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Resort operator BHI posts lower sales in November

BOULEVARD Holdings, Inc. (BHI) reported lower sales in November, despite the reopening of its resort in Boracay after the island’s six-month closure.
In a sales report disclosed to the stock exchange on Wednesday, BHI said consolidated sales of products and services dropped by 36% to P5.86 million in November, versus the P9.14 million posted in the same period a year ago.
On a six-month period, BHI’s consolidated sales fell by 52% to P18.68 million.
“(The) decrease in sales (was) mainly due to the six-month closure of Boracay, Malay, Aklan for rehabilitation effective April 26, 2018 and Friday’s Holdings, Inc., which owns and operates Friday’s Boracay Beach Resort (Friday’s Resort) is one of the companies affected by the order of the National Government,” the company said.
Friday’s Holdings is a subsidiary of BHI.
The company noted that Friday’s Resort restarted its hotel operations on Oct. 30, 2018, as Boracay Island welcomed back local and international tourists on Oct. 26.
With the tourist island’s reopening, Friday’s Resort said it expects improved business due to the rehabilitation back to its state in the 1980s.
“Friday’s Resort hopes for a balance of “economic development and sustainability” on the world renowned resort island,” the company said.
It also added that the increase of travel agents promoting Boracay will be valuable to its business as well as other compliant hotels, which in turn will ensure the continuity of their business operations.
BHI suffered a net loss of P1.77 million in the nine months ending February 2018, a reversal of its attributable profit amounting to P2.02 million in the same period the year before. Gross revenues meanwhile stood at P79.37 million, 11% higher year-on-year. — Arra B. Francia

Tri-camera smartphones may reverse $15-billion Sunny Optical wipeout

SUNNY OPTICAL Technology Group Co. was set to end 2018 as one of Hong Kong’s biggest losers, an unnerving fall for a smartphone parts-maker that minted millionaires out of janitors and chefs during a remarkable decade-long run. Some are betting it’ll be back to its winning ways before 2019 is over.
The first whiff of trouble emerged in August, when it reported disappointing margins, stoking fears the smartphone boom was ending. That worsened a months-long backslide that wiped about HK$119 billion ($15 billion) off its market value since a June peak as investors dumped technology stocks. Sunny’s the third biggest loser on Hong Kong’s benchmark index in that time, and the seventh worst-performing stock on MSCI’s main Asian technology gauge.
Yet that selloff is unwarranted given its prominence as the supplier of choice to names from Huawei Technologies Co. to Xiaomi Corp., investors say. Founded three decades ago by factory worker Wang Wenjian, Sunny has wilted as evidence mounted that consumers are finally cooling on mobile devices. But that perspective fails to recognize Sunny’s technology leadership, or acknowledge the trend toward cramming three cameras into devices — one of the few bright spots for an otherwise bleak 2019 smartphone industry outlook, they argue. Optical components are also pervading new fields, such as cars that increasingly load up on sensors and cameras in the interest of safety.
“If you just look at smartphones, it’s going to be a pretty barren 2019. But when it comes to the cameras, that’s where the opportunity lies,” said Kenneth Lo, a fund manager at KGI Securities Investment Trust who counts Sunny among his top 10 ideas. “We’re talking about a shift in phone specs and an upgrade trend that will propel optical equipment companies.”
Cameras have become one of the biggest and most-compared selling points of smartphones, as brands from Samsung Electronics Co. to Apple Inc. race to equip gadgets with ever more powerful visuals. Huawei — which knocked Apple off its no. 2 perch — got the ball rolling this year when it unveiled a triple-camera device. Multiple cameras working in tandem are said to enhance zoom — addressing a perennial weakness of flat mobile devices — and produce sharper images.
The advent of “tri-camera” Android devices should more than double growth in demand for optical lenses to 19% in 2019, while appetite for modules should average 18% over 2018 to 2020, estimates Frank He, head of A-share tech hardware research for HSBC Qianhai Securities Ltd.
“The rapid technical evolution requires strong R&D capability and significant financial resources,” he said. Sunny “is set to gain share from overseas peers.”
Jeff Pu, an analyst at Guangfa Securities, sees Sunny’s valuation benefiting from the trend to three cameras. He expects 15% of global smartphones to sport three cameras next year, from just about 1% now. Pu isn’t alone: 30 analysts covering Sunny on average expect the stock to rise 46% over the next 12 months.
“Almost every major smartphone brand will adopt tri-cameras next year,” he said. “That increases demand for modules and lens, and Sunny will benefit both ways.”
One wild card: Huawei, which accounts for almost a fifth of the company’s revenue, helped fuel Sunny’s ascent. But the Chinese telecoms giant is now grappling with resurgent concerns about the security of its products and it’s uncertain how that might impact the business.
More fundamentally, much depends on how rapidly triple-cameras become the standard. On that score, Sunny — while one of the world’s largest optical component designers — has to contend with nimble rivals such as Largan Precision Co. or O-Film Tech Co. And the industry’s cyclical nature means components popular early on typically get commoditized.
That’s why Sean Huang, a Taipei-based fund manager with Jih Sun Securities Investment Trust Co., is among those still reluctant to dive into a company that before its 2018 selloff had grown almost 100 times over the past decade.
“I will consider reviewing Sunny Optical 2Q next year as it will benefit from demand for tri-cam and auto cameras on smart cars,” he said. “I may add it back if the demand is strong.” — Bloomberg

Term deposit yields drop

By Melissa Luz T. Lopez
Senior Reporter
YIELDS ON term deposits went down yesterday, with demand posting a slight recovery as the holidays drew to a close, arming banks with more cash at their disposal.
Bids for the placements reached P46.086 billion on Wednesday, shooting beyond the modest P30 billion which the Bangko Sentral ng Pilipinas (BSP) offered to sell and improving from the P35.219 billion in tenders during the Dec. 27 auction.
Stronger appetite came even after the central bank slashed the auction volume to P30 billion for the week, which is the lowest level seen since the maiden offerings for the term deposit facility (TDF) back in June 2016.
As a result, rates for the one-week, two-week and one-month tenors declined across the board.
Demand for the seven-day placements amounted to P16.731 billion, lower than the P18.714 billion which the central bank accepted a week ago. However, the bids also went above the P10 billion which the central bank placed on the auction block.
In turn, this drove accepted yields to a 5.0784% average, spelling an 11.2 basis point (bp) drop from 5.1903% fetched last week.
Meanwhile, the 14-day tenor saw greater action as banks doubled their offers to P15.092 billion from P8.698 billion previously. This brought the tally above the P10-billion offering, while the average rate also inched lower to 5.1319% from 5.2014%.
The 28-day papers were also met by strong market interest. Tenders reached P14.263 billion, nearly double the P7.807 billion received a week ago to fill the BSP’s offer worth P10 billion.
In turn, the average yield also slid 4.2 bps to 5.1672% from the 5.2094% logged the week prior.
The TDF is the central bank’s main tool to mop up excess money supply in the financial system. Through the weekly auctions, the BSP can usher market and interbank rates closer to its desired range of 4.25-5.25% by setting the standard for short-term instruments through the yields which they accept.
The window has seen narrower bids over the past few weeks as banks chose to hold more cash to service increased client demand during Christmas.
“As we indicated in the past, we expect funds to start coming back to the banks after the holiday season. It was rather fast that the exodus took place right after New Year,” BSP Deputy Governor Diwa C. Guinigundo said in a text message when sought for comment.
However, the quick recovery in demand shows that market liquidity “is not actually tight,” as lenders are able to replenish their cash positions.
Given this week’s turnout, the BSP decided to raise the offering for the Jan. 9 auction. Up for grabs are P20 billion each for the one- and two-week tenors and P10 billion under a month-long lock-in, for a total of P50 billion.

Ayala energy unit to focus on growing RES customer base

AYALA-LED AC Energy, Inc. is looking at its retail electricity supply (RES) unit as a long-term business whose growth in the near term is meant largely to establish a respectable customer base, its top official said.
“We don’t want to grow for growth’s sake because this is a long-term business. I don’t think anyone is making money on RES. It’s really more of acquiring the customers and hope to build a long-term relationship base with that,” AC Energy Chief Executive Officer Eric T. Francia told reporters.
“It’s still a competitive market out there,” he said. “So to us, when we started this business, we wanted to establish our base.”
Mr. Francia said to be a “respected” player in retail electricity supply, one must have a minimum scale of power sales and a “good customer base.”
“I think 100 megawatts (MW) is a good size,” he said. “[It] puts us in the top five or six players. So it’s a good position especially if you combine it with the rest of the Ayala group. We’re probably the third or fourth largest as a group. So that’s a good position.”
The RES business is governed by rules on retail competition and open access (RCOA), which calls for contestable customers to move away from being part of the captive market of a distribution utility. These are customers whose electricity consumption for the past 12 months has reached the threshold set by the Energy Regulatory Commission (ERC).
RCOA rules have been questioned by some sectors. The resolution of a court case on the matter remains pending with the Supreme Court. For now, retail electricity suppliers are competing to corner a bigger share of the 1-MW contestable customers, which are not covered by the temporary restraining order issued by the court.
The switch to a licensed retail electricity supplier is meant to allow greater participation from new players, thus spurring competition and lowering power costs. RCOA is called for under Republic Act No. 9136 or the Electric Power Industry Reform Act of 2001 (EPIRA), the law that restructured the power sector.
Based on data from the ERC, AC Energy is one of three Ayala-led companies in the RES business. The other two are Ecozone Power Management, Inc. and DirectPower Services, Inc.
As of September 2018, AC Energy had a total of 71 customers with a total consumption of 106.43 MW, taking the lead for the Ayala group ahead of Ecozone Power’s 102.40 MW and DirectPower’s 95.93 MW.
As group, the Ayala companies have a combined market share of 10.6%, trailing Manila Electric Co.’s 31.56% share from its three RES units and the Aboitiz group’s 19.67% from five different entities.
“One of our focus is to retain and keep our customers satisfied and then we will be happy to win new customers. But we’re not very aggressive in getting others and dropping price. That’s not our strategy,” Mr. Francia said. — Victor V. Saulon

Appetite for long-term bonds seen picking up

THE BUREAU of the Treasury (BTr) expects market appetite for long-term bonds to pick up this year driven by expectations that inflation will decelerate further.
National Treasurer Rosalia V. De Leon said in a text message that there is an “increasing appetite” for the long-term bonds to be offered this quarter.
“If you notice, bonds offerings are on 10 and 20 years so there is increasing appetite as inflation is expected to decline,” she said in a text message last week.
Inflation is seen to decelerate further as fuel and food costs ease.
A BusinessWorld poll among seven economists yielded a 5.7% median inflation estimate for December, which if realized will be slower than November’s six percent and would mark the second straight drop in prices following September’s nine-year high of 6.7%.
Ms. De Leon added that the BTr has a “strong cash carryover” going into 2019.
For this quarter, the government is planning to borrow P360 billion through a mix of short- and long-term papers, higher than the P270 billion it looked to raise from October to December 2018.
Broken down, the Treasury wants to raise P240 billion through Treasury bills and another P120 billion via Treasury bonds.
The BTr will issue long-term 20-year bonds on Jan. 24 and 10-year instruments on Jan. 10 and March 28.
The government plans to borrow P1.189 trillion in 2019 to fund its spending plan.
Of this amount, 75% will be sourced domestically while the remainder will be from foreign creditors.
Apart from government securities, the government is also considering floating bonds in foreign currencies such as renminbi and yen to maintain its presence in the Chinese and Japanese capital markets.
Specific-use bonds are also being eyed to support the rehabilitation of Marawi City. — Karl Angelo N. Vidal

Whiskey, mezcal, amaro, gin, vodka, rum:2018’s Best Booze

By John deBary
Bloomberg
THE YEAR 2018 was an eventful one, no matter where you looked. This is no less true in the spirits world. Even as cannabis continued to boom as an intoxicant of choice and manufacturers pivot to weed beer, there have been innovations in almost every type of booze, from Japanese gin to bartender-made brandy to a Danish spirit from a team of Noma alums that defies categorization.
The spirits we selected as “best in show” represent a bunch of delicious, weird, and pioneering bottles divided into three categories: classics that are newly available from distributors; true innovators; and the purely best in class — plus an honorable mention that warrants its own space, because, well, it’s a not even alcoholic. If you’re in the market for a few different bottles in 2019, each of these is worth cracking open.
OLD IS THE NEW NEW
Many of these spirits have been available for years, if not centuries, though not necessarily in the US Better late than never.
Amaro dell’Etna. Made from a 1901 recipe of 26 botanicals, this Sicilian bitter is a great addition to the expansive lineup of digestif-style amaro. Bright and citrusy, with hits of vanilla and a satisfying smokiness, it’s best served neat.
Chateau de Leberon 1987 29-year Armagnac. Produced from grapes grown on an estate established in 1939 from 40- to 60-year-old vines, this unfiltered and undiluted brandy packs quite a punch at 49.9% alcohol by volume. But once you power through the heat, you’re left with deep, luxurious notes of coffee, tobacco, and baking spice. A slow sipper for long winter nights.
Clairin Vaval rum. Handmade and distilled to proof from a single varietal of sugar cane juice, like rhum agricole from Martinique, rather than molasses, Clairin stands apart significantly from rums you might be familiar with — it’s grassy, complex, and somewhat briny. Made near the beaches of southwestern Haiti, Clairin Vaval can be a great substitute for standard white rum in citrus-forward drinks such as a daiquiri or mojito.
Estancia Distillery raicilla. Raicilla has been produced in Mexico for more than 400 years, but it wasn’t until tequila took off that the spirit had much international visibility. This expression made in Jalisco roasts the piña of the Maximiliana agave in a way similar to mezcal (tequila’s are steamed), yet the resulting distillation remains super floral and fruity. It’s a good fit for someone who’s looking to branch out from more mainstream agave spirits.
Kilbeggan small-batch rye. Most Irish whiskies are made predominately from barley, but Kilbeggan dusted off an 1890s recipe that includes 30% rye grain — making it singular among Irish expressions available today. Certainly great as a neat pour, with inviting notes of mulled apple cider, this whiskey would make a superb wintertime Manhattan or boulevardier.
RENEGADES AND INNOVATORS
These pathbreaking products turned heads last year.
Greenhook Gin & Tonic. Stephen DeAngelo has been making wonderful gin in his distillery in the Greenpoint neighborhood of Brooklyn for years. Having established itself as a go-to for gin and tonic lovers with its flagship American dry gin, with notes of ginger and chamomile, Greenhook Ginsmiths has gone one step further and given us the whole drink in a sleek little can. Technically superior because both the gin and the tonic are carbonated, the drink is perfect for hot summer days.
Neversink whiskey. Fledgling distillery Neversink Spirits, an hour’s drive north of New York City, has been making delightful apple and pear brandies for a few years, and in 2018 it made its first foray into whiskey. A mash of corn, winter wheat, and malted barley is distilled, then aged for two years in American oak before finishing in apple brandy casks. It’s an engaging detour for those looking to mix things up with some non-Kentucky bourbons.
Empirical Spirits Helena. This stuff is wild. Helena comes to us via a collaboration between Danish distiller Empirical Spirits, co-founded by Noma alums Lars Williams and Mark Emil Hermansen, and Sam Anderson, the wine and beverage director at Contra, Wildair, and Una Pizza Napoletana in Manhattan. It’s made from three distinct barley varieties fermented with a custom koji mold and distilled in a vacuum still at low temperature. Mind-bending complexity makes this challenging to work with in cocktails — it might be best served neat or on the rocks — but it’s still extremely rewarding.
Black Cow vodka. Although this spirit came out in 2017, we’re giving it a variance because it’s hardly gotten any traction in the US — and it’s legitimately great. Made from whey, a by-product of cheese production, Black Cow is super lush and creamy, with an eye toward waste reduction and sustainability. It’s quite versatile, too, with just enough character to hold up in mixed drinks without overpowering.
Montreu Chardonnay single-grape brandy. Produced in the Cognac-adjacent town of Pons, France, this brandy can’t technically be called Cognac because of its Chardonnay base. (Cognac laws only allow certain grapes to be used.) But don’t let that turn you off — this light, floral spirit spends its time aging in French and American oak casks on the shores of the Atlantic Ocean. It’s a brisk, bright option for those looking to buck tradition.
TOP OF THEIR GAME
This stuff is just plain good. It’s as simple as that.
Bertoux brandy. Dreamt up by Jeff Bell, the general manager of PDT, and the NoMad’s Thomas Pastuszak, this California brandy is tailor-made for cocktails. Complex and full of stewed fruit and floral aromas, Bertoux slots in perfectly in all sorts of applications. It’s accessible enough to be a home-bar mixing mainstay, yet it’s tasty enough to sip neat, working wonders in both classic brandy cocktails such as the Sidecar and Vieux Carre and more innovative menus from coast to coast.
Mount Gay XO Peat Expression rum. Mount Gay only released about 6,000 bottles of this super-unique XO rum, aged eight to 15 years before finishing for six months in barrels previously reserved for peaty Scotch whisky. This combination might not sound amazing on paper, but it’s superb stuff, with a rich sweetness trailing into a long tail of smoke. Worth the cost (about $250) and effort if you can track it down.
Suntory Roku gin. If Japan was able to reverse-engineer (and some might argue improve) Scotch whisky, there’s no reason to think distillers there couldn’t do it with gin. And they did. This bright, tasty gin adds six (roku means “six” in Japanese) traditional botanicals — yuzu, sansho pepper, two kinds of green tea, cherry blossom, and cherry tree leaf — to a classic base of juniper, lemon peel, and coriander. Useful in a wide variety of applications, this just might give London dry gins a run for their money.
Compass Box “The Story of the Spaniard” whisky. Inspired by a one-off made for New York pub the Spaniard, this whisky is the industry-shaking producer’s first permanent release in four years. The blend is a hybrid of Scotch aged both in sherry casks and Spanish red wine casks. With lots of berries, citrus, baking spice, and slight tannins from the wine casks, I almost want to call it Christmas-y.
Del Maguey Wild Jabalí mezcal. This bottle has been racking up awards all year — and for good reason: Made from 100% Jabalí agave, which is notorious for being difficult to distill, this mezcal is wildly complex with rich fruit on the nose and woody herbal notes on the palate. I wouldn’t do anything else with this other than pour it in a glass and drink it.
NONSPIRIT “SPIRIT” HONORABLE MENTION
Seedlip Grove 42. The third entry in this line of alcohol-free botanical “spirits” blends three varieties of orange, plus lemon, ginger, and lemongrass to offer something a bit zestier and piquant than the prior variants. It’s best on the rocks with a splash of soda and can be used in more complex cocktails alongside ingredients that support Grove’s citrusy profile.

China approves 80 new game titles after lifting nine-month freeze

CHINA HAS approved 80 new video game titles in the first batch of licenses granted by the media regulator after the end of a nine-month freeze.
The initial games were mostly local, mobile titles and didn’t include any from industry giants Tencent Holdings Ltd. or Netease Inc. The notice of approvals was posted online by the State Administration of Press, Publication, Radio, Film and Television.
China’s gaming industry, which generates more than $30 billion of revenue, has been hammered in 2018 after regulators froze the approval process for new games, preventing companies from making money off hit titles. That threw Tencent into disarray, spurring its first profit drop in at least a decade and wiping about $200 billion off its market value since a January peak.
Tencent gained as much as 1.4% in Hong Kong. Although Tencent and Netease weren’t in the initial batch of approvals, both “should benefit as the dust settles,” Karen Chan, an analyst with Jefferies, wrote in a Dec. 30 report.
Tencent and peers from South Korea to Japan have rallied after the official China Securities Journal reported that regulators had reviewed and passed an initial batch of online games. It cited Feng Shixin, deputy director of the Communist Party’s influential propaganda department, telling an industry forum that the government was prepping licenses for green-lit titles.
The suspension stemmed from Beijing’s campaign to combat gaming addiction and a reshuffle of regulators, casting uncertainty over Tencent’s main business. China’s largest social media and gaming company — which remains barred from making money off global blockbusters like Fortnite and PlayerUnknown’s Battlegrounds — is said to be cutting its marketing budget to tide it over the dry spell.
Tencent distributes its own games as well as titles from external studios. Developers that supply the company include Capcom Co., Nexon Co., Activision Blizzard Inc. and Electronic Arts Inc., according to data compiled by Bloomberg. — Bloomberg

Cathay Pacific to honor premium tickets sold at steep discount in error

CATHAY Pacific Airways Ltd. made a mistake selling first- and business-class tickets at a steep discount. Now, the lucky few who made the bookings will travel in style after all.
The Hong Kong-based airline said on its Twitter and Facebook pages Wednesday that it would still welcome passengers that bought the business-class tickets from Vietnam to Canada and the US at economy prices earlier this week. The online ticketing foul-up meant return fares of as low as $675 from Da Nang in Vietnam to New York at the front end of the plane, or a small fraction of its original price.
“We do not want to go back on our promise to our customers,” Cathay said on its Twitter account. “We made a mistake but we look forward to welcoming you on board with your ticket issued.”
While the passengers were kept happy, the mistake adds to the embarrassments for the carrier that’s struggling to turn its fortunes around while competition intensifies from Chinese and budget airlines. The pricing gaffe comes on the heels of a sophisticated hack on Cathay’s computer systems last year that exposed private information of 9.4 million passengers in the world’s biggest airline data breach.
Gary Leff, a travel and loyalty-program blogger on View from the Wing, wrote on Dec. 31 that the Cathay business-class round-trip from Da Nang to New York started at $675 for travel in August. On Wednesday, the same journey cost around $16,000 for July and September, according to the airline’s website. Prices weren’t available for August.
Travel from Hanoi to Vancouver and back in a mix of business and first class could cost less than $1,000, according to a post on One Mile at a Time.
Other airlines have made similar pricing errors. Singapore Airlines Ltd. in 2014 and Hong Kong Airlines Ltd. last year honored business-class tickets mistakenly sold at economy fares. The carriers didn’t disclose how many people purchased the cheaper tickets.
Cathay had sold tickets to the US and other destinations from Vietnam in a promotional offer that ended Dec. 31, according to its website. Round trip business tickets to Los Angeles were sold from $2,940. — Bloomberg

Sony boosts 3D camera output amid industry interest

SONY CORP., the biggest maker of camera chips used in smartphones, is boosting production of next-generation 3D sensors after getting interest from customers including Apple Inc.
The chips will power front- and rear-facing 3D cameras of models from several smartphone makers in 2019, with Sony kicking off mass production in late summer to meet demand, according to Satoshi Yoshihara, head of Sony’s sensor division. He declined to provide sales or production targets, but said the 3D business is already operating profitably and will make an impact on earnings from the fiscal year starting in April.
Sony’s bullish outlook for 3D cameras provides much needed optimism to the global smartphone industry, which is suffering a slowdown as consumers find fewer reasons to upgrade devices. The Tokyo-based company has started providing software toolkits to outside developers so they can experiment with the chips and create apps that generate models of faces for communication or virtual objects for online shopping.
“Cameras revolutionized phones, and based on what I’ve seen, I have the same expectation for 3D,” said Yoshihara, who has worked for more than a decade on wider industry adoption of cameras in smartphones. “The pace will vary by field, but we’re definitely going to see adoption of 3D. I’m certain of it.”
Sony controls about half of the camera chip market and supplies customers including Apple, Alphabet Inc. and Samsung Electronics Co., although Yoshihara declined to identify them by name, citing confidentiality agreements. Huawei Technologies Co. is employing Sony’s 3D cameras in next generation models, people familiar with the matter told Bloomberg earlier in December.
Sony isn’t the only maker of 3D chips, with rivals Lumentum Holdings Inc. and STMicroelectronics NV already finding uses for them, such as unlocking phones through facial recognition or measuring depth to improve focus when taking pictures at night.
Yoshihara said Sony’s technology differs from the ‘structured light’ approach of existing chips which have limits in terms of accuracy and distance. Sony uses a method called ‘time of flight’ that sends out invisible laser pulses and measures how long they take to bounce back, which he said creates more detailed 3D models and works at distances of five meters. Other uses include mobile games, which could involve creating virtual characters that interact with and navigate real-world environments, or ones that use hand gestures for control.
To be sure, demand for Sony’s technology is untested and it remains to be seen if consumer interest in 3D will be enough to snap the smartphone market out of its funk. Annual global shipments probably fell 3% in 2018 with growth of just 2.6% expected in 2019, according to IDC. Yoshihara also said there will only be a need for two 3D chips on devices, for the front and back, despite a trend by smartphone makers to have three or more cameras.
During the interview, Sony showed several examples using a custom phone with a 3D camera on its rear. In one app, users made specific hand gestures to cast magic spells inside a virtual game. In another, the phone calculated the depth of the room and accurately displayed a virtual goldfish swimming in-front of and behind real-life objects.
“The most important thing in the coming year will be to get people excited,” Yoshihara said. — Bloomberg

China Bank looking to build branches in ‘rapidly urbanizing’ provinces this year

CHINA BANKING Corp. (China Bank) is eyeing to penetrate developing parts of the country with as it continues to expand its branch network this year.
In a text message, China Bank Head of Corporate Planning and Investor Relations Alexander C. Escucha said the Sy-led lender is still identifying areas with “high growth potential” as it plans to put up more branches this year.
“While 60% of the country’s [gross domestic product] is still in the [National Capital Region], there [are] many rapidly urbanizing areas in the provinces that are attractive,” Mr. Escucha said last week.
For this year, China Bank plans to open 23 branches using the licenses it obtained from its earlier acquisition of Planters Development Bank (Plantersbank), which will expire this year.
In 2014, China Bank took over the management and operations of Plantersbank, acquiring it for P1.86 billion.
Mr. Escucha added that China Bank will be focusing on “getting the new branches to break even” and pursuing its digital initiatives.
Last year, China Bank slowed its branch expansion as it concentrated on ramping up its digital banking channel as well as improving its infrastructure.
China Bank and its thrift banking arm China Bank Savings have a total network of 620 branches.
China Bank, the seventh-largest commercial bank in the country in asset terms, recorded a P5.56-billion net income for the first nine months of 2018, 2.1% lower than the P5.68 billion logged in the comparable 2017 period, as it was bogged down by lower non-interest revenues despite booking higher loans.
China Bank shares stood at P27.45 apiece on Wednesday, up by 35 centavos or 1.29%. — Karl Angelo N. Vidal

When three hens get together, expect wine to flow


THREE HENS are going to try to get your tongue buzzing and your lips moving with a wine brand called, well, Three Hens.
In a launch last month, BusinessWorld met up with the Llamas sisters, Jenny and Monica — both of whom use their married name, Garcia, though their husbands are unrelated — along with their business partner, Margie Sadhwani, in Makati for a hazy wine lunch at The Picasso Residences’ Pablo Bistro in Makati which served as the brand’s official launch.
Three Hens currently has two varieties: a white and a red. Both carry a denominacion de origen (DO) from Spain’s La Mancha region, plains that have the distinction of being Europe’s largest single demarcated DO region (as well as serving as the setting for Don Quixote). Monica Llamas-Garcia quoted My Fair Lady’s song “The Rain in Spain” (“The rain in Spain stays mainly in the plain”) to explain why they chose the region to create their wines. “It produces really good quality wines,” she said, which it owes to the climate and altitude.
The white, an airen, is slightly acidic, with a metallic edge. It went well with crisp, thin-crust pizza, and made a spicy paella even more lively. It’s perfect as a food wine. As for the red (a blend of merlot, syrah, and tempranillo), it is rich and has a well-rounded finish, and gives depth to the same pairings. This reporter’s notes said “Ay!” upon tasting the red.
As a Philippine brand, it’s easy to assume that it simply relabels and rebottles the Spanish product, but Monica shook her head. “We are working directly with the winery.” Her sister said that they helped develop the wine’s tasting profile through “months and months of e-mails.”
“We couldn’t call it a DO from La Mancha if it wasn’t bottled [there],” said Monica. Her sister, meanwhile said that the taste profile they longed to develop was “relatable, accessible, but with a twist.”
“We wanted people to enjoy it all the time,” she said.
Now, Spanish wines are famously temperamental, and not always easy to pair with food, and could be a little complex. The secret, according to elder sister Monica, was selecting wines that were a bit younger; their fruitiness allowing them to blend with food more. This age also makes the wines less complex, pairing it well with food and good times.
Jenny said that they started the brand because they have “a love of hanging out together, being with each other, and drinking wine.”
Her sister said, “I think it’s really capturing that experience in a bottle.
While Jenny works as a property developer, her sister Monica is connected to Don Papa Rum — her husband serves as Managing Director for Asia Pacific for that company, while she works as its Brand Director while wine and spirits share a category but differ in discipline, Monica still credits her experience in the business. “It’s a lot of experience with on-premise accounts such as restaurants and bars. There’s a lot of learning to get [from] there: what they’re looking for.”
Since the Philippines is not a wine-producing country, it’s easy to turn one’s nose up at a bottle that’s developed by Filipino minds. Asked how they combat the stereotype, Jenny said in jest, “Because we’re so cute!” On a serious note, however, Monica Llamas-Garcia said that Filipino palates are growing up. “With a more discerning public, it’s not necessarily ‘Filipino? Is it quality?’.” They’d be like, ‘Okay, is it a good brand? Do they deliver on the promise?’ And if they do, great.”
The wines are available in select supermarkets, and online through boozy.ph. — Joseph L. Garcia

AgriNurture to sell P500M worth of shares to China-based businessmen

AGRINURTURE, Inc. (ANI) on Wednesday said it plans to sell over 27 million primary shares worth P500.60 million to two businessmen engaged in construction and real estate in China.
In a disclosure to the stock exchange, the listed agri-trading company said its board approved the issuance and listing of up to 21.53 million primary shares at P18.16 each to Chaohua Xia. Mr. Xia is the general manager of Jiangsu Lunyiang Construction Ltd. in Jiangsu, China.
ANI said another 6.030 million shares, priced at P18.16 each, will be issued to Jiecheng Li, a businessman engaged in property management in Guangzhou, China.
In a text message to BusinessWorld, ANI President, CEO and Chairman Antonio L. Tiu said the proceeds from the share issuance will be used for working capital, particularly for its rice importation business.
Last September, ANI signed a $1-billion exclusive deal with Vietnam Southern Food Corp. to import 2 million metric tons (MT) of rice to the Philippines.
ANI’s Mr. Tiu is also the president and CEO of another listed firm Philippine Infradev Holdings, Inc. (formerly known as IRC Properties, Inc.).
Infradev and its Chinese partners Greenland Holdings Group, Jiangsu Provincial Construction Group Co. Ltd., Holdings Ltd., and China Harbour Engineering Company Ltd. were awarded the original proponent status for the construction and development of $3.7-billion Makati subway project.
Meanwhile, ANI said its board of directors has approved the amendment of its terms and conditions on stock rights offering where every existing shareholder of five shares will be entitled to one stock rights share, with the offer price of P1.
ANI reported a P21.37-million net income attributable to the parent during the first nine months of 2018, 40% up from P15.3 million a year ago. This was driven by a 113% rise in consolidated sale of goods to P1.55 billion during the January to September period. — Reicelene Joy N. Ignacio

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