leadership forum on water supply and sanitation - njulao presentation

8/6/2019 Leadership Forum on Water Supply and Sanitation - NJulao Presentation

http://slidepdf.com/reader/full/leadership-forum-on-water-supply-and-sanitation-njulao-presentation 1/31

by:

Noel O. JulaoExternal Relations Manager

Manila Water Company, Inc.

The Manila Water ExperienceThe Manila Water Experience

The views expressed in this paper/presentation are the views of the author

and do not necessarily reflect the views or policies of the Asian Development

Bank (ADB), or its Board of Governors, or the governments they represent.

ADB does not guarantee the accuracy of the data included in this paper and

accepts no responsibility for any consequence of their use. Terminologyused may not necessarily be consistent with ADB official terms.




Bac kground – The MWSS Priva tization

Performance Management

Corporate Transformation

Business Results

Conclusion

OUTLINE



BackgroundBackground – –

The MWSS PrivatizationThe MWSS Privatization




Background Background -- The MWSS PrivatizationThe MWSS Privatization

4.63882247.3Bangkok

1.436100241.4K. Lumpur

2.3351002410.6Seoul

2.836100246.3HongKong

2.07100243.0Singapore

9.86358.71610.6Manila

Staff/ 1000Connections

Non-Revenue

Water(% of prodn)

WaterCoverage

(% of pop )

WaterAvailability

(hrs/ da y)

Population(million)

City

Source : ADB 1996 Data

MWSS vs. Asian Utilities




Background Background -- The MWSS PrivatizationThe MWSS Privatization

August 1, 1997 Takeover

East Zone 2,200 employees

West Zone 3,100 employees

25-Year Concession

MetropolitanWaterworksandSewerageSystem(MWSS)




The MWSS PrivatizationThe MWSS Privatization

The Regula tory Environment

Department of

Environment &

Natural Resources

(DENR)

PollutionControl

Standards

Drinking Water

Quality

REGULATORY

OFFICE

Prices,Service Standards

Metropolitan Waterworks & Sewerage System (MW SS)

Board of Trustees

Concessionaires

Department of

Health (DOH)




Tariff Setting Tariff Setting

Concessiona ires are entitled toea rn an Approp ria te DiscountRate (ADR) on a llowed

expenditures

Manila Water is entitled to

rec over a ll elig ible expenses and

to earn a rate of return

Manila Water is measured

against a set of KPIs and BEMs

Agreed Service Obligations

Inc ome taxes

Concession fee

Capex

Opex

Return (ADR)

Resulting tariff to yie ld ADR

Agreed expend itures requiredto meet Service Ob ligations

Tariffs are set to a llow full cost recovery inc luding approp riate returns




Tariff Setting Tariff Setting

Mechanism for Tariff Ad justments

Rate Rebasing

♦ Every five years with full review of

business plan

Inflation ♦ Annua l ad justment for inflation

Foreign CurrencyDifferential Ad justment♦

Quarterly review and adjustment, c overseligible loans in foreign c urrenc y

Extraordinary PriceAdjustments

♦ Annual adjustment for events beyondcontrol of Manila Water

Orderly and transparent mec hanism for tariff ad justments

Formula-driven adjustments, sub jec t to MWSS review



Performance ManagementPerformance Management




Performance Management Performance Management

Drilling down of Targets

Key Performance Indic ator / Business Effic ienc y Measures

(KPI / BEM)

Company KPI + BEM / Goals

Group / Department Goa ls

Individual Goals / KRAs

850

865

880

895

910

925

940

955

970

985

1,000

Jan '06 Feb Ma r Ap r May Jun Jul Aug Sept Oct Nov Dec '06

Ac tua l Plan

24.00%

25.00%

26.00%

27.00%

28.00%

29.00%

30.00%

31.00%

32.00%

33.00%

34.00%

35.00%

36.00%

Feb Ma r A p r Ma y Jun Jul Aug Sep t Oc t Nov Dec

Ac tua l Pla n





Territory Management Concep t

SUPPLY ZONESUPPLY ZONE

MANAGERMANAGERTERRITORYTERRITORY

BUSINESS MANAGERBUSINESS MANAGERDISTRICTDISTRICT

OFFICEROFFICER

SUPPLY ZONE 1SUPPLY ZONE 1

SUPPLYSUPPLY

ZONE 2ZONE 2

SUPPLYSUPPLY

ZONE 3ZONE 3

BUSINESS AREABUSINESS AREA

11

3322

44

55

1010

77

99

99

1111

1212 1313

DMZ 1DMZ 1

DMZ 2DMZ 2





Decentralization

TheThe

EightEightBusiness AreasBusiness Areas

Balara Balara

Marikina

Cubao Cubao

San Juan/ Mandaluyong Mandaluyong

Pasig

Makati Makati

Taguig /

Antipolo



Corporate TransformationCorporate Transformation





Trust and Confidenc e

Full use of former public

sector employees

Business Area concep t

Partnership Corporate Program

Coordinators (CPC)

Clusters

Service Providers

/ Contrac tors





Development of Future Leaders - Cadetship Program

Classroom and leadership

training

On-the- job tra ining a t the

Business Area and

Operations

Continuous tra ining a t the

Business Area before being

c ross posted in other areas

of the c ompany

Number of Grad uates = 18214 Batches





Prog ram for Talent Exchange and Training (ProTExT)

Three (3) months tra ining to

United Utilities (UU)

operations – UnitedKingdom (UK), Austra lia,

Bulgaria, Estonia )

Rec eive a nd host ta lents

from the sam e c ompa nies /

countries





Upgrading of Standards - Service Providers

Vendor Prog ram

Extended financ ing





Company-wide Rec ognition Prog ram

Huwarang Manggagawa

for staff

President’s Pride due to

Performanc e (P3) formiddle management

Chairman’s Circ le (C2) for

senior ma nagement





Soc ial & Environmental Commitments aligned with Business Goals

PERFECT ALIGNMENT

B U S I N E

S S G O A L S

S O C I A

L / E N V I

R O N M

E N T A L

O B J E C T I V

E S



Business ResultsBusiness Results




Manila Water Manila Water ’ ’ s Accomplishmentss Accomplishments

in kilometers

0 0 5 30

174235

424

2,708

793

1,877

2,566

1,274

0

500

1000

1500

2000

2500

3000

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Q2

2008

Laying of ma ins and distribution mains




20.2%

63.0%

15%

20%

25%

30%

35%

40%

45%

50%

55%

60%

65%

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Q2

2008


in % Non-Revenue Water (NRW)

Reduc tion of water losses (NRW)





Ac cess to 24 hours water supply

1997 1997

26%

Q2 2008 Q2 2008

99%

24 hours 13-23 hours 0-12 hours24 hours 13-23 hours 0-12 hours





594

645

706

758 751767

1,0771,040

948

864

440

825

400

500

600

700

800

900

1,000

1,100

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Q2

2008

in Million Liters per Day

More water delivered to c ustomers





Significant growth in customer base

number of Households in Thousands

352

383

413

457

526

595

663

767

1,010985

870

325

300

400

500

600

700

800

900

1000

1100

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Q2

2008





VERY GOOD GOODSOURCE: PAWS Performanc e Rating s Phase II

UP National Eng ineering Center

2006

308 Barangays

2003188 Barangays

200137 Barangays

Public assessment of water servic es

2008307 Barangays





Solid Financ ial Performanc e

In Million Pesos

-1,000

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

Revenues

EBITDA

Net Income




Business ResultsBusiness Results

Growth in Shareholder Value

Pesos per Share

16.00

6.50

4.75

2.71

1.411.321.181.111.091.00

01

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

1997 1998 1999 2000 2001 2002 2003 2004 2005 2008

Initial Public Offering (IPO)





SPONSOR NAME OF AWARD

Best Workp lac e Prac tices

2005 Best Managed Company – Sma ll Cap

KAPATID AWARD

2006 Employer of the Yea r

Client Lea dership Award

2007 Best Managed Company – Sma ll Cap

EMPLOYERS

CONFEDERATION

OF THE

PHILIPPINES

PERSONNEL

MANAGEMENT

ASSOCIATION OR

THE PHILIPPINES

Recognitions/ Awards received




SummarySummary

● a solid example of a successful public -p rivate

partnership model;

● Incentive based regulation

● Alignment of soc ial / environmental ob jec tives with

business goals;

Manila Water . . . . .



THANK YOUTHANK YOU!!

leadership forum on water supply and sanitation - njulao presentation

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