SMC Global Power Holdings, the country’s second largest power generator, recorded a net income of Php16 billion in 2021, a 15% drop from its Php18.9 billion figure in 2020.

Parent firm San Miguel Corporation (SMC) said that the decline was due to a “contractor compensation for unfulfilled obligations.” The company’s operating income also declined by 14% to Php 31.9 billion from Php36.9 billion previously due to higher power purchase and fuel costs. 

Net sales, however, went up 16% to Php133.7 billion last year from Php115 billion the year prior. The company said this was on the back of better prices in the Wholesale Electricity Spot Market, as well as average bilateral rates, together with increased nominations from customers.

SMC Global Power is looking to construct a 300-megawatt (MW) liquefied natural gas combined-cycle power plant in San Carlos City, Negros Occidental. It also recently challenged the unsolicited offer of Terra Solar – the joint venture of Leandro Leviste’s Solar Philippines and Enrique Razon’s Prime Infra – for the supply of 850MW in mid-merit power to the Manila Electric Company (MERALCO).

San Miguel’s power arm is currently supplying MERALCO with 170MW of peaking power, particularly for the summer season.

Earlier this week, sister company Petron – the country’s largest oil firm – reported that it posted a profit of Php6.1 billion in 2021.

Overall, SMC’s net income last year went up by 120% to Php48.2 billion from Php21.9 billion the year prior.