Manila Water continued its strong performance for the first half of 2018, achieving net income growth of 10 percent from the previous year to reach P3.55 billion. This was mainly driven by the Manila Concession, supported by the contribution of international subsidiaries under Manila Water Asia Pacific (MWAP).

On a consolidated level, Manila Water maintained its healthy topline trend from the start of the year, posting 8 percent growth to P9.61 billion fueled by higher billed volume (water volume sold) and additional service connections. Recent international acquisitions in Thailand and Indonesia, along with existing operations in Vietnam have yielded notable gains, with income contribution of international subsidiaries growing by 86 percent from the previous year. Cost of services and operating expenses grew by 17 percent to P3.73 billion, as continuing business operations and development efforts remain in-step with growth aspirations.

In the Manila Concession, billed volume growth remained robust at 3 percent, with billed connections increasing to total over 975,000. In line with continued operations efficiency, systems losses (Nonrevenue Water) improved to 12.1 percent via pipeline replacement and asset repair programs. Capital expenditures (CAPEX) maintained its upward trend to reach P4.28 billion – 22 percent better than the same period last year – as the Company works to complete major phases of its water and used water projects.
 
Domestic subsidiaries under Manila Water Philippine Ventures (MWPV) posted 14 percent revenue growth to P1.69 billion, supported by steady billed volume and service connections at 2 percent growth. While the increase in operating costs and slowdown in project take-up has affected MWPV net income, business building efforts continue. MWPV was recently granted a 25-year franchise to provide water and sanitation services in Sta. Barbara, Pangasinan, and a Notice of Award was similarly granted by the Pagsanjan Water District for a joint venture in water supply and sanitation services provision. MWPV is now working on its submission of a bid proposal for New Clark City, a water and used water concession project of the Bases Conversion and Development Authority (BCDA). The project will have a concession period of 30 years, with an estimated CAPEX of P10 billion. 

MWAP has made great strides in its ASEAN growth expansion, posting an 86 percent increase in equity share in net income of associates to P339 million. All operating subsidiaries in Vietnam exhibited healthy net income growth, with the new regional acquisitions – East Water in Thailand, and PT Sarana Tirta Ungaran in Indonesia – contributing positive earnings.

Several projects are currently in the pipeline. For Indonesia, MWAP has submitted a bid for the West Semarang Water Supply project – a water supply PPP with a 25-year contract period and estimated CAPEX of USD34 million. Also, in Indonesia is the Sembayat Gresik Water Supply BOT, with a similar 25-year contract period and CAPEX of USD56 million. Further west, Manila Water has been invited to participate in the Weliwita Bulk Water project in Sri Lanka, with a 30-year contract period and estimated CAPEX of USD133 million.

Manila Water President and CEO Ferdinand M. Dela Cruz said these positive developments augur well with the Company’s growth aspirations not only in the domestic market, but more importantly as it continues to strengthen and pursue its ASEAN expansion initiatives. “We are pleased with the fresh growth trends happening in the original Manila East Zone Concession due to redevelopment, rising affluence in the metropolis as well finally supplying the other fast developing towns in the Rizal Province very soon. At the same time, we are very excited about our new business opportunities, as these are building blocks of our domestic and ASEAN growth strategy. We are confident that we will provide the brand of excellent service that Manila Water has built over the past 21 years to these new markets.”

For more details, please click the following links:

• 1H2018 Analysts' Briefing Presentation
• 1H2018 Form 17-Q
• 1H2018 Form 17-C