment program in the East Zone,” Aquino added.

In its annual stockholders meeting held last month, Manila Water announced that it will invest at least P30 billion pesos in projects within its concession area in the next five years. These projects include the extension of the water network up to the farthest areas in Rizal, expansion of sewer and sanitation coverage and development of new water sources. In the same meeting, the Company assured its stockholders that it can sustain the current cash dividend per share even with the prospective tax payment and huge capital requirements, through its strong cash earnings as demonstrated by its EBITDA and good collection efficiency.

Manila Water’s announcement of its first quarter results came at the heels of recent positive news that Manila Water was pre-qualified to bid for the Ho Chi Minh NRW Reduction Project. Manila Water had earlier announced its intentions of exploring new opportunities outside Metro Manila and within the Asian region.