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Embracing innovation and helping others

MPCTI President and CEO Derrick Ang Tan shares his secrets to success

By Bjorn Biel M. Beltran, Special Features Writer

Since he was young, Derrick Ang Tan had a knack for finding problems. He had an inquisitive, entrepreneurial mind, and he had always wanted to seek solutions for the everyday problems he encountered throughout his life.

At the time, the news was dominated by titan industrialists such as the late John Gokongwei and business magnate Lucio Tan. As an aspiring entrepreneur, Mr. Tan wanted to emulate them.

“When I was younger, my focus really was more on profit. So the reason I started this business was profit and so it was more of me, me, me,” he told BusinessWorld in an interview.

Mr. Tan started his business in 2001 as more of a distributor of various goods and products, working with that notion of success.

Years later, Mr. Tan is now the president and chief executive officer of Magna Prime Chemical Technologies, Inc. (MPCTI)  along with various leadership roles in Philippine manufacturing and construction industry groups like the Philippine Dry Mix Mortar Association and the Philippine Association of Paint Manufacturers.

Mr. Tan admitted that he would never have gotten this far if he had never changed his mind-set. Starting out as a selfish businessman who was determined to make his wealth, he realized there was more to business than the selfish drive to make money.

“When architects are your end-customers, they will ask you for a product like this or that. So we came in and adjusted, we started hearing them out and listening to their needs. It was only when we did this that we experienced a kind of a multiplier effect, where we saw exponential growth,” he said.

“It was a hard realization for me that I had it all wrong. When doing business, it was never about myself,” Mr. Tan said.

Necessity is the mother of all invention

Listening to their customers and end-users, Mr. Tan found a use for his talent for seeking solutions to everyday problems. Magna Prime transitioned into the construction chemicals business and has since built a reputation of innovation and a customer-centric strategy for growth.

Mr. Tan with his MPCTI Technical team

The company, Mr. Tan said, had four core pillars of innovation. The first was to have a listening ear for all of the problems of their customers and find opportunities providing solutions to those problems. When there are no obvious problems, the second part of Magna Prime’s strategy is to send in technical experts to examine how their products are used in the workplace and find the areas where things might be improved.

Another method of keeping in touch with the issues of the industry is through monitoring innovations abroad and find ways to incorporate new discoveries into the Philippine setting. Lastly, Magna Prime invests into research and development to find new opportunities.

“What I say to our employees is if you’re not helping our customers, then we’re not going to sell anything. Selling is just the byproduct of us helping others,” Mr. Tan said.

“If you want to be successful, you have to help others. If you’re a salesman or saleswoman, you have to help your customers. If you are an employee, you have to help your boss and your company for you to get promoted. In short, it is always about others. So if your business is not about helping others, if it’s not about providing for the needs of others, then it doesn’t really have meaning,” he shared.

“Because construction chemicals as an industry is dominated mostly by multinational companies, we’re happy to say that we’re one local company that is now competing with these big multinationals,” he added.

The vision and mission for Mr. Tan is to bridge the innovation gap between the Philippines and more developed countries like the United States and China, and spark a new era of innovation and discovery in the country.

Mr. Tan with his wife Sabrina and their two sons Jacob and Noah

Magna Prime is pursuing this through strengthening its foundation on which the company reaches out and communicates with its customers through digital platforms, social media, through training workshops and the technical hubs it has established all over the country.

Currently, Magna Prime has technical hubs in CW Home Ortigas Pasig, CW Home Commonwealth QC, CW Home Sta. Rosa, Laguna, CW Home Balintawak, QC, CW Home Alabang, Muntinlupa, Trust Hardware Buhangin, Cebu Home Banilad, Mandaue, MC Home Ortigas, Pasig, MC Home The Fort Taguig, MC Home San Fernando, Pampanga, and Olivan Hardware, Naga City.

“In this sense, if you’re able to set up all these channels in educating people, then it would be easy for us to teach them about new innovations in the space,” Mr. Tan said.

“Our core mission really is helping educate Filipinos on what construction chemicals are and what are the advantages of using them to construct more resilient buildings.”

Looking forward, Mr. Tan identified the current demand for more sustainable cities and green buildings as areas for further innovation. He hopes that a generation of future innovators can find the most significant problems in the future, and find their own opportunities in coming up with new solutions.

“Filipinos are very creative. They have to focus on new unique products that solve new problems. Invention will never end. There’s always a need for it,” he said.

“To be a good inventor, you need to be a good listener and have an eye for opportunities. Every problem is a gold mine,” Mr. Tan said.

 

Changing perks could halve jobs — SEIPI

ELECTRONICS MANUFACTURERS — whose products make up more than half of the country’s goods sold abroad — expect 50% job loss by 2026 if the current version of the bill that overhauls tax incentives was passed, Semiconductor and Electronics Industries in the Philippines, Inc. (SEIPI) President Danilo C. Lachica said.

Mr. Lachica told reporters on the sidelines of a forum on Tuesday that the industry projects 38,000 annual employment losses between 2022 to 2026 — totaling some 190,000 positions — cutting down half of the 380,000 direct jobs in electronics.

He said these job losses are probable “if the version of CITIRA that will be passed doesn’t address the concerns of the industry.”

SEIPI in a position paper last October offered recommendations for the proposed Corporate Income Tax and Incentives Rationalization Act (CITIRA), including retention of five percent tax on gross income earned (GIE) in lieu of national and local taxes, after expiration of the income tax holiday for existing investors who meet performance criteria.

The group also recommended the increase of GIE tax to seven percent from five percent for new and expansion projects, as well as to remove the five-year cap on import duty exemption of equipment, parts and materials.

SEIPI as well as the Philippine Economic Zone Authority have pressed for a longer 10- to 15-year period for companies now enjoying tax perks to shift to the new incentive scheme, compared to the two to five years in the CITIRA bill approved on Sept. 13 by the House of Representatives.

The same measure also removes the five percent GIE tax that kicks in after the income tax holiday expires.

It also slashes the regular corporate income tax to 20% in 10 years from 30% currently, which is the highest among major Asian economies.

Mr. Lachica explained that job losses begin in 2022 due to the nature of the industry. “The way our industry works, we will continue to run the products until they are obsoleted. But if we don’t have expansions, if the multinationals decide to locate elsewhere, then once the products are obsoleted the factory will shut down,” he said.

The industry provides employment, including indirectly, for at least three million people.

CITIRA’s principal author, Albay 2nd District Rep. Jose Maria Clemente S. Salceda who heads the House Ways and Means Committee, in a mobile message on Sunday said he wants to see the basis for SEIPI’s job-loss claim.

Asked on SEIPI’s proposed revisions for the bill, Mr. Salceda replied: “I will wait for the Senate version. I stand by the House version. No GIE as we know it.”

“GIE as we know, it is pure fiscal evil, mother of all transfer pricing — P560 [billion revenues foregone] in 10 [years] and most unfair to 1 [million] firms paying 30% with more employment and value contribution to the economy.”

CITIRA now awaits Senate action, but the Trade department said last week it would propose a new version to the Senate by yearend that would incorporate the longer transition period.

The Finance department supports the two- to five-year transition period in the bill approved by the House, while the Trade department has backed a five- to seven-year transition period in general and a seven- to 10-year transition for companies that employ over 3,000 people.

A SEIPI member company employing about 300 people will shut its Philippine operations by yearend, Mr. Lachica said, and more firms drafting exit plans for the next few years.

Companies exiting the country, however, “will not say it’s because of the tax reform,” he said, but noted it’s part of what companies consider.

“Some companies have exit plans. I don’t know if they’re gonna be triggering them once they see the final version [of the bill]. I don’t want to be a bearer of doom and gloom but multinationals — they always have contingency plans,” he said.

“I think it’s premature at this point to say the sky is falling, but there’s always the risk.”

Latest available data from the Philippine Statistics Authority show electronics products made up 56.4% of total merchandise exports at $29.654 billion as of September, growing 2.2%% from $29.029 billion in 2018’s comparable 10 months.

Semiconductors alone, which made up 73.14% of Philippine electronics products sold abroad and 41.27% of total merchandise exports as of September, edged up by a percent to $21.688 billion from $21.464 billion, the same data show.

SEIPI has 346 members, with over 100 in manufacturing. — Jenina P. Ibañez

Proposed 2020 budget approved by Tuesday, then ratified

THE PROPOSED P4.1-trillion national budget for 2020 will be approved on Tuesday, instead of Monday as initially planned, as senators sought more time to study the version produced by the Bicameral Conference Committee, Senate Finance Committee Chairman Senator Juan Edgardo M. Angara said on Sunday.

Albay 2nd District Rep. Jose Ma. Clemente S. Salceda, House of Representatives Appropriations Committee vice-chairman, had earlier said that the budget would be up for Bicameral Conference Committee approval and ratification of both chambers on Monday.

But Senator Juan Edgardo M. Angara said in a mobile phone message, “Moving naman ’yung discussions but senators asked for a one-day period to review the reconciled Bicam[eral Conference Committee] version of the budget.”

“So to give that, we will likely meet Tuesday for approval.”

In a separate message to reporters, Mr. Angara said that the two versions of the proposed 2020 national budget have been “approximately 90-95% reconciled” by the bicameral body.

He also noted that the proposals made by Senator Panfilo M. Lacson had been incorporated in the budget. “Senator Lacson’s proposals like placing some limits on administrative costs and having the possibility of greater local projects have also been adopted in some form in the budget’s general and special provisions.”

Mr. Lacson had proposed to realign funds for implementation of the Universal Health Care Act, Universal Access to Quality Tertiary Education Act and the Philippine Identification System Act.

He also moved to slash the budgets of the Department of Transportation and the Department of Public Works and Highways, particularly funds allocated for right-of-way acquisition.

Mr. Salceda said postponement of the meeting scheduled for Monday did not result from any problem between the House and the Senate, telling reporters via text: “Wala… ’yun naman talaga.”

The Bicameral Conference Committee, led by Mr. Angara and House Appropriations Chairman Isidro T. Ungab of Davao City’s 2nd District, began its work on Nov. 29, during which both chambers submitted their respective proposed amendments.

The House approved House Bill No. 4228, or the General Appropriations Act for Fiscal Year 2020, on Sept. 20, while the Senate passed its version on Nov. 27.

The 18th Congress is targeting to have the 2020 spending plan approved and ratified within the week — ahead of its Dec. 21, 2019-Jan. 19, 2020 Christmas-New Year break — in time for submission to President Rodrigo R. Duterte for signing into law before the year ends.

The Department of Budget and Management began 2021 national budget preparations on Nov. 29 as it released the national budget call asking government agencies to draft their proposed budgets.

The government is working to prevent a repeat of the nearly four-month delay in 2019 budget enactment. President Duterte signed the 2019 budget on April 15, but vetoed some P95.3 billion appropriations deemed unconstitutional.

The delay stemmed from an impasse between the House and the DBM over a stricter spending framework. It was further delayed after the Senate found post-ratification realignments made by some House members.

That delay plus a ban on new public works 45 days ahead of the May 13 midterm elections — which left planned new infrastructure projects unfunded last semester — made overall economic growth slow to 5.8% in the first three quarters from 6.2% a year ago and against a 6-7% government target for 2019. — Charmaine A. Tadalan

DBM drafting simpler bill that forces punctual state spending

THE DEPARTMENT of Budget and Management (DBM) is drafting a simpler version of the proposed budget reform bill and plans to submit it to Congress in 2020’s “first quarter.”

“What we’re planning to do is institutionalize the cash budgeting system, so we’re simplifying the bill,” Undersecretary Laura B. Pascua said in an interview on Thursday.

“’Yung things na pwedeng magawa administratively inaalis na namin (We will remove budget reforms that can be done administratively by the Executive branch which is faster).”

Ms. Pascua said the department plans to ask House of Representatives Appropriations Committee Chairman Rep. Isidro T. Ungab of Davao City’s 3rd District and Senate counterpart Senator Juan Edgardo M. Angara to sponsor the measure.

She said the department hopes Congress will approve the reform before the first regular session ends on June 5 next year. “It usually takes more than a year… palagay ko dapat before the Congress ends for this session,” Ms. Pascua said.

The measure will institutionalize a cash-based budgeting system, which forces government offices to spend allocations within the fiscal year. It grants a three-month extended payment period for goods and services that will have been delivered by Dec. 31.

The measure is among the administration’s priority legislative measures, along with the proposed fifth round of government salary standardization and the Freedom of Information bill.

The government shifted to cash-based budgeting in 2019 from a multi-year obligation-based system. The previous system allowed agencies to spend past the fiscal year, which resulted in underspending.

President Rodrigo R. Duterte on Sept. 9 issued Executive Order No. 91, s. 2019, to reiterate the government’s policy to adopt the new budget framework, despite late enactment of the P3.662-trillion national budget for 2019.

The DBM said the obligation rate of agencies has improved since 2017 when the national budget provided a two-year validity for appropriations.

The DBM reported that obligation rates in 2017 and 2018 were recorded at 95.6% and 93.1%, respectively; higher than 85.4% in 2015 and 84.6% in 2016.

“We’re doing the system now. We plan to show Congress that the system works,” Ms. Pascua said.

The 2020 budget will adopt the tighter spending deadline. The proposed P4.1-trillion national budget awaits approval this week at the Bicameral Conference Committee.

Congress plans to submit the 2020 spending plan to Mr. Duterte ahead of its Dec. 21, 2019-January 19, 2020 Christmas-New Year break.

Cagayan de Oro 2nd District Rep. Rufus B. Rodriguez has filed a measure proposing to institutionalize the new budget framework, while Senator Emmanuel Joel J. Villanueva had earlier said he is drafting his own version.

The proposal nearly made it out of the 17th Congress after it secured third-reading approval at the House in March 2018, but failed to hurdle the Senate before it adjourned on June 3. — Charmaine A. Tadalan

Domestic market capitalization of select stock exchanges in Asia Pacific

Domestic market capitalization of select stock exchanges in Asia Pacific

Mazda showcases ‘premium experience’ with new CX-30, CX-8

By Manny N. De los Reyes

MAZDA PHILIPPINES’ two all-new crossovers made their public debut over the weekend at the Bonifacio High Street Big Bear Oval. The 2020 Mazda CX-30 compact crossover and the all-new 2020 Mazda CX-8 three-row crossover headed the Hiroshima-based car maker’s expanded CX family lineup of upscale, stylish and fun-to-drive crossovers in a display and test drive activity designed to let customers discover and experience the next-generation Mazda Premium.

Bigger than the CX-5 but smaller than the flagship 7-seater CX-9 (but with the same wheelbase as the latter), the CX-8 is Mazda’s newest three-row sport utility vehicle (SUV). Its key feature is its availability as a luxurious 6-seater in a 2-2-2 seating configuration. For those with more traditional passenger-carrying needs, a more traditional 2-3-2 setup is also available.

The CX-8, which comes in front- or all-wheel drive models, is powered by a 190hp/252Nm normally aspirated 2.5-liter Skyactiv-G engine mated to a 6-speed automatic. It comes with adaptive LED headlamps, 19-inch wheels with 225/55R19 tires, power tailgate, and rain-sensing wipers.

Mazda’s new midsize SUV offers standard Nappa leather seats in a very upmarket deep red color, power adjustment for the front occupants (10-way with memory for the driver, 6-way for the passenger), tri-zone automatic climate control, heads-up display, power sunroof, and an 8-inch Mazda Connect infotainment system with a 10 Bose speakers.

The CX-8 boasts six airbags, ABS with EBD, front and rear parking sensors, a 360-degree camera, blind spot monitoring with rear-cross traffic alert, and lane departure warning with lane keep assist. The AWD variant comes with i-Activ Sense which bundles adaptive radar-based cruise control, smart brake support, and driver-attention alert.

The 2020 Mazda CX-8 starts at P2,290,000 for the 4×2 Signature and P2,450,000 for the 4×4 Exclusive.

Mazda seems to be plugging in all the gaps in its crossover-SUV line. While the CX-8 slots in between the CX-5 and CX-9, the curiously named CX-30 (why not CX-4?) squeezes in between the subcompact CX-3 and compact CX-5. The CX-30 is designed for those who adore the tiny but lovable CX-3, but want a little more space (it’s four inches longer and a little over an inch wider) and higher ground clearance (by 15mm). The CX-30’s 2,655mm wheelbase is closer to the CX-5’s generous 2,700mm, though, effectively addressing one of the CX-3’s weaker points — limited rear legroom.

Like the CX-3, the base variant of the CX-30 rides on 16-inch wheels (215/65R16 tires) while the mid- and top-of-the-line variants roll on 18-inch wheels with 215/55R18 tires. LED lighting, rain-sensing wipers, and power folding mirrors are standard, but only the mid- and high-trim models benefit from adaptive front lighting, with the range-topper getting a power tailgate.

And while the CX-3 shares its platform with the Mazda2, the CX-30 shares its chassis with the new Mazda3. All three Mazdas (CX-3, Mazda3 and CX-30) come with the same engine: a 155hp/200Nm 2.0-liter Skyactiv-G mated to a 6-speed automatic. And like the CX-3, the flagship model gets all-wheel drive.

All CX-30 variants have two-tone black-and-dark brown interior, with leather seats on the two higher models and power-adjustable driver’s seat for the flagship. All models also sport a 7-inch LCD instrument panel in tandem with Mazda’s Connect infotainment system with an 8.8-inch display and 8-speaker Mazda Harmonic Acoustics audio system.

The mid-range variant gets cruise control, dual-zone climate control with rear vents and an auto-dimming rearview mirror while the range-topper gets adaptive cruise control, heads-up display, and no less than 12 Bose speakers.

All CX-30 variants get seven airbags, ABS with EBD, stability control, and rear parking camera, with the top-end model adding front and rear parking sensors, a 360-degree camera and Mazda’s i-Activsense, which combines smart brake support, front-cross traffic alert, and driver-attention alert along with blind-spot monitoring with rear cross-traffic alert.

The 2020 Mazda CX-30 comes in four variants: the entry-level 2WD Pro at P1,490,000, the mid-range 2WD Sport at P1,790,000, the flagship AWD Sport at P1,990,000 and the AWD Signature (with white leather seats, which add P15,000 to the AWD Sport’s price).

“Mazda simply has the best-looking vehicle lineup in the country today. And what better way for car buyers to see, feel and drive them in one go than at this weekend’s Mazda Premium Experience,” shared Mikko David, Senior Manager for Marketing and PR of Mazda Philippines, before the opening of the event.

“Mazda customers can experience and feel for themselves the premium difference in design, interior quality and driving feel of the Mazda car and crossover range,” he added.

Aside from test drives of the new Mazda around BGC, the three-day event gave an in-depth tour of the new Mazda design philosophy as well as showcased the craftsmanship and safety technologies that can be found in the brand’s latest models.

Aside from the new CX-30 and CX-8, Mazda also made available for test drive the all-new Mazda3, the Mazda6 Turbo executive sedan, the award-winning CX-5 premium 5-seat crossover, and the CX-9 premium executive 7-seat crossover.

Ayala energy unit to ramp up overseas expansion

AYALA-LED AC Energy, Inc. is setting aside the bulk of the $1.5 billion shored up from recent capital-raising activities for projects in the Philippines, Australia and Vietnam, while looking at India and Myanmar as new markets, its top official said.

Eric T. Francia, AC Energy president and chief executive officer, said 2020 would be a “massive investment year” for the company as it expands into foreign countries, in part because of the near-term supply adequacy in the country.

“This year we raised a lot of funds,” he told reporters last week. “We’ve effectively raised around $1.5 billion. Half a billion of that is already deployed, committed.”

Mr. Francia said AC Energy, which includes its listed local unit AC Energy Philippines, Inc., is looking at the five countries to invest the remaining $1 billion, with the Philippines, Vietnam, and Australia receiving a quarter of that amount or $250 million each. India, Myanmar and other markets will get the rest.

Included in the fund raising is the rough estimate of the proceeds from the upcoming stock rights offering of AC Energy Philippines, adding to the capital raised from two bond offerings and the selldown of AC Energy’s stake in AA Thermal, Inc.

“We’re looking to build over 1,500 megawatts (MW) of attributable capacity to AC Energy… for financial close by 2020,” Mr. Francia said. “That’s where we’ll deploy the billion dollars.”

He said the power plant projects would be “predominantly renewables.” The company’s overseas expansion is “partner-driven” or similar to what it had done in Vietnam and Australia.

AC Energy has two types of foreign partners — a “development” partner with experience in building power plants, and a “local” partner with knowledge of the regulatory landscape.

“They’re experts and they do the on-the-ground work, and we help on the management and governance, the financing … and the big decisions,” he said.

The Philippines, Australia and Vietnam will get the “critical mass” of next year’s investments each with an installed energy capacity of at least 400 MW. India, Myanmar and other markets are where AC Energy expects its partnership platforms to “gain traction,” Mr. Francia said.

He said completing power plant projects — many of which are a hybrid of solar, diesel and battery storage — would take about a year, except in Australia where labor restrictions might require a longer construction phase.

In the Philippines, AC Energy plans to build solar and diesel-fired power plants, and potentially expand its existing wind farms. In Australia, the company is looking at solar power and possibly, pumped hydroelectric plant, Mr. Francia said.

AC Energy has existing solar farms in Vietnam, but the capital expenditure next year is largely for wind farms as the company targets to avail of the guaranteed feed-in tariff that has a November 2020 deadline.

Mr. Francia said India provides the least cost in building energy projects, while Australia is the most expensive. No utility-scale project is planned in Myanmar.

“That’s why it’s [2020) a big year because we’ve never done 1,500 MW of new investments in one year,” he said. — Victor V. Saulon

Geely holds Coolray drive to Bataan

SOJITZ G Auto Philippines (SGAP), the local distributor of Geely, recently conducted an overnight media drive to the north in its striking new Coolray subcompact SUV. Geely is the Chinese automaker which owns Volvo, Lotus, and the London Electric Vehicle Co., which now makes the iconic black London taxicabs.

Officials from Geely Auto International Corporation and SGAP joined the media participants over the two-day Coolray drive from Manila to Anvaya Resort in Bataan and back the next day.

At least 15 attendees from various media outfits joined an 8-vehicle convoy and embarked on the over 360-kilometer round-trip drive.

Driving to the destination, Geely challenged the participants to beat the Coolray Sport’s 15.5 km/L average fuel consumption claim within the mix of city and highway driving. The winning car achieved a 16.4 km/L fuel mileage.

With this, SGAP vows to continuously offer value for money in its vehicles, making sure that customers would find more high-tech features in Geely vehicles, which are normally found on luxury European brands, but at an affordable price.

The Geely Coolray Sport retails for P1,198,000, which includes premium features like auto parking, state-of-the-art gasoline direct injection turbo engine and 7-speed dual-clutch automatic transmission, and a 360-degree camera view — high-end features normally found in luxury cars.

The Coolray Sport variant was formally launched to the Philippine market last September. The flagship model was followed by two more affordable Coolray variants — Comfort and Premium — that start at an affordable price of P970,000.

For 2020, Geely will be growing its nationwide dealership network as well as adding more models to complement the Coolray. The Geely showroom on 1016 EDSA in Quezon City is currently its sole showroom.

LRWC ends talks with Galaxy, drops plans for Boracay casino

By Denise A. Valdez
Reporter

LEISURE & Resorts World Corp. (LRWC) is dropping its plan to build a casino on its 23-hectare property in Boracay, as the company is no longer in talks with Galaxy Entertainment Group for the project.

In a chance interview last week, LRWC Acting Chairman Eusebio H. Tanco said the company is no longer looking at building a casino when asked by reporters for updates on the planned $550-million integrated resort.

“Wala na… We are not looking at casino. But I’m keeping that piece of land,” he said after the Philippine Stock Exchange Bell Awards 2020 press conference in Bonifacio Global City.

“I’ll just hold on to that piece of land, but I’m not going to do a casino there. I’ll just land-bank it,” Mr. Tanco added.

LRWC bought the parcels of land in Boracay in 2017 for the planned million-dollar resort development. It was supposed to partner with Macau-based casino giant Galaxy Entertainment Group for the casino component of the resort.

“Wala na muna [There are no more talks for now]. We’ll just land-bank it, then we wait for opportunities,” he said, referring to talks with Galaxy.

Mr. Tanco said LRWC will instead focus on retail and its core businesses in 2020.

“You have Shangri-La Mactan, they’re doing very well without a casino. I have a joint venture with Ayala in Mactan, wala rin casino [there’s also no casino]. We’re building a huge resort complex without a casino. I’m not a casino guy kasi eh. Leave the casino to the casino players,” he said, explaining LRWC’s decision to withdraw the Boracay casino plan.

LRWC was initially planning to open the Boracay resort in 2021.

The project, however, encountered obstacles as the planned casino drew negative reactions from various stakeholders including President Rodrigo R. Duterte.

With the suspension of the casino plan, Environment Undersecretary Benny D. Antiporda said the department is happy as Boracay is better off without the gambling facility.

“If indeed it is true that they will no longer push through with their casino project, we consider it a positive development, for in this administration we are really eager to convert Boracay Island into a family-oriented tourism area, not a party place to vices like gambling and intoxicating drinking,” he said in a text message on Sunday.

Meanwhile, Mr. Tanco said LRWC’s is expecting to complete next month the redemption of all its preferred shares worth P1.65 billion.

“We have internal resources… We should be able to redeem everything by January,” he said.

The company told the stock exchange in October it was buying all its outstanding preferred shares where the redeemed shares “will be treated as Treasury Shares until and unless the shares are retired or reissued.”

Once the transaction is completed, the company’s foreign ownership would go down to 18.37% from 18.43% as of end-September.

Earnings of LRWC was slashed to P23.56 million in the first nine months of 2019 from P266.04 million in the year prior due to a slowdown in its casino and online businesses.

Bentley racks up top recognitions in UK

BENTLEY’s new Continental GT V8 recently clinched twin honors at the 2019 News UK Motor Awards, with the grand tourer crowned as People’s Car of The Year by Jeremy Clarkson. The Continental GT V8 was also named “Best British Built Car” following a poll among the readers of prestigious UK publications The Sun, The Times and The Sunday Times, as well as by listeners of talkSPORT.

Following these recognitions, Bentley at the Walpole British Luxury Awards led the roster of this year’s winners, which includes premium brands Church’s, Burberry, FLOWERBX, Smythson and Dunhill. Among those which were also cited were fashion designer Dame Zandra Rhodes and Ewan Venters, CEO of upmarket department store Fortnum & Mason.

Collecting the People’s Car of the Year award was Bentley Regional Director for the UK Sarah Simpson, who said, “We are delighted that the Continental GT V8 has been recognized both as the best British-built car and as the People’s Car of the Year. With the launch of the GT V8 in the UK, the success of the Continental GT here will go from strength to strength.”

For his part, Clarkson called the Continental GT V8 a “wonderful, wonderful car… particularly when you sit inside.”

“I want one,” he said.

The Continental GT in 2018 won 19 awards from publications in the UK, Europe, Russia and China. Its overall success at the 2019 News UK awards builds on last year’s inaugural event, where the GT claimed the “Luxury Car of the Year” title. The award-winning trend has continued this year, with the GT being crowned the Middle East Car of the Year and the GT Convertible winning a WardsAuto Best Interior award, as well as honors in the German Design Council’s Automotive Brand Contest.

Meanwhile, the Walpole British Luxury Awards’ program, held at The Dorchester in London’s affluent Mayfair district, was attended by more than 350 luxury industry creatives, executives and influencers, all of whom gathered to applaud both Britain’s established luxury companies and emerging talent alike for their outstanding work in the luxury sector.

Dedicated to celebrating the best high-end products and services coming from a range of British businesses — such as fashion, fragrance, fine jewelry, hotels, automobiles and accessories — the annual Walpole British Luxury Awards also fosters the premium goods industry’s unique qualities through mentorship programs, events, research and public affairs with the British government and those of the rest of Europe.

Bentley was chosen in the new Future Legacy category that has been added to this year’s awards’ list. The iconic luxury carmaker was recognized because it chose to use the power of its heritage, on which it built a visionary and relevant story for the future. Honored in particular was the Bentley Centenary program which presented the future of luxury mobility through the EXP GT 100 concept car.

The EXP 100 GT is a zero-emission, all-electric concept car that is also fully autonomous. Created to celebrate Bentley’s centenary year, it sets a new benchmark for sustainable luxury by adopting 5,000-year-old Copper Infused Riverwood, 100% organic leather-like textile that is a byproduct of winemaking, and British-farmed wool carpets and embroidered cotton interior surfaces, among other items. Even the car’s paint is made from recycled rice husks.

To bring the EXP 100 GT to life, Bentley collaborated with companies which also help protect the tradition of British craftsmanship, as well as put sustainable innovation at the top of their priorities.

Walpole CEO and Harrods Managing Director Helen Brocklebank called the EXP 100 GT “a technological tour de force of design and driver excitement.”

The winners of the prestigious Walpole British Luxury Awards were selected from a shortlist of brands across 10 categories by a panel of industry experts, headed by Walpole Chairman Michael Ward and Brocklebank.

Cavitex operator aims to post P3-billion revenues in 2020

THE operator of the Manila-Cavite Expressway (Cavitex) is targeting to generate P3 billion in revenues in 2020.

“We are targeting P3 billion next year. [Because of] CALAX (Cavite-Laguna Expressway project), then the full year of operations of C-5 (Circumferential Road 5 South Link), and then we are hoping to get our toll fee increase, yung 2011-2014 namin na [petition] naka-pending pa sa TRB (Toll Regulatory Board), by next year,” Roberto V. Bontia, president of Cavitex Infrastructure Corp. (CIC), told reporters on Dec. 2.

Mr. Bontia said the company is confident that it will hit its P2.2-billion revenue target for this year.

“Siguro we will be ending the year with close to 175,000 vehicles a day. Last year 149,000 or 150,000 [vehicles a day],” he said.

Cavitex has also benefitted from the traffic problem along the South Luzon Expressway (SLEx) due to the ongoing construction of the Skyway Extension.

“In fact, in November, we were averaging 190,000 vehicles a day, and that’s coming from a year-to-date of 175,000,” Mr. Bontia noted.

“Traditionally, December is a peak season but we were actually a beneficiary of the SLEx problem. We saw an uptick in Kawit (Cavite) and R-1 (Expressway) nuong nag-umpisa ‘yung problema doon. In fact, we’ve seen 4% to 5% increase in traffic because of the SLEx problem,” he added.

CIC, which is part of Metro Pacific Investments Corp. (MPIC), is the private concessionaire for the Cavitex project.

MPIC is one of three Philippine units of Hong Kong-based First Pacific Co. Ltd., others being PLDT, Inc. and Philex Mining Corp. Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has interest in BusinessWorld through the Philippine Star Group, which it controls. — A. L. Balinbin

Three-year T-bonds likely to fetch lower rates

TREASURY BONDS (T-bonds) on offer on Tuesday will likely fetch lower rates as the market awaits the central bank’s move on interest rates after the release of latest inflation data.

The Bureau of the Treasury (BTr) is offering on Tuesday P20 billion worth of reissued three-year T-bonds with a remaining life of two years and six months.

For Michael L. Ricafort, chief economist at Rizal Commercial Banking Corp., the yields on the tenor on offer tomorrow may move within the 3.6%-3.8% range.

On Oct. 1, the BTr borrowed P20 billion as planned from three-year bonds out of bids totaling P50.8 billion. The three-year papers fetched an average rate of 3.996%, 3.5 basis points (bps) higher than the 3.961% quoted when the tenor was offered on Aug. 27.

“The markets will anticipate the next BSP (Bangko Sentral ng Pilipinas) monetary policy-setting meeting on Dec. 12, 2019 for a possible cut in local policy rates that cannot be completely ruled out amid relatively low/benign inflation that is still well below the 2%-4% target,” Mr. Ricafort said via text message.

The three-year bonds were quoted at 3.922% at the secondary market on Friday, based on the PHP Bloomberg Valuation Service Reference Rates.

Inflation picked up to 1.3% in November due to higher prices in some commodity groups. Last month’s print was higher than the 0.8% recorded in the preceding month as well as the 1.2% median estimate in BusinessWorld’s poll of 16 economists.

Year-to-date, inflation averaged at 2.5% which is still within the 2-4% target range set by the BSP for 2019.

BSP Governor Benjamin E. Diokno earlier said the Monetary Board will watch out for November inflation data during its eighth and last policy-setting meeting on Thursday, Dec. 12.

ING Bank NV Manila Branch Senior Economist Nicholas Antonio T. Mapa expects the auction to be met with strong demand from the liquidity released after the banks’ reserve requirement ratio (RRR) cut took effect this month.

This may even prompt the Treasury to open its tap facility to accommodate oversubscription, he said.

“BSP recently released a fresh P100 billion in liquidity from a RRR reduction and this could help drive the government securities market rally for the time being as funds stay away from bank loans for the time being,” Mr. Mapa said.

“However, an offsetting factor would be some seasonal increase in short-dated local interest rates, or some premium for crossing-the-year peso funds/deposits/borrowings amid some window-dressing activities in view of the accounting yearend,” RCBC’s Mr. Ricafort added.

The RRR for universal and commercial lenders now stands at 14% and four percent for thrift banks following 400 bps worth of cuts for the year thus far, while the reserve ratio of nonbank financial institutions with quasi-banking functions is at 14%. Meanwhile, the RRR of rural banks is at three percent.

The Treasury has set a P220 billion borrowing program this quarter for the local market, broken down into P100 billion in Treasury bills and P120 billion via Treasury bonds. — B.M. Laforga

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