Pag-IBIG Fund posts record high loans, earnings

February 10, 2018 | 12:02 am

STATE-OWNED Home Development Mutual Fund, also known as Pag-IBIG Fund, booked record-high home loan disbursements and earnings in 2017, it said on Friday.

In a statement, Pag-IBIG chairperson Eduardo D. Del Rosario said the mutual fund released P65.1 billion in home loans in 2017, which he noted was the highest ever housing loan disbursement in its 37-year history.

The home loans were doled out to its 80,964 members last year.

The fund’s net income of P30.27 billion in 2017 was likewise its highest thus far, and is also the first time it hit the P30-billion mark.

Pag-IBIG Fund’s total assets also grew to P488.74 billion.

“As Pag-IBIG Fund’s contribution to the pro-poor agenda of President Rodrigo [R.] Duterte, homeownership was made even more affordable especially to the low-income earners,” Mr. Del Rosario said, speaking at the 2017 Chairman’s Report held in Pasay City.

Pag-IBIG Fund added that its members will benefit from the upbeat financials as it will disburse the bulk of its earnings through dividends.

“For 2017, Secretary del Rosario said that if Pag-IBIG Fund will have the same pay out as in 2016 at 90%, it may credit to members’ accounts P27.29 Billion in dividends — the biggest amount ever credited by Pag-IBIG Fund,” the statement added, referring to Mr. Del Rosario who also heads the Housing and Urban Development Coordinating Council.

The mutual fund also posted a savings collections at P36.6 billion and multi-purpose loan releases at P45.37 billion.

“Our strong financials and record-breaking housing loan takeouts benefit primarily our members… We’ve reached our targets, and we’ve done it with flying colors,” Pag-IBIG Fund chief executive officer added. — K.A.N. Vidal

Drop in cement prices lead to Cemex earnings fall

February 10, 2018 | 12:02 am

EARNINGS of Cemex Holdings Philippines, Inc. (CHP) were cut by more than half in 2017, as higher cement volumes sold for the period failed to offset the continued drop in cement prices.

In a presentation to investors, the company said net income slowed by 65% to P659 million in 2017, against the P1.87 billion it recorded a year ago. Operating EBITDA (earnings before interest, taxation, depreciation, and amortization) also declined by 50.7% to P3.3 billion, compared to P6.7 billion in 2016.

“Lower prices was the main reason for the decrease, as well as higher fuel and distribution costs,” the company said.

Net sales for the period dropped by 10% to P21.78 million, prompted by a 10% decline in domestic cement prices.

Construction of infrastructure projects drove the demand for cement last year, particularly in the fourth quarter as CHP noted an acceleration of government approvals for such projects.

“In 2018, the rollout of several big-ticket infrastructure projects and the rehabilitation of Marawi City will continue to boost the sector,” the company said.

Demand from the residential sector meanwhile contracted in the fourth quarter of 2017, but CHP expects to see some recovery this year as the tax reform program boosts higher take home pay for Filipino workers.

“The sector’s growth will be supported by the income-boosting tax reform, remittances from overseas Filipino workers, and the government’s emphasis on affordable housing,” said the CHP.

2018 CAPEX
Amid the company’s lower performance in 2017, CHP is keeping a positive outlook on the Philippine’s construction industry as it allots P3.7 billion in capital expenditures this year.

“CHP remains positive on the prospects of Philippine construction, with expectations of sustained economic expansion in 2018,” CHP President and Chief Executive Officer Ignacio Mijares was quoted as saying in a statement.

The company is currently undertaking a $225-million expansion of its Solid Cement Plant in Antipolo, Rizal, and is now finalizing negotiations with suppliers and contractors. CHP looks to start the operations of a new line by the first quarter of 2020.

“We remain focused on executing our capacity expansion plan in Solid Cement Plant. In addition, we are undertaking efforts to de-bottleneck our operations, achieve higher customer service levels, and reduce costs to drive growth for our business,” Mr. Mijares said.

With this, the expansion of the Solid Cement plant will corner the bulk of CHP’s P3.7-billion capex, or P3 billion. The remaining P700 million will be spent for maintenance capex, while P40 million will be for strategic capex.

Incorporated in 2015, CHP supplies cement under the APO, Island, and Rizal brands. The company also has a ready-mix concrete product called Promptis which is sold in Metro Manila.

Shares in CHP were down by 1.21% or five centavos to finish at P4.08 apiece at the Philippine Stock Exchange on Friday. — Arra B. Francia

DoTr, Bombardier sign deal to buy signaling equipment for MRT3

February 10, 2018 | 12:01 am

THE Department of Transportation on Friday signed a memorandum of agreement (MOU) with Canadian company Bombardier Transportation for the procurement of an original equipment manufacturer (OEM) signaling spare parts and maintenance of MRT-3’s signaling system.

The MOU also extends to a two-year contract for Bombadier as a maintenance provider for MRT-3 through direct contracting and emergency procurement.

The Canadian company has been supplying and maintaining the train’s signaling system for the first 12 years of operations, being the propriety rights owner of Cityflo 250 Light Rail and Metro Signaling Solution, which is used in the MRT-3.

However, DOTr decided to procure spare parts and maintenance services from a third party, which had failed to provide quality service.

The use of non-OEM signaling spare parts was done to save costs but is one of the reasons for the frequent breakdowns of the MRT-3, DOTr secretary Arthur P. Tugado said.

“For years, MRT-3’s signaling system was not maintained properly, and was not upgraded when due. That is why this time, we want to be sure that we get the right spare parts and that we maintain the system right,” he added.

“Bombardier’s track record is exceptional. They are the original manufacturer of MRT-3’s signaling system, and we are directly dealing with Bombardier, not a [joint venture], not a consortium, not any middleman.” — Anna G. A. Mogato

Gov’t cites benefits from removal of QR on rice imports

February 10, 2018 | 12:01 am

MAJORITY of Filipinos are expected to benefit from lower retail prices of rice should the agricultural tariffication law be amended, the National Economic and Development Authority (NEDA) said.

“About 93% of Filipino households are rice consumers and they stand to benefit from lower price of rice. It is high time that the bill amending the two-decade-old law is passed,” Socioeconomic Planning Secretary Ernesto M. Pernia was quoted as saying in a statement on Friday.

Mr. Pernia was referring to the Republic Act (RA) No. 8178, also known as the Agricultural Tariffication Act of 1996.

The passage of a bill seeking to amend RA 8178 will lift the quantitative restriction (QR) on rice imports and impose a 35% tariff on rice coming from Association of Southeast Asian Nations member-states such as Vietnam and Thailand, NEDA said.

According to NEDA’s preliminary estimate, headline inflation rate would be reduced by a percentage point if the domestic wholesale rice market reduces prices to the level of imported rice.

“At 35% tariff rate, the landed cost of imported rice, particularly from Thailand and Vietnam, along with its transport cost to the local market would be around P30.30 per kilogram,” NEDA’s statement read, adding that the price is about P4.31 lower than domestic wholesale price of rice.

With the price reduction, a Filipino family of five could save up to P2,362 per year, equivalent to 13% of its annual average rice expenditure of P17,921 indicated in the 2015 Family Income and Expenditure Survey.

NEDA added that once the law is amended, it is expected to ease the temporary inflationary impact of the tax reform law and the world oil prices, translating to increased savings of a household.

Inflation clocked in at 4% last month, its fastest reading in more than three years or since October 2014’s 4.3%. The government attributed the faster price increases to the implementation of the Tax Reform for Acceleration and Inclusion law which took effect last Jan. 1.

Mr. Pernia added that the tariff revenues to be generated will be funnelled back to Filipino farmers through Rice Competitive Enhancement Fund for the modernization and enhancement of the efficiency of the country’s rice industry.

Part of the fund will also directly support local farmers who will be affected by the lifting of the QR.

Since the entry of the Philippines to the World Trade Organization (WTO) in 1995, the country has been securing a waiver several times to extend the imposition of QR on rice imports in support of the local farmers’ preparation for competition.

With the expiration of the Philippines’ Waiver on the Special Treatment of Rice last June 30, 2017, there has been increasing pressure from WTO member countries for the Philippines to fulfill its obligation to tariffy rice, Mr. Pernia said. — KANV

Mercury Drug, PayMaya team up for cashless payments

February 10, 2018 | 12:01 am

LOCAL drugstore chain Mercury Drug Corp. struck a deal with PayMaya Philippines, giving its customers a cashless payment option through the scan-to-pay scheme called PayMaya QR.

The new payment scheme will soon be available in all Mercury Drug branches nationwide.

In a company statement, Mercury Drug President Vivian Q. Azcona said the innovation will improve their customer experience.

“This partnership with PayMaya is another way for us to innovate and further improve on the experience of our suki customers,” she said.

“We are excited to be among the pioneers in embracing this cashless technology,” she added.

The company’s assistant to the president Steve Q. Azcona said that this would lessen the queuing times in their stores.

“There is no need to process loose change anymore,” he explained in the same statement.

Voyager Innovations and PayMaya President and Chief Executive Officer Orlando B. Vea said that with the partnership with Mercury Drug, they are also planning to “roll out more initiatives in the coming months that will transform Mercury Drug customers’ experience.”

Voyager Innovations has set a goal of 30 million users by 2020.

Paymaya Philippines is the digital financial arm of Philippine Long Distance Telephone Inc. (PLDT) and Smart Communications Inc.’s Voyager Innovation.

Hastings Holdings, Inc., a unit under PLDT’s beneficial trust fund subsidiary MediaQuest Holdings, Inc., has partial interest over BusinessWorld through the Philippine Star Group which it controls. — Anna Gabriela A. Mogato

Local stocks slump amid global rout

February 9, 2018 | 6:56 pm

By Arra B. Francia, Reporter

LOCAL stocks took another beating on Friday, tracking the bloodbath in international markets as investors resumed profit taking.

The main index dropped 1.64% or 141.39 points to finish at 8,503.69 on Friday, less than 300 points down from its previous week’s finish. The broader all-shares index also gave up 1.3% or 66.29 points to 5,028.38.

“Philippine stocks retreated deeper into negative territory as Wall Street tangled with further volatility, with concerns about rising inflation and bond yields weighing on investors’ psyche against the backdrop of a relatively healthy domestic economy,” Regina Capital Development Corp. Managing Director Luis A. Limlingan said.

Global markets recorded even greater losses on Wednesday, with the Dow Jones Industrial Average plummeting by 1,032.89 points or 4.15% to end at 23,860.46. The S&P 500 index dropped 3.75% or 100.66 points to 2,581, while the Nasdaq Composite index was down by 274.82 points or 3.9% to 6,777.16.

“Basically it was carried by the US market being soft last night, but technically the way I look at it is the short term is trying to support itself right now at this level, even in the United States,” Summit Securities, Inc. President Harry G. Liu said in a phone interview.

Mr. Liu noted the market’s descent is a serious correction as it has gone up quite extensively since mid-2017. Fundamentals of companies however, remain intact.

“There’s no change in economic situation, so this will just be part of profit taking due to both US and our market have gone up extensively,” he said.

Regina Capital’s Mr. Limlingan meanwhile noted some investors have raised concerns after the Bangko Sentral ng Pilipinas raised its inflation forecast to 4.3% for full year 2018.

No sectoral counter was spared from the day’s sell-off. The property sub-index lost 2.45% or 96.24 points to 3,824.11, followed by holding firms that slowed 1.57% or 137.01 points to 8,615.28. Industrial slipped 1.25% or 146.19 points to 11,566.15; mining and oil shed 0.99% or 114.51 points to 11,424.21; financials dipped 0.95% or 20.91 points to 2,184.54; while services shed 0.91% or 15.52 points to 1,696.39.

Most stocks declined for the day, 138 versus the 64 that went up, while 46 names were unchanged.

The market’s value turnover stood at P8.62 billion after some 1.35 billion issues switched hands.

Foreigners continued their selling streak for the 11^th day, even as net outflows slimmed to P136.8 million on Friday, against the P556.3 million recorded in the previous session.

Peso drops on weak trade data

February 9, 2018 | 6:55 pm

THE PESO weakened further against the dollar on Friday as the country’s trade deficit expanded in December.

The local currency closed the week at P51.48 versus the dollar, down 17 centavos from its P51.31 finish on Thursday.

The peso traded weaker the whole day, opening the session at P51.58 against the greenback. It hit a low of P51.79 intraday, while its best showing was at P51.43 per dollar.

Dollars traded spiked to $1.17 billion from the $896 million that changed hands in the previous trading session.

“[The] peso weakened because of the wider trade deficit in December… the market responded negatively to the data release,” Ruben Carlo O. Asuncion, chief economist of UnionBank of the Philippines, told BusinessWorld in a mobile phone message.

Philippine Statistics Authority (PSA) data released on Friday showed that the country’s trade deficit widened to $4.02 billion in December from the $2.47 billion recorded a year ago and the $3.78 billion booked in November.

Imports grew to $8.74 billion by 17.6% from $7.43 billion a year ago.

Meanwhile, outbound shipments contracted to $4.72 billion by 4.9% from $4.96 in December 2016. This was due to fewer exports of coconut oil, ignition wiring and other wiring sets used for vehicles, aircrafts and ships, other manufactured goods and metal components, preliminary data from PSA showed.

Still, the wider trade deficit is “fundamentally not a concern,” Mr. Asuncion said.

“It’s not a concern because these are basic signs of a growing economy. The Philippines is a growing one and investments have to grow rapidly to propel it to a higher growth trajectory.”

“[The speech of some Fed officials] increased the likelihood of a policy rate hike by the Fed in March,” another trader added. — K.A.N. Vidal

Giant travel fair runs this weekend

February 9, 2018 | 6:33 pm

THIS year’s Travel Tour Expo (TTE) is the biggest in its 25 years existence as it occupies the entire SMX Convention Center — 16,230-square meters of exhibition space — in Pasay City. It runs from Feb. 9 to 11.

Expo has close to 400 exhibitors — 28 airlines, 133 hotels and resorts, 94 travel agencies, five cruise lines, and seven theme parks around the world.

The Philippine Travel Agencies Association (PTAA) said in a press release that they are expecting around 140,000 people to troop to the convention center over the weekend in search of deals over the weekend.

“Year after year, our countrymen have come to know the TTE as the venue where they were able to book their travels for an entire year. The expo [has] impacted the way Filipinos plan their travel,” Marlene Dado Jante, PTAA president and TTE 2018 chairperson, said during the exposition’s launch on Feb 8 at the Conrad Hotel Manila.

Aside from the expo at the first floor of the convention center, the PTAA will also hold its third International Travel Trade Expo, its business-to-business program, this weekend.

Ms. Jante said in her message that they will be joined by 84 sellers from 16 countries and by more than 250 travel agency buyers from the all over the country for the trade expo.

“[TTE] has allowed our people to become more sophisticated in choosing their travel program, designing their itinerary, planning ahead for vacation, and even selecting destinations,” Rolando Canizal, undersecretary of the Department of Tourism said during his keynote address at the launch.

The 25th Travel Tour Expo runs from Feb. 9 to 11 at the SMX Convention Center in Pasay City. Doors will open at 9:30 a.m. and the fair runs until 8 p.m. General admission tickets are P70 per person while senior citizen rates is P50. — Zsarlene B. Chua

TAGS: Travel Tour Expo, tourism, travel, SMX, travel agencies, airlines

McLaren, other supercars in custody still under litigation — Customs

February 9, 2018 | 5:54 pm

Twenty-two brand new luxury vehicles including high-end sports cars known as supercars which were intercepted on separate occasions at the Manila International Container Port (MICP) are the subjects of ongoing litigation at the Bureau of Customs.

One McLaren, two 2017 Chevrolet Camaro, two 2017 Range Rover, one 2017 Land Rover Evoque, 12 units Toyota Land Cruisers — all consigned to Gamma Gray Marketing — are undergoing legal proceedings, according to a Bureau of Customs press release. The MICP Law Division is expected to resolve the dispute.

Meanwhile, a 2005 Ferrari F430 2006 and a Lamborghini Murcielago consigned to Mary Joy Aguanta and Veronica Angeles, respectively, were declared forfeited in favor of the government by the MICP. However, the case is under appeal proceedings after the importers filed an appeal.

A Lamborghini Gallardo and a Rolls Royce consigned to Allan Usman Garcia and Roy Garchitorena, respectively, were intercepted in February 2018 and are now under examination and verification of import documents. Customs said warrant of seizure and detention will be issued once the customs authorities find a probable cause to issue the same.

Customs chief Isidro S. Lapeña said in the press release that the bureau will be steadfast in facilitating the disposition of the said cases. He also dispelled doubts and rumors from the public as to what happened to the supercars such as the McLaren and Lamborghini seized by the government last November and why these were not included in the demolition conducted on Feb. 6 in the Port of Manila.

“There are still a few who do illicit activities at the Bureau of Customs. This has to stop. We will not allow smugglers to blatantly disregard our laws, rules, and regulations on importation. The Bureau of Customs will be drastic in its efforts to combat smuggling and all forms of corruption,” Mr. Lapeña said.

Cemex reports 65% drop in earnings for 2017

February 9, 2018 | 5:15 pm

Earnings of Cemex Holdings Philippines, Inc. (CHP) was cut by more than half in 2017, as higher cement volumes sold for the period failed to offset the continued drop in cement prices.

In a presentation to investors, the company said net income was down by 65% to P659 million in 2017, against the P1.87 billion it recorded a year ago. Operating EBITDA (earnings before interest, taxation, depreciation, and amortization) also declined by 50.7% to P3.3 billion, compared to P6.7 billion in 2016.

“Lower prices was the main reason for the decrease, as well as higher fuel and distribution costs,” the company said. — Arra B. Francia

Trade deficit widens in December

February 9, 2018 | 5:01 pm

Trade deficit continued to widen in December, bringing the gap to another record high as exports contract for the first time in more than a year and as imports post double-digit growth.

Exports declined by 4.9% to $4.721 billion in December, a turnaround from the previous month’s 2.7% growth and the 6.6% posted in the same month in 2016. This was the worst turnout since the 10.9% contraction in July 2016. The last time exports posted a decline was in Nov.2016 when it recorded a 4.5% contraction.

The latest merchandise export figure brought full-year receipts to $62.875 billion, up 9.5% from 2016’s $57.406 billion, surpassing the government’s 5% target for the year.

In December alone, the country’s trade deficit reached a record-high $4.017 billion as imports exceeded exports. The country’s import bill increased 17.6% to $8.738 billion in December, slower than the 20.1% seen in the previous month and 19.0% in December 2016. 2017 saw a 10.2% merchandise import growth, few points higher than the 10% official target for 2017.

Hong Kong is the Philippines’ top export market in December with a 16.7% market share at $789.61 million. On the other hand, China– with an 18.9% share – was the country’s top source of imports. — Christine Joyce S. Castaneda

Philippines’ tourist arrivals hit 6.6 million in 2017, up by 11%

February 9, 2018 | 4:41 pm

THE DEPARTMENT of Tourism (DoT) reported on Jan. 31 that foreign tourists arrivals hit 6.6 million in 2017, 11% higher than the previous year’s 5.97 million.

The country bested the average tourism growth of Asia and the Pacific, which is at 6%, and Southeast Asia (8%), the DoT said, citing data from the United Nations World Tourism Organization (UNWTO) World Tourism Barometer.

In a press release posted on the DoT website, Tourism Secretary Wanda Tulfo-Teo cited the numbers as “milestone” for the agency despite the “political noise, security concerns, and travel advisories” that affected the tourism industry last year.

Based on the National Tourism Development Plan (NTDP), the DoT has set a target of 6.5 million arrivals for 2017.

South Koreans remained the Philippines’ top tourism market last year with arrivals numbering 1.6 million, almost a quarter of the total tourist arrivals. Boracay and Cebu were the top destinations for South Koreans.

The market for tourists from China was observed to have remarkable 43% growth, with the DoT citing as growth drivers the improved ties between the Philippines and China, added air routes, and the Visa Upon Arrival (VUA) option for Chinese nationals.

For 2018, the DoT projects 7.4 million tourist arrivals with sports and adventure tourism taking centerstage this year as the country hosts Strongest Man, the Iron Man, and other sports-related events.