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PHL bond market’s growth eases in Q2

THE PHILIPPINES was the second-fastest growing bond market in the second quarter among emerging East Asia region, even as expansion was at a “modest” pace amid slower government issuances, the Asian Development Bank (ADB) reported on Wednesday.

The September issue of ADB’s “Asia Bond Monitor” report released Wednesday showed the Philippines was the second-fastest growing bond market in emerging East Asia next only to Indonesia.

The sub-region consists of China, Hong Kong, Indonesia, Malaysia, the Philippines, Singapore, South Korea, Thailand and Vietnam.

Outstanding bonds issued by the Philippines climbed 1.8% in the second quarter from the preceding three months to $131 billion (P6.707 trillion), fueled by an 1.7% increase in government-issued notes to $103 billion (P5.29 trillion) and a 2.3% rise in corporate bonds to $28 billion (P1.417 trillion).

Year-on-year, total bonds outstanding in the second quarter expanded by 16.8% — with government issuances climbing 15.2% and corporate bonds rising 23.3%. The local market also logged the second-fastest growth from the previous year after Indonesia’s 17.6%.

However, this eased from the 17.8% year-on-year growth logged the previous quarter.

“The outstanding amount of LCY (local currency) bonds in the Philippines leveled off…at the end of June…. Government bonds remained the driver of growth, albeit through a slower expansion of 1.7% q-o-q (quarter-on-quartet) in Q2 2019 versus 8.8% q-o-q in Q1 2019. The government lowered its issuance volume in Q2 2019 due to a sound cash position resulting from underspending and strong issuance in the prior quarter due to auction taps and the success of retail Treasury bond issuance,” ADB said in the report.

Broken down, of the Philippines’ outstanding LCY government bonds, Treasury bills grew by 7.4% quarter-on-quarter to $13 billion (P652 billion), while Treasury bonds inched up by 1.2% to $90 billion (P4.62 trillion).

Year on year, T-bills grew 71.2% while T-bonds grew 10.7%.

“The slower growth was primarily driven by the high base in Q1 2019 due to the large issuance of retail Treasury bonds, which also resulted in minimal growth in Treasury bonds…,” ADB said.

The lender said the issuance of government bonds in the second quarter fell by more than half to P312 billion from P675 billion in the previous quarter. This was mainly due to the large issuance volume of Retail Treasury bonds of P236 billion in the first quarter.

The government also had a lower planned issuance volume in the second quarter compared with the previous quarter and likewise made rejections and partial awards due to high rates sought by market participants.

Meanwhile, the corporate bond segment also registered slower quarter-on-quarter growth of 2.3% to P1.42 trillion in the April-June period, easing from 5.4% in the first quarter “as maturities capped issuance, which more than doubled during the quarter,” the multilateral lender. Year-on-year, corporate bonds grew 23.3%.

The top three sectors in terms of issue peso-dominated corporate bonds outstanding were banking with P492 billion, accounting for the 34.7% of the total, property (P353 billion or 24.9%) and holding firms (P259 billion or 18.2% of the total).

Emerging East Asia’s LCY bond market grew 3.5% in second quarter from the preceding three months and by 14.% year-on-year, the multilateral lender said.

“This growth though is tempered by various risks in and around the region,” it said.

“In particular, the persistence and intensification of the trade conflict between the PRC (People’s Republic of China) and the US poses by far the most significant threat to emerging East Asia’s economic growth and financial stability…. Since most emerging East Asian economies have close trade, investment, and other economic linkages with both giants, they are likely to be hit hard if the trade row deepens further.”

Despite growing faster than most of its neighbors, the Philippines’s bond market continued to be the second smallest in emerging East Asia, only beating Vietnam’s $53 billion. Meanwhile, China remained to be the largest issuer in the second quarter with $11.512 trillion, followed by Korea with $2.019 trillion and Thailand with $425 billion. — BML

Samsung launches two new Galaxy A phones

SAMSUNG has launched in the Philippines two phones part of its mid-range Galaxy A series, with more models coming towards the end of the year.

Samsung Philippines said in a statement that it launched last week the Galaxy A50s and A30s.

The Galaxy A50s is equipped with Exynos 9611 that has a clock speed of up to 2.3GHz to improve users’ browsing, streaming and gaming experience.

The phone also has an AI-based Game Booster that analyzes the type of game being processed while optimizing the device’s performance, as well as a Frame Booster feature which adds virtual images in between frames to compensate for the dropped images for a better viewing experience.

The A50s carries a triple rear camera: a main 48-megapixel (MP) camera, an 8MP ultra-wide lens, and a 5MP live focus camera. Meanwhile, it has a 32MP front camera.

The dual-SIM phone has 6GB of RAM and 128GB in internal storage, which is expandable up to 512GB via its MicroSD card slot.

It comes with a 6.4-inch Super AMOLED Infinity-U display and also features face recognition technology. Battery life is at 4000mAh, equivalent to up to 23 hours of talk time or up to 19 hours of video playback, and offers fast charging capable up to 15W via USB Type-C port. The Galaxy A50s also has a Power Optimization feature.

The Samsung Galaxy A50s is priced at P18,990 and is available in Prism Crush Black, Prism Crush White, and Prism Crush Green variants. Pre-order the smartphone from Sept. 13–27 and get a free Galaxy Fit e watch.

Meanwhile, the new Galaxy A30s also features a triple rear camera — a 25MP main camera, a 5MP live focus camera and an 8MP ultra-wide lens — a 16MP front camera, and 4,000mAh battery life.

The A30s has a 6.4-inch Super AMOLED Infinity-V display. It features a 1.8 GHz octa-core chip, 4GB RAM and 64GB internal memory also expandable via a MicroSD card. The phone likewise offers fast charging.

The Samsung Galaxy A30s priced at P12,990 and will be available on Sept. 28 in the same colors as the A50s.

To complete the A series line up, Samsung said it will soon launch additional models, the Galaxy A20s and Galaxy A10s, which will be priced at P9,990 and P6,990 respectively.

As rice farmers groan, rice company holds a gala

A CHEF prepares a dish for the gala dinner marking the launch of Renucci Rice’s Dalisay variety on Sept. 11 at the Hyatt Grand Ballroom.

AN OFT-REPEATED legend about Queen Marie Antoinette of France is that when she was told that the people had no bread, she replied, “Then let them eat cake.” The phrase has gone down in history as a marker of the indifference that the wealthy give to the poor.

As rice farmers suffer from low farmgate prices they say is caused by the Rice Tarrification Law passed earlier this year, Renucci Rice, a brand of Chen Yi Agriventures, threw a lavish rice-themed dinner in the ballroom of the Grand Hyatt on Sept. 11 to launch its Dalisay variety. The dinner was prepared by David Senia, a famed Singapore-based chef who has worked in Michelin-starred restaurants, and what’s more, during a stint in Japan, has prepared dinner for the Emperor of Japan. It was attended by the present Secretary of Agriculture, William Dar, along with some of Manila’s finest, and a few names of questionable reputation.

To be fair to all parties however, including Marie Antoinette, there was no record of the queen having said “Let them eat cake” during a bread crisis. The quote may have been made up or misattributed by her enemies: an earlier ancestor, Queen Marie Therese, wife of Louis XIV, may have been the source of the quote. In fact, Marie Antoinette was said to have written during the time of the bread crisis when she is supposed to have uttered the phrase, “It is quite certain that in seeing the people who treat us so well despite their own misfortune, we are more obliged than ever to work hard for their happiness.”

Again, to be fair this time to the Renucci couple, Patrick and Rachel, they gave up their glamorous lives in Paris to establish Renucci in the Philippines after the devastation caused by Typhoon Yolanda five years ago.

“We lived this amazing life in Paris. We partied with our friends, we drank the best of French wines, we skied in the Alps,” said Ms. Renucci in a speech. “Typhoon Yolanda happened and it shook us to the core. We said that this overflowing love we had for each other, we need to give it all back. Give it back to the province of Leyte, to the survivors of Yolanda, to the rice farmers of Leyte, but most especially, to the people of the Philippines.

“We have produced the best-tasting rice in the Philippines, and we have built the most technologically advanced rice processing complex in Southeast Asia, in Leyte.” (This complex is described in detail in this story from BusinessWorld: https://www.bworldonline.com/chen-yi-launches-rice-processing-facility/)

Mr. Renucci said that Renucci Rice exists as a sustainable business, resting on three points: one, taking care of the Earth by “helping the farmers, to use only the chemicals that they need,” and making it profitable, “otherwise, you are an NGO.”

The final point, of course, is to help the farmers, which Renucci does with its Renucci Partnership Program. Summarized, it is giving loans for seeds to farmers at 0% interest, and providing the equipment at low-interest leases. The Renucci couple calculates that they have helped more than 4,000 farmers to increase their income by 10 times.

The dinner, by this metric, then became not a throwaway excess, but a celebration of prosperity. Marinated Tuna Tartare with egg yolk cream, ikura, and rice with Filipino spices was served as an appetizer, along with a Filipino sea bass rouille with Provencal crispy risotto, fennel salad, and Bouillabaisse sauce. For the main course, there was a Chinese-style crispy suckling pig with Renucci rice Yaki Nasu Miso, Bok Choy, and Red Wine fusion jus. Dessert was Renucci Sticky Rice, Mango Cremeux, and a rice sorbet.

Mr. Dar, in an interview with BusinessWorld, defended the birth pains of the Rice Tarrification Law. Farmers now complain of low farmgate prices of palay, pegged below P20 pesos last month, which significantly affects their income. To assuage this, the government, according to Mr. Dar, is to provide loans of P15,000 at 0% interest, payable in eight years. As well, taxes derived from the rice tariffs will be earmarked for use for the Rice Competitiveness Endowment Fund, which would help farmers to increase their yield via modernizing processes in planting and processing.

Mr. Dar said about small farmers, “They would be the very focus of this program, Once they group themselves into associations, or cooperatives, then they are the ones to receive the machines, the driers — whatever is under the mechanization program.” Mr. Dar predicts that the first group will benefit by the planting season in November.

Ms. Renucci, meanwhile, said, “If people replicated our model, and help the farmers increase their yield, we would get very good quality palay, uplift the farmers from poverty, and… invested in the technology, we could produce rice as good as Japanese and Thai rice.” — Joseph L. Garcia

Manila Water, Maynilad to ask SC to reconsider fines

MANILA WATER Co., Inc. and Maynilad Water Services, Inc. will ask the Supreme Court to reconsider its decision which found the firms liable for fines. — PHILSTAR/ED GUMBAN

MANILA WATER Co., Inc. said on Wednesday it will exercise all its legal options, including the filing of a motion for reconsideration by Oct. 2 in response to the Supreme Court (SC) decision that found the company liable for fines for violation of the Philippine Clean Water Act.

Separately, the parent firm of Maynilad Water Services, Inc. said it will file a motion for reconsideration on the same court decision on the water concessionaire on or before Oct. 2.

The company’s main shareholders Metro Pacific Investments Corp. (MPIC) and DMCI Holdings, Inc. filed separate disclosures to the stock exchange on Wednesday.

The companies said they received a copy of the decision of the Supreme Court en banc on the case. The secretary of the Department of Environment of Natural Resources is also a respondent in the case.

In said decision, the Supreme Court found the company liable for fines for violation of Section 8 of the Philippine Clean Water Act.

Manila Water said the company is jointly and severally liable with the Metropolitan Waterworks and Sewerage System (MWSS) for the total amount of P921,464,184 covering the period starting from May 7, 2009 to the date of promulgation of the decision, Aug., 2019, to be paid within 15 days from finality of the decision.

From finality of the decision until full payment of the fine, Manila Water is to be fined the initial amount of P322,102 per day, subject to a further 10% increase every two years as provided under Section 28 of the Philippine Clean Water Act, until full compliance with Section 8 of the same law.

The total amount of fines imposed by the decision is to earn legal interest of 6% per annum from finality and until its full satisfaction.

In their disclosures, MPIC and DMCI cited the same fines for Maynilad.

Sec. 8 of the law mandates MWSS, as the government agency vested with the duty to provide water and sewerage services, and/or the concessionaires in Metro Manila and other highly urbanized cities — as defined in the Local Government Code — to connect all existing sewage lines to the available sewerage system within five years from the law’s effectivity or from May 6, 2004.

The decision also enjoins all water supply and sewerage facilities and/or concessionaires in Metro Manila and other highly urbanized cities to comply strictly with Sec. 8 of the law.

On Wednesday, shares in Manila Water slipped by 1.36% to P21.70 each. Shares in MPIC rose by 0.20% to P5.06, while DMCI shares declined by 1.21% to P8.99 each. — Victor V. Saulon

TDF yields mixed on geopolitical concerns

TERM DEPOSIT yields were mixed on Wednesday on the back of an escalation of oil prices brought about by worries from the attack on Saudi Arabia’s oil facility.

The central bank received bids amounting to P96.435 billion for its term deposit facility (TDF) on Wednesday, higher than the P80 billion it wanted to sell.

This amount also beat the P93.395 billion the Bangko Sentral ng Pilipinas (BSP) received last week against a P50-billion offering.

Broken down, demand for seven-day papers amounted to P32.598 billion, well beyond the P20 billion on offer and also beating last week’s P23.7 billion in bids for a P10-billion offering.

Rates for this tenor ranged from 4.29% to 4.385%, a slightly higher margin compared to last week’s 4.3-4.4% range. The average rate settled at 4.3323%, 1.63 basis points (bp) lower than last week’s 4.3486%.

For the 14-day deposits, demand totalled P31.314 billion, more than the P30 billion the BSP offered. However, this declined from the P34.454 billion in bids tendered last week against a P20-billion offer.

Banks sought returns ranging from 4.3% to 4.545% from the two-week papers, inching up from last week’s 4.25-4.465% range. The average rate stood at 4.4139%, 1.44 bps higher than last week’s 4.3995%.

Meanwhile, the 28-day papers fetched tenders worth P32.523 billion against the P30 billion on offer but slipping from last week’s P35.241 billion worth of bids for the BSP’s P20-billion auction volume.

Yields asked for by lenders played around 4.3% to 4.5140%, a wider band compared to last week’s 4.40-4.525% range, causing its rate to average at 4.4578%, 3.29 bps lower than last week’s 4.4907%.

“The results of the TDF auction reflected an increase in the liquidity to be siphoned from the financial system owing to the release of funds from the deposits of the national government with the BSP,” Deputy Governor Francisco G. Dakila told reporters in an email.

Rizal Commercial Banking Corp. chief economist Michael L. Ricafort attributed this week’s mixed yield performance to the attack on Saudi Aramco’s oil facility which pushed oil prices higher early this week.

“The mixed yield performance…may be largely attributed to the net increase in global crude oil prices to two-month highs after the drone attacks in Saudi Arabia’s major oil production facilities…as this could still lead to some slight upticks in the local inflation rate based on the latest net increase in global crude oil prices since the start of this week after the weekend attacks,” Mr. Ricafort said.

He however noted that prices have “already eased…after signals that Saudi Arabia crude oil production could be fully restored sooner than earlier expectations.”

The TDF is the central bank’s primary tool to shore up excess liquidity in the financial system and to better guide market interest rates.

BSP Governor Benjamin E. Diokno has said the central bank is looking to cut benchmark rates by another 25 bps as early as its meeting on Sept. 26. — Luz Wendy T. Noble

Huawei to open concept store in SM Davao in October

DAVAO CITY — Huawei Technologies Co., Ltd. is set to open next month its concept store in this city as it tries to corner a bigger chunk of the mobile phone market here.

The concept store, which will have an area of 130 square meters at SM City Davao, will not just sell mobile phones but also other products, said Pedro Chen, Huawei’s regional sales head for Mindanao.

“We need to have a bigger store here because later, Huawei will have more businesses in the future,” said Mr. Chen.

The other products, he said, will include headsets, wearables such as watches and audio and virtual reality sets, laptops and netbooks, and even smart television sets.

At the press conference for its Huawei Nova 5T model Saturday, Mr. Chen said the concept store will be the second biggest in terms of area in the country, next to the one being constructed in Metro Manila which is about 300 square meters.

“We will come up more IoT (Internet of Things) products that we will make available (here),” he said as he pointed out that the company is pushing to provide its customers the products for the “smart life.”

Meanwhile, the new phone model is attracting young people as its price point is for mid-range buyers, Mr. Chen said.

He said the company is targeting some 20% of mobile phone buyers with the Nova 5T.

“(Buyers) will have a very good experience in gaming,” he added, saying the phones central processing unit and graphics processing unit are top of the line.

The Nova 5T, which retails for P18,990, also has four rear cameras for those who want to have better pictures. — Carmelito Q. Francisco

Save the World, One Bottle of Wine at a Time

By Elin McCoy, Bloomberg

WHATEVER YOU’RE concerned about — oceans, rhinos, cardiovascular research, hunger, oysters, injured dogs, salmon, veganism, art projects, politics, climate action — there’s a wine out there for you. (And no, not just to forget your woes.)

So-called “activist wines,” those that inspire drinkers to vote with their dollars, have created a “new road map for fine wine,” says sommelier Peter Weltman of Borderless Wine. As with the broader rise of ethical consumerism, wines that do good, as well as taste good, aren’t just a passing fashion. They represent a serious shift in the industry that’s gone from niche to mainstream over the past few years.

“There are countless research studies that show people today want to buy ethically and sustainably produced products from companies that share their values,” says Rob Symington, whose family owns the Portugal-based wine company Symington Family Estates. As of July 22, the nearly 140-year-old wine company achieved B Corporation status, joining a global movement of companies committed to social, environmental, and ethical business practices that are a force for good.

In an e-mail, Symington ticked off a couple of those studies. Unilever announced in June that its purpose-led Sustainable Living Brands are growing 69% faster than the rest of its business. A 2015 Nielsen poll of 30,000 consumers in 60 countries reported that 66% were willing to pay more for sustainable goods.

And I’ve just come across a report published last month by UK-based market research firm Wine Intelligence that found young consumers are increasingly paying attention to the impact of their behavior on the environment and extending that sense of responsibility to wine drinking choices.

Add to all that a new group of winemakers who want to do more than make great wine; they want to change the world, one bottle at a time.

Some wineries donate a percentage of profits or proceeds from a special cuvée to worthy causes. From Emmy Award-winning musician Dave Matthews, Dreaming Tree wines has given more than $1.5 million to environmental organizations such as the Wilderness Society. Profits from its brand-new rosé will go to the International Rhino Foundation. Every bottle of Proud Pour’s Mendocino sauvignon blanc restores 100 wild oysters to local waters.

Symington points out that we can’t talk about ethical wine without addressing climate change and the goal of ending carbon emissions. Fetzer Vineyards in Mendocino was first US winery to switch to green power 20 years ago, and in 2016 became the country’s first certified carbon neutral wine company.

Equally important is social responsibility and how wineries treat workers. Several decades ago, wine drinkers avoided South African wine because of that country’s apartheid policies. Now, many have joined the Fair Trade movement that promotes good working conditions and invests in development projects such as improving drinking water. Stellenbosch’s Thandi wines was the first fair trade-certified winery in the world.

At the annual wine think tank event Fine Minds 4 Fine Wines, organized by the Areni Institute, that I attended in July in Bordeaux, France, social sustainability was a hot topic. Laura Catena, whose family pioneered modern wine in Argentina, started the Bodegas de Argentina Sustainability Protocol. It encompasses training in many skills and language classes for workers and vineyard classes for local rural high schools to give students a way to remain in the area.

Is all this just a version of greenwashing? Check labels for certifications such as organic, Fair Trade, vegan, and membership in the new International Wineries for Climate Action. One way to track down wines with a conscience is to look for like-minded importers such as Weltman, who is starting to bring in wines from war-torn regions through his Borderless Wine Alliance to encourage activist wine buying. Dar Richi, a Lebanese wine made by a Syrian refugee, will debut this fall. “I realized that with our wine purchases we can help advance regional peace and political and social values,” he says, “and make a difference in the world.”

Mika Bulmash, an international development specialist who started Wines For the World in 2013 after working a harvest in South Africa built a portfolio of producers that meet strict criteria, including taking positive action about social responsibility and environmental sustainability.

What do these ethically minded wines taste like? A great cause doesn’t mean they’ll be good in the glass. But with these below — I’m happy to report — you don’t have to compromise on taste.

WINES WITH A CONSCIENCE: SEVEN GREAT BOTTLES TO BUY
2017 Indaba Chenin Blanc ($10) — Cape Classics importer Andre Shearer brings in South African wines and started the Indaba label as a way to fund education in the Cape Winelands. This exuberant, floral-scented white made by famed winemaker Bruwer Raats is one of the best wine values I know.

2015 Quinta do Ataide DOC Vinho Tinto Douro Red ($25) — Last year, the Symington family introduced this dry, pure red with a suave velvety texture, made from the traditional blend of grapes that go into port. The vineyard is organic, and the family estates have just obtained B Corp. certification.

2016 Bosman Family Vineyards Twyfeling Cinsaut ($25) — This thirst-quenching red imported by Wines For the World smells of fresh berries and spice, with flavors to match. Bosman received official fair trade certification in 2009, and workers own a 26% share in the vineyards and business. It’s one of South Africa’s largest wine land reform projects. Money from the wines goes into a trust that supports dozens of social and empowerment projects.

2018 Ehler’s Estate Sauvignon Blanc ($32) — French philanthropists built up this organic Napa estate over several decades. After they died, it became part of their Leducq Foundation, which funds cardiovascular research. This silky textured white has lush citrusy aromas and rich, juicy grapefruit and lemon flavors.

2015 Iron Horse Ocean Reserve Blanc de Blancs ($44) — This winery pioneered sparkling wine in the cool Green Valley area of Sonoma. For every bottle sold of this all-chardonnay cuvée, it donates $4 to National Geographic’s Pristine Seas initiative for marine protected areas and sustainable fishing practices.

2015 Maysara Immigrant Pinot Noir ($45) — Moe Momtazi, who fled from Iran and was given political asylum in the US, founded an engineering company and eventually established this biodynamic Oregon wine estate. One-third of the proceeds from this lively cherry- and herb-scented pinot noir go to refugee and immigrant programs.

2017 Gorgona Bianco Toscana ($130) — The Tuscan Frescobaldi family, which owns Ornellaia, has been training inmates on Italy’s prison on Gorgona Island since 2012 in vineyard and winemaking skills they can use when they return to society. They produce a red and a white from the grapes. This expensive but serious white blend of vermentino and ansonica is chalky and lemony, with very long, complex flavors.

Downton Abbey opens its doors with Airbnb listing

TWO Downton Abbey fans will soon get the chance to live like a Crawley for a night when Highclere Castle, the main filming location for the Emmy Award-winning drama, lists on Airbnb.

As a promotion for the upcoming film Downton Abbey, which premieres Sept. 20 in the US, the estate in Hampshire, England, is opening its doors to two guests for a one-night stay on Nov. 26.

George Herbert, the 8th Earl of Carnarvon, and his wife, Countess Fiona, live at the castle when it is not open to the public. They will invite the guests for cocktails in the saloon, followed by dinner in the state dining room, where they will be served by the castle’s butler. Then they’ll receive coffee in the library before retiring to one of the principal bedrooms, with views of the rolling hills.

In the morning, the guests will receive a private tour of the castle grounds, which include gardens of roses and lavender, along with beech and oak woodlands.

“It’s an absolute privilege and pleasure to call Highclere Castle my home, and I am delighted to be able to share it on Airbnb for a truly unique stay,” Lady Carnarvon said in a statement announcing the listing.

Booking will open on Oct. 1 at 12 p.m. BST and will cost £150 ($186.40). It will be first come, first served, so… good luck.

The history of the Highclere dates to 749 A.D., when an Anglo-Saxon king gave the estate to the bishops of Winchester, who built a medieval palace and gardens. In 1679, the palace was rebuilt after being purchased by Robert Sawyer, a direct grandfather of the current earl, and then was transformed into Highclere Castle with renovations in 1842.

During the summer months, the castle opens its doors to about 1,200 visitors per day, five days a week, starting at £16.

While Downton Abbey aired from 2010 to 2015, the castle’s great hall, library, music room, drawing room, saloon, dining room, and bedrooms were used for filming.

The PBS Masterpiece series gained a fervent following during its six-season run; its finale drew 9.6 million viewers. The series followed Lord and Lady Grantham as they navigated Edwardian England with their family and servants, from the sinking of the Titanic in 1912 until 1925. It was nominated for 69 Emmys and won 15.

Despite the castles’s 100,000 square feet and 300 rooms, there are still a few drawbacks to staying there. No pets are allowed (sorry, Isis), but there are nine dogs on the site. Only one butler is allowed per person, so manage your expectations accordingly. — Bloomberg

AGI to launch P2.5-billion share buyback program

ALLIANCE GLOBAL Group, Inc. (AGI) is embarking on a P2.5-billion share buyback program for the next 12 months.

In a statement issued Wednesday, the holding firm of tycoon Andrew L. Tan said its board of directors has approved the buyback exercise that will start on the 23rd and end on Sept. 23, 2020.

This will continue its P5-billion share buyback program expiring this month, or 24 months since it started on Sept. 20, 2017. AGI said it bought a total of 309 million shares worth about P4.28 billion during the period.

“We continue to pursue a share buyback because we believe in our stock’s underlying value, which is backed by our strong franchises across all our business segments, years of profitable operations, and continued expansion thrust,” AGI Chief Executive Officer Kevin Andrew L. Tan said in a statement.

The AGI shares will be bought in cash and will be booked as treasury shares.

“The share buyback is also EPS (earnings per share)-enhancing and should improve our share values moving forward,” Mr. Tan said.

Shares in AGI dropped 0.48% or six centavos to close at P12.50 each at the stock exchange on Wednesday.

AGI’s net income attributable to the parent dropped 11% to P3.75 billion in the second quarter of 2019, amid a 17% uptick in gross revenues to P40.93 billion. On a six-month basis, attributable profit was up 4% to P8.1 billion, while revenues climbed 15% to P82.8 billion.

The listed conglomerate has committed to spend P410 billion in capital expenditures over the next five years, about nine percent higher than its P377-billion spending from 2015 to 2019. This aims to support the expansion of AGI’s business units, which includes property, liquor, gaming, quick-service restaurants, and infrastructure.

About 73% of the capex will be poured into property unit, Megaworld Corp., as it continues the development of more townships across the country.

Megaworld recently launched its 25th township called Arden Botanical Estate, in partnership with leisure and tourism developer Global-Estate Resorts, Inc. The firms will spend P18 billion over a 15-year period for the project.

Travellers International Hotel Group, Inc., which owns and operates Resorts World Manila, cornered 15% of the capex, as it will be developing Westside City Resorts World inside the state-owned Entertainment City complex in Parañaque. The total capex for the integrated resort has been set at P57 billion.

The rest of the capex will be split among Golden Arches Development Corp., Emperador, Inc., and Infracorp Development, Inc. — Arra B. Francia

Manulife readies new products

MANULIFE PHILIPPINES is preparing to roll out new products as it aims to improve efforts to assess their clients’ needs.

Manulife Philippines President and CEO Richard Bates told reporters in a briefing late Tuesday that the insurer is currently doing customer surveys and meet-ups with clients to assess their needs.

Mr. Bates assumed his post last Aug. 5, replacing Ryan Charland who has been assigned to Manulife’s Indonesia unit.

“We will be having exciting things coming down, nothing that I’m afraid I can announce today, but we are constantly looking that what we develop is what the client needs,” Mr. Bates said when asked if the market can expect additional products from the insurer.

Mr. Bates said the insurer has an “optimistic” view of the market, citing the economy’s continued growth in the past few years and increasing investments in the country.

“When you look at how well the market has grown in the Philippines over the last few years and the directions and investments that are coming in, you have to be optimistic about the future,” he said.

“Overall, I’m feeling very optimistic about the opportunity, I’m new to the post but very excited about the opportunity,” he added.

He said that in terms of digitalization in their back-end operations, sales and customer information, the insurance firm “still [has] some way to go,” although improvements are ongoing.

“As an organization, we still have some ways to go, but we have made incredibly fast ground in a very short period of time so I’m very pleased with where we are, very pleased where we’ve got to… The question is always making sure that we remain innovative and remain creative and that’s part of the reason why the office looks this way,” he explained.

Manulife on Tuesday inaugurated its new headquarters in NEX Tower on Ayala Avenue in Makati City.

The new office features an open layout, collaborative workspaces, including work cafés in every floor, training and meeting rooms, and its own event area, among others.

Mr. Bates said they’ve seen improved productivity among their employees with the new open-design office.

“As an organization, it helped to drive our engagement with our team and it helped to drive up their productivity and ultimately help to drive up customer satisfaction,” he said.

Manulife Philippines is the local unit of Canada-based giant Manulife Financial Corp. with 1,400 employees and more than 9,000 agents across the country.

As of end-2018, the insurance firm posted P2.59 billion in net earnings based on the unaudited statistics submitted by life insurers to the Insurance Commission. — BML

Order checks for Apple’s new iPhone bode well — analysts

PRE-ORDERS for Apple Inc.’s latest iPhones have gotten off to a better start than the last cycle a year ago, several Wall Street analysts said on Monday, citing their own research data.

The company last week unveiled three iPhone models featuring upgraded processors and new camera functionality, including iPhone 11, iPhone 11 Pro and iPhone 11 Pro Max, priced between $699 and $1,099.

CNBC quoted TF International Securities analyst Ming-Chi Kuo, known as a close follower of the Cupertino, California-based company’s supply chains, as saying that demand for new iPhones is beating his expectations — and that much of it was due to Chinese consumers.

Greater China was the third biggest region in terms of sales in 2018 and after raising alarms after slack sales growth earlier this year, Apple has seen bumps in demand driven by discounting by Chinese online retailers.

Chinese e-commerce site JD.com on Saturday said on its official Weibo account that day one pre-sales for the iPhone 11 series jumped 480% versus the previous year, with the top three most popular products being the iPhone 11 Pro in midnight green, and the standard iPhone 11 in black and purple.

Chinese media outlet Yicai also said on Monday that they jumped 335% on Alibaba’s Tmall platform on the first day of sales versus pre-sales for the iPhone XR last year, citing Tmall figures.

CNBC said that Kuo had boosted his forecast for iPhone 11 series shipments from between 65 million and 70 million units in 2019 to between 70 million and 75 million units.

While giving numbers that did not compare directly with Kuo’s, analysts at two other brokerages also said that the initial orders were looking good.

Instinet, owned by Japanese bank Nomura, cited “shipment” checks for its conclusions, while Wedbush’s Daniel Ives said he had conducted supplier checks throughout Asia including China.

“We are careful about extrapolating first weekend data, though it is fair to say it is ahead of last year’s launches,” Instinet analysts wrote in a note.

“Should the early shipment time data hold and translate to unit volumes, Apple may be able to offset this year’s average selling price reduction,” they added.

Apple shares were trading marginally higher around midday in New York compared to an almost half-percent fall for the tech-heavy Nasdaq index. — Reuters

South Korean pub takes down North Korean trappings after complaints

SEOUL — The owner of a North Korea-themed pub being renovated in South Korea took down a North Korean flag and portraits of the isolated country’s late leaders on Monday after complaints from neighbors who feared he was violating a Cold War-era law.

A North Korean flag and images of Kim Il Sung and Kim Jong Il, the late grandfather and father of North Korean leader Kim Jong Un, were hung on the outside wall of the pub in the South Korean capital, Seoul, media showed.

But residents of the neighborhood complained saying the pub may have violated South Korea’s National Security Act, a 1948 law banning the “praising, inciting or propagating the activities” of enemies, a city official said.

“The flag and photos were taken down as there was controversy,” Song In-soo, an official from the Mapo district office, told Reuters.

Song said the case has been referred to police. They declined to comment.

North and South Korea have been fierce rivals since the 1950-53 Korean War ended in a truce, not a peace treaty. They remain technically at war.

Numerous South Koreans have run afoul of the security law over the decades, most accused of spying for North Korea, or abetting it in some way.

But the atmosphere has become more relaxed in recent years, especially since President Moon Jae-in came to power in 2017 championing efforts to improve ties with the North.

Broadcaster KBS reported that the owner of the pub wanted to “change the atmosphere” after business slumped and had not intend to glorify North Korea. — Reuters

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