by Pia G. Alimon, AUGUST 2021
Ours is a heartwarming story of a relatively newcomer, which has turned out to be a major force in expanding market share and generating substantial revenue for Metro Pacific Investments Corporation (MPIC).
This “newcomer” happens to be your parent company, MPTC.
Whether you’re part of the Head Office, NLEX Corp, MPT South, CCLEC, MPT Asia, MPT Mobility, or any of our subsidiaries– you will be proud to know that this comparatively newcomer in the constellation of companies in MPIC – or even in the larger MVP Group – has become a significant member of the country’s premier infrastructure conglomerate.
MPIC’s universe is made up of a constellation of companies. MPIC has businesses in power (Meralco and MET Power Ventures), toll roads (MPTC, of course), water (Maynilad and Metro Pacific Water), healthcare (Metro Pacific Hospitals and the MWell app), light rail (Light Rail Manila Corp), logistics (Metro Pac Movers), real estate (Landco), and fuel storage (Phil. Coastal Storage and Pipeline Corp.)
Why do we say that we are now a “major star” in the MPIC Universe?
Contribution to Group Core Income. In the years 2017, 2018, and 2019, MPTC has risen to being second biggest contributor to MPIC. In 2020, when markets contracted and economic activity slowed down, adversely affecting travel, Toll Roads was third revenue earner of the group.
Revenue Drivers. The following milestones contributed to the double-digit core income and growth of MPTC.
Acquisitions. In 2017, we had our first major foreign acquisition with our investment in Indonesian utilities conglomerate Nusantara Infrastructure (NI). The acquisition was significantly completed the following year when we acquired an additional 26.40% stake to total with a majority holding in the infrastructure conglomerate. We invested further in NI’s tollway arm Margautama Nusantara in 2019. “This is our gift to the ASEAN,” our President & CEO REF once declared.
Toll Collection. Opening of expressway projects and starting toll collection means toll revenue, which is the bread and butter of our company. In 2019, we opened NLEX Segment 10 and CAVITEX C5 Link Segment 3A-1. Also, in 2019, we were finally able to able to implement our toll rate adjustments, with the last being 8 years before, in 2011.
Diversification. MPTC continues its innovative moves, highlighting diversification initiatives. In 2018, our group’s first foray in TSFs bore fruit with the opening NLEX Drive and Dine in Valenzuela. Opening and operating the NLEX Drive and Dine is significant as it marked our diversification from our usual expressway operations. The following year we acquired our longtime manpower resource agency Southbend Express Services Inc, then followed by mobile startup company DibzTech in 2020. All these comprise our well thought-out strategy of completing the expressway ecosystem. Aside from bringing in a new stream of revenues, we are also strengthening our philosophy of delighting our customers even more.
Efficient housekeeping. Within a period of five years, MPTC’s financial performance has shown a growing efficiency. The long-standing policy of placing our O&M costs and operating costs at high productivity levels has shown favorable results.
Increasing EBITDA margin means that the company’s operating expenses are lesser in relation to its total revenue, thereby leading to a more profitable operation. Our EBITDA margins remain within the vicinity of 63% – 66%, a very good profitability picture in the industry. This means we are spending prudently and efficiently, as we generate more revenues.
During the pandemic, these cost management initiatives kept our head above the water: identification of priority projects across all depts, conducting of a Project Health Check, suspension of employee travel and face-to-face events, review and renegotiation of engagements with service providers and consultants, among others.
Doing Well, Doing Good. With a steady stream of revenues and improving margins, there is no doubt that the tollway business has successfully transitioned from the survival to a winning mode. The revenue stream shows that vehicular traffic is making a rebound, and our good housekeeping has shown great results in terms of good margins. That’s the “doing well” part.
In the “doing good department,” we took care of our employees groupwide, and promptly shifted to ETC to contribute further to the countrywide implementation of health protocols. We gave back, too– we exempted health workers and other frontliners from paying toll.
Overall Outlook. From a macro view, seeing our tollway business’ contribution to the revenue of the entire MPIC Universe, we are heartened by all indicators that we are truly in the bigger league of players within the MPIC Group. We are all the more encouraged to play our growing role better.
From a micro view, getting up close and personal about our individual performance as individual expressway companies, we have appreciated the fact that our daily commitment to assure streams of revenue at the toll booths, and our alert watch over our costs – result in commendable financial and operating performance of every operating unit.
Now, we know that everyone’s effort counts. Now we know what it takes to be a “major star in the MPIC Universe.” Our resolve therefore is shine through every passing day.
About the writer:
Officially Celeste Pia Marcia Guiang Alimon, Pia does the branding, marketing and corpcomm-ing for MPTC. She believes that no truer words have e’er been spoken when Yoda uttered, “Do or do not. There is no try.” Also, Pia’s Myers-Briggs test once told her she’s an introvert.