Vol. XXII, No. 161 [ BusinessWorld Online ]
Wednesday, March 18, 2009 | MANILA, PHILIPPINES
PANGILINAN-LED Metro Pacific Investments Corp. expects profits to jump by more than threefold this year as subsidiaries ranging from hospitals to tollway management bring in more cash.
In a press briefing yesterday, Metro Pacific Chairman Manuel V. Pangilinan said the company expects core net income to reach P1.2 billion in 2009 from last year’s P347.1 million, as a result of "cautious confidence."
"In contrast to the increasingly pessimistic outlook for the global economy, prospects for [Metro Pacific] in 2009 are actually quite sanguine — driven by anticipated improved operational performances and stronger financial results of the subsidiaries and affiliates," Mr. Pangilinan said.
"This favorable impression of [Metro Pacific’s] performance [this year] is the result of new investments made in recent years, which have reinforced the growth and stability of [Metro Pacific] as an important infrastructure company in the country," he added.
Metro Pacific Investments Corp. Chairman Manuel V. Pangilinan (right) announces the 2008 financial results of his growing investment powerhouse, joined by company president Jose Ma. K. Lim (left) and other officials. — PHOTO BY JONATHAN CELLONA
Including one-time gains, the company reported net income of P548.9 million for 2008, reversing the previous year’s net loss of P110.4 million. Underlying profits reached P347.1 million, 11 times higher than the previous year’s P32.3 million.
Metro Pacific said this was due to the improved performance of Maynilad Water Services, Inc., Metro Pacific Tollways Corp. and health care businesses such as Medical Doctors, Inc. and the Davao Doctors’ Hospital, Inc.
Maynilad remitted P1.306 billion to Metro Pacific following a 10% increase in billed water volume to 315 million cubic meters, new connections, and an 8% increase in billed customers to 762,315.
Profits of Metro Pacific Tollways, operator of the North Luzon Expressway, went down by 5% to P1.51 billion on lower traffic volume amid high fuel prices during the second half of 2008 and a reduction in toll rates.
"It was a difficult year for the tollways because of the very volatile price in gasoline which resulted in a severe drop in traffic toward the second half of the year. We also had a reduction in toll rates because of the strong peso at the start of the year," said Jose Ma. K. Lim, Metro Pacific president.
"Traffic started to recover at the end of [2008]. As of the first two months [of 2009], we are back to 145,000 cars per day. We expect this level of traffic to continue for the rest of the year," Mr. Lim said.
Mr. Lim said the purchase of the 67.1% controlling interest in North Luzon Expressway held by the Lopez-led First Philippine Infrastructure, Inc. for P12.3 billion was the company’s biggest last year.
Metro Pacific said hospitals continued to remain profitable. Revenues of Medical Doctors, owner of the Makati Medical Center, rose by almost a fifth to P3.2 billion in 2008 despite fewer beds as a result of renovation. Profits though went down by a tenth to P222 million.
Davao Doctors’ core net income last year reached P128 million, up from P115 million the previous year.
Early this year, Metro Pacific bagged a 20-year contract from the Archdiocese of Manila to manage the 212-bed Cardinal Santos Medical Center, the third hospital in the company’s growing health care business. It pledged to spend P750 million to upgrade the hospital within 10 years.
Metro Pacific partly divested from leisure property developer Landco Pacific in late 2008, "following a strategic review" and a decision to focus instead on infrastructure. The company is selling a 21% stake in Landco to another holding firm, reducing its ownership to 30%.
Metro Pacific shares closed unchanged at P2.90 yesterday. — KJRL
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