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Tuesday, February 12, 2013

Stock News 2013: San Miguel sets $35-B investment plan

English: Bottle and can of beer San-Miguel sel...
English: Bottle and can of beer San-Miguel selling in the Philippines (Photo credit: Wikipedia)

San Miguel Corp. will focus on growing the businesses currently in its portfolio over the medium term in a move that will involve aggregate investments of about $35 billion, according to the head of the diversified conglomerate.

More importantly, many of the big-ticket projects – especially in the infrastructure sphere – were slated to be completed before the end of President Aquino’s term in 2016, SMC president Ramon Ang said.

“Many of our expansion plans for our projects will be completed by 2014 or 2015,” Ang said, replying to questions e-mailed by the Inquirer. “Before 2016, we will have completed our investments in two new power plants, our [planned] airport project, the Petron [refinery] expansion, our mining investments and the toll roads.”

San Miguel has been on an acquisition spree in recent years when it acquired the country’s biggest petroleum refiner and distributor Petron Corp., flag carrier Philippine Airlines and a slew of toll road concessions, among others—part of 35 deals worth $7 billion over the last decade.

One company that will benefit from an aggressive expansion program is PAL, where San Miguel holds a 49-percent stake along with management control, while the Lucio Tan group holds 51 percent.

“Our total investments planned for PAL will be around $10 billion,” Ang said, explaining that most of this would be in the form of new aircraft.

“This year, we will concentrate on the expansion of [PAL],” he said. “With the arrival of new aircraft, PAL will, for sure, be very competitive against any airline in the world.”

Eighteen aircraft are slated for delivery this year, starting in August. These include eight Airbus A330s, with a capacity of 418 passengers each; two Boeing B777-300ERs for its long-range services, and eight Airbus A321s, each capable of carrying 202 passengers in a two-class configuration.

“So 2013 will be a big year for PAL,” said Ang, who also serves as the airline’s president. “PAL is very promising.”

He added that the positive impact on the airline’s financial statements would be felt once the efficiencies of the more fuel-efficient aircraft have been factored in, although he said he believed that it would remain “cash flow-positive” this year and next.

If the government approves San Miguel’s proposal to build a new international airport, Ang said the total investments into the project would easily contribute another $10 billion to the economy.

He said the conglomerate has identified a “Korean partner” for the project and was just waiting for the government’s green light for the private undertaking. He declined to disclose whether the proposed four-runway international airport would be located to the north or south of Metro Manila—a precaution, he said, to prevent land speculation that would push up acquisition costs for the 2,000 hectares needed for the project.

On the power sector, Ang outlined plans for San Miguel to build an additional 3,000 megawatts of capacity all over the country.

“We will start building [the power plants] this year,” he said. “Right now, we have two sites: one in Bataan for 600 MW and another 600 MW in Davao del Sur. In the next few months, we will identify the remaining other sites that will complete the 3,000 MW.”

Both plants will be powered by clean coal technology, called “circulating fluidized bed boilers.”

The additional 3,000 MW of generation capacity would involve investments worth $6 billion, he said.

This year, San Miguel would also concentrate on building its portfolio of toll way projects, Ang said. In particular, he wanted the Tarlac-Pangasinan-La Union Expressway (TPLEx) to eventually extend to Laoag, Ilocos Norte.

http://business.inquirer.net/105677/san-miguel-sets-35-b-investment-plan

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Monday, February 11, 2013

Stock News 2013: Most stock markets closed in Asia for holidays

The New York Mercantile Exhange at 628 Broadwa...
The New York Mercantile Exhange at 628 Broadway between Bleecker and Houston Streets in the NoHo section of Manhattan, New York City was built in 1882 and designed by Herman J. Schwarzmann with Buchman & Deisler. (Source: AIA4 Guide to NYC (4th ed.)) (Photo credit: Wikipedia)

Stock markets in Hong Kong, mainland China and Seoul were among those closed Monday for the Lunar New Year holiday. Japanese markets were also shut for a public holiday.

Australia’s S&P/ASX 200 was marginally higher at 4,973.20, with a positive earnings report from retailer HB Hi-Fi Ltd. helping to boost retail stocks. JB Hi-Fi surged 15.4 percent after reporting its first half net profit had risen 3 percent to 82 million Australian dollars ($84.6 million). David Jones rose 3.6 percent and Myer Holdings added 3.1 percent.

Key stock indexes in the Philippines and Indonesia also rose while markets in Singapore, Taiwan and Vietnam were closed for holidays.

Benchmark oil for March delivery rose 5 cents to $95.77 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell 11 cents on the Nymex on Friday to close at $95.72 a barrel.

http://business.inquirer.net/107021/most-stock-markets-closed-in-asia-for-holidays

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Sunday, February 10, 2013

Stock News 2013: $4B Manila mega-casino complex to open in March

English: Hotel / Casino New York-New York in L...
English: Hotel / Casino New York-New York in Las Vegas. Français : L'hôtel-Casino New York-New York à Las Vegas, dans le Nevada. (Photo credit: Wikipedia)

A $4-billion mega-casino complex is set to open in Manila in mid-March when the first of four franchise-holders starts commercial operations, the parent firm said in a disclosure released Wednesday.

The $1.2-billion Solaire Manila Resorts is one of four gaming operations licensed to operate at Manila’s bayside Entertainment City, a government project designed to compete with Macau, Las Vegas and Singapore as a gaming hub.

Boasting 500 hotel rooms set in modern resorts, Solaire will open its doors on March 16, parent company Bloomberry Resorts Corp. said in a disclosure to the Philippine Stock Exchange.

“[We] confirm that [Bloomberry’s] Solaire Manila Resorts and Casino has collected the top former operating officers of world-renowned casinos in Las Vegas and other parts of the world,” it said in a letter to the exchange.

The Feb. 5 letter, released by the bourse Wednesday, said these personnel include around 400 Filipinos who have worked in gaming and hotels across the world.

Solaire plans to add 300 more hotel rooms after two years, said Bloomberry, a listed firm controlled by port tycoon Enrique Razon.

Two other franchise-holders—one involving Australian billionaire James Packer and Macau gaming tycoon Lawrence Ho as shareholders and another with Japanese gambling tycoon Kazuo Okada—are also building at the complex.

The 100-hectare (247-acre) Entertainment City, a project of the state-owned gaming regulator Philippine Amusement and Gaming Corp., required each of the franchise-holders to invest at least $1 billion.

A unit of global leisure and entertainment group Genting Hong Kong Ltd. is a key investor in the fourth franchise.

Bloomberry said it could not confirm a local news report that the entire Entertainment City project would generate annual revenues of at least $10 billion by 2017, putting it among the world’s gaming big leagues.

http://business.inquirer.net/106351/4b-manila-mega-casino-complex-to-open-in-march

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Saturday, February 9, 2013

Stock News 2013: P10B project in Lapu-Lapu

The departure hall of Mactan Cebu Internationa...
The departure hall of Mactan Cebu International Airport on Mactan Island. (Photo credit: Wikipedia)

Megaworld Corp., one the country’s biggest property developers led by tycoon Andrew Tan, is creating its first ever masterplanned township project in the Queen City of the South that is Cebu, as it targets to provide an unrivalled lifestyle of luxury and convenience in the Visayas.

Located in Lapu-Lapu City, the 16-hectare Mactan Newtown is set to replicate what Megaworld has created in Eastwood City and its other townships within the metropolis, according to Noli Hernandez, president of Megaworld Cebu Properties Inc.

Rising in the middle of Cebu’s hottest tourist destination, this live-work-play township is envisioned to provide a consummate lifestyle in which people need not venture out for work, leisure or recreation.

It has recently officially opened for business with the grand opening of the biggest McDonald’s outlet in Central Visayas. Once completed, the Mactan Newtown will boast a masterful mix of residential enclaves, office towers, commercial establishments and recreational facilities.

THE 16-HECTARE Mactan Newtown is set to replicate Megaworld’s previous township developments in Metro Manila.

“At Mactan Newtown, we will be giving the Cebuanos more time for things that really matter and allow them to live more fulfilling lives. This vision sprang from the simple recognition of the need for more intelligent communities that actually work, and it’s a vision that has been translated so far to Megaworld’s other phenomenally successful townships in Metro Manila,” Hernandez explains.

“Megaworld has been known for its previous masterpieces in Manila such as Eastwood City, The McKinley Hill and Newport City. As in these other developments, local and foreign investors can expect nothing less than a solid and steady appreciation of property values, given the synergies that can only be created when world-class components of living, working and playing are put together,” he further says.

According to Hernandez, future residents of the P10-billion development can “look forward to a unique lifestyle that is both dynamic and laidback, luxurious but accessible, visionary but real and tangible.”

He stresses that buying a unit at The Mactan Newtown is not simply about acquiring a dwelling place, but rather about becoming part of a community.

MANGO Trees line the Mactan Newtown’s wide pedestrian lanes.

“[It is] where even the smallest studio unit provides access to a full suite of recreational facilities, from a fully-equipped gym, a 20-meter lap pool, an aqua gym, a rock-climbing wall, a tennis court, an indoor spa, culinary station and a function room, not to mention an ultra modern hotel-like lobby,” Hernandez notes.

The township’s proximity to various resorts and the availability of water sports activities, Hernandez adds, also highlights the uniqueness of the community. And if these weren’t enough, stepping out of one’s residential tower also means being served a feast of various international dining and shopping options located within the township.

http://business.inquirer.net/105519/p10b-project-in-lapu-lapu-to-change-cebu

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Friday, February 8, 2013

Stock News 2013: SMC property unit goes back into private hands

English: Phillippine stock market board
English: Phillippine stock market board (Photo credit: Wikipedia)

San Miguel Corp. is taking its property unit San Miguel Properties Inc. (SMPI) back into private hands.

The board of SMPI approved the filing of a voluntary petition to delist from the Philippine Stock Exchange (PSE), the company on Wednesday said in a disclosure.

In line with the PSE’s delisting rules, the board also approved SMPI’s conduct of a tender offer to buy out shares held by minority stockholders.

The thinly traded SMPI, a subsidiary of San Miguel Corp., has a meager public float of 0.06 percent out of its market capitalization of about P85 billion. It last traded at P700 a share on Nov. 13 last year.

SMPI was one of seven public companies whose trading had been suspended due to failure to comply with the 10-percent minimum public float required by the PSE.

In its disclosure, SMPI said it had mandated ATR Kim Eng Capital Partners Inc. as financial adviser on its tender offering.

The tender offering is targeted to run from Feb. 27 to March 26. Management was authorized to decide on the price and other terms and conditions of the offer.

http://business.inquirer.net/106381/smc-property-unit-goes-back-into-private-hands

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Thursday, February 7, 2013

Stock News 2013: High cost of modernization takes toll on Globe income

The old Globe corporate logo.
The old Globe corporate logo. (Photo credit: Wikipedia)

One step back, two steps forward. This was how Globe Telecom Inc. characterized its latest financial performance after it reported a 30-percent decline in its net earnings last year—despite having booked higher sales—as it accelerated spending for its ongoing network modernization program.

In a press briefing, officials of the Ayala-controlled telecommunications firm said that its net income for 2012 declined to P6.85 billion from the previous year’s P9.83 billion. The drop came despite a 6-percent increase in Globe’s revenues to P82.7 billion at the end of 2012 from P77.7 billion in the previous year.

Amid complaints being received by the firm from subscribers as it upgrades its long-neglected network, Globe president and CEO Ernest Cu said the company was “encouraged by the continued growth and resilience” of its mobile and broadband businesses “that allowed us to reach record peaks in revenues quarter after quarter despite intense competition” and the ongoing network and IT modernization.

“As we anticipate a more challenging year ahead, given the increasingly competitive environment, we are hopeful that the gains we have made in terms of brand building and differentiation through customer experience will tide us through this most critical period as we complete our network and IT modernization program and undertake the related transition efforts,” he said.

The impact of the modernization-related spending was felt most acutely in the final quarter of the year when its quarterly net income dropped to only P49 million from P1.84 billion in the same quarter of 2011.

The sharp decline was due to the accelerated depreciation costs associated with retiring old network equipment as well as to higher subsidies the company had to pay for the large demand for new iPhone 5 units acquired by subscribers.

On Wednesday, Globe officials also said that the company would soon begin talks with stakeholders of Lopez-owned Bayan Telecommunications Inc. to discuss the firm’s eventual exit from its ongoing rehabilitation program.

Globe recently acquired close to 100 percent of the liabilities of the debt-saddled company in a deal that also allowed the Ayala-led firm to make use of Bayan’s valuable 3G frequency.

Cu said that a future merger with Bayan was possible if such a plan would be accepted by all stakeholders involved. He stressed, however, that any prospective union between Globe and Bayan would not face the same regulatory roadblock experienced by rival PLDT and Digital Telecommunications Inc. two years ago since a merged Globe-Bayan entity would be far from the size that a PLDT-Digitel union would have created in terms of cellular frequencies controlled by a single entity.

During Wednesday’s briefing, Globe officials noted that the company’s broadband and fixed line data segments also posted significant gains on account of the rising demand for data and Internet connectivity.

“Full year broadband revenues were up 16 percent to P8.7 billion as the year marked another milestone for the business with the commercial launch of its broadband LTE service that provided subscribers with alternative tools to improve their overall Internet experience,” Globe said.

http://business.inquirer.net/106337/high-cost-of-modernization-takes-toll-on-globe-income

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Wednesday, February 6, 2013

Stock News 2013: Union Bank finalizes takeover of Cebu thrift bank

English: A logo for the Union Bank of the Phil...
English: A logo for the Union Bank of the Philippines (Photo credit: Wikipedia)

Aboitiz-led Union Bank of the Philippines has obtained board approval to take over 99.54 percent of 32-branch Cebu-based thrift bank City Savings Bank (CitySavings) for P5.7 billion.

In a disclosure to the Philippine Stock Exchange on Wednesday, Union Bank said it would buy the controlling stake in CitySavings from parent conglomerate Aboitiz Equity Ventures (AEV) and Pilmico Foods Corp. at 2.5 times the thrift bank’s book value.

AEV, which owns 45 percent of Union Bank, owns CitySavings together with its wholly owned subsidiary Pilmico Foods Corp.  After the acquisition, CitySavings will remain as a separate corporate entity, keeping its company name as well as its brand identity of simple and straightforward banking.

Union Bank will buy the combined 194,371 shares of AEV and Pilmico in CitySavings, marking a consolidation of the banking interests of the Aboitiz group under Union Bank.

Its acquisition of CitySavings is seen in line with Union Bank’s long-term strategy of beefing up its retail banking base and consumer-based portfolio.

Established in 1966, CitySavings has more than 300 employees, a stockholders’ equity of about P1 billion and total resources exceeding P9 billion, based on the bank’s website. It has 99,000 borrowers and a depositors’ base of about 59,000.

http://business.inquirer.net/106393/union-bank-finalizes-takeover-of-cebu-thrift-bank

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