Construction and Energy Services
First Balfour, Inc. (First Balfour) participates in nation-building by delivering world-class engineering and construction services to the energy, water, transport, and specialized building sectors. A Quadruple A contractor, First Balfour has also diversified its businesses to include distinct capabilities in geothermal well drilling and equipment rentals through its wholly-owned subsidiary, ThermaPrime Drilling Corporation (ThermaPrime), and its Plant and Equipment Division, T1 Rentals, respectively.
First Balfour, Inc. (First Balfour) participates in nation-building by delivering world-class engineering and construction services to the energy, water, transport, and specialized building sectors. A Quadruple A contractor, First Balfour has also diversified its businesses to include distinct capabilities in geothermal well drilling and equipment rentals through its wholly-owned subsidiary, ThermaPrime Drilling Corporation (ThermaPrime), and its Plant and Equipment Division, T1 Rentals, respectively.
Its Consolidated Net Income After Tax also went up by 16.0 percent from the previous year despite a turbulent start of the year with Typhoon Odette, the spread of the COVID-19 Omicron variant, and supply chain disruptions putting pressure on its operations. This can be attributed to the strong performance of First Balfour’s big-ticket projects, most notably in CCLEX.
First Balfour ended 2022 with an order generation of PHP4.9 billion, slightly lower than the PHP5.0 billion in 2021. As the award of some major projects were pushed back, the order backlog for 2022 was at PHP7.8 billion by year-end, slightly lower than 2021’s PHP7.9 billion.
Key Highlights
In 2022, First Balfour solidified its position as an industry leader in the construction of renewable power and energy projects through the award of numerous projects including the following:
- The PHP2.46-billion engineering, procurement, and construction (EPC) contract for EDC’s Tanawon Geothermal Power Plant. The project is the third in a series of large-scale projects awarded by EDC in the past two years, following the Palayan Binary Plant in Albay and Mindanao 3 Binary Plant in North Cotabato.
- The National Grid Corporation of the Philippines (NGCP) also awarded First Balfour a new contract worth PHP634 million as part of its efforts to accelerate the completion of the Hermosa-San Jose 500-kilovolt (kV) Overhead Transmission Line (OHTL).
In the high-value building sector, the company secured a fit-out project to redesign the workspaces of FPH and its various subsidiaries in the Rockwell Business Center (RBC) Tower 3 in Pasig City. Additionally, it was awarded with the construction of the PHP412.0 million Pivot Building of St. Luke’s Medical Center in Quezon City. This six-storey healthcare support building is set for completion in 2023.
First Balfour completed a number of projects in 2022 including its two big-ticket projects: the iconic 8.9-kilometer CCLEX bridge which was inaugurated last April 27, 2022 and the Novaliches-Balara Aqueduct 4 (NBAQ4) which is set for inauguration on January 27, 2023. It also delivered the Mindanao 3 Binary Plant in record time, enabling EDC to begin full operations in just 13 months after project commencement. Similarly, First Balfour successfully completed the civil onshore works for First Gen’s Liquefied Natural Gas (LNG) Terminal project in November.
Works continue to progress well with the civil and structural works subcontract for the Batangas Combined Cycle Power Plant (BCCPP) in Batangas City, the various work packages for the Palayan Binary Power Plant in Albay, and the East Bay Water Treatment Plant (WTP) in Pakil, Laguna.
In its commitment to promote green initiatives and contribute to the conglomerate’s mission of working towards a decarbonized and regenerative future, it formed a Technical Working Group (TWG) for Sustainability that is tasked to strengthen its systems in capturing and analyzing environmental, social, governance (ESG) data. First Balfour’s President and Chief Operating Officer Anthony Fernandez has also joined the Council for Inclusive Capitalism, a select pool of leaders who have committed to create a more inclusive, sustainable, and trusted form of capitalism.
In 2022, ThermaPrime continued to deliver its commitments under its contracts with major customers EDC and Philippine Geothermal Production Company, Inc. (PGPC). For its international businesses, it completed its consultancy engagement with West Japan Engineering Consultants for the Mataloko and Ulumbu geothermal projects in Indonesia. Its engagements in Japan also remain healthy with ThermaPrime serving three repeat customers out of the nine active drilling contractors in the country. These projects allowed ThermaPrime to declare and pay a total of PHP100.0 million dividends to First Balfour for the year of 2022.
T1 Rentals ended strong in 2022, with revenues reaching an all-time high of PHP1.5 billion, a 15.0 percent increase from last year’s PHP1.3 billion. This growth is attributed to the business unit’s entry into the industrial sector, specifically through new clients in the concrete manufacturing and extractive industries. Its equipment fleet also grew to 873 units by end-2022. Furthermore, T1 Rentals has also opened a 3,400-sqm equipment yard in Clark, Pampanga to better service the Central Luzon market.
First Balfour’s heavy equipment transport business Therma One Transport also rebranded into T1 Transport in early 2022. This strategic rebranding forms part of its growth and expansion to sustainable people transport through electric vehicles and maritime transport through tugboat vessel operations.
First Balfour also began on its journey of transformation from a core engineering and construction firm to a more sophisticated business enterprise. To aid in this transformation, there were several personnel and organizational changes implemented in 2022 which included the creation of a Strategic Investments Division (SID) whose mandate is to spearhead the evolution of First Balfour’s business into a more robust enterprise that supports our mission of decarbonization and regeneration and drives positive changes in our communities.
Among remarkable achievements in 2022 was the recognition of the Novaliches-Balara Aqueduct 4 (NBAQ4) project as the overall winner in the 2nd Philippine Excellence in Concrete Construction Awards (PECCA). Organized by the American Concrete Institute (ACI) Philippines Chapter and the Philippine Constructors Association (PCA), PECCA aims to recognize outstanding concrete projects in the Philippines that celebrate innovation and technology and inspire excellence throughout the global concrete design and construction community. The Cebu-Cordova Link Expressway (CCLEX) project also won first place in the infrastructure category of the Premio Obras CEMEX 2022 (CEMEX Building Award 2022) held in November 2022 in Mexico City. CCLEX was among the 26 international finalists from 10 other countries. Since opening its doors to the international community in 2004, the CEMEX Building Award has established itself as one of the world’s most prestigious competitions in architecture and construction.
Looking Forward
First Balfour views 2023 as a year of consolidation, an opportunity to prepare for another inflection point in 2024. The company’s growth is expected to be driven by the government’s robust investments in infrastructure, the market leadership of its allied businesses, and prospective business ventures in electric vehicle transport solutions and sustainable water management.
For its construction business, First Balfour is set to embark on several noteworthy projects in 2023, including the 120-MW Aya Pumped-Storage project with First Gen worth PHP4.6 billion, the 40-MW Mahanagdong Binary Geothermal Plant of EDC with a cost of PHP1.5 billion, various maintenance projects for EDC worth PHP500.0 million, the South Commuter Railway project for the Department of Transportation worth PHP17.0 billion, and the East Bay Raw Water Intake project for Manila Water at PHP800.0 million.
First Balfour will continue moving up the construction value chain by positioning for larger and more complex projects through high value-added offerings. With the new government’s push to continue increased spending in infrastructure, First Balfour is assured of a robust market. The company’s focus on its four key markets is aligned with the government’s economic plan for 2023-2028 with massive investments in energy transition to cleaner and renewable energy sources and in transport infrastructure that is much needed by the country.
