Stock News 2012: 50 new McDonald's branche

English: The mdonalds logo from the late 90s (Photo credit: Wikipedia)The master franchise holder of McDonald’s in the Philippines expects as much as 50 new branches this year to take advantage of robust economic growth.

The rapid pace of growth will continue for the next three to five years, an executive said.

“We are very excited, we continue to grow. This year we can grow 40 to 50 stores all over the country,” Kenneth S. Yang, president and CEO of master franchise holder Golden Arches Development Corp., said in a chance interview.

This will allow the company to end the year with a record 370 stores nationwide.

Yang said the expansion is 50 percent more than the company did last year, on top of the store renovations.

“Definitely the economy is very strong and I think the growth of the business process outsourcing industry is helping a lot and the overseas remittances continue to be there,” Yang said. “Consumer spending is still very strong so I think,” he added.

The local economy surged 6.4 percent in the first quarter due to government and private sector spending while January to May remittances climbed 5.5 percent to $9.26 billion from a year ago.

Given the strong fundamentals, Yang said the company is maintaining its bullishness and the rapid expansion pace in the next three to five years.

New branches will be driven by a mix of company-owned stores and by franchising. “Our thrust for franchising is outside Manila, on provincial areas,” Yang said.

McDonald’s is also tapping tourist destinations like Palawan, Bohol and Boracay, Yang said.

Benchmark investment for a new branch is around P40 million, with McDonald’s targeting businessmen, professionals and retirees as its franchising partners.

The first branch of the quick service restaurant chain opened in Morayta, Manila back in 1981.

Meanwhile, profitability of McDonald’s is cut by higher operating costs.

“The challenge is really the cost of operating the business. Costs are increasing like commodity and electricity. It is very hard to keep our profitability at the same level so we try to be more efficient,” Yang said.

http://www.philstar.com/Article.aspx?articleId=835037&publicationSubCategoryId=66

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Stock News 2012: Manila Water gets top credit rating

Manila Water Company (Photo credit: Wikipedia)
Ayala-led Manila Water Co. Inc. obtained the highest issue credit rating of PRS Aaa from Philippine Rating Services Corp.

A triple A credit rating is deemed “of the highest quality with minimal credit risk” and that the borrower’s capacity to meet financial commitment on the obligation is extremely strong.

PhilRatings is the only domestic credit rating agency in the country accredited by both the Bangko Sentral ng Pilipinas and the Securities and Exchange Commission.

In assigning the rating, PhilRatings took into account Manila Water’s proactive management and competent technical staff with a proven track record; the company’s efforts to expand its service areas to ensure continued growth; sustained profit performance; more than adequate liquidity position, financial flexibility and capitalization which can support additional debt.

Manila Water is the exclusive concessionaire for the East Zone of Metro Manila, comprising 23 cities and municipalities. It continues to expand its market locally with projects in Laguna, Pampanga, Boracay and Cebu. It also has international ventures in Vietnam.

“Throughout its operating history, the company has been able to meet and even surpass its regulatory and financial targets, making efficient use of its capital, accumulated industry experience and partnerships. The company’s management has also been very proactive in dealing with issues relating to the water industry, such as the development of new water sources,” PhilRatings said.

Manila Water chalked a net income of P4.27 billion in 2011, up seven percent from a year earlier. It sustained upward traction in the first quarter this year with net earnings rising 64 percent to P1.34 bilion.

As of end-2011, the company had comfortable levels of cash and short-term investments amounting to P5.89 billion. The amount further increased to P6.45 billion at the end of the first quarter 2012.

PhilRatings said the projected growth in Manila Water’s retained earnings is expected to support additional debt.

The company is currently undergoing its third rate rebasing period as the concessionaire of the East Zone. Rate rebasing occurs every five years after 1997, when the company was awarded the concession.

Manila Water has already submitted the requirements for the process to the regulators and is expecting feedback within the year.

http://www.philstar.com/Article.aspx?publicationSubCategoryId=66&articleId=820593

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Stock News 2012: H2O Ventures Planning 5 Hotels

Manila Ocean Park design (Photo credit: Wikipedia)
H2O Ventures, the developer of Manila Ocean Park, is planning to invest $200 million to build five uniquely themed hotels in Metro Manila and resort destinations over the next five years.

In a press briefing, H2O founder Lim Chee Yong said they have started construction and will open the P2-billion Worldhotel and Residences Makati by the second quarter of 2014.

Lim said they are also opening hotels in Cebu, Boracay and Busuanga and that they have already acquired the resort properties in Busuanga and Boracay.

He added that “H2O Ventures is now on the look out for land owners who are interested to partner with it in developing its 5th hotel project and another Worldhotel property in the heart of Metro Manila.”

Lim said they prefer to look for another property within Metro Manila for its Worldhotels brand and is open to sites in Quezon City, Ortigas or Manila.

Meanwhile, Worldhotels vice president for Asia Pacific Roland Jegge said they intend to expand the Worldhotels brand to 15 to 20 hotels over the next 10 years. They have just opened Le Monet Hotel in Camp John Hay in Baguio City last month.

The 40 storey, 401-room Worldhotel and Residences Makati is a 5-star accommodation that will be the best and largest hotel in the Kalayaan-Makati Avenue vicinity. It is a new generation hotel built to be modern, edgy and hip.

The hotel will have 252 guest rooms, including 72 suites while the residences will feature 149 serviced apartments, including 63 units of 1-bedroom and 20 units of 2-bedroom units.

H2O Ventures, a company founded by Lim and a consortium of investors, started in the Philippines in 2005 with the development of Manila Ocean Park and Hotel H2O.

The company has built the capability to develop properties similar to Worldhotel and Residences Makati given its track record in Manila Ocean Park, the country’s leading marine themed park and Hotel H2O, the only aquarium-themed hotel in the country as well as through its affiliation with Worldhotels on branding, marketing and distribution.

http://mb.com.ph/articles/357507/h2o-ventures-planning-5-hotels

Stock News 2011: In Boracay, DMCI is at the top of its game

Image via Wikipedia
DMCI Homes, a leader in resort-themed communities, hopes to ride the crest of a property boom on Boracay Island especially with prime areas for real estate development getting scarce on this 1,006-hectare paradise.

Reynaldo Salazar, DMCI Homes director for business development, says Alta Vista De Boracay, DMCI’s first leisure property project built on the serene side of Boracay, has been attracting buyers not only for its promise of a hassle-free vacation house but also for its promising investment potential.

“Land values and construction costs in Boracay have gone up since we started building Alta Vista in 2006. They are bound to get higher as demand continues to rise and very few prime beach properties are left for development,” says Salazar.

Located at Barangay (village) Yapak, in the northern part of Boracay, Alta Vista de Boracay boasts a convenient access to the shorelines of three popular Boracay beaches: White Beach, Puka Beach and Punta Bunga beach, as well as fantastic views wherever you turn your head.

Since it was placed on the map as having the best beach in the world, Boracay has suffered through several setbacks with the influx of tourists and their impact on this fragile jewel between the Tablas Strait and Sibuyan Sea.

But Salazar says it has slowly but surely resolved problems on power, water, sewerage and garbage disposal.

“The airport and the seaport are being developed, utilities are being improved. It still has its problems, but what is important is what the government is doing to address them. Investors have taken notice, with big-name resort operators such as the Shangri-La Hotels coming in recent years,” says Salazar.

The 503-room Alta Vista de Boracay was completed two years ago with 70 percent of all the units sold so far enrolled in DMCI’s condotel investment program.

Salazar says that, compared with other hotels that operate more than 100 rooms on the island, Alta Vista—with competitive room rates of P3,000 to P5,000 a night—has performed at par or slightly better in terms of occupancy rates through the first five months this year.

“We’re confident we can sustain our occupancy further beyond Boracay’s peak and super-peak seasons, which usually last up to two months in a year,” he says.

Salazar says that being a few kilometers away from the world-famous White Beach (Alta Vista de Boracay is at Puka Beach on the northern side of the island) has its positive and negative side.

http://business.inquirer.net/5302/in-boracay-dmci-is-at-the-top-of-its-game

Stock News 2011: San Miguel to bid for 3 airport projects

Image via Wikipedia
Diversifying conglomerate San Miguel Corp. is investing about $300 million to modernize and set up new tourism amenities at the Godofredo P. Ramos airport here, the main gateway to the world-famous Boracay Island.

The conglomerate also plans to participate in the public bidding for the public-private partnership airport contracts for Palawan, Bohol and Caraga (Agusan).

The three airport projects were cited by President Aquino on Saturday during the inauguration of the SMC-backed Caticlan airport rehabilitation.

“When we join the bidding, the price becomes reasonable, so we’ll participate in all of them,” SMC president Ramon S. Ang told reporters at the sidelines of the inauguration of the airport project. It was earlier reported that SMC was likewise interested in the Naia 3 airport terminal privatization.

By the time the Caticlan modernization project is completed by December 2013, it will accommodate three million tourists a year from only 500,000 at present. “We invested here because we saw the potential that we can contribute to [boost] tourist arrivals,” Ang said.

Over the last seven months, SMC has spruced up the Caticlan airport but it would take at least two more years to complete the major upgrading, Ang said.

The $300-million investment will include not only the upgrading of the airport itself but the construction of new amenities like a 5,000-room budget hotel, a world-class convention center and a retail complex that will showcase local souvenirs and a row of seafood restaurants. The tourism amenities, Ang said, would be managed by local operators.

http://business.inquirer.net/5291/san-miguel-to-bid-for-3-airport-projects

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