BUSINESS MIRROR: First Gen rises most in 3 months on better sales, economic outlook
September 02, 2009

First Gen Corp., the Philippines’ largest private power producer, rose the most in three months in trading yesterday on speculation electricity sales will gain in the second half as the economy recovers.

First Gen climbed 8.14 percent to P23.25 on the Philippine Stock Exchange, its biggest jump since June 3 and the highest since July 28.

“The economy is expected to perform better in the second half, and that should help lift energy sales,” said Astro del Castillo, managing director of investment advisory firm First Grade Holdings Inc. There may be a “bounce” in earnings for First Gen, he said.

The Philippines is expected to review its economic growth targets this year following better-than-expected results in the second quarter, newspaper reports show.

The country’s economic growth accelerated in the second quarter from the slowest pace in a decade, with gross domestic product increasing 1.5 percent from a year earlier, the National Statistical Coordination Board said on August 27. The economy expanded 0.4 percent in the previous three months.

First Gen’s profit declined 1.8 percent on year to USD20.345 million in the first quarter after sales declined to USD530.7 million from USD632.8 million a year earlier, the power producer said on August 19.

First Gen is the largest vertically integrated power generation company in the Philippines with an installed capacity of 2,582.4 megawatts (MW). It accounts for approximately 17 percent of total installed capacity in the country today.

The company was incorporated in December 1998 to become the primary holding company for the power generation and energy-related businesses of the Lopez Group. First Philippine Holdings Corp., parent and controlling shareholder of First Gen, became involved in the power generation industry in 1993 through its first major investment in power generation, Bauang Private Power Corp.

First Gen’s assets comprise the 1,000-MW Santa Rita and 500-MW San Lorenzo natural gas-fired power plants, the 225-MW Bauang medium-speed bunker-fired diesel power plant, the 112-MW Pantabangan-Masiway Hydroelectric Complex, and the 1.6-MW Agusan mini-hydro power plant.

In November 2007, First Gen acquired a 60-percent controlling stake in Philippine National Oil Co.-Energy Development Corp., now known as Energy Development Corp.

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