Stock News 2012: Ayala seals Valenzuela land deal

English: Blank map of Valenzuela city in the Philippines divided into its legislative districts (district 2) (Photo credit: Wikipedia)

Property giant Ayala Land Inc. and the Gatchalian family have finalized a deal to develop 17 hectares of the latter’s “Plastic City” estate in Valenzuela City, envisioned to be redeveloped into a mixed-use urban complex in northern Metro Manila.

Philippine Estates Corp. (PHES), the Gatchalians’ property development arm, disclosed to the Philippine Stock Exchange on Tuesday the signing of an agreement with ALI’s Avida Land to develop the company’s properties in Valenzuela.

This deal comes about a week after the signing by PHES of a memorandum of agreement with ALI’s low-cost residential unit, Amaia Land, to likewise develop the former’s property in Cavite into a residential or subdivision project.

PHES is one of the owners of the property that Avida proposes to develop in Valenzuela. “The agreement signed is an initial step to move forward planning and developing the area,” a spokesperson from ALI said.

The 17 hectares covered by the deal is part of the Gatchalian family’s 60-hectare former plastics manufacturing hub, but ALI president Antonino Aquino said the Ayala-controlled real estate firm was interested to develop the entire area under a mixed-use masterplan.

But Aquino said the plan would be to pursue the development in parcels.

The Gatchalian’s Plastic City Industrial Corp. (PCIC) has long ceased its plastics manufacturing and commercial operations due to continued losses, but its subsidiaries have leased out its warehouse and building facilities in the estate.

ALI had been in talks with the Gatchalians for over a year for the development of the property in Valenzuela, which has a lot of spending power especially because it has a number of large industrial manufacturers as locators.

Through these property deals with the Ayala group, the Gatchalian family, for its part, seeks to unlock more values from its real estate assets, taking advantage of the robust property market in the country.

It was earlier reported that the redevelopment planned by the Gatchalians for Plastic City would include an educational complex envisioned to be a smaller version of the UP technohub in Quezon City. It also aims to build office space that will attract business process outsourcing (BPO) companies, banking on expectations that more and more BPO locators will move outside the main central business districts in search of other hubs around Metro Manila.

Part of the proposed master plan is likewise to put up a new hospital to serve Valenzuela City. The residential portion is envisioned to offer townhouses and condominiums for different market segments.

http://business.inquirer.net/98799/ayala-seals-valenzuela-land-deal

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Stock News 2012: Meralco sees 7% sales growth

Meralco Bolts logo (Photo credit: Wikipedia)

Manila Electric Co. (Meralco), the country’s biggest power distributor, expects its electricity sales to grow by 7 percent this year, faster than the 1 percent posted a year ago.

For 2013, however, Meralco has set a more conservative sales growth target of 4 to 5 percent, which approximates the average yearly growth of the utility, according to Meralco president Oscar S. Reyes.

Reyes said the expected growth in 2012 was largely boosted by the “healthy pickup of [electricity] demand by industrial consumers,” particularly the semiconductor sector, construction related industries like steel and plastic, and the food and beverage industry.

“There’s a clear indication that industrial growth is healthier now than it was last year,” Reyes explained.

“Commercial demand has also been quite healthy and that’s a result of, I think, the continuous building of new malls and entertainment centers,” he added.

The electricity demand of Meralco’s residential customers, according to Reyes, posted a “decent” growth, due to the healthy inflows of remittances from overseas Filipino workers and increase in private consumer spending.

With the projected growth in sales, Meralco expects its 2012 net income to hit P16 billion.

For 2013, Reyes noted that the 4 to 5 percent growth target was based on the fact that the “fundamentals are there for the continued robust growth of the economy because there’s over P21 billion in OFW remittances, over P13 billion in BPO remittances, and we have private direct investments, on top of portfolio money flows.”

“[Those inflows] drive both private consumption spending and capital investment,” he said.

The elections next year are likewise expected to help perk up electricity demand, he added.

Reyes, however, noted that more than just the growth targets, the main concern right now should be the ability of the country to meet the rising demand for electricity.

http://business.inquirer.net/98449/meralco-sees-7-sales-growth

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Stock News 2012: Philodrill sees P2B profit

The Terra Nova Oil Project (Photo credit: Wikipedia)

Exploration firm The Philodrill Corp. is targeting to breach the P2-billion net income mark in two to three years’ time as it anticipates higher revenues from the doubling of oil production at the Galoc oil field in offshore Palawan.

Philodrill executive vice president Francisco Navarro said the second phase of development for the Galoc field would not only extend the life of the field to 2020, but also more than double the daily oil production to anywhere between 10,000 and 12,000 barrels of oil a day (bopd) from the current 5,000 bopd.

For the second leg of development, the members of the consortium operating Service Contract 14C-1, which operates the Galoc field, are investing a total of $188 million (about P7.5 billion). Of the amount, Philodrill is spending a little over 7 percent, or $13.16 million (or about P526 million).

“We have funding already available. We’re not borrowing. The drawing down of funds has already begun because the long lead items needed for the drilling are being acquired earlier. We expect drilling to start by the third quarter of next year,” Navarro said.

The Phase II development for the Galoc oil field involves the drilling of two subsea wells, which will be tied back to the existing floating production, storage and offloading (FPSO) facility. There is also an option to drill a third well on the Galoc North prospect following the completion of the two development wells.

For 2012, Navarro disclosed that Philodrill expected its net income to hit only P300 million to P400 million, about 60 percent lower than the P1.04 billion in net profit it posted in 2011. The decline was attributed largely to the shut-down of the Galoc oil field. Field operator Galoc Production Co. had shut down its operations at the Palawan oil field late last year for an upgrading work and was able to resume production only in the first week of April.

Philodrill, however, was expected to further increase its income next year to about P1 billion, which it might double by either 2014 or 2015 with the new wells at the Galoc already producing at optimum levels, Navarro added.

http://business.inquirer.net/98499/philodrill-sees-p2b-profit

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Stock News 2012: Robinsons Magnolia Is ‘Green Mall’

Fotoloco Smart Parenting @ Robinsons Magnolia Grids 245 (Photo credit: FOTOLOCO!)

Robinsons Magnolia Mall, which was opened recently, has been certified as a green infrastructure by the local government of Quezon City, making it the “First Green Mall Building” in the country’s most populous city.

In a statement, the Gokongwei-led Robinsons Land Corp. said the four-level retail complex was awarded the certificate in ceremonies in City Hall. It was found to have strictly adhered to the stringent standards set under the city government’s Green Building Ordinance of 2009, which requires the design, construction or retrofitting of building, other structures and movable properties to meet minimum standards of a green infrastructure.

The awarding of the green building certification now makes the Robinsons Magnolia Mall, located along the bustling corner of Aurora Boulevard and Hemady Street, a showcase of sustainable development practices.

According to Arlene G. Magtibay, Robinsons Malls’ General Manager, “We are very glad that Robinsons Magnolia has been certified as Quezon City’s first Green Mall Building.  We have always been concerned that our developments work with and not against the environment, and we are happy that the QC government shares the same vision and has recognized our efforts towards this common goal.”

Magtibay said that RLC’s 32nd mall was installed with skylight and glass curtains that allow natural lighting, a move that is expected to rake in huge energy savings for the company.

To further reduce its carbon footprint, Robinsons Magnolia Mall used the more energy efficient colored LED (light emitting diode) light fixtures for the façade.

Compared with normal high wattage metal halide lamps, the LED lighting saves 50 percent in energy consumption.

In the interior, the mall resorted to high efficient light fixtures that saves energy by 30 percent.

Robinsons Magnolia likewise treats the wastewater coming from its sewage treatment plant (STP) and recycles the wastewater for use in cleaning, flushing toilets and irrigation.  It has installed rainwater collectors which help reduce its usage of fresh water.

http://www.mb.com.ph/articles/384175/robinsons-magnolia-is-green-mall#.UMKGS-Smj3w

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Stock News 2012: BDO Keen On PNB Acquisition

Philippine National Bank (Photo credit: Wikipedia)

The SM group of companies is making a bid for the acquisition of a stake in Philippine National Bank and its possible merger with BDO Unibank Inc. as talks between PNB and Bank of the Philippine Islands remained inconclusive.

In an interview SM Investments Corporation chief finance officer Jose Sio said they are in discussions with PNB’s principal shareholder Lucio Tan for a possible investment in PNB.

“We are always interested in making investments for as long as it will help us grow,” Sio said adding that BDO chairperson Tessie Sy has a good relationship with Tan.

However, Sio laughed off market talk that BDO has offered to acquire a stake in PNB at R150 per share. “Well I heard market talk saying we offered R200 per share,” he countered. PNB last traded at R92.70 per share.

Sio said the price will have to be determined after they look into the quality of PNB’s assets although he noted that the bank has a good land bank of prime properties. The SM group is also in real estate, particularly malls and residential buildings.

Bank of the Philippine Islands and PNB have earlier asked the Philippine Stock Exchange to suspend the trading of their shares as they disclosed that their principals are in discussion for a possible merger.

However, the banks eventually asked the PSE to lift the trading suspension since no deal has been made.

It was reported that PNB may have received counter-offers from other banks since a merger between BPI and PNB may translate to market leadership, dislodging BDO as the top bank and Metrobank as the second largest lender in the country.

Analysts had said that a merger between BPI and PNB would have triggered a new wave of merger and acquisitions (M&As) in the local banking industry.

Once a merger between BDO and PNB pushes through, this would further cement BDO’s position as the country’s biggest bank.

COL Financial research head April Tan Lee noted that, in the 1990s, there was a wave of M&As after Equitable Bank merged with PCI Bank.

“I think what happened was that Metrobank bought all these banks afterwards to maintain its number one position,” Lee said adding that, “The question today is, will that trigger more consolidation from big names because they want to maintain their lead?”

http://www.mb.com.ph/articles/385912/bdo-keen-on-pnb-acquisition#.UMKFQuSmj3w

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Stock News 2012: New sin tax measure

English: A few bottles of Koval distilled spirits, from Koval Distillery in Chicago, Illinois, USA. (Photo credit: Wikipedia)

Members of the Senate and House of Representatives to the bicameral conference committee on Tuesday morning signed the sin tax reform measure that aims to bring more government revenues estimated at P 33.96-billion in 2013.

Sen. Franklin Drilon, acting chairman of the Senate ways and means committee chairman, said the total incremental revenue for the first year of implementation of the tax measure would be P23.4 billion from tobacco products and P10.56 billion from alcohol or a total ofP33.96 billion.

As of press time, the House representatives of the bicameral committee who have signed the report were House majority leader Neptali Gonzales II and Representatives Henedina Abad, Jocelyn Limkaichong, Eric Singson, Luis Villafuerte, and Arnulfo Fuentebella.

The senators who have signed were Drilon, Sergio Osmena III, Panfilo Lacson, and Pia Cayetano.

Lawmakers agreed that for cigarettes packed by hand, the tax that will be imposed by January 1, 2013 will be P12/pack; P15/pack by 2014; P18/pack by 2015; P21/pack by 2016 and a unitary rate of P30/pack by 2017.

The four percent increase of the P30/pack rate will kick off by 2018, and every year thereafter.

For cigarettes packed by machine, there is a cut off for net retail price (NRP) for prices of P11.50 and below and those priced P11.50 and above.

For P 11.50 and below, the excise tax that will be imposed will be P12/pack effective Jan. 1, 2013; P17/pack by 2014; P21/pack by 2015; and P25/pack by 2016.

Effective January 1, 2017, there will be a unitary rate of P30 per pack, and the four percent increase will kick off on January 1, 2018.

For fermented liquors such as beers, the two-tier rate will be based on an NRP of P50.60 or less that will have a tax of P15/per liter; and P50.60 and above, P20/per liter in 2013.

By 2014, fermented products priced at P50.60 or less will be imposed with P17/liter; P19/liter in 2015; P21/liter in 2016. By 2017, all beer regardless of NRP will have a single rate of P 23.50 per liter.

For distilled spirits, a specific tax of P 20 per proof liter and P15 of NRP, per proof liter in ad valorem tax will be imposed effective January 1, 2013. By 1025, there will be a 20 percent increase of NRP per proof liter, depending on the bottle. By 2017, ad valorem taxes for distilled liquor will increase as the NRP increases.

http://philstar.com/headlines/2012/12/11/884842/senators-congressmen-sign-new-sin-tax-measure

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Stock News 2012: Manulife premiums up 60%

Insurance (Photo credit: Christopher S. Penn)

Manulife Philippines has reported a 60-percent growth in total premiums and deposits in the first nine months of 2012.

Total funds under management ballooned to a record P58.5 billion, while wealth sales increased 169 percent.

Total premium income reached P4.98 billion in 2011 based on data coming from the Insurance Commission (IC). That implies that premium income, including deposits, is around P7 billion end September this year.

The Asia Pacific Bond Fund (APBF) contributed significantly to the insurer’s AUMs despite having been launched in October 2011.

As of end-September 2012, APBF turned out a 7.06-percent return year-to-date – an impressive feat relative to similar funds. This is also much better than time deposit rates offered by most banks at currently below one percent.

APBF is available through Manulife Philippines’ dollar-denominated single pay (Affluence Max/Affluence Max Gold) and regular pay (Affluence Builder series) variable life products.

As of end-September 2012, total subscriptions amounted to $26 million for the fund.

According to Manulife Philippines president and chief executive officer Indren Naidoo, insurance sales in the third quarter were stimulated by the availability of new endowment and whole life products.

Endowment and whole life products are protection products that usually result in recurring business as payments are generally paid over a long period of time, in contrast to onetime or single pay premium products.

“The enhanced anticipated endowment are the Freedom series for the agency channel and MoneyMax series for the bancassurance channel, and whole life or the Seasons 100 for the agency channel and Legacy Protect 100 for the bancassurance channel products with financial protection coverage and guaranteed benefits,” Naidoo explained.

Total policies-in-force stood at nearly 400,000.

The Manulife Philippines chief executive said that the insurer expanded close to 4,000 agents primarily due to its rapid and aggressive branch office expansion throughout the country.

http://philstar.com/banking/2012/12/11/884484/manulife-premiums-60

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