Napocor’s net loss seen hitting P49 billion next year
Monday, August 14, 2006
By MYRNA M. VELASCO
After posting a net income of P9.0 billion last year, state-owned National Power Corporation (NPC) is once again projected to post whopping net loss of P48.8 billion in 2007.
The financial forecast for NPC was stipulated in an official document submitted to the International Monetary Fund (IMF) for the Brettonwood institution’s post-program monitoring.
Official records show that the power firm logged a consolidated net income of P85 billion in 2005; but P76 billion accounted for foreign exchange gains; thus it was only the P9.0 billion that can be treated as income from operations.
Such level of profitability is seen sustained for 2006; company officials note, notwithstanding delays in its privatization.
NPC’s move back to profitability have been attributed to improved fuel mix and the adjustments granted by the Energy Regulatory Commission on its tariffs.
Officials stressed that in the past two years, stringent cost-cutting measures have been resorted to; including economic dispatch of power plants giving priority to the utilization of those running on cheaper fuels; especially with the lingering spikes in oil prices.
Company executives emphasized though that the 2006 and 2007 forecast figures shall still undergo re-validation in light of market developments; primarily the commercial operation of the Wholesale Electricity Spot Market.
NPC finance head Lorna Dy explained that the calculation contained in the IMF submission has not taken into account yet foreign exchange gains.
She added that the forecast was still based on the P52-to-$ 1US exchange rate, "so it is still not final and may still go up or down depending on the forex fluctuations."
Officials of the power firm and even its transferee-company Power Sector Assets and Liabilities Management Corporation (PSALM) have been pinning too much hope on potential proceeds from the sale of its assets to ultimately shore up the company’s financial standing.
Dy further noted that when the numbers were rolled, they have just considered the regulated rates for the power firm; adding that with the WESM, "the rates may go up or down, thus may have an impact on our financial position."
NPC’s highest net loss was recorded in 2003 at P117.02 billion primarily due to forex losses and the unilateral move of President Arroyo to cap the rates of NPC. The last time the state-owned power firm registered an income of P3.05 billion was in 1997.
Until this time, there is no definite direction yet on the sale of the NPC assets with most of their bidding timetables already thrown into air.
The industry is keeping close watch on the scheduled sale of hydro plants this year; primarily the 12megawatt Masiway and 100-MW Pantabangan assets; and also the offer of 25-year concession contract for the National Transmission Corporation.
posted by philpower @ 10:35 AM,
