A fruitful year

July 8, 2019 | 9:00 am

Passion and Philosophy: Atty. Ray C. Espinosa

The year 2018 was an especially good year for the Philippines’ largest electric distribution company, the Manila Electric Company (Meralco). For the new president and chief executive officer of Meralco, Ray C. Espinosa, who took over recently, this presents both an opportunity to take the firm to greater heights and a challenge to keep the momentum going.

According to its 2018 annual report, despite slower macroeconomic growth, high prices of coal, gas and fuel, as well as high inflation and interest rates, Meralco posted revenues of P304.5 billion in 2018, an 8% increase from P282.6 billion in 2017. The company’s core net income likewise rose 11% from P20.2 billion to P22.4 billion.

Consolidated energy sales of the company went up by 5% from 42,102 gigawatt hours (GWh) to a record of 44,313 GWh. “Of the total, industrial energy sales had the highest growth at 7% to 13,156 GWh from 12,309 GWh with growth leaders from the electrical machinery, rubber and plastics, and food and beverage industries. Commercial energy sales followed with a 5% growth to 17,463 GWh from 16,597 GWh, attributed to real estate, retail trade, and hotels and restaurants.

Residential energy sales grew 4% to 13,555 GWh from 13,060 GWh, buoyed by net new customer accounts numbering 273,766. Streetlights volume accounted for the balance at 139 GWh,” the report said.

By the end of 2018, Meralco had 6.6 million customer accounts, up 5% from the 6.3 million at the close of 2017. 92% of its customers were residential customers and 8% were commercial customers. Industrial and streetlights customers accounted for less than 1% of the total.

The company managed to reduce its system average interruption frequency index, or the average number of power interruptions a Meralco customer experiences in a year, to an all-time low of 1.8 times last year. Its system loss rate also reached an all-time low of 5.67%.

“As a result of a lower system loss rate, total customer savings amounted to about P6.1 billion in 2018 or an average savings of P0.14 per (kilowatt hour) kWh, based on the 8.5% system loss cap from January to May 2018, and 7.5% indicative system loss cap from June to December 2018,” the report said.

It added that from 2008 to 2018, the cumulative savings for Meralco customers totaled P39.6 billion or P0.11 per kWh.

For its continuous system and expansion program in 2018, Meralco had capital expenditures of P13.7 billion, up 13% from 2017.

Last year, it completed the Lancaster substation in Cavite and four capacity expansion projects for Balibago, Sta. Maria, Carmelray Industrial Park II and Santolan substations.

With the construction, meanwhile, of the Biñan-ROHM-LIIP 115-kilovolt (kV) line and the New Cruz na Daan-Baliuag 69-kV line, the company’s subtransmission system was made stronger.

In 2018, the number of Meralco employees grew to 5,602 from 5,539 in 2017. The company also improved its GWh sales per employee ratio from 7.50 in 2017 to 7.82 in 2018, as well as its customer per employee ratio from 1,142 to 1,180.

“To sustain the performance, the company invested in people training programs,” the report said. Among these programs were the five-month-long Meralco Cadet Engineering Program for newly hired engineers and the two-day-long course called #LiDEr to enhance the leadership and management competencies of Meralco’s distribution engineers.

3rd major telco set to get permit today

July 8, 2019 | 12:33 am

By Denise A. Valdez
Reporter

THE MISLATEL CONSORTIUM is scheduled to complete its award as the new major telecommunications player today with the receipt of its permit to operate and radio frequencies from the government.

Adel A. Tamano, spokesman of the group formed by China Telecommunications Corp., Udenna Corp. and Chelsea Logistics and Infrastructure Holdings Corp., said in a mobile phone message on Sunday that the group will get its permit in “a ceremony at Malacañang” this afternoon. “Everything has been submitted, we have complied with all requirements including the P25-billion performance bond,” he said.

Department of Information and Communications Technology (DICT) Undersecretary Eliseo M. Rio, Jr., who chaired the oversight committee on the state auction for a new major telco player last year, confirmed in a text message the awarding ceremony at the Palace.

“Tomorrow will be the fulfillment of the President’s campaign promise that if he won, he will improve telecommunication services in this country by bringing in a third telco to give competition to Globe (Telecom, Inc.) and Smart (Communications, Inc.),” he told BusinessWorld.

Mislatel’s submission of its performance bond was the requirement the DICT and the National Telecommunications Commission (NTC) were waiting for before awarding the certificate of public convenience and necessity (CPCN) and radio frequencies to the consortium.

“We will give Mislatel its CPCN on July 8… Hindi namin pwedeng ibigay sa kanila yung CPCN nila if hindi sila mag-post [We can’t give them their CPCN until they post their performance bond]. So we scheduled that time for the awarding,” Mr. Rio had told reporters last month.

Mislatel will receive its CPCN, or permit to operate as a telco, and radio frequency bands of 700 megahertz (MHz), 2100 MHz, 2000 MHz, 2.5 gigahertz (GHz), 3.3 GHz and 3.5 GHz.

Mr. Tamano had said the rollout of Mislatel would start immediately after getting its CPCN. Its commercial launch is scheduled in the second quarter of 2020.

Prior to awarding, the group said it was “taking steps to prepare for rollout” by “moving forward on the planning and evaluation stage for our network infrastructure and backbone.”

Mr. Rio said after awarding the CPCN and frequencies, the DICT and NTC will start monitoring Mislatel’s compliance with its performance commitments as indicated in its bid in the government auction.

Mislatel committed to render a minimum broadband speed of 27 Megabits per second (Mbps) in its first year of operations and 55 Mbps in the succeeding years. It also committed to have a 37.03% coverage of the national population within its first year and 84.01% cumulative coverage in five years.

If it fails, the government must recall the CPCN and frequencies awarded to Mislatel and will keep its performance bond of P25 billion.

“This is the first time that a new telco was required to come up with committed Quality of Service and has to post a performance bond, which it will loose in if it fails to satisfy its commitment. That was never done with Globe and Smart,” Mr. Rio said, noting how the initiative is expected to improve mobile communication services in the country.

ERC to hear co-op plea to pass on realty tax

July 8, 2019 | 12:32 am

THE ENERGY REGULATORY COMMISSION (ERC) will hear this week a petition filed by electricity cooperatives to treat rural property tax (RPT) as a pass-on cost that can be collected from power users.

In its order, the regulator had given interested parties until July 4 to submit comments on the petition of Philippine Rural Electric Cooperatives Association, Inc. (Philreca). The first public consultation is scheduled on July 10.

“Parties who have filed their written comments on or before the prescribed period would be given priority during the above-scheduled public consultation,” the ERC said in its petition.

In its petition, Philreca asked the ERC to authorize its members to pass on the tax cost to their customers, saying this move would be “valid and timely considering that local government units (LGUs) had assessed and collected RPT” from electric cooperatives (ECs).

“The RPT should therefore be allowed to be a pass-through charge to the ECs member-customers subject to post verification and confirmation by the Commission similar to the local business and franchise tax,” Philreca said.

The public consultation comes as the association recently emerged as one of the winning party-list groups during the May 13 elections, allowing it to sit as a representative in Congress to represent electricity cooperatives and their member-consumers.

Janeene D. Colingan, executive director and general manager of Philreca, did not immediately respond when asked to comment on Wednesday’s public consultation.

Neither did ERC Spokesperson Floresinda B. Digal immediately respond when asked about how soon the regulator can rule on the matter as well as comments received as of the deadline.

This week’s hearing is just the Luzon leg of the public consultation for stakeholders. The ERC directed Philreca to inform its members and the stakeholders of the event “by any means available and appropriate.”

The order was signed by Josefina Patricia A. Magpale-Asirit, ERC oversight commissioner for legal service.

The ERC previously set the hearing and public consultation on the petition between March and April in venues in Luzon, the Visayas and Mindanao.

In its petition, the association said the need for ERC rule-making became more urgent after the decision of the Supreme Court in the case of Manila Electric Co. versus Lucena City’s assessor and treasurer that affirmed that transformers, electric posts, transmission lines, insulators and electric meters are not exempted from RPT.

“The RPT is the life blood of the LGUs authorized by the Local Government Code of 1991 (Republic Act No. 7160) and thus the collection and payment thereof can no longer be avoided by ECs,” Philreca said.

“The ECs have no option but to pay the RPT; otherwise the LGU can exercise its right to levy the real properties of the ECs to enforce collection thereof and thereby hamper the ECs from performing its mandate of providing electric service to its member-customers.”

The association also said its members’ existing tariffs do not provide for surplus funds through a return on rate base and depreciation like those of private distribution utilities.

It said while private utilities can exercise a certain degree of flexibility by charging the RPT against their surplus funds, the ECs are constrained to fund the same from their meager internally generated funds.

It added that in most cases, the funding comes from loans obtained from the National Electrification Administration and financial institutions.

Philreca also asked for other relief “deemed just and equitable.” — Victor V. Saulon

SEC to allow cross-border publication of ASEAN capital market reports

July 8, 2019 | 12:31 am

THE SECURITIES AND EXCHANGE COMMISSION (SEC) has drafted guidelines as part of a regionwide move to allow capital market professionals from Association of Southeast Asian Nations (ASEAN) members to issue research reports outside their home countries.

In a draft memorandum circular posted on its Web site last Friday, the country’s corporate regulator explained that cross-border publication of research reports will help investors gain access to more information on ASEAN capital market products, specifically on equities listed within Southeast Asia.

Under the draft guidelines on the Implementation of Cross-Border Publication of Research Report, salesmen of broker dealers or investment houses, certified investment solicitors, key officers of fund managers, and other professionals authorized by the SEC can issue research reports in other ASEAN countries that signed a memorandum of understanding (MoU) on this initiative.

These professionals, who must be licensed in their home jurisdictions, must apply for a salesman or certified investment solicitor license with the SEC to release reports under this framework.

Aside from having a license from their home regulator, only those with no pending disciplinary actions or who have not been convicted by a judicial or administrative body are allowed to participate in cross-border publication of reports.

Professionals may issue research reports on shares that have been listed in ASEAN, bonds or sukuk, and units of collective investments scheme such as units of a real estate investment trust and units of infrastructure fund.

Securities that are still under initial public offering are not included among products that can be subjects of such reports.

The release of the draft guidelines is part of the commission’s efforts to support the ASEAN Capital Markets Forum’s initiatives to enhance connectivity of capital market professionals in their member countries.

To recall, the SEC signed in March an MoU on cross-border publication of research reports under the ASEAN Capital Market Professional Mobility Framework. Malaysia, Singapore and Thailand were the other signatories.

The SEC has already issued guidelines for the ACMF pass, which provides for the free movement of investment advisers in the ASEAN.

The commission is inviting all interested parties to submit their comments and inputs on cross-border publication until July 16. — Arra B. Francia

Will the declining trend in underemployment be sustained?

July 8, 2019 | 12:30 am

‘Imminent’ acceleration of infrastructure spending to fuel economic growth

July 8, 2019 | 12:30 am

AN ‘IMMINENT’ ACCELERATION of Philippine investment growth — especially as the government speeds up infrastructure spending this semester after a four-month budget delay crimped expenditures in the first half — should fuel faster economic growth next year, according to a July 5 HSBC Global Research ASEAN Perspectives report.

Noting that “infrastructure spending is slowing sharply this year” across Southeast Asia largely due to elections, “a new investment cycle… should boost domestic demand into 2020.”

In its remarks on the Philippines, the report said that despite “one-off budget issues in the first half” that prevented the release of funds for new projects, “the government is likely to sharply accelerate infrastructure spending to reach its… target of seven percent of GDP by… 2022.”

“Our assumption of a pickup in investment supports our forecast for (GDP) growth in the Philippines to accelerate to 6.4% in 2020” from a six percent this year and 2018’s four-year-low 6.2%. HSBC expects second-quarter growth at 5.8% from 5.6% in January-March.

Mazda Philippines Adds Turbo, Refreshed Sports Wagon to Mazda6 Lineup

July 8, 2019 | 12:11 am

By Ulysses Ang

THE MAZDA6 has earned its reputation as the enthusiast’s choice in the executive car segment. Today, it has cemented that by not only offering a choice between two body styles — a sedan and a wagon, but a choice between a torquey diesel and for the first time ever, a powerful turbocharged gasoline engine. Regardless of option, it now fully realizes its potential as a true driving masterpiece that only Mazda could achieve.

Joining the 2.2-liter Skyactiv-D variant, the 2019 Mazda6 sedan is now available with a turbocharged 2.5-liter Skyactiv-G engine. With Dynamic Pressure Turbo technology, it produces 231 horsepower and 420 Nm of torque using regular unleaded fuel. Mated to a 6-speed automatic powering the front wheels, it drops the Mazda6’s 0-100 km/h to 7.6 seconds — 0.2 seconds faster than its diesel-powered sibling.

Available only as the top-trim Signature variant, the 2019 Mazda6 Skyactiv-Turbo continues Mazda’s penchant for providing a finely crafted interior. The seats are finished in Deep Chestnut-colored Nappa leather seats, ventilated to raise the comfort of both the driver and front passenger while Ultrasuede accents and real Japanese Sen Wood trim give it an atmosphere of elegance and style. The Mazda Connect infotainment system now integrates Apple CarPlay and Android Auto too.

Like the Mazda6 Skyctiv-D, the Mazda6 Skyactiv-Turbo features a 360-degree camera, Lane Keep Assist, and Blind Spot Monitoring for Rear Cross Traffic Alert. It also has an updated steering system and revised chassis dynamics for enhanced handling while added sound insulating material and a redesigned suspension configuration contribute to a quieter and smoother ride.

Joining the Mazda6 sedan lineup is the updated Mazda6 Sports Wagon. Receiving the Evolved Kodo Design, this long roof variant features similar exterior and interior appointments as the sedan.

The bolder face and revised 19-inch alloy wheel design are complemented by the standard Nappa leather seats with front ventilation, an 8-way electric driver’s seat with memory, dual-zone climate control, cruise control, electronic parking brake, Apple CarPlay and Android Auto Mazda Connect integration, 360-degree camera, Adaptive LED headlights, Lane Keep Assist, and Blind Spot Monitoring with Rear Cross-Traffic Alert.

The 2019 Mazda6 Sport Wagon is available with a single powertrain: the updated 2.5-liter normally-aspirated Skyactiv-G engine making 190 horsepower and 252 Nm of torque. Tweaked for added smoothness and quietness, it also comes fitted with cylinder activation technology for added fuel efficiency.

The 2019 Mazda6 range is now available at all Mazda dealerships nationwide with the following prices: Mazda6 Sports Wagon Signature — P1,995,000; 2019 Mazda6 Skyactiv-D Signature — P2,250,000; and 2019 Mazda6 Skyactiv-Turbo Signature — P2,250,000.

TMP Tech, a wellspring of auto service professionals

July 8, 2019 | 12:10 am

TOYOTA MOTOR PHILIPPINES School of Technology (TMP Tech), a premier automotive technical school based in Laguna, held the commencement exercises for Batch 8 of its two-year Toyota General Job Automotive Servicing Course.

A total of 92 graduates, who are now full-fledged Toyota Technicians, will soon join the country’s highly-skilled work force in auto service operations at Toyota dealerships nationwide. TMP Tech students are equipped through advanced training that combines the Technical Education and Skills Development Authority (TESDA) curriculum for Automotive Servicing Course (National Certification Levels I-IV) and Toyota’s Technical Education for Automotive Mastery in the 21^st Century (TEAM 21).

The graduates’ skills gained through an intensive on-the-job training at local Toyota dealerships, on top of classroom lectures and workshop simulations, give them an edge in getting employed in the Toyota network.

Established six years ago, TMP Tech continues to be an agent of nation-building through quality technical education and skills development. It further provided new courses to develop more Filipino technicians requiring specialization in Automotive Body Repairing (NC II) and Automotive Body Painting and Finishing (NC I-II).

Volvo Philippines joins MEGA Equality Ball

July 8, 2019 | 12:09 am

VOLVO PHILIPPINES once again highlights its support for equality, diversity, and freedom by supporting this year’s MEGA Equality Ball. The crème de la crème of the country gathered at the magnifique Grand Plaza Ballroom of Sofitel Philippine Plaza Manila recently not only to commemorate Philippine Independence but also to celebrate the many colors of Pinoy pride.

Renowned fashion designer Francis Libiran and Miss Universe 2018 Catriona Gray turned heads as they each alighted from their stylishly sexy Volvo XC90. Likewise, the spectacular entrance of event host Laura Lehmann also captured the attention of everyone as she was ferried in via Volvo S90 T8 Twin Engine Plug-in Hybrid.

STUNNING S90
Equally at home on the road and in the midst of the Philippine’s fashionable set, the S90 Plug-in Hybrid is Volvo’s latest innovation. Offering power without compromise, this elegant sedan features an exhilirating drive with uncompromised efficiency powered by Volvo’s unique plug-in hybrid technology.

The Volvo S90 features a high-performance petrol engine combined with an electric motor. With this avant-garde powertrain, this gorgeous, tech-laden Volvo delivers outstanding highway performance and all-wheel drive capability — all with zero emissions.

A VOLVO FOR ALL
Volvo has always been about caring for people. It has been the company’s mission to make people’s lives easier, safer, and better not only through the cars they create but also by creating a working environment that is fair, collaborative, diverse, and inclusive. It values good work-life balance and has recently introduced a paid, gender-neutral parental leave policy for all sales company employees across the EMEA region, offering a total of six months of leave with 80% pay.

Entrepreneur takes home P1-million cash prize from Ford’s Big Deal raffle promo

July 8, 2019 | 12:08 am

AN ENTREPRENEUR took home P1-million cash prize as the grand winner of Ford Philippines’ Big Deal raffle promo.

Marianne Hernandez is a businesswoman from Muntinlupa City who is into dog breeding and rice reselling. She is a wife to an OFW and has recently purchased a 2019 Ford Ranger XLT 4×2 AT from Ford Global City, which earned her a raffle entry to the Big Deal promo.

According to Ms. Hernandez, she needed a pickup to cater to the needs and demands of her businesses. “The Ford Ranger is a very capable truck in helping me transport the dogs that I breed and sacks of rice from one place to another. I particularly love the wide truck bed which can carry and move heavy loads of goods without compromising the quality of the driving experience, which is what the Ford Ranger is really known for.”

When asked where she will spend the winnings, the mom of two replies, “I plan to use my cash prize to renovate my house, save up for the school tuition fees of my kids, and visit Hong Kong for a vacation in September when my husband comes home.”

Present during the awarding ceremonies at Ford Global City are Ford Philippines Managing Director Bert Lessard and Ford Global City General Manager Danny Chua.

With the Ford Big Deal promo, customers who reserved or purchased any variant of the EcoSport, Everest, Mustang, Explorer, Fiesta, or Expedition, as well as the Ranger XLS, XLT, and Wildtrak variants during the Manila International Auto Show or within the month of April from any Ford dealership received raffle coupons.

Subaru Ultimate Test Drive Year 2 goes to Manila, Cebu, Davao and South Luzon

July 8, 2019 | 12:07 am

MOTOR IMAGE PILIPINAS, Inc., the exclusive distributor of Subaru vehicles in the Philippines, invites you to year 2 of the Subaru Ultimate Test Drive (SUTD) series. Find out what makes Subaru cars truly special by being in the driver’s seat yourself.

Subaru’s four core technologies — Symmetrical All Wheel Drive, Boxer Engine, Subaru Global Platform, and EyeSight Driver Assist — work together to give outstanding drivability, performance and driving confidence. Subaru is making the all-new Forester, XV and other EyeSight-equipped vehicles available for anyone to try and experience the Subaru difference in action.

The event happens in Manila this coming July 12 to 14 at the SM Mall of Asia Concert Grounds (Block 16) and heads towards Cebu and Davao in August and South Luzon in November.

Pre-register at https://www.subaru.asia/ph/sutd2019mnl and be one of the first 50 to receive a limited edition SUTD gift from us. Bring family and friends to see what event sponsors Shell, Motul and Sonax have in store. Exclusive freebies and deals await on-site bookings.

Hino joins first nationwide modern PUV caravan, showcases new jeepneys

July 8, 2019 | 12:06 am

HINO MOTORS PHILIPPINES (HMP), one of the pioneer participants of the government’s Public Utility Vehicle (PUV) Modernization Program, joined the first Modern PUV Caravan held at the Clark Economic Zone in Pampanga earlier today with the theme “Arangkada ng Pagbabago Tungo sa Kaunlaran.”

The Modern PUV Caravan is a joint undertaking of the Department of Transportation (DoTr), Land Transportation Franchising and Regulatory Board (LTFRB), Land Transportation Office (LTO) and the Office of Transportation Cooperatives (OTC) in cooperation with the Development Bank of the Philippines (DBP), Land Bank of the Philippines, various industry associations and vehicle manufacturers, including HMP.

During his speech, LTFRB Chairman Martin Delgra III said: “The caravan launch today is a strong manifestation of the collaborative effort of private and public partners in the implementation of the PUV Modernization Program. We intend to push this program as far and as fast as possible and that won’t happen without the support of all the stakeholders.” LTO Undersecretary Mark Richmond de Leon likewise called for the support of all stakeholders, especially the drivers and transport cooperatives, for the success of the program. He highlighted that the PUV Modernization Program is a priority project of the government because a modern, reliable transportation system can help usher in a better economy for the country.

Around 30 legs of the modern PUV caravan are scheduled to be held nationwide until February 2020. Phase one of the caravan, which will run for the entire month of July until the first week of August, includes stopovers in Urdaneta City, Pangasinan; San Fernando City, La Union; Laoag City, Ilocos Norte; Tuguegarao City, Cagayan; Santiago, Isabela; Baguio City; Cabanatuan City, Nueva Ecija; and Marilao City, Bulacan.

HMP will be showcasing its PNS-compliant modern PUVs, Jeepney Class II (AC) and Jeepney Class III (AC), during the different legs of the caravan. These Euro 4-powered Hino jeepneys provide comfortable seating and are equipped with safety features such as a speed limiter, CCTV, GPS and a dashboard camera, which all ensure a better, safer commuting experience for both Filipino drivers and passengers.

HMP Chairman Vicente Mills, Jr. shared, “We are honored to be part of this meaningful program which seeks to gradually improve our national transportation system. It has always been our vision to see a more connected community where people and goods go where they need to go in the most efficient manner and we are positive that this effort brings us all closer to achieving that. HMP is committed and well-positioned to support this PUV modernization initiative and we all look forward to the opportunities that this will open up for our local transportation industry and its various stakeholders.”

As the country’s only one-stop shop for sales, service and the customization of trucks and buses for many years now, Hino has a reputation for delivering premium quality, which commuters can also expect from its modern PUVs. Since last year, HMP has turned over more than 100 modern PUVs to several transport cooperatives in Taguig, Pateros, Makati, Quezon City and Iloilo.