First Gen holds first-half profit at P8.7B as geothermal offsets gas sale

Insider Spotlight

• First Gen kept first-half recurring profit steady at P8.7 billion despite selling 60 percent of its natural gas business last year.
• Geothermal filled much of the gap, with EDC’s recurring earnings nearly doubling to P3.8 billion on higher output and power prices.
• New geothermal capacity and battery projects boosted growth, helping offset weaker hydro and wind generation.

Lopez-led First Gen Corp. kept first-half attributable recurring net income steady at P8.7 billion despite having a much smaller share of its natural gas business following last year’s sale of a 60 percent stake to Enrique Razon Jr.’s Prime Infrastructure Capital.

First Gen is one of the Philippines’ biggest power producers and the country’s largest renewable energy producer, with businesses spanning geothermal, hydro, wind, solar and battery storage after reducing its exposure to natural gas.

Geothermal steps up

Geothermal provided the crucial earnings lift, with recurring income from First Gen’s Energy Development Corp. nearly doubling to P3.8 billion from P1.9 billion as better steam availability lifted electricity sales and contracted power prices increased.

The gains were supported by investments made last year:

• EDC completed 88.6 megawatts of additional geothermal capacity following a drilling program launched in 2024.
• Three new battery projects with 40 megawatt-hours of capacity began operations in late 2025, opening another source of revenue.
• The gains came despite weaker Burgos Wind output and higher interest expenses from debt used to fund drilling and expansion.

Federico R. Lopez

First Gen chair, CEO 

Management’s view

First Gen president and COO Francis Giles B. Puno said geothermal should remain a key earnings driver as its drilling program delivers more steam, while new battery projects and stronger power prices provide additional support. 

Hydro faces a tougher outlook, however, as dry conditions limit water levels, particularly at Casecnan where generation typically picks up from May to November.

Gas and hydro weigh

That stronger geothermal performance helped offset the sharp reduction in First Gen’s exposure to natural gas, with the company now recognizing only its 40 percent share of earnings from the operating gas plants following the stake sale.

Its gas portfolio contributed P4 billion in equity earnings, compared with P7.5 billion from the entire business a year earlier before the transaction.

Hydro also weakened, with recurring earnings falling 48 percent to P433 million as Casecnan swung to a P304 million loss because of lower water availability and interest expenses, partly offset by stronger results at Pantabangan-Masiway.

More power sold

Despite those pressures, First Gen’s consolidated revenue jumped 73 percent to P41.1 billion as its power plants sold more electricity at higher prices.

Renewables now dominate the group’s revenue mix, with EDC’s geothermal, wind and solar portfolio accounting for 73 percent of first-half revenue and hydro contributing another 8 percent.

—Edited by Miguel R. Camus