2018 Integrated Report
message from the chairman
Fellow Shareholders,
Although technically speaking the recent events in our Manila Concession did not take place in 2018, I nevertheless felt that it was important to address this issue before anything else. The water supply shortage which affected our customers in the past weeks has been a very challenging time for all of us. Several factors resulted in this lack of supply, greatly impairing the high standards of service which we have maintained for over 20 years. As emphasized in the statements that have already been made, we take responsibility for our own shortcomings. We recognize the difficulties which our customers have experienced because of this incident, and we are committed to making things better for them. Following the incident, we have been working tirelessly to bring water availability back to the affected areas. Through the efforts of our employees and cooperation with key stakeholders and government agencies, we have regained 99 percent on our water availability standard of 8-12 hours at ground floor water pressure. As our water supply augmentation operations continue to stabilize with the additional water supply from our Cardona Water Treatment Plant and the recommissioning of deep wells, we continue to explore all possible options to bring services back to the high levels that our customers have been accustomed to.
Amidst challenges of this kind, we take to heart the hard lessons which make us stronger. With this crisis, our efforts show us once again that significant gains can be made when we have a strong partnership with our stakeholders. Our collaboration with our principal, the Metropolitan Waterworks and Sewerage System (MWSS) as well as other government agencies is helping us chart a path towards long-term, sustainable water infrastructure development for the Metro Manila East Zone. We are now in detailed discussions with MWSS on the development and construction of the Wawa-Calawis Water Source Project. This project will address the medium-term water supply requirements of the Manila Concession. Beyond the East Zone, these current realities have placed much-needed urgency on the matter of water sector reform, not just for Metro Manila but for the country as a whole. We will continue to work with government as it lays the groundwork for the sustainable management of this very important resource for our country.
In the face of adversity, we must have the strength to learn and then move forward. I am encouraged to see that the growth strategy we set a few years ago, with a foundation firmly rooted on the Manila Concession, continues to thrive as we expand into new territories and serve more communities.
Manila Water can emerge stronger in the face of seemingly insurmountable challenges. The company draws strength from its core, which is built upon resilience, and its commitment to its customers.
In the Manila Concession last year, we saw the successful resolution of our regulatory impasse with the approval of our Rate Rebasing business plan. This provides us with a clear mandate of maintaining and expanding water and used water coverage to even more communities in the East Zone. Equally important, this lays testament to the mutual acknowledgment by MWSS and Manila Water of the urgent need for increased water supply, as well as reliable water and used water infrastructure to meet the growing demands of customers.
For our domestic subsidiaries under Manila Water Philippine Ventures, the tougher competitive environment did not deter us from expansion. We secured 11 new business projects across the country, covering water concession, bulk water, and septage management contracts. This is in line with our aspiration to steadily increase our footprint in the country, where we work to establish efficient water and used water operations, expand coverage, and improve service levels in these communities.
Overseas, Manila Water Asia Pacific further expanded its geographic footprint. Early last year, we completed the acquisition of an 18.72 percent stake in East Water, a water supply and distribution company in Thailand. This acquisition has given us a new platform to access a large customer base as well as potential business opportunities along Thailand’s Eastern Economic Corridor. Equally important, as we build strong ties with our partners we will gain further insight on more valuecreating opportunities.
Manila Water has always focused on long-term sustainable growth that contributes to social development. From the time that we started in 1997, we have always seen our responsibility to our customers as a mission to fulfill, more than a business to run. As we have weathered considerable challenges in the past, it inspires me to see that the strength and resilience which our company has built through the years, is very much alive in our people, our culture, and in our work.
Manila Water can emerge stronger in the face of seemingly insurmountable challenges. The company draws strength from its core, which is built upon resilience, and its commitment to its customers. With your trust and support, we will continue to champion our mission of providing access to water and sanitation services for the communities we serve.
I thank our Board of Directors for their continued guidance, our management team and all our employees, and finally, our customers, shareholders, partners, and all our stakeholders who inspire us to keep moving forward and remain steadfast in our commitment to helping uplift the lives of our countrymen through our products and services.
FERNANDO ZOBEL DE AYALA
Chairman