MANILA, Philippines --- Manila Water Company, Inc. (Manila Water) was assigned the highest Corporate Credit Rating of PRS Aaa (Corp.) by Philippine Rating Services Corporation (PhilRatings) as it has a very strong capacity to meet its financial obligations.
PhilRatings said the rating reflects Manila Water’s proactive management and competent technical staff with a proven track record and its efforts to expand its service areas to ensure continued growth.
The rating also took into consideration MWC’s sustained profit performance; and more than adequate liquidity position, financial flexibility and capitalization which can support additional debt.
PhilRatings noted that, throughout its operating history, Manila Water has been able to meet and even surpass its regulatory and financial targets, making efficient use of its capital, accumulated industry experience and partnerships.
The company’s management has also been very proactive in dealing with issues relating to the water industry, such as the development of new water sources.
Manila Water continues to increase its profitability with net income for the period rising by 7 percent from P3.98 billion in 2010 to P4.27 billion last year.
The trend continued in the first quarter of 2012 as net income improved by 64 percent to P1.34 billion, from P816 million for the same period last year.
MWC keeps comfortable levels of cash and short-term investments on hand. This amounted P5.89 billion as of end 2011 and further increased to P6.45 billion as of the end of the first quarter 2012.
The company likewise maintains healthy coverage ratios as EBITDA Interest Cover and Debt Service Coverage Ratio (DSCR) as of end 2011 were at 5.16x and 2.65x, respectively, reflecting Manila Water’s strong capacity to meet its current obligations.
MWC is currently undergoing its third Rate Rebasing period as the Concessionaire of the East Zone. It has already submitted the requirements for the process to the regulators and is expecting feedback within the year.
Given its prior experience with previous Rate Rebasing periods and a historically strong performance vis-à-vis regulatory standards and targets, the process is likely to go smoothly and result in the company’s continued viability and growth in the next five years.
source: mb.com.ph
