New Assets Weigh on Near-Term Earnings but Fortifies Water Supply Resilience as Very Strong El Niño Looms
Manila Water Company, Inc. (Manila Water) sustained its growth momentum in the first nine months of 2026, delivering double-digit revenue and EBITDA gains on tariff adjustments, steady demand, and disciplined cost management. Newly completed infrastructure is now in service, reinforcing water security as the country braces for a very strong El Niño that may extend into the first half of 2027.
Consolidated revenues rose 11% to Php33.4 billion from Php30.1 billion a year earlier, driven by tariff adjustments and sustained demand across business units. EBITDA grew 12% to Php24.4 billion, and margin maintained its strength at 73%, as cost discipline and efficiency initiatives offset challenging market conditions. Cost of services and operating expenses were contained at Php9.6 billion, with increases stemming mainly from regulatory and compliance costs, the integration of new facilities, and higher input and service costs amid the macroeconomic environment. Net income was Php12.0 billion, 5% lower year on year, as higher depreciation and interest expenses from newly completed assets began to be recognized—a natural phase of the investment cycle. Net income margin moderated by 6 percentage points but remained strong at 36%.
The East Zone Concession, which now fully integrates the assets and operations of Wawa JVCo, continued to perform solidly. Revenues grew 12% to Php26.9 billion from Php24.1 billion, driven by the fourth tranche of the Rate Rebasing adjustment in January, which raised the average tariff by 11% to Php67.20 per cubic meter. Higher subdivision and construction-related consumption strengthened the customer mix and kept billed volume steady at 395 million cubic meters. EBITDA rose 13% to Php20.5 billion, with margin improving to 76%. Net income fell 5% to Php11.1 billion as depreciation and financing costs of newly commissioned facilities weighed on earnings; net income margin was 41%.
Non-East Zone Philippines (NEZ PH) revenues rose 6% to Php7.4 billion on tariff adjustments, higher billed volume in Clark, South Luzon, and Boracay, and higher supervision fees from the Laguna Water and Estate Water projects. EBITDA increased 8% to Php3.8 billion, with margin steady at 51%. Net income grew 19% to Php1.35 billion, lifting net income margin by 2 percentage points to 18%.
Strengthening Water Security and El Niño Readiness
Capital expenditures remained on track at Php11.7 billion, reflecting disciplined project execution and compliance with service obligations. These investments now underpin the Company’s El Niño readiness.
In the East Zone, Manila Water is optimizing output from its Cardona, East Bay Phase 1, and Calawis treatment plants while advancing East Bay Phase 2 and the 220 million liters per day (MLD) Kaysakat plant, targeted for completion within the year. The Company also kept Non-revenue Water below 15%—at 14.80% as of end-September—with each percentage-point reduction freeing up an additional 15–16 MLD for customers.
Outside Metro Manila, Manila Water Philippine Ventures has activated preparedness measures across its operating units. Calasiao Water in Pangasinan has rolled out its service continuity plan, with a mobile water tanker on standby and new deep wells due in 2027; Metro Ilagan Water in Isabela commissioned an additional deep well in May and is building a 13 MLD treatment plant; and Cebu Water delivers over 30 MLD.
“Our nine-month performance demonstrates the resilience of our business and the strength of our fundamentals. We continue to deliver double-digit revenue and EBITDA growth while navigating inflationary pressures and absorbing the near-term costs of bringing critical new assets online. These investments are strengthening our business for the future – expanding and diversifying our water sources, reinforcing system reliability, and improving network efficiency. We are equally encouraged by the growth we continue to see in our NEZ PH businesses. The strong performance of our subsidiaries is a clear indication of even more opportunities to provide better, and reliable water service to more communities in the country. As we prepare for a potentially strong El Niño, we remain confident in our ability to manage near-term challenges with discipline while sustaining dependable, long-term value creation for our customers and shareholders.” Manila Water President and CEO, Mr. Roberto R. Locsin said.
15 
