Good day, everyone. Thank you for joining us this online evening to discuss First Pacific 2024 full-year financial and operating results. The results presentation is available on First Pacific's website, www.firstpacific.com, and at the investor relations session presentation page. This results briefing is being recorded, and the replay will be available on First Pacific's website this evening in the investor relations session. For participants from the media, please note the Q&A session is open for investors and analysts only. If you would like to raise questions, please contact us when the briefing finishes. Today with us is our Executive Director, Mr. Christopher Young, and he will come in in a minute, and our Chief Financial Officer, Mr. Joseph Ng, our Associate Directors, Mr. John Ryan, and Mr. Stanley Yang, and other senior executives from the head office in Hong Kong. Over to you, John, for the presentation, please.
Thanks very much, Sara. One or two housekeeping points as we begin. Most of you, if not all of you, are probably aware that we update this presentation from time to time, certainly every quarter with results of operating companies that report on that basis, and often more frequently with changes in minority shareholdings. Second, please be aware that when you see something in this book that is underlined, it's almost certainly a hyperlink. If you're looking at it on screen, you can, for example, looking at the table of contents, rush to that page. If you are looking at the beginning of the MPIC section and it says Financial Highlights underlined, you click there and it'll take you to the appropriate place in the MPIC website.
Okay, to begin, John, please, let's go to page four for a quick glance at our pie chart most of us are familiar with. Indofood's the biggest of our assets, the green, blue, and red are our core holdings. Philex and others are there in purple. These values are as of the end of December. Since the end of December, our stake in MPIC has increased from 46.3%- 49.9%. That information is correct at the far end of the book where you see the economic interest in all the units that we've got. The valuations of the companies here are at the closing share prices as of the end of 2024. MPIC and PLP, of course, are book value, specifically for MPIC at the PHP 5.2 per share it was privatized at in the autumn of 2023.
Quickly to the next page, probably a little surprise to all of you who followed the nine-month numbers of our units. We've had some record highs, record high contribution, record high recurring profit, record high full-year distribution to shareholders by the grace of our CFO, Joseph Ng, who joins us here this afternoon. We paid out a total of HKD 0.255 per share to our shareholders because the earnings were superb and the cash flows remained strong as they were from the previous year. A few details on that are on page six. You can see dividend income bottom left chart a little bit down from the record high set in 2023. Overall, our balance sheet, cash flows, et cetera, remain quite strong. We've retained two investment-grade credit ratings. I think it's for over two years now.
As you can see up left there, we've got no borrowings following due this year. We've got about $200 million due in 2026, and then our only bond is due in 2027. That's about a bit less than a quarter of all of our borrowings. As you can see from the pie charts down at the bottom, fixed-rate borrowings are a little bit over half of the total. We have an interest coverage ratio at the end year of 4 times. Our comfort level, as many of you are aware, is 3 times or higher. There are some details about the interest rates we pay and the maturities there in the bullet points. Let's move very quickly on to Indofood. 2024, I think, was the 11th year in a row of record high revenues at Indofood.
Certainly, the EBIT and the core profit were at record highs, and so were many of their sale numbers. We're looking at page seven, where we've got the EBIT margins in the blue box showing that Noodles full-year margin of 25.9% is the highest full-year margin we've ever seen for that food group, and it has been the big driver of their profit rising from high to high. We expect Indofood will continue strong into 2025. If you look two pages further along on page nine, you can see there that the biggest increase in sales has, again, been to the Noodles division, and they make up a total, as you can see, of 46% of all sales. It's the biggest, I think, instant noodle maker in the world. It's increasingly international, as the time series of geographic sales breakdown shows you down at the bottom of that page.
We expect sales in all of those regions to continue growing through 2025. Page 10, the next page shows you some time series data about their borrowings and cash flows and so on. Absolutely fascinating numbers, I think they are. In the interest of time, let's move on to Metro Pacific, the privately owned holding company in the Philippines on page 11, where we see the power, the toll roads, the water, the big main businesses, followed by healthcare. It is now 27 hospitals and then some other smaller businesses. To recap on page 12, that company was privatized in the autumn of 2023. If you want details of its operations and earnings, you really have nowhere else to go except to First Pacific, where we own just about half of MPIC, or GT Capital, which is the second biggest shareholder, just under 20%.
Now, the numbers on page 13 again show lots of record highs, record high contribution, record high core profit. We see that these numbers were driven mostly by power, followed by water and roads. Water and roads were boosted by higher tariffs, power by higher sales, and increasing production of electricity in its rapidly growing electricity generation business. Metro Pacific hasn't got any formal forecasts for full-year 2025, but current trends suggest that it will be another strong year. Page 14 shows you a little bit about balance sheet and cash flow over at MPIC. Record high dividend income during 2024, as you can see in the box on the top right. We can get into more detail on the MPIC companies in the Q&A, but because we're such a big and diverse group, let's just hit the highlights in the narrative.
We're leaping ahead now to page 21 for a few brief words about PLDT. Again, some record highs, record high sales and service revenues, rather, and record high EBITDA. All three of its main businesses delivered stronger sales. If you look at the breakdown of service revenues there on the bottom right, you've got, as in the past few years, mobile data and SMS showing the strongest growth, and then fixed line data also growing strongly, and fixed line voice as well. Mobile voice is the only major source of service revenues that is down, and we expect PLDT going forward to continue growing quite adequately. Remember, they're an important source of dividend income for us. They pay 60% of core profit to shareholders. Now, on page 23, we've got the fintech that is controlled by PLDT.
They're the biggest shareholder with 38%, the only telco in the Philippines to have a banking license. The column charts at the bottom show you that they are growing very strongly. Depositors more than doubling over the course of the past couple of years. Deposit balances growing very strongly. Loan disbursals, as you can see, are up enormously. They moved into profitability in December 2024, and we would expect that in the early months of 2025, we might continue to see that strong performance. First Pacific, you'll see in the footnotes there, owns directly about 1.4% of Maya. Our economic interest, I think, is a little over 11%. Details are in the back of the book. Regarding the future of Maya, you can ask us about that in the Q&A. Stanley Yang, our Head of Corporate Development, I'm sure would be delighted to talk to you about that.
Over on page 25, Pacific Light Power followed record performance in 2023 with a more moderate pace of earnings in 2024, mostly because of lower blended non-fuel margins. Nevertheless, they continue to be a strong and important payer of dividends to First Pacific. Recently, looking to the future, they were awarded a power project of 600 MW of hydrogen-ready CCGT, which should go into operation in January 2029. Stan, am I inaccurate on that 600 MW ? Is it 670?
It's capable of more, but the contract with EMA is 600.
Okay, that's why we've got that detail there. Now, to our last of our bigger holdings, Philex Mining Corporation on the following page, page 26. As we've seen in each of the past few years, the grades are in slow decline at the Padcal mine, which produces gold, copper, and a little bit of silver. It remains profitable, as we see in the column chart on the top right. We have managed to again extend the mine life at Padcal through 2028. That is quite important because you see on page 27, the future of Philex is in the Silangan mine, which is expected to begin production in 2026. We will have a couple of years of overlap where Philex will be operating two mines while the Silangan project gets up to speed with its much higher grades of copper and gold.
You can compare the grades between the two mines by looking at the two pages next to each other. Now, the appendix in this book has got a couple of new pages. Page 34 has got some per-share data that we haven't had before. On page 43, we've got a graphical look at earnings and exchange rates, which can give you some comfort on that sort of thing. That's it for the opening narrative. I think, Sara, now?
Yeah, we can start the Q&A session.
Hi, John, this is Jeff from CLSA. Can I jump in and start asking a question? I cannot find the raise hand button from my end because sorry for jumping in suddenly.
Please go ahead.
Yeah, thank you for all the remarks. A few questions from me. The first one, just trying to understand just a very boring maintenance when trying to understand the FPM Power. How should we think about the earnings trajectory in 2025 and maybe 2026? Just trying to see what should be expected on that. That's the first one. I will wait for the next few after the answer for this question. Thank you.
Stan, can you help?
Sure. Why don't I take that one? Hi, Jeff. In terms of the Pacific Light performance, as you are aware, the performance after 2021, when the plant became profitable, ramped up and hit a high in 2023. Now, 2023 was an exceptional year. It's a one-off in our view because of the confluence of the supply, the gas situation, and so forth that pushed prices to levels that the Singapore market had never seen. As part of that, the key metric is basically the gross margin, what was called the non-fuel margin, which was at over SGD 100 per MWh . As a result of that, the profits were, and even now are, very high. Last year, that came down. The non-fuel margin was mid-80s.
We expect that that would gradually, not in a big leap, but a gradual tapering, where you have to recall that the long-run marginal cost, when we think about vesting contracts, when the Singapore government offers these vesting contracts, it's based on a long-run marginal cost. The price range on that is approximately $45-$50 per MWh . When you put that in context, then it's not a surprise then as the supply comes on stream, as the demand is steady, that you would see some tapering down from where the levels have been in the last couple of years. How quickly that happens, I think that's depending also on the market growth. EMA have stated that they expect that the growth to be strong.
There is a basis for growth rates to exceed 4% in the market on an annual basis in terms of generation demand. With that in mind, I think what we will monitor, of course, is the price fluctuations. In the next couple of years, I think it is fair to say that the expected price will not be as high. Having said that, though, it is a merchant market. There is additional demand that is growing. Another key factor is the 600 MW new project that John mentioned earlier, where by virtue of having that, and this project will be completed in 2029, that adds significant new capacity into PLP's portfolio. It is a new turbine. It is more efficient.
When you think about the heat rate and the performance relative to the cost of running these plants, I would say that overall PLP's portfolio will still be one of the newest in terms of overall among all the Gencos, including the two F-classes that they have today and a new 100 MW ancillary services that's being completed soon. When we think about the portfolio, then PLP has a good runway. The other thing to mention is that the gas situation, which has always been a problem in the past, the management was able to secure long-term contracts, and we believe that they have a benefit in terms of relative to other peers in the market.
Thank you, Stan. Jeff?
Yeah, thanks, John. Switching gear a bit to Metro Pacific, or let's say Meralco first, I was seeing some news article about Terra Solar phase two maybe somewhere over the past two weeks or so. Is there anything that you can share with us now on that specific projects, or is it still very early stage to talk about it?
It's Stan as well. Let me take that. I think the focus at this point is really on Terra Solar as it is, phase one, and that's the 3,500 MW project. That is going to be delivered in two phases. The initial one will be delivered in Q1 of 2026, and the balance, 250 MW, will be in Q1 of the following year in 2027. These are the key in terms of the buildout of this particular project, the 3,500 MW, which Actis, the U.K. private equity firm, just recently closed on its investment of 40% into the project. I think you may be referring to some articles about future continued buildout of solar projects. I think it's too premature to get into any details of it.
I think clearly, in terms of fuel mix, the government, the country will want additional renewables, and we would continue to look at that. In terms of timing and specifics, that would be too early to say. For now, the real focus is around this 3,500 MW peak with the 20-year power supply agreement that has been contracted with Meralco.
Got it. Switching gear a bit to the Maynilad . I was referring to the announcement you guys put out about a week or two ago about the spinoff of Maynilad . Just trying to work on your upper bound of evaluation, which I calculated as $2.8 billion U.S. dollar. Would you be able to share some of your working assumptions or what needs to be achieved in order to arrive at that sort of valuation for spinoff, or what are the sort of considerations here for us? Thank you very much.
Stan's going to talk a lot.
Yeah, on that one, I won't comment in terms of specifics around valuation other than at the level that you're talking about. This is reference to the maximum price in the filing because let's say in Hong Kong, often the protocol is you would have a range, a min and a max on the range. In the Philippines, in this preliminary filing, it is a maximum only. There is no range in terms of a minimum as well. That price range would be set closer to the IPO timetable. That is something that you have to bear in mind in terms of what the valuation is because under the PSE requirements, it's just the maximum at this point. I think the key, though, what will drive the valuation, one is the strong performance.
The fact that in the last two years, in 2023, the business was able to implement a tariff increase of approximately 13%. In 2024, an even larger one at about 19.8% tariff increase. As the management focuses on improving the operations and the efficiency of the system, the non-revenue water, which is a measure of the loss of the water in the pipes and so forth, is a key benchmark that is targeted to come down and be reduced. With the capital expenditure program and the focus on driving more efficiencies, this will deliver more water to the customer and hence more revenues and then flows to the earnings of the business. That is a key metric that from where it is last year, it finished just over 40%.
We would like to see that by the end of the next couple of years, it can get to a level that will come down to below 30% and then eventually to a longer-term goal of in the 20% level. That we feel is benchmarked against other well-run water utilities globally. I think that as those get implemented and get executed, this would help in terms of the valuation and the picture for Maynilad.
Thanks, Stan. My last question would be the boring one about share buybacks. The reason why I am asking about share buybacks again is because a lot of interesting and value unlocking deals coming through. Philex Mining is becoming very interesting starting from next year. We have a very healthy head office balance sheet or the cash interest cover ratio. I think for 2024, we have the first net cash inflow at the HoldCo level as well for the entire 2024. My question is, given the current discount on NAV, which my data is showing 56% pretty wide, is it something we should be thinking about again in the near future for share buybacks, or is it still more or less depends on other stuff?
Just a few help, and maybe Chris might have a comment after you speak.
Yeah, maybe I'll try to address that. Jeff is just there. I think at the end, it ties to the general question about capital allocation because the share buyback is always part and parcel of the so-called returns, broadly the return to the shareholders. It ties to a number of things, including the dividend distribution policy. It's a kind of dynamic kind of situation that we are assessing every year. The very broad kind of analysis that you can see from the cash flow just put up by John, that 2024, very, very broadly, a $300 million dividend thereabout, dividend income thereabout, I mean, of the office items, about 90-100. The so-called free cash that we could deploy at the headquarters level, somewhere around $200 million.
We are now paying roughly $100, two-thirds of that back to the shareholders in the form of distribution. We are not, and we still need to keep some cash for reinvestment. For example, the new CCGT plan that PLP has to build and put up for operation in January 2029, we need to push back a bit kind of an equity contribution to help PLP to build it. We need to keep some cash for that. You also mentioned earlier about the IPO, and as part of that, we also need to sort out some money to fund the so-called distribution to the shareholders, which effectively is also a return to the shareholders.
All in all, what we are saying is that we need to assess as to the liquidity situation at the headquarters level before we kind of consider again any share buyback. Because if we stick with this distribution policy, we are paying at least $130 million-$140 million back to the shareholders over a free cash flow of roughly about $200 million. There would not be a lot of liquidity per se that we could deploy for both share buyback as well as putting that money down to PLP to help to fund the buildout of the new CCGT plant. It's a good idea, but it's not something that we would actively consider. I think 2023, we actually made the decision of deploying some of our cash to fund the privatization of MPIC, which actually cost us $130 million.
Now, at that point, we did face a choice between putting the money down to help to privatize the company or actually continue a small-scale buyback. We made that decision to put the money down for the privatization, and we see the outcome and the positive reaction in share price to that. It is something that we'll consider on a kind of regular basis, but I think it ties to a number of things, in particular, the dynamic capital allocation measures that we will consider every year.
Please, if you'd like to chip in anything or. Okay, we have a short, let us see that question. To what extent does MPIC want to be diluted during the Maynilad IPO? Will Maynilad still be consolidated in First Pacific and MPIC first IPO? Over to you, Stan.
The incentives that the IPO, the base offer, and any overallotment would be on the principle of having new money into the business in the form of the primary issuance. The funds that come into the company would then be applied to the capital expenditure requirements of the business. I think there are additional opportunities depending on how the IPO and the demand and take-up of investors is to have an upsize amount. The base amount, which under the filing focused around 22%, and then the overallotment would give about 25.3% in new primary proceeds. Now, to the question of dilution, that would be diluted by virtue of the new shares coming in and the enlarged shareholding base.
Having said that, the intention is that MPIC, along with the other shareholders who exist today, DMCI and Marubeni, would continue to, as a block, have a substantial and majority shareholding in Maynilad . Because today, the shareholding structure is that there is a holding company that owns 94% of Maynilad , and then there is an additional approximately 5% that is held directly by Metro Pacific. Following this, even with dilution, Metro Pacific and its holding company, Maynilad Water Holding, has a 51% interest in the business. That just gives you a perspective that even with some of the new money coming in, potentially anywhere from 25% up to, let's say, 30% through this initial public offering of potentially the new equity, there will be the dilution for sure, but still having the controlling block held by this holding company.
Okay, thanks very much, Stan. Another written question is again for you, Stan. Can we share the financing mix the PLP will use to finance its new power plant projects? How will this affect dividends from PLP going forward?
Sure. In terms of the financing plan, the current anticipation is that approximately 60% of the project cost would be taken for the project financing, and then an equity contribution of approximately 40% for the equity component. In terms of the dividends, PLP will continue to pay its shareholders as the proxy in the last couple of years, approximately 100% of the core income has been distributed as dividends. These dividends, in turn, to help with the funding portion of it, would be then reinvested into the project and PLP in terms of funding the equity portion. That would be the expectation over the next couple of years as this project gets developed.
Thanks very much, Stan. Have we got more questions coming from our listeners?
Petra has a question.
Pardon us?
Petra, do you have a time?
Petra, yes. To gearing ratio target, Joseph, can you please help with that?
Normally, at our level, we set the so-called debt level or target debt level more reference to the interest coverage ratio, which is the debt interest servicing capability that we could sustain rather than looking into the so-called gearing ratio. If you look at the gearing ratio, either use the book, which does not really reflect the true value of the company, because many of the underlying investment, we will not do the mark-to-market valuation, or else you need to use the gross asset value, which is about $5 billion kind of value vis-à-vis the net debt that we are having about 1.3. The so-called value of the investment that we are holding actually fluctuates and also depends on how you deal value investment like the MPIC because it's not privatized.
That could be deemed low, and that could be much higher than what we are saying in our kind of our statement of net asset value. We normally focus more on the interest servicing capability. We normally set a ratio of not less than three times, which we feel quite comfortable with. Currently, I think we have as of December 2024, we have more than four times. I think we are very comfortable with the interest servicing capability. Mind you, while we think that there is clearly a kind of a decent level of debt to be held at the headquarters level. As of now, we are having a gross debt about $1.47 billion. All the ratios that we are seeing are quite healthy.
We got the kind of the confirmation from one of the credit agencies, Moody's, a few weeks ago to confirm our credit rating at the same Baa3 and stable outlook. Overall, I think we're quite comfortable with what we are having. In terms of the debt maturity profile, I think the next one coming up would be another $200 million all the way until January 2026. We have nothing due in 2025. We are quite comfortable about getting refinancing of that $200 million due in January 2026. It is no issue at all about kind of refinancing the debt and keeping the same $1.47 billion gross debt at our level.
Thanks very much, Joseph. Stan, what's the total CapEx cost for the new power plant?
What was disclosed in the recent announcement was the value as related to the EPC contract. That value as disclosed was $564 million. As part of the overall project, though, there would be additional costs, for example, related to battery storage, the seawater intake system, connection charges, and financing costs, and so forth. At this point, that has not been publicly disclosed other than the value of the $564 million in terms of the expected EPC cost.
Thank you, Stan. Now we have a question about normalized spreads in the electricity generation sector in Singapore. What do you think the ROI is going to be? Or were you just answering that? No. For the new power project in Singapore.
Yeah. In terms of the expected returns, I think what we would say is that when we look at returns, we would look at returns in excess of 12% up to mid-teens, typically for investments in this space. For this 600 MW project, that is in line with our expectation.
Thank you, Stan. Across the capital? Yeah, for the project.
Yeah, I think on a weighted average cost of capital, somewhere in a 10% level for before the impact of any leverage.
Okay. For those of you who are based in Europe, we'll be coming to see you in a couple of weeks' time. If you haven't heard from us about this, please get in touch. We can talk about these things in more detail. A visit to the U.S.A. will follow thereafter, I think beginning in early May. Again, if you want to see us, please drop us a note. Have we got more questions coming from our listeners?
Yes, go ahead. Timothy, go ahead.
Oh, hi. Thank you, Management, for taking my question. Mine would be about MPTC. I think the toll business dates back to 2023. There were talks about bringing it public along with Maynilad. Then time goes by, there were talks about private placement or merger even. I'm just wondering if there's any update on that end and if there's going to be a corporate action related to the toll business. Is there an estimated kind of schedule that we can take reference of? Thank you.
Yeah, what I would say is that the strategic plan would be to find new capital. Yes, indeed, there were discussions and options in terms of how that form would be conducted. At the moment, there are discussions underway, not related to a public listing, but rather a private placement. That is a process that began last year, and the discussions are advancing and continuing. For us at MPTC, the expectation and the objective would be to find a significant minority shareholder with new primary proceeds to invest into the business. There are discussions underway. Of course, as and when the transaction is ready, then announcements and appropriate disclosures will be made.
Thank you, Stan. Stan, let me take a stab at explaining the intended subscription and in-specie issuance to our shareholders for the Maynilad IPO. Essentially, the Hong Kong Stock Exchange has got something called a Practice Note 15, via which they've said to First Pacific that we should give our own shareholders a chance to participate in the Maynilad IPO. For that reason, we will be subscribing to, I think, 0.45% of the new total of shares in Maynilad. We will distribute those shares to our own shareholders, either in-specie as Maynilad shares or in cash. Does that sound accurate, Stan? Someone is asking, to what extent does MPIC want to be diluted during the Maynilad IPO? Would Maynilad still be consolidated by MPIC and by extension First Pacific?
To take that one, the question on dilution. One, the IPO itself is a requirement as part of the franchise renewal. We have no choice but to list the business by January 2027. Having said that, IPO has always been discussed as a consideration because we think that the business, one, there will be significant capital required to grow the business, to address the problems in terms of NRW improvement and so forth, so that these would be upside to us as that pipeline and so forth is improved and the NRW reduced. As a base of that, then with the new primary proceeds and under the listing, one of the requirements is to offer at least 30% to shareholders. Stemming from that, yes, there is an expectation of dilution.
Having said that, though, MPIC will continue to stay as the largest shareholder of Maynilad following the listing. In terms of the consolidation, there is the holding company that I mentioned, which today has approximately 94%, that would continue to be the controlling shareholder. Metro Pacific, by virtue of its 51.3% shareholding in that holding company, then that's the basis for continued consolidation.
First Pacific's announcement on this matter, I think it was last week, has got some more details of the ownership. For Maynilad, if you want to look more into those details. Have we got more questions coming?
Yeah, it's Tony Watson here. First of all, apologies for jumping in. Please can't find the hands-up control. Anyway, two questions. One, the First Pacific 2027, it's a little early yet, but any thoughts around refinancing that or possibly doing some new issuance ahead of that, given we've got very, very tight credit spreads throughout the market in the Asia-Pacific space anyway. Second question is around PLDT's wholly owned online bank, that Maya. Do you guys have any thoughts around an IPO, a trade sale, or possibly bringing in an industry partner, or just any general outline of plans you have for that venture? Thanks.
Joseph?
Joseph here for the first one about a bond. And that's the only bond we have in the debt portfolio. We issued in 2020 for seven years at 4.38%. And it's actually still a very, very low borrowing cost. To ask us if we see some of our numbers, I think the average borrowing cost for us now is about 5%. And the average tenor is about three point something years. So it's a few years, two years away. I think that bond due in September, remember correctly, 2027. We're actively looking into that, to be honest. When we are now considering the refinancing for 200 in 2026, and one of the options, to be honest, is that, well, 200 is not difficult to be refinanced. One of the options that we are discussing with the bank, nothing is concrete.
It's about bundling the 200 with 350, but nothing is concrete and solid. To be honest, it may be still quite early for the 350. To be honest, the reason why we put in place the credit rating a few years ago was to plan ahead for kind of getting access again to the bond market. The market conditions so far have not been very conducive, to be honest. We are monitoring that closely. We never say never, but we will look actively into the bond space. There are a number of houses knocking on the door to see whether we have any interest to early refinance that 350 million. I think first thing first, we look into the 200.
If there are attractive proposals from the investment houses of doing a jumbo 550, then we'll take a serious look into that. As of now, we focus more on the 200, which will be due in, as I say, January 2027. Sorry, January 2026.
Thank you, Joseph. Now, regarding Maya, there are some adults in the room. We've got Tencent as a shareholder, the International Finance Corporation arm of the World Bank is a shareholder, and so is KKR. PLDT is simply the biggest with about a 38% stake. There is and has been for a long time, lots of talk about what the future of Maya might be. To speak more specifically and less vaguely, I'll turn to Stan again.
Sure. On Maya, I think what's important with Maya to note is that the business, as a startup, you always try to cultivate it. You try to build as much customers. In this case of the digital bank, both the deposit side and the loan book. Now, fortunately, as the management has been executing on their growth and strategy, the business is hitting an inflection point. The number of depositors and the customer base is now very large. You have a digital bank with 5.4 million customers at the moment. In terms of the total balance at year-end, PHP 39 billion of total deposits. Similarly, on the loan side, I think it's fair to say that management in reason and looking at the care of the business and also protecting against higher levels of defaults through that loan book a little bit more slowly.
Now that the ability to assess customer credit and so forth has picked up, the loan side of the portfolio, as you can see on the slide here on the screen, has really jumped in 2024. We expect that to continue to move going forward, to continue to grow. For us, it is an inflection point. I would say that the business overall still is behind the competitor, GCash, although they are not in the digital banking per se in the way that Maya has the license. They were the fintech that has gotten a bit bigger. Certainly on the business at this point, the focus is around growing the business. Of course, in terms of strategic options, as you point out, whether a trade sale or an IPO in the future would make sense.
I think these are discussions that both PLDT and the other shareholders who John mentioned would continue to discuss around these options. At this moment, though, the mandate for the business is to continue to grow it. Fortunately, in terms of the business, in the latter part of last year, the business has started to generate positive net income, and that is expected to carry into 2025. On the whole, though, this is a good business that we think will create significant value. The question is, how do we monetize it and the timing and the options, as mentioned, in terms of sale or listing?
Okay. John, can we look at the questions here?
Metro looking for another strong year. Does this imply increasing revenues and net profit for 2025 and 2026?
You know if current trends continue, yes. If we were to sail over to, I think it's page 34 in this book. It's not 34. Where is it? Page 43. If you look at page 43 in this book, the economies of the Philippines and Indonesia are expected to have doubled from 2018 to 2029. One more page, 34, please. Sorry, 43. I had the numbers backwards. I think it's safe to expect that under these circumstances, a company which is offering services in defensive industries like power, roads, and water, which tend to be fairly strong in times of downturn and grow in times of upturn, I think it's probably a safe bet that MPIC having a strong year in 2025 again and in 2026 could well imply stronger revenues and profits. There is no formal forecast by MPIC.
Do we have any more questions coming from our listeners? We don't see any raised hands, do we?
No.
Right. Executive Director Christopher Young, you want to wind up closing remarks?
Okay. Thanks, John. First of all, thanks to everyone for joining the call today. It's very encouraging to see numbers on the call. I hope you got a good sense from the presentation and from the Q&A what is driving the underlying results of the company. We highlighted the strong growth in earnings 2024, I think 11% growth, which is the fourth successive year of strong growth. Actually, earnings, I think five years ago, were at about the $300 million level recurring profits. We're now up to about $670 million. There has been a period of strong growth both on the earnings front and on the dividend front. In terms of the outlook, again, without giving any formal forecasts, the underlying businesses continue to do well. Indofood is doing well. As John just described, all of the component parts of Metro Pacific are doing well.
We see that we have a very, very strong base for growth over the next few years. I think we've got the base of earnings growth, and we can see that continuing in the near future. If we look at the start of 2025, I think across the group as a whole, it's been encouraging. We hope that that will continue for the balance of the year. We hope you're able to join us again for a half-year results, which I think are at the end of August, August 27, where hopefully we are able to report continued growth across the group as a whole. Thank you all again for joining us, and we hope to hear from you again in August. Bye for now.
Thank you, Chris.
Thank you, everybody. Get in touch with further follow-ups. Bye-bye.
Thank you.