MERALCO announced that its consolidated core net income, which excludes onetime, exceptional charges, stood at P7 billion, which is 169% better than the core net income in 2008 of P2.6B. Core earnings per share is at P6.33, 168% higher than 2008.

The improvement is attributable mainly to a slightly higher volume of energy sold and to an adjustment in distribution rates, which took effect in May 2009. Consolidated reported net income for 2009 increased by 114% to P6B compared with P2.8B in 2008.

Consolidated revenues, in which electricity accounts for 97% of the total, decreased slightly by 3.6% due to a P0.69 per kWh decrease in average generation and transmission charges as well as adjustment on the estimated amount of electricity distributed but unbilled after scheduled meter readings of the various bill groups. The impact of this reduction was partially offset by the increase in kilowatthour-consumption for the year and the implementation of the PBR (Performance-Based Regulation)- based rate of P0.257 per kWh-adjustment starting May 2009, Meralco’s first distribution rate adjustment after almost six years.

Total costs and expenses amounted to P175.6B in 2009, or 5.9% lower compared with the P186.6B in 2008.

Consolidated EBITDA (earnings before interest, taxes, depreciation and amortization) amounted to P13.3B, representing an EBITDA margin on gross revenues of 7%. Consolidated free cash flow amounted to P18.8B for the year, 34x higher than the P0.5B for 2008. The significant improvement in free cash flow is due to improved liquidity from working capital items as a result of the rate adjustment in May 2009. Consolidated capital expenditures amounted to P9B, which is 3% lower than the P9.3B in 2008.

The consolidated gross debt balance as of Dec. 31, 2009 stood at P20.7B, with net debt at P3.6B.

In 2009, Meralco and its subsidiaries paid down principal debts totaling P19.6B and customer refunds primarily under Phase 4B of P1.8B, representing a total financing outlay of P21.4B. New debts on a consolidated basis amounted to P1.7B, most of which relate to its real estate subsidiary.

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