ENERGY DEVELOPMENT CORPORATION (Company s full Name)

Transcription

1 SEC Number File Number ENERGY DEVELOPMENT CORPORATION (Company s full Name) One Corporate Centre Julia Vargas cor. Meralco Ave., Ortigas Center, Pasig City (Company s Address) (632) (Telephone Number) March 31, 2018 (Quarter Ending) SEC FORM 17-Q (Form Type)

2 COVER SHEET SEC Registration Number E N E R G Y D E V E L O P M E N T C O R P O R A T I O N ( A S u b s i d i a r y o f R e d V u l c a n H o l d i n g s C o r p o r a t i o n ) A N D S U B S I D I A R I E S (Company s Full Name) J u l i a V a r g a s C o r n e r M e r a l c o A v e n u e, O r t i g a s C e n t e r, P a s i g C i t y (Business Address: No. Street City/Town/Province) Maribel A. Manlapaz (Contact Person) (Company Telephone Number) S E C Month Day (Form Type) Month Day (Fiscal Year) (Annual Meeting) (Secondary License Type, If Applicable) Dept. Requiring this Doc. Article I Amended Articles Number/Section Total Amount of Borrowings 566 P=38,850,484,298 P=26,710,887,225 Total No. of Stockholders Domestic Foreign To be accomplished by SEC Personnel concerned File Number LCU Document ID Cashier S T A M P S Remarks: Please use BLACK ink for scanning purposes.

3 SECURITIES AND EXCHANGE COMMISSION SEC FORM 17-Q QUARTERLY REPORT PURSUANT TO SECTION 17 OF THE SECURITIES REGULATION CODE AND SRC RULE 17(2)(b) THEREUNDER 1. For the quarterly period ended March 31, Commission identification number: BIR Tax Identification No Exact name of issuer as specified in its charter: ENERGY DEVELOPMENT CORPORATION 5. PHILIPPINES 6. (SEC Use Only) Province, country or other jurisdiction of Industry Classification Code Incorporation or organization 7. One Corporate Centre Julia Vargas cor. Meralco Ave., Ortigas Center, Pasig City 1605 Address of issuer's principal office Postal Code 8. (632) Issuer's telephone number, including area code: 9. Former name, former address and former fiscal year, if changed since last report: 10. Securities registered pursuant to Sections 8 and 12 of the Code, or Sections 4 and 8 of the RSA Title of each Class Number of shares outstanding as of March 31, 2018 Common Stock, P1.00 par value 18,737,010,000 Preferred Stock, P0.01 par value 9,375,000, Are any or all of the securities listed on a Stock Exchange? Yes [ ] No [ ] If yes, state the name of such Stock Exchange and the class/es of securities listed therein: PHILIPPINE STOCK EXCHANGE COMMON SHARES PHILIPPINE DEALING EXCHANGE PESO PUBLIC BONDS FIXED RATE PESO BONDS SINGAPORE EXCHANGE SECURITIES TRADING LIMITED (SGX-ST) USD BONDS 12. Indicate by check mark whether the registrant: (a) has filed all reports required to be filed by Section 17 of the Code and SRC Rule 17 thereunder or Sections 11 of the RSA and RSA Rule 11(a)-1 thereunder, and Sections 26 and 141 of the Corporation Code of the Philippines, during the preceding twelve (12) months (or for such shorter period the registrant was required to file such reports) Yes [ ] No [ ] (b) has been subject to such filing requirements for the past ninety (90) days. Yes [ ] No [ ] SEC Form 17Q 1Q 2018

4 PART 1: FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS Our unaudited consolidated financial statements for the three-month period ended March 31, 2018 have been prepared in accordance with Philippine Accounting Standards (PAS) 34, Interim Financial Reporting, and are filed as Annex I of this report. ITEM 2. MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS ( MD & A ) The following is a discussion and analysis of the Company s consolidated financial performance for the three-month period ended March 31, The prime objective of this MD&A is to help the readers understand the dynamics of our Company s business and the key factors underlying our financial results. Hence, our MD&A is comprised of a discussion of our core business and an analysis of the results of operations. This section also focuses on key statistics from the unaudited financial statements and pertains to risks and uncertainties relating to the geothermal and other renewable power industry in the Philippines where we operate up to the stated reporting period. However, our MD&A should not be considered all inclusive, as it excludes unknown risks, uncertainties and changes that may occur in the general economic, political and environment condition after the stated reporting date. Our MD&A should be read in conjunction with our unaudited consolidated financial statements and the accompanying notes. All financial information is reported in Philippine Pesos (PhP) unless otherwise stated. Any references in this MD&A to we, us, our, or Company pertains to the Energy Development Corporation and its subsidiaries. "EDC" pertains to the Parent Company Energy Development Corporation. Additional information about the Company can be found on our corporate website SEC Form 17Q 1Q 2018

5 The following is a summary of the key sections of this MD&A: OVERVIEW OF OUR BUSINESS...4 Principal Products or Services... 4 Distribution methods of products or services... 4 Competition... 4 Dependence on one or a few major customers and identity of any such major customers... 5 New Products or Services... 5 FINANCIAL HIGHLIGHTS...7 RESULTS OF OPERATIONS...9 FINANCIAL CONDITION...12 CAPITAL AND LIQUIDITY RESOURCES...15 CASH FLOW...15 DISCUSSION ON THE SUBSIDIARIES...16 Green Core Geothermal Inc. (GCGI) Bac-Man Geothermal Inc. (BGI) EDC Burgos Wind Power Corporation (EBWPC) Unified Leyte Geothermal Energy Inc. (ULGEI) FG Hydro Power Corporation (FG Hydro) KEY PERFORMANCE INDICATORS...24 Commitments that will have an impact on the issuer s liquidity...25 Foreign Exchange Rate Volatility...25 Any events that will trigger direct or contingent financial obligation that is material to the company, including any default or acceleration of an obligation...25 CASH DIVIDENDS...25 MAJOR STOCKHOLDERS...26 BOARD OF DIRECTORS...26 OFFICERS...27 SEC Form 17Q 1Q 2018

6 OVERVIEW OF OUR BUSINESS Principal Products or Services The Company operates in its five geothermal service contract areas where it is principally involved in the generation and sale of electricity through Company-owned geothermal power plants to NPC, electric cooperatives, privately-owned distribution utilities (DUs), large industrial clients, and the NGCP, pursuant to PPAs, WESM transactions, ASPA, and FIT, respectively. EDC s subsidiaries, GCGI and BGI, also hold offtake agreements in the form of PSAs with various customers, particularly electric cooperatives and for GCGI, ASPA with NGCP. Through its 60% equity interest in FG Hydro, the Company indirectly operates the 120 MW Pantabangan and 12 MW Masiway Hydroelectric Power Plants, located in Pantabangan, Nueva Ecija Province, Central Luzon. The power plants supply electricity into the Luzon grid to service the consumption of its distribution utilities clients covered by bilateral contract. The Company has evolved into being the country s premier pure renewable energy player, with interests in geothermal, hydro, wind and solar power. For geothermal energy, its expertise spans the entire geothermal value chain, i.e., geothermal energy exploration and development, reservoir engineering and management, engineering design and construction, environmental management. Its wind energy expertise covers project research and development and wind data assessment. With FG Hydro, the Company has not only acquired expertise in hydropower operation and maintenance, but also started to sell power on a merchant basis. The Company also operates the Burgos Solar Project (Phases 1 and 2), which is inside the same concession area as EBWPC wind farm. Distribution methods of products or services About 40.3% or GWh of the 1,813.1 GWh sales volume from its electricity business was sold to NPC by Unified Leyte and Mindanao 1 and 2 Power Plants. About 24.8% or GWh sales volume was sold to electric cooperatives, industrial customers and WESM in the Visayas region by the Palinpinon, Tongonan and Nasulo geothermal plants. About 14.5% or GWh sales volume was sold to electric cooperatives, industrial customers and WESM in the Luzon region by Bac-Man geothermal power plants. FG Hydro's electricity generation of GWh was sold to WESM in the Luzon region and distribution utility clients in Nueva Ecija. Burgos wind and solar power plants generated GWh and 2.7 GWh of electricity, respectively, which were sold under the Feed-In-Tariff (FIT) regime. ULGEI s 57.4 GWh strips of energy were sold mainly to WESM. Siklab s 1.0 GWh energy from solar rooftop were sold mainly to FGES. SEC Form 17Q 1Q

7 Competition The government, in implementing the thrust of the EPIRA, has paved the way for a more independent and market-driven Philippine power industry. As such, selling power and consequently the dispatch of power plants depend on the ability to offer competitively priced power supply to the market. The Company has multiple power projects in Luzon, Visayas, and Mindanao. The successful privatization of NPC assets and NPC-IPP contracts in Luzon and Visayas, coupled with the integration of the two Grids under the WESM, introduced new players and opened competition in the power industry. Potential competitors include other parties offering baseload and other energy services such as the energy arms of Aboitiz, San Miguel and Ayala Corporation. Further to clauses in the EPIRA Law entitled Retail Competition and Open Access (RCOA), a new electricity buyer group consisting of individual retail customers has emerged with the DOE. Retail competition means that eligible electricity customers (or retail customers) may themselves contract for the supply of electricity with authorized suppliers, rather than through the franchised distribution facility. Open Access, on the other hand, means that retail electricity customers and suppliers of electricity may also contract with the transmission company and the distribution company for the wheeling or delivery of energy/electricity through the transmission or distribution wires. Open Access is thus means by which Retail Competition is achieved [2]. The Company will face competition in both the development of new power generation facilities and the acquisition of existing power plants, as well as in the financing for these activities. The performance of the Philippine economy and the historical high returns of power projects in the country have attracted many potential competitors, including multinational development groups and equipment suppliers, to explore opportunities in the development of electric power generation projects in the Philippines. Accordingly, competition for and from new power projects may increase in line with the long-term economic growth in the Philippines. The Company believes that it will be able to compete because of its competitively-priced power, the reliability of its power plants, its use of clean and renewable fuels, and its expertise and experience in power supply contracting and trading. [1] Source: DOE Website: [2] Source: The Energy Report Philippines Ed, KPMG Global Energy Institute Dependence on one or a few major customers and identity of any such major customers Close to 32.6% of the Company s electricity revenue are derived from existing long-term Power Purchase Agreements (PPAs) with NPC. Concessions As of March 31, 2018, the Company holds the following service contracts. Geothermal Resource The five (5) geothermal service contract areas where EDC s geothermal production steam fields are located are: Tongonan Geothermal Project Southern Negros Geothermal Project SEC Form 17Q 1Q

8 Bacon-Manito Geothermal Project Mt. Apo Geothermal Project Northern Negros Geothermal Project 5 The Company, through its subsidiaries Green Core Geothermal Inc. (GCGI) and Bac-Man Geothermal Inc. (BGI) secured three (3) Geothermal Operating Contracts covering power plant operations: Tongonan Geothermal Power Plant (with a twenty-five (25) year contract period expiring in 2037, renewable for another twenty-five (25) years)* Palinpinon Geothermal Power Plants (with a twenty-five (25) year contract period expiring in 2037, renewable for another twenty-five (25) years)* Bacon-Manito Geothermal Power Plants (with a twenty-five (25) year contract period expiring in 2037, renewable for another twenty-five (25) years) *On October 23, 2009, the Palinpinon and Tongonan geothermal power plants were turned over to Green Core Geothermal Inc. (GCGI), which won the PSALM s auction of the said plants on September 2, The Company also holds Geothermal Renewable Energy Service Contracts (GRESC) for the following prospect areas: Mandalagan Geothermal Project (with a five-year pre-development period expired in 2017, 25- year contract period expiring in 2037, renewable for another twenty-five (25) years) Mt. Zion Geothermal Project (with a five-year pre-development period expired in 2017, 25-year contract period expiring in 2037, renewable for another twenty-five (25) years) Balingasag Geothermal Project (with a five-year pre-development period expired in 2017, 25- year contract period expiring in 2037, renewable for another twenty-five (25) years) Mt. Zion 2 Geothermal Project (with a five-year pre-development period expiring in 2020, 25- year contract period expiring in 2040, renewable for another twenty-five (25) years) Amacan Geothermal Project (with a five-year pre-development period expiring in 2021, 25-year contract period expiring in 2041, renewable for another twenty-five (25) years) Wind Resource The Company holds ten (10) Wind Energy Service Contracts (WESC) with the DOE. The WESCs are for the following projects: 150-MW Wind Project in Burgos, Ilocos Norte; under DOE Certificate of Registration No. WESC (25-year contract period expiring in 2034; renewable for another twenty-five (25) years) 84-MW Wind Project in Pagudpud, Ilocos Norte; under DOE Certificate of Registration No. WESC (25-year contract period expiring in 2035; renewable for another twenty-five (25) years) Burgos 1 Wind Project in Burgos, Ilocos Norte; under DOE Certificate of Registration No. WESC (25-year contract period expiring in 2038; renewable for another twenty-five (25) years) Burgos 2 Wind Project in Burgos, Ilocos Norte; under DOE Certificate of Registration No. WESC (25-year contract period expiring in 2038; renewable for another twenty-five (25) years) Matnog 1 Wind Project in Matnog and Magdalena, Sorsogon; under DOE Certificate of Registration No. WESC (25-year contract period expiring in 2039; renewable for another twenty-five (25) years) SEC Form 17Q 1Q

9 Matnog 2 Wind project in Matnog, Sorsogon; under DOE Certificate of Registration No. WESC (25-year contract period expiring in 2039; renewable for another twenty-five (25) years) Matnog 3 Wind Project in Matnog, Sorsogon; under DOE Certificate of Registration No. WESC (25-year contract period expiring in 2039; renewable for another twenty-five (25) years) I1REC (Iloilo 1 Renewable Energy Corporation) Wind Project in Batad and San Dionisio, Iloilo; under DOE Certificate of Registration No. WESC AFI (25-year contract period expiring in 2039; renewable for another twenty-five (25) years) Burgos 3 Wind Project in Burgos and Pasuquin, Ilocos Norte; under DOE Certificate of Registration No. WESC (25-year contract period expiring in 2040; renewable for another twenty-five (25) years) Burgos 4 Wind Project in Burgos, Ilocos Norte; under DOE Certificate of Registration No. WESC (25-year contract period expiring in 2040; renewable for another twenty-five (25) years) Solar Resource The Company holds six (6) Solar Energy Service Contracts (SESC) with the DOE. The SESCs cover areas in the following: 4.16-MW Phase 1 and 2.66-MW Phase 2 Burgos Solar Project, Ilocos Norte; under DOE Certificate of Registration No. SESC (25-year contract period expiring in 2039; renewable for another twenty-five (25) years) Iloilo Solar Project in Iloilo City; under SESC No (25-year contract period expiring in 2041; renewable for another twenty-five (25) years) Gaisano Iloilo Solar Rooftop Project in Iloilo City; under SESC No (25-year contract period expiring in 2041; renewable for another twenty-five (25) years) President Roxas Solar Project in President Roxas, North Cotabato; under SESC No (25-year contract period expiring in 2040; renewable for another twenty-five (25) years)** Kilada-Matalam Solar Project in Matalam, North Cotabato; under SESC No (25- year contract period expiring in 2040; renewable for another twenty-five (25) years)** Bogo Solar Project in Bogo, Cebu; under SESC No (25-year contract period expiring in 2040; renewable for another twenty-five (25) years)*** **Cancellation letter has been submitted with Department of Energy (DOE) dated March 2016, awaiting confirmation reply ***Cancellation letter has been submitted with Department of Energy (DOE) dated July 2017, awaiting confirmation reply New Products or Services EDC is in various phases of early stage / pre-development activities in some of its concession areas. SEC Form 17Q 1Q

10 FINANCIAL HIGHLIGHTS YTD March 2018 vs. YTD March 2017 Results During the first quarter of 2018, recurring net income attributable to equity holders of the Parent Company was posted at P1,813.6 million, decrease by 44.2% as compared to the P3,249.7 million for the same period in The recurring net income generated decreased by 42.0% or P1,433.0 million to P1,981.7 million from the P3,414.7 million posted during the same period in The decrease is mainly attributable to the P1,434.2 million decrease in revenues primarily due to Unified Leyte. The Company posted a net income of P1,504.8 million in the first quarter of 2018, a 53.8% or P1,752.4 million decrease from the P3,257.2 million in the three-month period ended March 31, The movement was mainly driven by the P1,434.2 million decrease in revenue. Net income is equivalent to 18.4% of total revenues for the quarter ended March 31, 2018 as compared to the 33.9% for the same period in Net income attributable to equity holders of the Parent Company at P1,336 million for the first quarter of 2018 is a P1,749.6 million decrease from P3,085.6 million during the same period in SEC Form 17Q 1Q

11 RESULTS OF OPERATIONS The following table details the results of operations of the Company for the first quarter of 2018 and STATEMENTS OF INCOME Horizontal and Vertical Analysis of Material Changes as of March 31, 2018 and 2017 HORIZONTAL ANALYSIS Favorable (Unfavorable) Variance March 2018 VERTICAL ANALYSIS (Amounts in PHP millions) March 2018 March 2017 Amount % REVENUE Sale of electricity 8, ,612.3 (1,434.2) -14.9% 100.0% 100.0% COSTS OF SALE OF ELECTRICITY Costs of sale of electricity (4,017.3) (3,432.5) (584.8) -17.0% -49.1% -35.7% GENERAL AND ADMINISTRATIVE EXPENSES (1,308.1) (1,210.2) (97.9) -8.1% -16.0% -12.6% FINANCIAL INCOME (EXPENSE) Interest expense (996.3) (1,040.5) % -12.2% -10.8% Interest income % 1.2% 0.6% (895.7) (983.6) % -11.0% -10.2% OTHER INCOME (CHARGES) Foreign exchange losses net (459.4) (137.2) (322.2) % -5.6% -1.4% Proceeds from insurance claims ,601.5% 4.5% 0.1% Miscellaneous, net (60.4) (35.3) (25.1) 71.1% -0.7% -0.4% (149.2) (166.0) % -1.8% -1.7% INCOME BEFORE INCOME TAX 1, ,820.0 (2,012.2) -52.7% 22.1% 39.7% BENEFIT FROM (PROVISION FOR) INCOME TAX Current (287.4) (507.1) % -3.5% -5.3% Deferred (15.6) (55.7) % -0.2% -0.6% (303.0) (562.8) % -3.7% -5.9% NET INCOME 1, ,257.2 (1,752.4) -53.8% 18.4% 33.9% Net income attributable to: Equity holders of the Parent Company 1, ,085.6 (1,749.6) -56.7% 16.3% 32.1% Non-controlling interest (2.7) -1.6% 2.1% 1.8% EBITDA 4, ,504.9 (2,073.1) -31.9% 54.2% 67.7% RECURRING NET INCOME 1, ,414.7 (1,433.0) -42.0% 24.2% 35.5% Recurring net income attributable to: Equity holders of the Parent Company 1, ,249.7 (1,436.1) -44.2% 22.2% 33.8% Non-controlling interest % 2.1% 1.7% March 2017 SEC Form 17Q 1Q

12 YTD March 31, 2018 vs. YTD March 31, 2017 Revenue Total revenue from sale of electricity for the quarter ended March 31, 2018 decreased by 14.9% or P1,434.2 million to P8,178.1 million from P9,612.3 million during the same period in This is mainly attributable to the decrease in revenue of Unified Leyte due to unplanned outages on account of earthquake and typhoon. Costs of Sale of Electricity Costs of sale of electricity increased by 17.0% or P584.8 million to P4,017.3 million for the period ended March 31, 2018 from P3,432.5 million during the same period in 2017 mainly due to the following: P240.1 million purchased services and utilities; P177.6 million repairs and maintenance; and P161.0 million parts and supplies issued. General and Administrative Expenses General and administrative expenses increased by 8.1% or P97.9 million to P1,308.1 million in the first quarter of 2018 from P1,210.2 million during the same period in 2017 mainly due to the increase in purchased services and utilities amounting to P157.7 million partly offset by P50.2 million decrease in provision for doubtful accounts. Financial Income (Expense) Financial expenses - net decreased by 8.9% or P87.9 million to P895.7 million for the period ended March 31, 2018 from P983.6 million during the same period in Interest Expense Interest expense decreased by 4.2% or P44.2 million to P996.3 million for the quarter ended March 31, 2018 from P1,040.5 million during the same period in The favorable variance is mainly due to the decrease in the Company s total debt. Interest Income Interest income increased by 76.8% or P43.7 million to P100.6 million for the quarter ended March 31, 2018 from P56.9 million during the same period in 2017 attributed to higher interest income on funds invested. Other Income (Charges) Other charges for the first quarter of 2018 amounted to P149.2 million, 10.1% or a P16.8 million decrease from P166.0 million during the same period in Foreign exchange gains (losses) - net Foreign exchange losses - net for the three-month period ended March 31, 2018 amounted to P459.4 million, a P322.2 million increase from P137.2 million during the same period in The variance was mainly brought about by the depreciation of PHP against US$ for the quarter SEC Form 17Q 1Q

13 ended March 31, The comparative foreign exchange rates were as follows: PHP:US$ December 31, March 31, December 31, March 31, Proceeds from insurance claims Proceeds amounting to P370.6 million were received during the first quarter of 2018, a P364.1 million higher than the P6.5 million received during the same period in These claims were due to earthquake and typhoon damages. Miscellaneous, net Miscellaneous charges - net for the quarter ended March 31, 2018 amounted to P60.4 million, 71.1% or a P25.1 million increase from of P35.3 million during the same period in The movement was mainly due to the increase in mark to market gain on financial asset at fair value through profit or loss and derivative gains amounting to P26.3 million and P21.3 million, respectively, partly offset by the decrease in loss on direct write-off of input VAT claims amounting to P30.0 million. Provision for Income Tax Current Net Income The Company s current tax expense decreased by 43.3% or P219.7 million to P287.4 million for the quarter ended March 31, 2018 from P507.1 million during the same period in 2017 mainly on account of lower taxable income. Deferred Deferred tax for the first quarter of 2018 amounted to P15.6 million, a 72.0% or a P40.1 million decrease from the P55.7 million during the same period in 2017, mainly due to deferred tax asset attributable to realized forex loss from loan. As a result of the foregoing, the Company s net income decreased by 53.8% or P1,752.4 million to P1,504.8 million for the first quarter of 2018 from P3,257.2 million net income during the same period in Net income is equivalent to 18.4% of total revenue for the period ended March 31, 2018 as compared to 33.9% for the same period in SEC Form 17Q 1Q

14 FINANCIAL CONDITION The following table details the financial condition of the Company as of March 31, 2018 and December 31, STATEMENT OF FINANCIAL POSITION Horizontal and Vertical Analysis of Material Changes as of March 31, 2018 and December 31, 2017 HORIZONTAL ANALYSIS VERTICAL ANALYSIS Favorable (Unfavorable) Variance (Amounts in PHP millions) March 2018 December 2017 Amount % March 2018 December 2017 ASSETS Current Assets Cash and cash equivalents 14, , , % 10.2% 8.5% Financial asset at fair value through profit or loss 1, ,033.5 (20.2) -2.0% 0.7% 0.8% Trade and other receivables 7, ,270.9 (169.0) -2.3% 5.1% 5.3% Parts and supplies inventories 3, , % 2.7% 2.7% Due from related parties % 0.0% 0.0% Derivative assets % 0.1% 0.1% Other current assets 2, ,146.0 (536.3) -17.0% 1.9% 2.3% Total Current Assets 28, , , % 20.7% 19.6% Noncurrent Assets Property, plant and equipment 92, ,557.8 (425.1) -0.5% 66.0% 67.3% Exploration and evaluation assets 3, ,063.2 (4.9) -0.2% 2.2% 2.2% Goodwill and intangible assets 4, ,019.4 (18.8) -0.5% 2.9% 2.9% Deferred tax assets net 1, , % 0.8% 0.8% Available-for-sale (AFS) investments % 0.5% 0.5% Derivative assets % 0.1% 0.0% Other noncurrent assets 9, , % 6.8% 6.7% Total Noncurrent Assets 110, , % 79.3% 80.4% TOTAL ASSETS 139, , , % 100.0% 100.0% LIABILITIES AND EQUITY LIABILITIES Current Liabilities Trade and other payables 10, ,935.2 (852.0) -7.8% 7.2% 7.9% Due to related parties (0.7) -3.4% 0.0% 0.0% Income tax payable % 0.2% 0.0% Current portion of: Long-term debts 7, , % 5.6% 5.6% Derivative liabilities (4.5) % 0.0% 0.0% Total Current Liabilities 18, ,672.1 (389.9) -2.1% 13.1% 13.6% Noncurrent Liabilities Long-term debts - net of current portion 57, , % 41.3% 41.7% Net retirement and other post-employment benefits % 0.7% 0.6% Derivative liabilities - net of current portion (80.2) % 0.0% 0.1% Deferred tax liabilities % 0.1% 0.0% Provisions and other long-term liabilities 1, ,905.8 (109.4) -5.7% 1.3% 1.4% Total Noncurrent Liabilities 60, , % 43.4% 43.8% EQUITY Equity Attributable to Equity Holders of the Parent Preferred stock % 0.1% 0.1% Common stock 18, , % 13.4% 13.6% Treasury Stock (73.5) (73.5) - 0.0% -0.1% -0.1% Common shares in employee trust account (44.3) (44.3) - 0.0% 0.0% 0.0% Additional paid-in capital 6, , % 4.7% 4.8% Equity reserve (3,706.4) (3,706.4) - 0.0% -2.7% -2.7% Net accumulated unrealized gain on AFS investments % 0.0% 0.0% Fair value adjustments on hedging transactions (22.9) % 0.1% 0.0% Cumulative translation adjustment % 0.7% 0.3% Retained earnings 35, , , % 25.8% 25.2% 58, , , % 42.1% 41.3% Non-controlling interests 2, , % 1.4% 1.3% Total Equity 60, , , % 43.5% 42.6% TOTAL LIABILITIES AND EQUITY 139, , , % 100.% 100.0% SEC Form 17Q 1Q

15 Cash and cash equivalents Cash and cash equivalents increased by 22.0% or P2,569.7 million to P14,265.4 million as of March 31, 2018 from the P11,695.7 million in December 31, The increase was primarily attributable to the P4,320.5 million net cash generated from operating activities. The aforementioned were mainly offset by the following: P639.3 million payments of interest and financing charges; P455.8 million acquisition of property, plant and equipment; and P510.0 million principal re-payments of long-term debts. Other current assets This account decreased by 17.0% or P536.3 million to P2,609.7 million as of March 31, 2018 from the P3,146.0 million balance in December 31, 2017 was primarily due to decrease in short-term investments. Derivative Asset Favorable (Unfavorable) Variance March 31, 2018 December 31, 2017 Amount % Current % Noncurrent % % This account increased by 100.2% or P165.9 million to P331.4 million as of March 31, 2018 from P165.5 million balance as of December 31, 2017 mainly due to the valuation adjustments for the period. Trade and other payables This account decreased by 7.8% or P852.0 million to P10,083.2 million as of March 31, 2018 from the P10,935.2 million balance as of December 31, 2017 due to payment to suppliers. Income tax payable The increase in income tax payable is due to the higher income tax expense for the period. Derivative liability (Favorable) Unfavorable Variance March 31, 2018 December 31, 2017 Amount % Current (4.5) % Noncurrent (80.2) % (84.7) % The decrease of 100.0% or P84.7 million to nil from P84.7 million is due to maturity of hedged accounts. SEC Form 17Q 1Q

16 Net retirement and other post-retirement benefit The 6.9% increase or P61.3 million to P946.6 million as of March 31, 2018 from P885.3 million as of December 31, 2017 mainly due to retirement expense provision recognized during the period. Deferred tax liabilities This account increased by 120.1% or P79.5 million to P145.7 million as of March 31, 2018 from P66.2 million balance as of December 31, 2017 mainly due to recognition of deferred tax liability on NOLCO. Provisions and other long-term liabilities This account decreased by 5.7% or P109.4 million to P1,905.8 million as of March 31, 2018 from P1,796.4 million balance as of December 31, 2017 mainly due to decrease in provisions. Fair value adjustments on hedging transactions The turnaround of P=171.8 million is mainly due to the fair value adjustments on hedging transactions. Cumulative translation adjustment The increase of P=469.0 million is mainly due to the cumulative translation adjustment of foreign currency denominated subsidiaries. Non-controlling interests Non-controlling interest increased by 9.2% or P168.8 million to P2,006.7 million as of March 31, 2018 from the P1,838.0 million balance as of December 31, 2017 due to the share of net income. SEC Form 17Q 1Q

17 CAPITAL AND LIQUIDITY RESOURCES As of March 31 (in millions of pesos) YoY change Statement of Financial Position Data Total Assets 139, , Total Liabilities 78, ,229.3 (6,346.2) Total Stockholder s Equity 60, , ,346.0 The Company s assets as of March 31, 2018 amounted to P million, 0.7% higher as compared to the P138,627.0 million level as of March 31, CASH FLOW YTD March 31, 2018 vs. YTD March 31, 2018 Net cash flows from operating activities decreased by P1,648.3 million to P4,320.5 million for the period ended March 31, 2018 from P5,968.8 million during the same period in 2017 mainly due to lower operating revenue combined with higher operating expenses. Net cash flows used in investing activities decreased by 52.0% or P627.1 million to P578.2 million for the quarter ended March 31, 2018 as compared to the P1,205.3 million during the same quarter in 2017 primarily due to lower capital expenditures. Net cash flows from financing activities for the three-month period ended March 31, 2018 amounted to P1,149.3 million, a P355.1 million decrease from the P1,504.4 million net cash flows used during the same period in 2017 primarily due to lower payments on long-term debt and interest and other financing charges. SEC Form 17Q 1Q

18 DISCUSSION ON THE SUBSIDIARIES Green Core Geothermal Inc. (GCGI) For the periods ended March 31, (Amounts in PHP millions) Revenue 1, ,534.8 Cost of sale of electricity (1,416.4) (1,727.1) General and administrative expenses (113.3) (126.8) Other income (charges) - net (46.6) (91.7) Income before income tax Provision for income tax (84.0) (125.3) Net income As of March 31, 2018 Audited December 31, 2017 Total current assets 1, ,327.7 Total noncurrent assets 13, ,610.5 Total current liabilities 3, ,104.2 Total noncurrent liabilities 4, ,949.6 Total equity 7, ,884.4 GCGI s revenue decreased by 28.1% or P711.6 million, to P1,823.2 million as of March 31, 2018 from P2,534.8 million for the same period in The decrease was largely due to lower sales volume by GWh. Cost of sale of electricity decreased by 18.0% or P310.7 million, to P1,416.4 million in 2018 from P1,727.1 million in The decrease was due to lower cost of steam (P379.4 million) offset by higher depreciation expense (P28.1 million) and parts & supplies issued (P28.0 million). General and administrative expenses decreased by 10.6% or P13.5 million, to P113.3 million in 2018 from P126.8 million in 2017 due to lower provision for impairment of input VAT (P19.8 million) offset by higher purchased services & utilities (P7.9 million). Other charges net decreased by 49.2% or P45.1 million, to P46.6 million in 2018 from P91.7 million in 2017 due mainly to this period s income from insurance claims (P50.9 million). Provision for income tax decreased by 33.0% or P41.3 million, to P84.0 million in 2018 from P125.3 million in 2017 due to lower income before income tax. With the foregoing, net income decreased by 64.9% or P301.0 million, to P162.9 million in 2018 from P463.9 million in Total current assets decreased by 15.9% or P370.5 million, to P1,957.2 million as of March 31, 2018 from P2,327.7 million balances as of December 31, The decrease was due to lower other current assets (P223.2 million), cash & cash equivalents (P179.5 million) offset by higher trade & other receivables (P42.1 million). SEC Form 17Q 1Q

19 Total current liabilities decreased by 5.3% or P217.6 million, to P3,886.6 million as of March 31, 2018 from P4,104.2 million as of December 31, The decrease was attributed to lower trade & other payables (P299.2 million) offset by higher income tax payable (P81.3 million). Total noncurrent liabilities decreased by 10.2% or P502.9 million, to P4,446.7 million as of March 31, 2018 from P4,949.6 million as of December 31, 2017 due to this period s repayment of loan (P510.0 million). Total equity increased by P164.3 million, to P7,048.7 million as of March 31, 2018 from P6,884.4 million as of December 31, 2017 due to this year s net income (P162.9 million). SEC Form 17Q 1Q

20 Bac-Man Geothermal Inc. (BGI) For the periods ended March 31, (Amounts in PHP millions) Revenues 1, Cost of sales (935.3) (860.4) General and administrative expenses (39.8) (39.8) Other charges-net (55.5) (66.0) Income before income tax Provision for income tax (16.1) 0.2 Net income As of March 31, 2018 Audited December 31, 2017 Total Current Assets 1, ,764.2 Total Non-Current Assets 5, ,206.3 Total Current Liabilities 2, ,270.7 Total Non-Current Liabilities 3, ,198.7 Total Equity 1, ,501.1 Revenues increased by 13.8% or P=137.7 million, to P=1,135.0 million during the first quarter of 2018 from P=997.3 million for the same period in The favorable variance was primarily contributed by higher average price by PhP0.5860/kWh because of the increased BCQs. Cost of sales increased by 8.7% or P=74.9 million, to P=935.3 million from P=860.4 million for the same period in The increase was largely attributed to higher purchased services and utilities by P=54.0 million and higher steam costs by P=13.7 million. General and administrative expenses approximated the P=39.8 million for the same period in Other charges-net decreased by 15.9% or P=10.5 million from P=66.0 million for the same period in The favorable variance was mainly contributed by lower interest charges-net by P=11.9 million reduced by higher foreign exchange loss-net by P=2.9 million. Total current assets dropped by 2.2% or P=39.0 million, to P=1,725.2 million as of March 31, 2018 from P=1,764.2 million as of December 31, The reduction was mainly due to the decrease of cash and cash equivalents by P=404.4 million partly offset by the increase of other current assets particularly on additional fund for debt service reserve account by P=202.7 million, increase of trade and other receivables by P=152.8 million and increase of parts and supplies inventories by P=9.9 million. Total non-current assets decreased by 0.8% or P=41.0 million, to P=5,165.3 million as of March 31, 2018 from P=5,206.3 million as of December 31, The decline was traceable to the reduction of property, plant and equipment by P=51.9 million mainly on account of depreciation for this period partly offset by increase of other non-current assets mostly on input VAT claim from the BIR by P=11.2 million. Total current liabilities decreased by 7.6% or P=171.9 million, to P=2,098.8 million as of March 31, 2018 from P=2,270.7 million as of December 31, The decrease was mainly due to decrease of trade and other payables by P=197.4 million partly offset by this quarter income tax payable of P=16.3 million and increase of due to related parties by P=8.7 million. SEC Form 17Q 1Q

21 Total non-current liabilities increased by 0.1% or P=3.6 million, to P=3,202.3 million as of March 31, 2018 from P=3,198.7 million as of December 31, The increase was largely contributed by increase of long-term debts by P=1.9 million pertaining to the amortization of deferred financing costs and increase of net retirement and other post-employment liability by P=1.5 million. Total equity increased by 6.4% or P=88.3 million, to P=1,464.4 million as of March 31, 2018 from P=1,376.1 million as of December 31, The increase was attributed to the net income earned during the period. SEC Form 17Q 1Q

22 EDC Burgos Wind Power Corporation (EBWPC) For the years ended March 31 (Amounts in USD millions) Revenue Costs of sale of electricity (7.2) (8.5) General and administrative expenses (0.4) (0.4) Other charges net (1.2) (3.7) Income (Loss) before income tax Provision for income tax (1.5) (0.3) Net Income (Loss) As of March 31, 2018 Audited December 31, 2017 Total current assets Total noncurrent assets Total current liabilities Total noncurrent liabilities Total equity EBWPC reported $22.9 million revenue from sale of electricity for the year ended March 31, 2018 from $24.5 million for the same period in This is 6.5% or $1.6 million decrease mainly due to lower actual generated sales volume. Costs of sale of electricity decreased by 15.3% or $1.3 million, to $7.2 million as of March 31, 2018 from $8.5 million for the same period in The favorable variance was mainly due to lower repair and maintenance ($1.1 million) and rental, insurance and taxes ($0.2 million). Other charges - net decreased by 67.6% or $2.5 million, to $1.2 million as of March 31, 2018 from $3.7 million for the same period in This was mainly due to higher foreign exchange gain of $2.1 million. Total current assets increased by 10.9% or $8.0 million primarily due to increase in trade and other receivables ($9.6 million) and cash and cash equivalents ($2.4 million), partly offset by decrease in other current assets of $4.0 million. Total current liabilities increased by 9.2% or $2.3 million due to the increased in trade and other payables by $2.7 million. Total equity increased by 4.7% or $7.2 million, to $159.1 million as of March 31, 2018 from $151.9 million in This was mainly due to the net income earned during the period ($12.6 million) and increased in cumulative translation adjustment ($3.3 million), partly offset by dividend declaration ($8.6 million). Other balance sheets accounts have minimal movement during the quarter. SEC Form 17Q 1Q

23 Unified Leyte Geothermal Energy Inc. (ULGEI) For the periods ended March 31, (Amounts in PHP millions) Revenue Costs of sale of electricity (541.5) (526.1) General and administrative expenses (10.3) (2.5) Loss before income tax (110) (153.6) Net Loss (110) (153.6) As of March 31, 2018 Audited December 31, 2017 Total current assets Total current liabilities 1, ,761.9 Total capital deficiency (1,695.7) (1,585.7) ULGEI s revenue increased by 17.8% or 66.7 million to million as of March 31, 2018 from million for the same period in The increase was due to higher average selling price by 0.54/kWh ( 52.2 million) and higher sales volume by 3.6 GWh ( 14.5 million). Cost of sale of electricity increased by 2.9% or 15.4 million to million as of March 31, 2018 from million for the same period in The increase was due to higher sales volume (3.6 GWh or 20.3 million) offset by lower average price ( 0.05 /kwh or 4.9 million). General and administrative expenses increased by 312.0% or 7.8 million, to 10.3 million as of March 31, 2018 from 2.5 million for the same period in The increase was mainly due to higher Taxes and fees. With the foregoing, net loss decreased by 28.4% or 43.6 million to million as of March 31, 2018 from million for the same period in Total currents assets increased by 6.8% or 12.0 million, to million as of March 31, 2018 from million balance as of December 31, The increase was mainly due to higher withholding tax and trade receivables. Total current liabilities increased by 6.9% or million, to 1,883.9 million as of March 31, 2018 from 1,761.9 million balance as of December 31, The increase was due to higher trade and other payables. Total capital deficiency increased by 6.9% or million to 1,695.7 million as of March 31, 2018 from 1,585.7 million balance as of December 31, The increase was due to net loss on operation. SEC Form 17Q 1Q

24 FG Hydro Power Corporation (FG Hydro) For the periods ended March 31, (Amounts in PHP millions) Operating revenues Cost of sales General and administrative expenses Operating profit Other (income) expenses net 7.9 (3.7) Income before tax Provision for income tax Net income As of Audited March 31, 2018 December 31, 2017 Total assets 6, ,753.0 Total liabilities 1, ,183.7 Total equity 5, ,569.3 FG Hydro generated revenues of P788.3 million for the period ended March 31, 2018, 5.2% or P43.0 million lower than the revenues of P831.3 million for the same period in The unfavorable variance was mainly on account of zero ancillary service revenues for the period as compared to P236.9 million revenues for the same period in The new Ancillary Services Procurement Agreement with the National Grid Corporation of the Philippines was provisionally approved by the Energy Regulatory Commission on March 9, 2018 but implementation commenced in the immediately following billing period. The unfavorable variance was partly offset by higher average spot prices of electricity sold through the WESM and increased electricity generated during the period. Cost of sales for the period ended March 31, 2018 of P212.6 million was P24.6 million or 13.1% higher as compared to the P188.0 million level in The unfavorable variance was mainly due to increased replacement power purchases combined with increased water service fees paid to the National Irrigation Administration on account of higher generation during the period. General and administrative expenses, however, dropped by P15.6 million or 18.8% to P67.5 million during the period as compared to P83.1 million in The favorable variance was mainly due to lower taxes and licenses and insurance expense during the period. Interest expense for the period of P11.6 million was 17.1% or P2.4 million lower as compared to P14.0 million for the same period in 2017 due to reduced long-term debt balance. Provision for income tax for the period ended March 31, 2018 of P49.8 million is 63.2% or P85.4 million lower as compared to P135.2 million for the same period in The significant drop in income tax was mainly due to the lower income tax rate of 10%, the rate applicable to FG Hydro as a renewable energy developer, effective February 22, 2017 for the Pantabangan plant and February 27, 2017 for the Masiway plant. Overall, FG Hydro s net income rose by 5.1% or P21.8 million to P450.5 million for the period ended March 31, 2018 from the P428.7 million reported income for the same period in Total assets as of March 31, 2018 stood at P6,232.8 million, P479.8 million or 8.3% higher than the December 31, 2017 level of P5,753.0 million. The favorable variance was mainly due to higher cash and accounts receivable balances in SEC Form 17Q 1Q

25 As of March 31, 2018, total liabilities stood at P1,213.0 million, P29.3 million or 2.5% higher than the December 31, 2017 level of P1,183.7 million. The unfavorable variance is mainly on account of higher income tax payable for the period ended March 31, Total equity as of March 31, 2018 rose to P5,019.8 million, P450.5 million or 9.9% better than the December 31, 2017 level of P4,569.3 million mainly from net income earned during the year. SEC Form 17Q 1Q

26 KEY PERFORMANCE INDICATORS The top eight (8) key performance indicators are set forth below: March 2018 March 2017 Current Ratio 1.58:1 1.22:1 Debt-to-Equity Ratio 1.08:1 1.30:1 Net Debt-to-Equity Ratio 0.84:1 1.04:1 Return on Assets (%) Return on Equity (%) Solvency Ratio Interest Rate Coverage Ratio Asset-to-Equity Ratio Current Ratio Total current assets divided by total current liabilities. This ratio is a rough indication of a company s ability to pay its short-term obligations. Generally, a current ratio above 1.00 is indicative of a company s greater capability to settle its current obligations. Debt-to-Equity Ratio Total interest-bearing debts divided by stockholders equity. This ratio expresses the relationship between capital contributed by the creditors and the owners. The higher the ratio, the greater the risk being assumed by the creditors. A lower ratio generally indicates greater long-term financial safety. Net-Debt-to-Equity Ratio Total interest-bearing debts less cash & cash equivalents divided by stockholders equity. This ratio measures the company s financial leverage and stability. A negative net debt-to-equity ratio means that the total of cash and cash equivalents exceeds interest-bearing liabilities. Return on Assets Net income (annual basis) divided by total assets (average). This ratio indicates how profitable a company is relative to its total assets. This also gives an idea as to how efficient management is at using its assets to generate earnings. Return on Equity Net income (annual basis) divided by total stockholders equity (average). This ratio reveals how much profit a company earned in comparison to the total amount of shareholder equity found on the balance sheet. A business that has a high return on equity is more likely to be one that is capable of internally generating cash. For the most part, the company s return on equity is compared with an industry average. The company is considered superior if its return on equity is greater than the industry average. Solvency Ratio Net income excluding depreciation and non-cash provisions divided by total debt obligations. This ratio gauges a company s ability to meet its long-term obligations. Interest Rate Coverage Ratio Earnings before interest and taxes of one period divided by interest expense of the same period. This ratio determines how easily a company can pay interest on outstanding debt. Asset-to-Equity Ratio Total assets divided by total stockholders equity. company s leverage, the amount of debt used to finance the firm. This ratio shows a SEC Form 17Q 1Q

27 Commitments that will have an impact on the issuer s liquidity As of March 31, 2018, the Company has unserved purchase orders and awarded contracts for the purchase of various capital goods in the total amount of P354.4 million. Other than these, we are not aware of any other material commitments that should impact the Company s liquidity. Foreign Exchange Rate Volatility The Company has P=26,710.9 million in long-term US dollar denominated loans as of March 31, 2018 which is 40.7% of the total Company s long-term loans. Any events that will trigger direct or contingent financial obligation that is material to the company, including any default or acceleration of an obligation There are no material changes in the contingent financial obligations since the last annual balance sheet date. CASH DIVIDENDS No cash dividends have been declared as of period ending March 31, SEC Form 17Q 1Q

28 MAJOR STOCKHOLDERS As of March 31, 2018, the total number of stockholders was 566 and the stock price was P5.59. Public float level was at 10.88% (or 2,039,374,145 common shares). List of Top 20 Stockholders as of March 31, 2018 Ran Number of Shares Name Nationality k Preferred Common Total % 1 Red Vulcan Holdings Corporation Filipino 9,375,000,000 7,500,000,000 16,875,000, Philippines Renewable Energy Holdings Corporation Dutch - 8,899,999,810 8,899,999, PCD Nominee Corporation 3 (Filipino) Filipino - 1,069,298,593 1,069,298, PCD Nominee Corporation 4 (Foreign) Foreign - 962,691, ,691, First Gen Corporation Filipino - 148,910, ,910, Northern Terracotta Power Corporation Filipino - 148,092, ,092, First Life Financial Co., Inc. Filipino - 800, , Camara, Rosalind Filipino - 663, , Nicolas,Virginia Maria D. Filipino - 393, , Mei, Ting Chinese - 195, , Vallar, Ronald Arellano Filipino - 187, , Pamintuan, Maria Antonietta T. Filipino - 160, , Tan, Alfred L. Filipino - 153, , Tan, Lozano A. Filipino - 150, , Oliva, Dulce Maria S. Filipino - 137, , ALG Holdings Corporation Filipino - 131, , Mar, Peter,&/Or Annabelle C. Filipino - 105, , Crisostomo, Emily Azarcon Filipino - 100, , Postulka, Jason Michael American - 100, , Adrias, Fernando V. Filipino - 78,750 78, Sumalpong, Juliet G. Filipino - 78,750 78, Ferrer, Jose Tomines Filipino - 75,000 75, Ongking, Giovanna Filipino - 75,000 75, BOARD OF DIRECTORS As of March 31, 2018, the members of the Board of Directors of EDC are as follows: Federico R. Lopez Joaquin E. Quintos IV Richard B. Tantoco Francis Giles B. Puno Jonathan C. Russell David Andrew Baldwin David Simon Luboff Christopher Eu Sun Low Edgar O. Chua Francisco Ed. Lim Manuel I. Ayala Chairman and Chief Executive Officer Director Director, President and Chief Operating Officer Director Director Director Director Director Independent Director Independent Director Independent Director SEC Form 17Q 1Q

29 OFFICERS As of March 31, 2018, the Officers of EDC are as follows: Name Position Oscar M. Lopez Chairman Emeritus Federico R. Lopez Chairman & CEO Richard B. Tantoco President & COO Nestor H. Vasay Senior Vice President/Chief Financial Officer / Treasurer / Head of Finance and Shared Services Group Ma. Elizabeth D. Nasol Senior Vice President, Head of Human Resource Management Group Victor Emmanuel B. Santos, Jr. Senior Vice President and Regulatory Compliance Officer Bernadette Ann V. Policarpio Corporate Secretary Ana Maria A. Katigbak Assistant Corporate Secretary Erwin O. Avante Vice President, Head of Corporate Finance, Compliance Officer (SEC & PSE) Ferdinand B. Poblete Vice President, Chief Information Officer, Head of Information Technology Group Ariel Arman V. Lapus Vice President, Managing Director for Latin America James Arnold D. Villaroman Vice President, Head of Leyte Geothermal Business Unit Liberato S. Virata Vice President, Head of BGBU Project & Resource Exploration Management Reman A. Chua Vice President, Head of Wind Ilocos Norte Business Unit, Business Development Group Solar and Wind Technologies Raymundo N. Jarque, Jr. Vice President, Head of Business Development Group Geothermal Rassen M. Lopez Vice President, Head of Legal and Regulatory Group Bernardito M. Lapuz Vice President, Chief Risk Officer, Head of Strategy and Risk Management Group Ramon A. Carandang Vice President, Head of Corporate Affairs Group Emmanuel C. Portugal Vice President, Chief Digital Transformation Officer Grace Stephanie L. Marcelo Vice President for Treasury Maribel A. Manlapaz Assistant Vice President, Comptroller Glenn L. Tee Chief Audit Executive, Assistant Vice President/Head of Internal Audit Ryan Z. Velasco Senior Manager, Corporate Information Officer, Head of Investor Relations SEC Form 17Q 1Q

30

31 ENERGY DEVELOPMENT CORPORATION AND SUBSIDIARIES FINANCIAL SOUNDNESS INDICATORS March 2018 March 2017 Current Ratio 1.58:1 1.22:1 Debt-to-Equity Ratio 1.08:1 1.30:1 Net Debt-to-Equity Ratio 0.84:1 1.04:1 Return on Assets (%) Return on Equity (%) Solvency Ratio Interest Rate Coverage Ratio Asset-to-Equity Ratio

32 Prime Terracotta Holdings Corporation E: 100% V: 100% Philippines Energy Markets B.V. E: 100% V: 100% Red Vulcan Holdings Corporation E: 40% V: 60% Philippine Renewable Energy Holdings Corporation E: 47.5% V: 31.67% ID: 100% Green Core Geothermal Inc. (GCGI) Bac-Man Geothermal Inc. (BGI) Unified Leyte Geothermal Energy Inc. (ULGEI) Southern Negros Geothermal, Inc. (SNGI) Bac-Man Energy Development Corporation (BEDC) Legend: D Direct Ownership ID Indirect Ownership E Economic Interest V Voting Interest D: 60% D: 100% D: 100% D: 100% D: 100% D: 100% EDC Geothermal Corporation (EGC) ID: 0.01% D: 99.99% Energy Development (EDC) Corporation Chile Limitada EDC Soluciones Sostenibles Ltd First Gen Hydro Power Corporation (FGHPC) EDC Pagali Burgos Wind Power Corporation (EPBWPC) EDC Burgos Wind Power Corporation (EBWPC) EDC Pagudpud Wind Power Corporation (EPWPC) EDC Chile Holdings SPA EDC Geotermica Chile SPA EDC Wind Energy Holdings Inc. (EWEHI) ID: 100% ID: 100% ID: 95% ID: 95% ID: 100% EDC Energia Verde Chile SpA ID: 100% EDC Energia de la Tierra SpA ID: 100% ID: 100% EDC Bayog Burgos Wind Matnog 3 Renewable Power Corporation Energy Corporation (M3REC) (EBBWPC) Iloilo 1 Renewable Energy Matnog 1 Renewable Corporation (I1REC) Energy Corporation (M1REC) Negros 1 Renewable Energy Matnog 2 Renewable Corporation (N1REC) Energy Corporation (M2REC) PT EDC Indonesia Geotermica Crucero Peru S.A.C. Geotermica Tutupaca Norte Peru S.A.C. Geotermica Loriscota Peru S.A.C. EDC Wind Energy Holdings Inc. (EWEHI) 2 ID: 70% ID: 70% ID: 70% PT EDC Panas Bumi Indonesia EDC Geotermica Del Sur S.A.C. EDC Energia Azul S.A.C. EDC Energia Peru S.A.C. EDC Energia Geotermica S.A.C. EDC Progreso Geotermica Peru S.A.C. ID: 100% Burgos 3 Renewable Energy Corp. (BREC 3) Burgos 4 Renewable Energy Corp. (BREC 4) Calaca Renewable Energy Corp. (CREC) EDC Drillco Corporation (EDC Drillco) EDC Bright Solar Energy Holdings Inc. (EBSEHI) ID: 100% EDC Siklab Power Corporation ( formerly EDC Bago Solar Power Corporation ) EDC Sinag Power Corporation (formerly EDC Burgos Solar Corporation ) EDC Siklab Iloilo Power Corporation (formerly Kayabon Geothermal Inc.) EDC Mindanao Geothermal Inc. (EMGI) EDC Cleansolar Visayas Power Corporation (ECVPC formerly MAREI) ID: 0.01% ID: 99.99% ID: 100% EDC Desarollo Sostenible Ltd/ ID: 99.96% EDC Energia Verde Peru S.A.C. ID: 30% Energy Development Corporation Peru S.A.C. ID: 0.01% ID: 70% EDC Holdings International Limited (EHIL) ID: 100% EDC Hong Kong Limited (EHKL) ID: 99.99% D: 100% ID: 100% EDC Peru Holdings S.A.C. ID: 99.99% EDC Geotermica Peru S.A.C. EDC Hong Kong International Investments Limited (EHKIIL) ID: 0.01% ID: 0.01% EDC Energia Renovable Peru S.A.C.

33 Economic = 66.76% FGEN Corporate Structure as of March 31, 2018

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35 FIRST PHILIPPINE HOLDINGS CORP. AND SUBSIDIARIES CORPORATE STRUCTURE March 31, % First Philippine Holdings Power Generation 66.76% First Gen Corporation Property 86.58% Rockwell Land Corporation 100% Rockwell Integrated Property Services, Inc. 100% Primaries Development Corporation 60% Rockwell Primaries South Development Corp. 100% Stonewell Property Development Corporation 100% Primaries Properties Sales Specialists Inc. 76.4% Rockwell Leisure Club, Inc. 100% Rockwell Hotels and Leisure Management Corp. 100% Retailscapes Inc. 80% Rockwell-MFA Corp % First Philippine Industrial Park, Inc. 100% FPIP Property Developers and Management Corporation 100% FPIP Utilities Incorporated 85.00% Grand Batangas Resort Development Incorporated 40.52% First Batangas Hotel Corp. Power Distribution Manufacturing 30.00% Panay Electric Company 100% First Philippine Electric Corporation 99.15% Philippine Electric Corporation 100% First Philec Inc. (formerly First Electro Dynamics Corp. 100% First Philippine Power Systems 100% First Philec Manufacturing Technologies Corporation 89.04% First Philec Solar Corporation 100% Cleantech Energy Holdings PTE, Ltd. 100% First PV Ventures Corporation 70.00% First Philec Nexolon Corporation % First Philec Energy Solutions, Inc. 100% First Philec Solar Solutions 25% MHE-Demag (P), Inc. 100% First Balfour, Inc. 100% 100% ThermaPrime Drilling Therma One Corporation Transport Corporation 100% First Philippine Utilities Corporation Other Businesses 60.00% First Philippine Industrial Corporation 100% Securities Transfer Services, Inc % 100% FPHC Realty and First PhilippineRealty Development Corporation Corporation 100% 100% 100% FPH Land First Ventures Inc. Industrial 67% Township, TerraPrime, Inc. Inc. 3.94% Manila Electric Company Technology School, Inc. 100% FGHC International 100% First Philippine Properties Corp. 100% First Industrial Township Water, Inc. 100% Torreverde Corp % Asian Eye Institute, Inc. 100% FP Island Energy Corp. 100% First Industrial Science & 100% First Industrial Township Utilities, Inc. 100% First Philippine Dev t Corp. FPH Capital Resources Inc. 100% FPH Fund 100% FPH Ventures 100% FWV Biofields Corp 60% First Sumiden Realty, Inc.