Facebook Instagram Linkedin Twitter Youtube
Home Blog Page 11160

Palay farmgate prices rise as lean season begins

THE average farmgate price of palay, or unmilled rice, continued to rise year-on-year two weeks into the start of the lean season, the Philippine Statistics Authority (PSA) reported.
In its palay, rice and corn price report, the PSA said the average farmgate price of palay was P21.60 per kilogram (kg) in the second week of July, up 11.17% from a year earlier. The average was 0.47% lower compared with the previous week.
The price of palay breached the P21 level after almost two years in early May, despite projections of rice production increasing this year and in 2019.
The average price for well-milled rice rose week-on-week and year-on-year.
The average wholesale price for well-milled rice was P42.09 per kg, up 0.38% week-on-week and 7.81% year-on-year. At retail, prices rose 0.27% week-on-week and 7.05% year-on-year to P44.81 per kg. — Anna Gabriela A. Mogato

New reporting standards for banks in effect

NEW REPORTING RULES for banks and financial firms will formally take effect this year, which stand as the equivalent of global standards for pricing financial instruments.
The Bangko Sentral ng Pilipinas (BSP) has formally adopted the Philippine Financial Reporting Standards (PFRS) 9, which specifically covers financial instruments held or issued by local players.
“The policy sets out the supervisory expectations in classifying and measuring financial instruments and in recognizing impairment to promote prudence and transparency in financial reporting,” the central bank said in a statement sent over the weekend.
The latest standards are the counterpart of the International Financial Reporting Standards 9, which is a global set of rules prescribing how to account for financial instruments held by banks and similar institutions.
Under the PFRS 9, entities need to classify and measure financial assets at either its amortized cost or fair value.
The PFRS 9 should cover all financial reporting starting Jan. 1. The central bank has already given notice to banks and supervised entities about the adoption of these standards as early as 2010.
With the new issuance, bank officials are required to “assess the impact” of the new accounting standards on their business strategies and risk management systems as they update their reporting processes.
“Specifically, the Bangko Sentral will evaluate the consistency of sales activities and metrics being used in monitoring the performance of financial instruments with the business model for holding the instrument. This will align the accounting treatment with risk management strategies and is seen to strengthen governance over the reporting system,” the central bank said.
Among the changes include the “early recognition” of a firm’s allowance for credit losses, which should come even before actual loan defaults. The central bank, however, said this has been put in place through prior regulations for credit risk management.
Firms with simple operations may adopt straightforward loan loss models compared to those with more complex business structures.
S&P Global Ratings said they expect the transition to the PFRS to be “moderate and manageable” for Philippine banks, as they stand ready to adjust given favorable credit conditions and ample capital buffers to ensure sound financial footing.
The Philippine banking system is seen to remain strong and stable given healthy profits and improving asset quality, the debt watcher said. — Melissa Luz T. Lopez

Anchor Land’s Manila luxury condo now sold-out

ANCHOR LAND Holdings, Inc. said it has sold-out its luxury residential condominium project called Admiral Grandsuites along the Manila Bay area.
The upscale property developer in a statement over the weekend said it has recently topped off the 43-storey condominium, indicating that it has placed the last beam of the building during construction.
While the listed firm did not disclose the sales value of the entire project, it said each square meter was sold at P167,000 for all 51 units.
Amenities at the Admiral Grandsuites include a function hall, theater room, fitness center, children’s club, garden deck, yoga room, game rooms, KTV room, spa, and wellness rooms.
It has partnered with several consultants, including ASYA Design Partners, Meinhardt Philippines —for consulting services in engineering, BLG Facade Design Consultancy, New Golden City Builders & Development Corp., and Jose Aliling Construction Management for the development of Admiral Grandsuites.
Anchor Land targets to turn over the units to buyers by the fourth quarter of 2019.
The condominium is part of Anchor Land’s Admiral Property, which also houses the 53-storey luxury Admiral Baysuites and the Admiral Hotel.
“Once completed, the Admiral Property will help tell the wonderful history of Old Manila. Both local and international residents and guests will be treated to a culture-rich luxury experience,” Anchor Land President Digna Elizabeth L. Ventura-Sison said in a statement.
The complex is located near the Ninoy Aquino International Airport and the Cultural Center of the Philippines Complex, the SM Mall of Asia, as well as the Philippine Amusement and Gaming Corp.’s Entertainment City which houses several hotels and casinos like Solaire and Resorts Casino, City of Dreams Manila, and Okada Manila.
Since its incorporation in 2004, Anchor Land has developed mostly luxury residential projects for the Filipino-Chinese community in Manila, Pasay, Parañaque, and San Juan. Residential projects account for 90% of the company’s revenues, while commercial projects provide the remaining 10%.
Earlier this year, Anchor Land Chief Executive Officer Steve Li said the company is working toward increasing recurring revenue base to contribute 20% of total revenues by 2021. In line with this, the company is developing a seafood restaurant called Baylife Venue, a two-tower BPO office called Anchor Land Corporate Center, and a bed space leasing facility called Cosmo Suites. It also has resort developments in Boracay and Coron, Palawan in the pipeline. — Arra B. Francia

Don’t forget it’s the MaArte Fair this weekend


FOR ITS 10th year, the MaArte Fair turns its eyes on the men, this year offering the Pinoy ManCave category alongside its special products for the home and for ladies. The Pinoy ManCave exhibitors include Randy Ortiz, Siklo Pilipinas (upcycled rubber tires), Cosimo Leathersmiths, and Rameilius Trading Inc.
The MaArte Fair will be held on Aug. 10 to 12 at The Peninsula Manila in Makati.
This year, there will be a little above 40 exhibitors, with about 14 new vendors added to the list, offering jewelry, accessories, fashion, and homeware. They include Gifts and Graces; “threadwork” by Good Luck, Humans; Domesticity’s houseware; Piopio’s fashion made with handwoven fabrics; Oscar Mejia’s perfumes; Cosimo Leathersmiths; jewelry by Nicole Whisenhunt and Tim Tam Ong; pottery by Joey de Castro; Tali Handmade’s bags; and herbal teas from Tsaa Laya.
Twenty percent of the proceeds of the MaArte Fair goes to the Museum Foundations of the Philippines Inc., which then forwards its earnings to the National Museum to further its projects.

German poultry farmers seeking price rises as drought increases costs

HAMBURG — German poultry farmers are seeking price rises from supermarkets because this summer’s drought has caused a surge in the cost of animal feed grain, producer association ZDG said on Friday.
“The significant rise in animal feed prices in past weeks has brought German poultry farmers into great difficulty,” the ZDG said. “Prices for wheat, a central component of chicken and turkey feed, is currently about 25% over last year’s level, with a rising trend.”
The hottest July since 1881 has damaged Germany’s harvest and the country’s wheat crop is expected to slump about 25% on the year, the German farmers’ union said on Wednesday.
Germany’s government is considering special aid for livestock farmers to help them overcome the rise in animal feed prices.
The ZDG said poultry farmers could not alone carry the extra costs caused by the drought.
“We call on the food retailer sector to increase their purchase prices,” the ZDG said. “And consumers should be willing to pay more for poultry meat.”
German food retailing traditionally offers very low prices and is dominated by giant discount supermarkets that have strong purchasing power and are unwilling to accept price rises. — Reuters

NAIA consortium says SWS survey shows Filipinos still prefer NAIA

THE CONSORTIUM of seven of the country’s top conglomerates proposing to rehabilitate the Ninoy Aquino International Airport (NAIA) said more Filipinos still prefer the main Manila gateway over its alternatives in Clark, Sangley and Bulacan, citing data from a survey conducted by the Social Weather Stations (SWS) in March.
In a statement over the weekend, the consortium said the SWS survey results showed “62% of the respondents wanted NAIA to be retained while 22% were for Clark, 9% were for Cavite, and 6% voted for Bulacan.”
The consortium is hoping to get an original proponent status (OPS) from the Department of Transportation (DoTr) for its proposal to rehabilitate NAIA for approximately P106 billion.
“Only the grant of an OPS is needed for this private proposal to move forward,” NAIA Consortium spokesperson Jose Emmanuel “Jimbo” F. Reverente said in the statement.
He noted the importance of speeding up the process “because every year’s delay will cost the country opportunity losses in terms of trade, investments, and tourism, and the jobs they will generate, among others.”
“We are ready to start construction right after we get the notice to proceed (NTP) and deliver the first phase of expanding NAIA’s capacity by 2020,” he added.
Last month, the DoTr said it has already submitted its recommendation for the NAIA consortium’s rehabilitation proposal to the Manila International Airport Authority (MIAA). If the MIAA approves it, the DoTr will then forward it to the National Economic and Development Authority’s Investment Coordination Committee (NEDA-ICC).
Once it secures approval from the NEDA Board, it will then be subjected to a Swiss challenge where other companies may submit competing offers. The original proponent will be given the right to match these offers.
The super consortium is composed of the country’s biggest companies, namely: Aboitiz InfraCapital, Inc.; AC Infrastructure Holdings Corp.; Alliance Global Group, Inc.; Asia’s Emerging Dragon Corp.; Filinvest Development Corp.; JG Summit Holdings, Inc. and Metro Pacific Investments Corp. Its technical parter is Singapore-based Changi Airports International Private Ltd.
It submitted to the government in February the P350-billion unsolicited proposal to rehabilitate the Manila gateway for 35 years, but has since modified its submission to reduce the cost to about P105 billion to P106 billion and the concession period to 15 years.
Part of its original proposal was to build an additional runway, which has been removed and indicated as just an option for future expansion, said Transportation Undersecretary for Aviation Manuel Antonio L. Tamayo in May.
Other elements in the super consortium’s plan is to expand the existing terminals and add new taxiways. This is aimed to up the capacity of NAIA to 47 million in two years and to 65 million in four years.
While rehabilitation of NAIA is still pending, the government is also making an effort to redirect passengers to airports in nearby locations. It is currently bidding for the operations and management contract of the Clark International Airport in Pampanga and is reviewing San Miguel Corp.’s proposal to build a Bulacan International Airport. The DoTr also said it has approved the Cavite provincial government’s proposal to build a Sangley International Airport in the south. — Denise A. Valdez

Discovering the treasures of Morocco


A KAFTAN to add color to your wardrobe; a copy of your best friend’s name written out in Arabic calligraphy; ingredients such as cinnamon powder, figs, and couscous for adventurous meal preparations; and a collection of multicolored plates for use as decorations for the living room wall — for an entire month, taking home or sharing a piece of the Kingdom of the West requires no air fare.
Luxury retailer Rustan’s showcases the culture and handicrafts of Morocco at the special Le Coeur du Moroc (Heart of Morocco) section at the fifth floor of Rustan’s Makati for the entire August.
“The Embassy of Morocco opened here (this year), and we have close ties with Morocco, so, we decided to do this festival since we do festivals ever so often. The last Moroccan [festival] we did was 20 years ago,” Marilen Tantoco, Rustan’s Vice-President for home merchandising and Philippine honorary consul general to Morocco told BusinessWorld at the festival’s launch on July 31.
The festival — done in partnership with the Embassy of Morocco, the Moroccan National Tourism Office in China, HSBC, and Fairmont Makati — features a wide range of authentic Moroccan items including women’s djellaba (a traditionally long, hooded, baggy robe with sleeves), babouche slippers, Moorish-inspired hanging lamps and lanterns, multicolored plates, mirrors made of hand-carved natural bone and hand-embossed metal, tagine (clay cooking pots), and pure Argan oil (often called “liquid gold” in Morocco).
“It’s just a matter of what they (customers) use,” Ms. Tantoco said of the item selection, adding that they have included items made in Morocco which are also available in other countries.
“It is always with great pride and excitement that we share the beauty and bounty of our home country. From our cuisine to our crafts, fashion and beyond, the Kingdom of Morocco is such an important cultural and historical country. It is with great joy that we are able to share more of it to the Filipinos,” Mohammed Rida El Fassi, Ambassador of Morocco to the Philippines, was as quoted as saying in a press release.
“It’s very difficult to talk about the culture of Morocco in one sentence because it is a very old country and has a rich history and diversified culture,” Mr. El Fassi told BusinessWorld.
According to the ambassador, the history of civilization is evident in today’s Moroccan handicrafts. “It (handicraft-making) is ancestral know-how. Morocco has always been at the crossroad of civilization,” Mr. El Fassi said. “The [Moroccan] government is always preserving from production and educating people how it is done.”
To complete the immersion to Moroccan culture, internationally acclaimed chef Moha Fedal is serving Moroccan dishes at Café Casablanca; Moroccan musicians are performing Berber folk music, artisans are writing traditional Arabic calligraphy and doing henna hand tattoos for guests at the retail floor until Aug. 7. — Michelle Anne P. Soliman

Peso to rise ahead of PHL data

THE PESO will likely strengthen this week ahead of likely upbeat economic reports in the Philippines, boosted by the softer-than-expected jobs data out of the United States.
The local unit closed Friday’s session at P53.15 against the greenback, down six centavos from its P53.09-per-dollar finish on Thursday.
However, the peso climbed week-on-week from its P53.285-per-dollar finish on July 27.
Foreign exchange traders said on Friday that the dollar might weaken today should the non-farm payrolls data come out weaker than expected.
The US produced 157,000 additional jobs in July, the slowest gain since March and lower than the 190,000 jobs expected by economists in a Reuters poll.
However, the unemployment rate declined by a tenth of a percentage point to 3.9%.
“After depreciating on Monday due to weaker-than-expected US non-farm payrolls report, the greenback may drop further the following day amid likely upbeat Philippine inflation data,” Land Bank of the Philippines market economist Guian Angelo S. Dumalagan said in an e-mail on Saturday.
Headline inflation is seen to accelerate further in July to 5.5%, according to the median estimate in a BusinessWorld poll among 14 economists.
If realized, last month’s inflation print would be faster than the 5.2% print in June as well as the 4.6% in May.
Mr. Dumalagan added the peso might continue to strengthen as investors cautiously anticipate the interest rate decision of the Bangko Sentral ng Pilipinas (BSP).
“The dollar may remain weak until Thursday, as the BSP is widely expected to hike rates again by at least 25 bps to arrest inflationary pressures and manage financial market volatility,” he said.
The BSP has been signalling a hike in interest rates when it meets this week, with its chief saying earlier that the monetary authority is “ready to follow through” on the two rate hikes in May and June.
“The possible uptick in the second-quarter GDP (gross domestic product) growth of the Philippine may also reduce the dollar’s appeal versus the peso,” Mr. Dumalagan noted.
Economists expect the country’s economic growth to remain robust in the second quarter with increased government spending and private investment offsetting any possible household spending slowdown.
A BusinessWorld poll of 15 analysts yielded a 6.8% median GDP growth print for the April-June period, steady from the expansion booked in the first three months of the year albeit slightly faster from the 6.6% tallied in a comparable year-ago period.
The US currency may continue to be “relatively weak” against the peso on Friday, Mr. Dumalagan said, although it may be capped a bit by expectations of firm US inflation reports.
“These price reports are expected to support views of two more US rate hikes before the year ends,” he added.
For this week, a foreign exchange trader expects the peso to move between P53 and P53.20, while Mr. Dumalagan gave a P52.75-P53.35 range. — Karl Angelo N. Vidal

Archer Daniels takes early lead in fight for trade war spoils

CHICAGO — Agricultural commodities trader Archer Daniels Midland Co. has so far weathered the U.S.-China trade war better than rival Bunge Ltd with a more conservative trading strategy, diversified crop sales and limited exposure to Brazil’s currency swings.
The companies perform similar functions: buying, selling, transporting and processing crops around the world. However their starkly different second-quarter earnings show how varying strategies can produce drastically different results, providing lessons for other global grain traders.
ADM on Tuesday reported a doubling of quarterly profit from a year earlier, as higher volumes and margins for U.S. grain and soy exports put it in a strong position for trade gains through the rest of the year.
A day later, Bunge stumbled to a surprise loss it blamed partly on wrong-sided bets that a prompt trade truce would push up soybean futures. Instead, the trade war escalated and prices fell sharply, piling pressure on the company to reverse losing positions.
ADM, which is more focused on US operations than Bunge, cashed in as China shifted its soybean purchases to Brazil because of the trade war, prompting other countries to buy more US soy, Chief Financial Officer Ray Young said on an earnings call.
Bunge reported a $125 million mark-to-market loss tied to soybean crush contracts in the April-to-June quarter and confirmed losses from hedges in the soy futures market that could have been profitable with a trade resolution. It also took a $24 million hit from currency hedges in Brazil.
Bunge traders are known for taking more risk than those at ADM and they did not pay off this time, said Michael Underhill, chief investment officer for Capital Innovations, a shareholder of both companies.
“With Bunge, it was the commodity as well as the currency exposure that showed up and was reflected in their lower earnings,” he said.
The company defended its bet, saying it will recover those losses in the second half of the year as it cashes in on the robust soy processing margins locked in during the second quarter.
ADM offset some of its mark-to-market losses in soy with gains on canola for an overall net mark-to-market loss of about $40 million.
Bunge said it does not encourage traders to take more risks. ADM declined to comment on trading and hedging strategies.
Both companies had said the trade dispute between the world’s two largest economies was an opportunity to increase returns after a global oversupply of food commodities limited trading opportunities in recent years.
“ADM has been able to deliver some of their improved results earlier than we have, and some of that is timing. But, in the case of Bunge, it’s coming,” Bunge Chief Executive Officer Soren Schroder said in an interview.
As the trade war drags on, Schroder said Bunge will continue with a strategy to lock in profit when it can because trade policies could quickly shift.
“You have to be prepared for pretty much anything so our posture has been to lock down as much as we can, to secure as much of the future profitability as we can. That’s an approach that we’ll continue to take,” he told Reuters.
Bunge’s prized South American grain handling and processing infrastructure, which has made it a takeover target over the past year, also proved a hindrance last quarter.
While Chinese buying of Brazilian soy soared, Bunge’s grain origination business in the country was hurt by a trucker strike. It is under pressure to deliver better results after fending off takeover approaches from ADM and Glencore.
“If they don’t deliver on the second half of this year, if I’m a board member I’m certainly more open to hearing talks of a takeover,” said Seth Goldstein, Morningstar analyst in Chicago.
Analysts were divided on whether Bunge would be able to fully reverse its losses in the second half.
CFRA lowered its price target by $5 to $78 per share but maintained its “buy” rating on Bunge shares, while J.P. Morgan downgraded its Bunge rating to neutral.
Bunge has set a “high bar” for a second-half turnaround amid “uncertain trade policy and unresolved freight challenges in Brazil that may drive further earnings volatility in 2018,” said J.P Morgan analyst Ann Duignan. — Reuters

Monetary Board orders closure of 2 rural banks

BSP-bangko_sentral-080917
THE BANGKO SENTRAL has shuttered two rural lenders.

THE BANGKO SENTRAL ng Pilipinas (BSP) has shut down two rural banks last week as the regulator cracks down on more problem lenders.
The policy-setting Monetary Board ordered the closure of the Rural Bank of Sta. Elena, Inc. from Camarines Norte and the Tiaong Rural Bank, Inc. from Sto. Tomas, Batangas during their Aug. 2 meeting.
The Philippine Deposit Insurance Corp. (PDIC) has stepped in as receiver for both lenders effective Friday, it said in a statement.
Rural Bank of Sta. Elena runs one branch and holds P19.6 million of deposits across 744 accounts, according to PDIC data.
Meanwhile, Tiaong Rural Bank operates seven branches, which include two in Laguna, and one each in Cavite and Quezon. Total deposits amount to P891.7 million across 18,471 accounts.
“[U]pon placement of the Bank under liquidation, the powers, functions and duties of the directors, officers and stockholders of the Bank are terminated,” the PDIC said.
PDIC’s takeover paves the way for the state-run insurer to acquire the lender’s assets in order to pay outstanding liabilities to depositors.
Bank deposits are insured up to P500,000 per depositor, according to the law. Funds used to settle valid deposit insurance claims are drawn from the Deposit Insurance Fund managed by the PDIC.
Those with deposits worth P100,000 and below can avail of early payment, provided they do not how unsettled dues with these small lenders.
The state insurer also collects and resolves loans from borrowers and disposes of the bank’s remaining assets through its regular public biddings and negotiated sale, which will be used to settle claims beyond the P500,000 limit.
The latest closure orders bring the number of shuttered banks to seven this year, matching the 2017 tally.
Other lenders which folded this year include Iloilo’s Bangko Buena Consolidated, Inc., Women’s Rural Bank, Inc., the Rural Bank of Initao (Misamis Oriental), Inc., the Empire Rural Bank and the Rural Bank of Loreto, Inc. in Dinagat Islands.
The central bank has been prodding small banks to pursue mergers in order to keep serving their markets while remaining on good financial footing. — Melissa Luz T. Lopez

OUTLIER: BDO Unibank, Inc.

By Mark T. Amoguis, Researcher
THE SY-LED BDO Unibank, Inc. was one of the most actively traded stocks last week as market players reacted to its flat first-half earnings report.
A total of P1.896 billion worth of 14.149 million BDO shares exchanged hands on the trading floor from July 30 to Aug. 3, data from the Philippine Stock Exchange showed.
On a week-on-week basis, its share price was lower by 0.15% to P136.80 last Friday from its July 27 closing price of P137 apiece. Year-to-date, the bank’s share price was down by 16.59%.
“The activity [last week] on BDO was driven mainly by the earnings result,” said Rachelle C. Cruz, research analyst at AP Securities, Inc., in a phone interview last Friday.
“The market was looking at [BDO’s] core earnings rather than earnings that has been affected by — not one-time but more of especially — non-recurring gains or non-interest income,” she added.
Based on its unaudited consolidated financial statements disclosed to the bourse, BDO’s net interest income rose by almost a fifth to P45.975 billion in the first semester from P38.616 billion last year.
Its net income for the period was at P13.113 billion amid “solid” results of its core lending and deposit-taking businesses. This figure, however, was down by 1.26% from P13.281 billion a year ago.
In a statement, BDO said its earnings for the six months to June “would have increased by 13%” had it not been due to the implementation of a new accounting standard (Philippine Financial Reporting Standards 9) on the investment portfolio of its insurance unit BDO Life Assurance Co., Inc. and the ongoing expansion of its rural banking arm One Network Bank, Inc.
Justino B. Calaycay, Jr., head of research at Philstocks Financial, Inc., said BDO, as well as other listed banks, might pick up in the latter half of the year as this is where spending levels tend to go up.
“Hopefully they should be able to post high single digits or even in the low double digits [by yearend],” he said in a separate phone interview.
For her part, AP Securities’ Ms. Cruz expects BDO to take in P31.7 billion in net income this year against the bank’s P31-billion profit guidance for 2018.
For this week, AP Securities’ Ms. Cruz said the focus will be on other companies that will report second-quarter figures, hence BDO’s value turnover will experience “some sort of tapering.”
AP Securities gave BDO a price support ranging from P129.50 to P134.80 and a resistance P142.50 to P146.10.
Philstocks’ Mr. Calaycay, on the other hand, pegged a support for BDO at P128 to P132 and a resistance at P137.50 to P140.
“If the earnings pick up, we see a push towards P147 to P150 levels for BDO,” he said.

Brow grooming expert’s expansion driven by demand for services, available mall space

IT MIGHT be a new name in the brow business but Happy Brows is planning to grow to 100 branches by 2020, with the aggressive expansion attributed to the growing grooming market and the move of retail to digital rather than physical spaces.
Happy Brows opened its first space in 2017 in SM City Lipa, Batangas.
“Before, malls primarily focused on retail but…, now shopping can now be done online so there are more spaces in malls for services like ours. We are now requested by malls to open as many stores as we can,” Arvin A. Amaro, marketing head of R2 group of companies, told BusinessWorld during the opening of its Gateway Mall branch in mid-July.
Happy Brows, he said, offers competitive pricing for its services, making it accessible to anyone aged 20 to 45. According to its Facebook page, brow cleanup costs P130 while brow shaping is P160.
“[Our brow services] sells like peanuts… [because] we’re more value for money,” said Mr. Amaro.
Aside from brow services, Happy Brows also offers hair removal services and lash enhancements.
Currently, the brand has 10 branches, with the another branch set to open on Aug. 8 at SM San Pablo in Laguna. The brand also has branches in Cagayan de Oro and Cebu.
“People like to take care of themselves and look good,” said Mr. Amaro, which explains aggressive expansion of the company’s other grooming services, Hey Sugar, which focuses on waxing and hair removal, and Nail-a-holics, which offers nail services.
Hey Sugar, which first opened in 2013, has 30 branches nationwide as of July and sees this number growing to 100 by 2020, while Nail-a-holics has 63 branches as of July and expects to have 150 branches by 2020. — Zsarlene B. Chua

1...11,15911,16011,161...13,232Page 11,160 of 13,232
© 2024 BusinessWorld Publishing.
All rights reserved.
Read our privacy guidelines
Facebook Instagram Linkedin Twitter Youtube