The Manila Electric Company (Meralco) posted record earnings in 2025 with a 12% increase in core net income, bringing the total to PHP 50.6 billion, despite electricity demand staying around the same average as last year.

Reported net income rose 11% to PHP 51.1 billion, meanwhile, core earnings before interest, taxes, depreciation and amortization also rose by 15% to PHP 86.4 billion.

Distribution utility (DU) stayed at a steady volume of 53,997 gigawatt-hours (GWh), similar to last year. Cooler weather patterns and growing rooftop solar adoption also softened residential and commercial consumption, despite the customer count increasing by 2% to 8.2 million.

Despite steady sales volume, earnings growth was primarily attributed to the strong performance of the company’s power generation arm, Meralco PowerGen Corporation (MGEN).

MGEN’s contribution to core net income jumped to 52% at PHP 16.8 billion, which accounts for 33% of the company’s total earnings. Energy output also jumped to 78% with 27, 289 GWh, attributed to new liquefied natural gas (LNG) investments and increased participation in the reserve market.

Consolidated revenues rose 6% to PHP 497.3 billion, mainly attributed to higher pass-through generation and transmission charges and increased generation revenues. Purchased power costs, likewise, also increased, this time at 9% to PHP 377.3 billion.

The company’s average retail electricity rate climbed to PHP 11.81 per kilowatt-hour (kWh) as of end-December 2025. The increase was explained by higher transmission and generation charges, as reflected in the monthly electricity bills.

The company also noted that its distribution charge – which represents a smaller portion of the overall electricity bill – declined year-on-year due to refunds and regulatory adjustments.

Meralco significantly ramped up its capital expenditures (CAPEX) in 2025, doubling its consolidated CAPEX to PHP 108.9 billion. Around 73% of this was allocated to MGEN’s MTerra Solar project as well as other renewable energy projects.

The DU also spent PHP 28.5 billion in network upgrades, new connections, and infrastructure development to ensure grid and power stability despite increasing demand.

As investments increased, so did consolidated debt which is now at PHP 230 billion. Net debt stood at PHP 120.6 billion with a final net debt-to-EBITDA ratio of 1.38 times.

The company’s board approved a final cash dividend of PHP 16.672 per share. This brings total dividends declared for 2025 to PHP 28 per share- roughly equivalent to 62.5% of core earnings per share.

Looking ahead, Meralco has filed its First Regulatory Period reset application covering July 2026 to June 2030. The company is seeking approval for an average distribution tariff of PHP 2.34 per kWh to support a proposed four-year capital expenditure program amounting to PHP 272.2 billion.

With profits reaching record levels even in a flat demand environment, Meralco is now positioning itself for an expansion driven by large-scale renewable energy and LNG investments. How will these investments ultimately shape electricity rates for consumers in the coming years?

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