Aboitiz Power Corporation

Beneficial EBITDA for 1H 2026 was PHP 43.3 billion, up 27% from PHP 34.1 billion in 1H 2025. 2Q beneficial EBITDA was PHP 23 billion, up 21% year on year and 13% quarter on quarter. Beneficial revenue rose 28% to PHP 110 billion from PHP 86.2 billion, and reported net income after tax increased 45% to PHP 18.4 billion from PHP 12.7 billion. Generation EBITDA was PHP 38.8 billion, up 30% year on year; Power Generation gross profit rose 23% to PHP 41.6 billion; average gross profit per kWh increased 4% to PHP 2.09. Total energy sold grew 7% to 17.3 TWh, total energy generated rose 11% to 22.7 TWh, and purchased power volumes increased 27% to 5.4 TWh. Bilateral contract volumes expanded 17% to 15.2 TWh, spot market sales were 2.1 TWh, ancillary services sales were 928 GWh, and RES volumes grew 10% to 2.8 TWh. Balance sheet debt fell to PHP 325.6 billion from PHP 332.5 billion at year-end 2025, cash was PHP 62.7 billion, net debt was PHP 258.5 billion, and net debt-to-equity improved to 1.17x from 1.24x. For 2026, management guided to around PHP 62 billion in capex, with about 80% to 85% for growth and about PHP 10 billion for MOB capex.

Management framed the quarter as a continuation of portfolio expansion and contract coverage gains, with generation remaining the main growth engine. The CEO/lead executive highlighted new solar and storage additions, continued renewables buildout, and a move to a 50% coal share from 57% in December 2025, signaling a gradual shift in the mix. Tone was constructive but cautious, especially on regulation, with repeated emphasis on working constructively with policymakers and maintaining long-term sustainability.

The CFO highlighted strong operating leverage from higher contracted volumes and market prices, while also noting higher generation costs and purchase power costs tied to coal outages and elevated spot prices. He cited PHP 41.6 billion of generation gross profit, PHP 53.1 billion of generation costs, and PHP 15.4 billion of purchase power costs, plus PHP 10.6 billion of net interest expense, PHP 10.5 billion of depreciation and amortization, and PHP 4.2 billion of taxes and other provisions. On the balance sheet, debt declined to PHP 325.6 billion, cash stood at PHP 62.7 billion, and the net debt-to-equity ratio improved to 1.17x; he also said 89% of debt is peso-denominated and PHP 128 billion matures beyond 2031. He added that 2026 capex of PHP 62 billion is mostly growth capex, and that retail bond maturities in 2026 are planned to be refinanced.

Analysts focused heavily on regulatory risk, especially system loss recovery, possible changes to EPIRA, and lower reserve market price ceilings. Management said it supports efforts to reduce consumer costs but called it too early to quantify the financial impact of any system loss change, and said system loss recovery is a DU/customer issue that does not affect the generation charge under PSAs. They also said a lower reserve market ceiling would clearly hurt AP, but the proposal is still under consultation. On operations, management said TVI 1 and 2 outages drove lower coal availability and that both units are expected back by end-August; they also said the outage allowance has been exhausted and replacement power is now being supplied.