Lopez-controlled power producer First Gen Corp. said Monday its net profit in the third quarter of the year dropped 64 percent to $35.6 million.

In a statement to the Philippine Stock Exchange, the company said the decrease was due primarily to higher interest and financing costs resulting from the debt taken for the purchase of its controlling stake in geothermal power firm Energy Development Corp. (EDC).

"Our lower net income was expected considering the amount of debt we had to take on in acquiring a controlling stake in EDC. The company is currently focused on a number of fundraising exercises and is already on its way to normalizing its financials," said First Gen chief finance officer Giles Puno.

First Gen's interest expenses went up to $141 million from $56.4 million last year. It said this was exacerbated by unrealized foreign exchange losses due to the depreciation of the peso.

First Gen also blamed the decrease in its earnings to additional costs stemming from the expiration of the income tax holiday of its 1,000-megawatt Santa Rita power plant in Batangas province as well as the lower profits of unit First Gen Hydro Power Corp., which owns the 112-megawatt Pantabangan-Masiway hydroelectric power complex in Nueva Ecija.

The company noted that its revenues rose 64.3 percent to $1.3 billion but this was offset by the decrease in First Gen Hydro's income.

Earlier, First Gen announced it signed an agreement with Japanese conglomerate Marubeni for the sale of a portion of its stake in EDC to partly finance its debts.

First Gen Corp., a unit of First Philippine Holdings Corp., has an installed power capacity of 2,582 megawatts, accounting for about 17 percent of the country's total installed capacity.