FIRST PHILIPPINE HOLDINGS IS A CORPORATION THAT IS CONSTANTLY IN ACTION. WE’RE ALWAYS TRYING TO FIND WAYS TO DELIVER FOR OUR STAKEHOLDERS AND THE FILIPINO PEOPLE.
First Philippine Holdings Corp. (FPHC) has received a credit rating upgrade from Philippine Rating Services Corp. for its outstanding P5 billion fixed-rate corporate notes. The new rating of PRS Aa was two notches higher than the PRS A+ FPHC secured earlier. Obligations rated PRS Aa are of high quality and are subject to very low credit risk. The obligor’s capacity to meet its financial commitment on the obligation is very strong, PhilRatings said.
In changing the rating, PhilRatings took into account the strengthened liquidity position of FPHC and its major subsidiary, First Gen Corp. (First Gen); lower debt level; improving profitability outlook; assured stable and steady cash flow over the long term given its investments in First Gen and Manila Electric Co. (Meralco); and reduced debt at the level of its parent company, Benpres Holdings Corp. (BHC).
According to PhilRatings, FPHC was also able to prepay a substantial amount of debt. From P21.2 billion in end-2008, the company’s debt was trimmed to P12.9 billion at end-September 2009, resulting in an improvement in debt-to-equity ratio to 0.3x at end-September 2009.
“Profitability outlook for First Gen has since improved given its lower debt level and better performance of its associate Energy Development Corp. This translates to an enhanced profitability outlook for FPHC likewise. In addition, lower debt level of FPHC will also positively impact its bottom line,” PhilRatings said.
“FPHC has an assured and steady cash flow over the long term. FPHC derives its operating cash flow from dividends received from subsidiaries and associates, particularly First Gen and Meralco. Most of First Gen’s power assets benefit from long term contracts. Meralco, on the other hand, has a captive market under its 25-year franchise until 2028,” PhilRatings noted.
(Reference: The Philippine Star, April 6, 2010)