ACEN, the listed energy platform of the Ayala group, today reports net income of P7.4 billion for 2023. This represents a decline of 43 percent from 2022, which included P8.6 billion in accounting adjustments from various events in that period. Taking out the impact of all noncash items, ACEN’s profitability increased 150 percent year over year, driven by a nearly three-fold increase in core operating earnings.
Financial Highlights
FY 2023 vs FY 2022
Statutory revenues, comprised of the consolidated Philippine and Australian businesses, rose 4 percent to P36.5 billion. Meanwhile, attributable earnings before interest, taxes, depreciation, and amortization (EBITDA), which includes ACEN’s share of EBITDA from non-consolidated operating projects, grew 31 percent to P18.8 billion during the year. Overall, ACEN’s key financial metrics significantly improved year over year on the back of new operating capacity, stronger wind and solar generation, the resolution of plant curtailments, and a strong net merchant selling position at the Philippines’ Wholesale Electricity Spot Market (WESM).
Income from operations, which represents the company’s share of ongoing profits from both its consolidated and nonconsolidated operations globally, rose 81 percent to P8.1 billion. Core operating earnings, which in turn deducts overhead and development expenses and net financing costs, all at the parent, tripled to P4.9 billion with the continued ramp-up of new renewables capacity and generation output.
In 2023, ACEN also booked P4.5 billion in gains, inclusive of P3.4 billion in remeasurements, from the Salak & Darajat partial sale in the third quarter. This was offset by a ₱2.0 billion impairment of the India platform due to the impact of cost overruns and project delays. For comparison, 2022 included P8.6 billion in net noncash items, primarily via revaluation gains from the acquisition of ACEN Australia.
All together, this resulted in a consolidated net income after tax for ACEN of P7.4 billion in 2023.
Q4 2023 vs Q4 2022
The fourth quarter of 2023 saw income from operations grow 38 percent to P1.9 billion from the year-ago period. This was driven by robust growth in the Philippines, Australia, and India, which saw new contributions from new capacity coming online, while the domestic market benefitted from a more consistent net merchant selling position for the period. The quarter, however, saw a ramp-up in overhead and development expenses as ACEN continued to invest in resources to support its longer-term growth.
Core operating earnings expanded significantly in the quarter, amounting to P1.0 billion from a loss in 2022. ACEN’s recovery from last year’s headwinds, including the high cost of purchased power, the buyout of a customer contract, and typhoon-related curtailment in the Visayas, contributed to the company’s stronger performance in the fourth quarter.
Attributable EBITDA for the quarter rose 74 percent to P4.7 billion. ACEN’s consolidated net income after tax for the period reached P830 million, with the decrease from 2022 owing to the same accounting adjustments discussed in the annual results.
Operating Highlights
As of end-2023, ACEN now carries over 4.7 GW in attributable capacity, 99 percent of which is from renewables. Of this, 37 percent is now fully operational, 28 percent is already partially operating and 35 percent remains under construction. During the year, several new solar and wind farms were added to the company’s growing portfolio. These include the 60 MW Pangasinan Solar and 300 MW Palauig 2 Solar in the Philippines in January, the 38 MW Stockyard Wind in Altoona, Pennsylvania, in the United States in March, the 600 MW Monsoon Wind in Sekong and Attapeu, Lao PDR in April, and the first phase of ACEN’s acquisition of SUPER Energy’s Solar NT platform in Vietnam in June.
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Several plants also commenced or ramped up operations. As a result, total attributable renewables output across ACEN’s facilities worldwide rose 32 percent to 4,474 GWh, driven by production from new partially operational plants as well as stronger wind resources in some markets.
Philippines
Philippine renewables generation stood at 1,137 GWh for 2023, up 34 percent year over year. Stronger wind resources at ACEN’s wind farms, as well as the start of commissioning for the 160 MW Pagudpud Wind, the first and second phases of SanMar Solar totaling 385 MW, and the 44 MW second phase of Arayat-Mexico Solar, drove the increased energy output in the company’s home market.
International
Outside the Philippines, ACEN delivered 3,328 GWh in attributable generation, 31 percent higher year over year. Alongside the ongoing partial commissioning for the 420 MW Masaya Solar in India and near-full capacity and operational completion for the 521 MW New England Solar, the stronger wind regime across ACEN’s wind farms in Vietnam and Indonesia, as well as high geothermal reliability, drove stronger output in the international business.
Balance Sheet and Funding Highlights
Consolidated assets rose 22 percent to P284.9 billion at the end of 2023. Throughout the year, to support its expansion plans, ACEN completed its maiden preferred equity issuance and secured green loans, a major project finance deal and its first sustainability-linked loan with a syndicate led by the Asian Development Bank (ADB). In addition, fresh corporate loans were booked in the fourth quarter.
In September, ACEN issued P25.0 billion in perpetual preferred shares, which were listed on the Philippine Stock Exchange (PSE) in A and B series. This was the largest preferred share offering in the country since 2016. Series B was also the first-ever Philippine peso-denominated fixed-for-life equity instrument listed on the PSE.
Supported by its own Green Finance Framework, ACEN once again secured several green term loan facilities in 2023. ACEN Australia signed a green term loan facility with a syndicate led by Bank of China, CTBC Bank and Standard Chartered Bank in January worth AU$277 million, the Australian platform’s largest to date, as well as an AU$75.0 million term loan with HSBC in December. In the Philippines, ACEN signed new loan facilities for renewables capacity expansion with some of the country’s largest banks: P20.0 billion with the Land Bank of the Philippines (Landbank), P5.0 with China Banking Corporation (Chinabank) and P5.0 billion with Metropolitan Bank & Trust Company (Metrobank).
ACEN also tapped the ADB, one of the world’s largest multilateral financial institutions, to lead an innovative US$107.0 million financing package in Vietnam, as well as an P11.0 billion sustainability-linked loan facility with the Bank of the Philippine Islands (BPI).
Long-term investments thus grew 43 percent to P156.6 billion, while cash reserves at end-2023 rose 15 percent to P39.7 billion.
Sustainability Highlights
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