First Pacific Co Delivers Record Profits Amid Cautious Outlook

First Pacific Co ((HK:0142)) has held its Q4 earnings call. Read on for the main highlights of the call.

First Pacific Co’s latest earnings call struck a confident but measured tone. Management highlighted record recurring and net profits, robust dividend growth, and improving balance-sheet strength, while acknowledging pressure points in power prices, commodity costs, and future refinancing. Overall sentiment leaned positive, with operational outperformance seen as outweighing geopolitical and market risks.

Record And Rising Profits

First Pacific reported recurring profit up 10% year-on-year to $740 million, with net profit also rising 10% to a record $661 million. Executives stressed that recurring profit has more than doubled since 2018 from about $290 million, underscoring a multi-year track record of earnings expansion across its core holdings.

Revenue And Turnover Growth

Group turnover in FY2025 increased 2% to just over $10 billion, helped by higher revenues at Indofood and Metro Pacific Investments Corp. Several flagship investees, including Indofood and PLDT, posted record-high revenues, while MPIC delivered its highest-ever earnings, reinforcing the breadth of the group’s growth drivers.

Strong Operational Contributors

MPIC’s core profit climbed 15%, fueled by stronger contributions from Meralco’s power generation and the new LNG terminal known as Project Chromite. PLDT also delivered record service revenue and record EBITDA, maintaining a solid 52% EBITDA margin that underpins cash generation despite slower profit growth.

Maya Fintech Turns Profitable

The call highlighted that Maya, PLDT’s 38%-owned fintech platform, moved into profitability for the first time in 2025. This milestone not only boosted PLDT’s earnings but also signaled growing diversification into digital financial services, potentially opening a new avenue of growth within the portfolio.

Shareholder Distributions At Peak Levels

Directors approved a final distribution of HKD 0.14 per share, bringing regular full-year payouts to HKD 0.27 per share, the highest in the company’s history. Including a special distribution linked to Maynilad, total shareholder distributions grew about 10% year-on-year, with regular dividends up roughly 6% versus the prior year.

Solid Balance Sheet And Liquidity

Head office dividend income reached about HKD 311 million in 2025, supporting central cash flows and service of obligations. The interest coverage ratio improved to 4.5 times from 4.0, with average funding cost around 4.6% and no major debt due before a $350 million bond maturing in September 2027.

Strategic Projects And Asset Development

Management flagged continued investment in PacificLight Power, including an equity injection to fund a new gas-fired plant that aims to enhance capacity and efficiency. Philex’s Silangan project is accelerating toward commercial operations with higher ore grades than the existing Padcal mine, while PLP’s valuation has risen to about $398 million after recent funding.

Capital Markets Access And Liquidity

The Maynilad listing generated a special cash distribution and broadened market liquidity for that asset, supporting both valuation transparency and capital recycling. New coverage from mainland China brokerages is also ramping up, which management expects will improve investor access and trading liquidity for First Pacific shares.

PLP Earnings Under Pressure

PacificLight Power saw a slight decline in earnings and sales in 2025 as Singapore electricity prices dropped from the 2023 peaks, squeezing profitability even though market share held steady at about 9.6%. Management framed the weakness as cyclical, but acknowledged that lower power prices will weigh on near-term results.

Muted Profit Growth At PLDT And Indofood

Despite record service revenue and EBITDA, PLDT’s core profit rose only 1%, reflecting margin pressures and investment needs within its telecom and digital businesses. Indofood also posted just a 1% increase in core profit, albeit at record levels, suggesting that earnings growth is slowing as cost inflation and competition temper margin expansion.

Exposure To Fuel And Middle East Risks

Executives cautioned that ongoing tensions in the Middle East could disrupt LNG and gas supplies, with potential impacts on Singapore’s power market and PLP’s fuel sourcing. Any prolonged disruption could increase fuel cost volatility and challenge availability, making this a key external risk factor to watch.

Refinancing And Market Volatility Concerns

A $350 million bond coming due in September 2027 remains a focal point for treasury planning, especially against uncertain rate and credit conditions. Management is weighing refinancing through either the bond market or bank facilities, and emphasized the need to navigate geopolitical and interest-rate volatility carefully.

FP Natural Resources Wind-Down And Impairments

FP Natural Resources narrowed its losses in 2025 as sugar and alcohol operations largely ceased, trimming the drag on group results. However, management plans to dispose of remaining refinery assets at below book value, leading to impairment charges that will be treated as nonrecurring items.

Toll Roads And Ownership Dilution

Contribution from toll road assets held via MPIC did not expand meaningfully over the year, in part because of reduced ownership interests that capped upside. While the underlying assets remain strategic infrastructure plays, the lower economic stake limits the lift to group earnings from this segment.

Muted Tariff Uplift At Maynilad

Looking ahead, Maynilad’s next tariff adjustment is expected to be modest at about 4% in 2026, smaller than previous step-ups in water rates. This implies a more subdued near-term revenue boost from the water utility, even as it continues to provide stable cash flows to the group.

Commodity And FX Headwinds

Management revisited past spikes in wheat and crude palm oil prices, alongside multi-year depreciation of the rupiah and peso, as reminders of persistent macro risk. While current operations have shown resilience, these commodity and foreign-exchange swings can compress margins and affect local-currency earnings going forward.

Guidance And Outlook

For 2026, management expressed cautious optimism, pointing to FY2025 momentum and reiterating a constructive view on turnover and profit growth, backed by Indofood, MPIC, PLDT, Maya and PLP’s future plant. Balance-sheet guidance signals limited near-term maturities, disciplined capital returns of over 70% of free cash, and a focus on funding PLP’s gas project while actively managing refinancing and fuel-supply risks.

First Pacific’s call painted a picture of a diversified group delivering record profits, rising dividends, and improving financial resilience despite pockets of earnings pressure. Investors will be watching how management steers through lower power prices, modest tariff growth, and looming refinancing needs, but for now operational momentum and disciplined capital allocation remain the defining themes.