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Top PHL business players hold fund-raising golf tournament

FOR THE 16TH YEAR running, the Federation of Philippine Industries (FPI) — composed of 34 industry associations and 132 corporations from across different sectors — will be hosting a fund-raising golf tournament geared toward the advancement of Philippine businesses.

Senior executives and key stakeholders from the country’s Top 1000 Corporations will gather at the Tagaytay Midlands Golf Course this Feb. 9 to take part in a charity drive that has consistently proven crucial to the success of the FPI’s numerous advocacies to promote Philippine entrepreneurship. As in years past, this coming together of the Philippine business sector’s most civic-minded movers and shakers is a demonstration of FPI members’ generosity of spirit, as well as their commitment to support local industries in their vital role in the heightened competitiveness and in the continuous growth of the national economy.

Among the organization’s campaigns that the fund-raising tournament will be benefiting are advocacies like anti-smuggling (which includes the fight against Illicit Trade), power and energy and environment sustainability. The FPI extends its gratitude to those who have already pledged to take part in the fund-raiser, as it looks forward to the support of the many guests who are expected to lend a hand in the success of the tournament.

The 16th Annual Federation of Philippine Industries Golf Tournament will be co-presented by Coca-Cola FEMSA Philippines — part of the broader Coca-Cola FEMSA group, San Miguel Corp., and PMFTC.

SL Agritech to undertake hybrid rice technology project in Lanao del Sur

By Anna Gabriela A. Mogato

HYBRID RICE producer SL Agritech Corp. is looking to expand the local yield of hybrid rice produced in the province of Lanao del Sur, after allocating 50 hectares for two hybrid rice varieties.

SL Agritech on Tuesday signed a memorandum of agreement with Lanao del Sur officials for a 50-hectare hybrid rice technology demonstration as part of rehabilitation efforts for Marawi City.

SL Agritech Senior Technical and Promotion Consultant Frisco M. Malabanan said P1.65-million project will help around 50 farmers in the nearby municipality of Bubong.

“The [rice] yield from the area is only 3 metric tons (MT) to 3.5 MT per hectare. According to research, we are ranging from 7 MT to 14 MT, following the recommended technology [for the hybrid rice],” he said on Tuesday.

Seeds have already started to be sown in the area last Jan. 19. The 50 farmers have already undergone the necessary briefing and training — a move Mr. Malabanan said should also entice other farmers to switch to hybrid rice farming.

“SL Agritech will provide the technology and production inputs. We have to link this to other agricultural product suppliers and trader millers so that when the palay is ready for harvesting, the trader miller will buy back the produce,” Mr. Malabanan said.

Go Negosyo, an advocacy group that also signed the memorandum of agreement for the project, will help ensure sustainable agribusiness in the region.

Lanao del Sur provincial agriculturist Mohamadali D. Macaraya said the goal is to replicate the project in the surrounding areas, which will expand the covered area for hybrid rice to 1,000 hectares in the next planting season.

Mr. Macaraya noted the region has 4,319 hectares but cannot be used due to the lack of proper irrigation.

“We have plenty of rivers. Our [water] supply is more than enough but the problem is how to divert the canals from rivers to the field. We need the government to support us because this will help the people of Marawi City and Lanao del Sur,” he added.

Mr. Macaraya said the local government unit is requesting for funds to rehabilitate the post-harvest facilities after most of these were destroyed during the five-month Marawi siege last year.

If properly implemented, the hybrid rice project could provide employment to 50,000 people.

“If we could introduce livelihood to the people, they will not have to think about resorting to criminality,” Mr. Macaraya said.

Mr. Macaraya estimated that once Lanao del Sur adopts the hybrid rice, the fields could yield around 20 million to 30 million bags of palay annually. He noted this can reduce the region’s dependence on rice imports, given 80% of rice is imported to keep up with the demand.

2017 GDP growth accompanied by job destruction — IBON

ROBUST GAINS in gross domestic product (GDP) were accompanied by job destruction, with a contraction seen in the labor market, think tank IBON Foundation said in its 2017 year-end report.

“There is scant attention (being paid) to how employment actually contracted in 2017 by the biggest amount since the Asian financial crisis. This vividly underscores the exclusionary nature of the country’s growth,” IBON noted in its Birdtalk 2017 series, “Dutertenomics and Dictatorship: Thwarting Democracy.”

The Philippine Statistics Authority (PSA) last week reported a 6.6% rise in fourth-quarter GDP, bringing full-year economic growth to 6.7%.

IBON’s assessments were based on its computations, which re-estimates government data to “make it more comparable with historical data.”

It said the number of employed fell by 663,000 year on year to 40.3 million while the unemployed rose by 66,000 to 4.1 million.

“This is the largest contraction in employment in 20 years or since the 821,000 lost in 1997,” IBON noted.

It also estimated a decrease in the country’s labor force participation rate (LFPR) to 63.7%, which is “the lowest in over three decades since the 63.1% rate during the severe economic crisis in 1985.”

“It is conspicuous that while the number of those 15 years old and over (i.e. the potential labor force) rose by 1.6 million, the labor force actually shrank by 545,000 and the number of those not in the labor force grew by a huge 2.1 million,” IBON said.

“These trends in 2017 are little changed even if official government figures are used,” it added.

In the October round of last year’s labor force survey, the PSA reported a 5% employment rate, compared to 4.7% a year earlier, equivalent to 2.19 million Filipinos (up from 2.04 million) with an LFPR at 62.1%, lower than 63.6% in 2016.

IBON likewise underscored the loss of employment in the agriculture sector despite being one of the highlights of the country’s economic performance last year as it picked up slack from the slowdown recorded in services, which included business process outsourcing.

“This is a serious blow to farmers remaining in deep rural poverty from wide landlessness and uncompleted agrarian reform, backward production methods and government neglect, and vulnerability to natural calamities,” IBON said.

The think tank likewise noted flat real wages, or wages controlling for inflationary effects, claiming that the government’s periodic increase in the minimum wage is not enough to offset inflation.

“[W]hile the economy has more than doubled in size in real terms (120%) in the 16 years since 2001, the real average daily basic pay of wage and salary workers is unchanged with an insignificant half a percentage point (0.54%) increase over that same period,” IBON said.

Aside from the widening gap between nominal and real wages, the group also pointed that the gap between the minimum wage and the family living wage (FLW) “remain wide.”

“IBON estimates the FLW for a family of six, with families tending to be larger at lower income levels, at P1,171 in end-2017; the equivalent figure for a family of five is some P976,” the report read.

These gaps, IBON claimed, would even be more felt with the implementation of  package 1 of the Tax Reform for Acceleration and Inclusion (TRAIN) this year.

“[U]sing data on TRAIN’s impact in 2018 from the DoF (Department of Finance) clearly establish TRAIN’s regressiveness. The six lowest income deciles or the poorest 60% of families lose 0.7-0.8% of their income, while those in the four highest income deciles gain 5.5-12.3% of their income. Even the top 1% apparently gain 2.8% of their income.”  

“These figures disregard the cash transfers because these are temporary for just three years and adding them covers up the permanent tax burden. They also disregard the imputed PIT (personal income tax) gains for the poorest six deciles because most families here are unlikely to be paying PIT  to begin with.”

“The eventual tax burden is also very likely much higher than as estimated by the DoF because oil excise taxes continue to rise in 2019 and 2020 which means additional inflationary impact. It also remains to be seen if actual movements in prices will be higher or lower than as simulated by the DoF.”

Officials from the National Economic and Development Authority had yet to respond to request for comment at deadline time. — Jochebed B. Gonzales

Continuing the Strategic Rebalance

The Trump administration’s early moves in East Asia unsettled America’s allies and friends.

First, President Trump immediately announced the US withdrawal from the TPP. Second, the new Defense Secretary Jim Mattis, in his testimony to the US Congress, declared that the Trump Administration would not repeat the Obama administration’s term of “rebalancing” or pivoting to Asia because it implied that the US was turning away from its defense obligations in other parts of the world. This and his tirades against multilateral trade arrangements generated an apprehension in East and Southeast Asia, that Trump will ignore the region.

However, current developments show that the Trump administration could not simply shift focus away from Asia.

Early on, they realized that prudence in the conduct of US foreign policy in East Asia requires taking into account the broad trends of Asia’s economic dynamism, China’s rising power, and its predecessor’s rebalancing strategy in grappling with emerging regional security challenges.

President Trump found it necessary to reinvigorate engagements in the Asia Pacific to fulfill his campaign promise to “Make America Great Again.”

Possessing the most powerful navy and as the leading maritime trading nation, the US has maintained a significant economic, diplomatic, and strategic presence in the region since the end of the Second World War. Reassessing American security interests and engagement in East Asia — including some inherited policies from the Obama administration, key White House officials have realized that the Asia Pacific had become “a key driver of global politics” and “the rebalancing is a means for a sustained and coherent US long-term strategy toward the region.” This requires continuing assertion of America’s leadership role in Asia and projecting its naval power to counter-balance China’s pervasive regional influence.

MAINTAINING THE FOCUS ON ASIA
In early 2017, President Trump and key officials sent a consistent message that US commitment to America’s Asian allies, especially to the defense of South Korea and Japan, is as solid as ever.

In April, President Trump invited the leaders of three ASEAN member states — Singapore, Thailand, and the Philippines to the White House to muster support against the North Korean nuclear arms program. Secretary Mattis and Vice-President Mike Pen conveyed two messages to allies and competitors in the region — the US stands firm against North Korea’s nuclear saber-rattling and China’s territorial expansion in the South China Sea; and that despite President Trump’s rhetoric about America’s First Policy, this administration will not turn away from American security commitments in Asia.

As declared by his predecessor, Secretary Mattis announced that the US remains committed to protecting the rights, freedoms and lawful use of the sea, and the ability of countries to exercise those rights in the strategically important East and South China Seas.

Consequently, in May 2017, the US Navy conducted three separate Freedom of Navigation (FON) patrols near Chinese-occupied features in the South China Sea.

The USS Dewey sailed near the Chinese occupied Mischief Reef on 25 May. In July, the USS Stethem conducted a FON operation in the Paracels to challenge the excessive maritime claims by China, Vietnam, and Taiwan. This was followed by two US B-1 Lancer bombers from Guam that flew over the South China Sea. These FON sorties in the South China Sea reinforced the Obama administration’s strategic commitment to rules-based order through naval power.

During the 2017 Shangri-La Dialogue in Singapore, Secretary Mattis reiterated all the themes emphasized by previous administrations (especially the Obama administration) on “the US being a Pacific Power, and the Asia Pacific region being a priority for Washington” and declared that “security is the foundation of prosperity, and the US will continue to strengthen (its) military capabilities in the region.”

The North Korean nuclear ambition and escalating rhetoric has become a top security concern.

US defense officials believe that within a decade, it is possible that North Korean intercontinental ballistic missiles will be capable of hitting US territories in the Pacific and the continental USA posing “a clear and present danger” to global peace and stability.

In late October, Secretary Mattis reiterated that the US will not accept a nuclear-armed North Korea.

Acting primarily on diplomacy, the Trump administration is not shy about its military options. The US has tried to elicit Chinese support by asking Beijing to tighten security along its border including tighter customs inspections, travel ban, and asset freeze on North Korean entities involved in nuclear and ballistic programs. The US, Japan and South Korea are also working together to apply economic and diplomatic pressure.

THE REBALANCING CONTINUES
The Trump administration’s current foreign policy behavior in East Asia reflects continuity rather than discontinuity with the Obama administration’s rebalancing policy.

This stemmed from an appreciation and understanding that the US must play a leading role in strengthening American alliances, partnerships, and regional institutions that widely share American commitment to a rules-based international order as the foundation of peace and stability in East Asia. This is also based on the acceptance of the stark reality that American leadership in the Asia-Pacific region is being challenged by China.

Two American analysts quipped this point, “Asia remains a high priority region; administrations may change but national interests do not.”

 

Renato Cruz de Castro is a Trustee of Stratbase ADR Institute.

Taiwan holds live-fire drills amid tensions

HUALIEN — Taiwan troops staged live-fire exercises Tuesday to simulate fending off an invasion, as the island’s main threat China steps up pressure on President Tsai Ing-wen and a row over airline routes escalated.

The military dispatched reconnaissance aircrafts to surveil simulated incoming ships, followed by tanks firing rounds as the mimicked enemy landed at the Port of Hualien in eastern Taiwan.

Attack helicopters released flares and F-16 fighter jets also launched assaults, backing up on-the-ground battle against the “enemy” troops — who wore red helmets to differentiate themselves.

While the ministry did not specify the annual drill simulated a Chinese invasion, it said that the drill is to “show determination to safeguard peace in the Taiwan Strait and national security.”

The Taiwan Strait is the waterway that separates the island from China.

It comes after Ms. Tsai last month warned against what she called Beijing’s “military expansion” — the increase of Chinese air and naval drills around the island since she came to power in May 2016 — and amid a new row over flight routes in the strait.

Beijing sees the self-ruling island as part of its territory, to be reunified at some point, and by force, if necessary.

Cross-strait relations have turned frosty since the inauguration of Ms. Tsai, who refuses to acknowledge self-ruling, democratic Taiwan is part of “one China.”

The drill on Tuesday takes place annually prior to Lunar New Year holiday — which lands in mid-February this year — as a way to boost public confidence in Taiwan’s defense capabilities.

“Our combat readiness has no holidays,” Huang Kai-sen, a lieutenant general, told AFP.

“In order for our citizens to feel safe during the Chinese New Year, we are standing by and on guard 24 hours a day,” he said.

Tensions have been growing this month since China started new flight routes in the strait without consulting Taiwan.

Taipei slammed the move as reckless and said it could threaten the island’s security.

It has retaliated by blocking nearly 200 flights between Taiwan and China by Chinese airlines during the Lunar New Year period.

China also sent its sole operational aircraft carrier the Liaoning through the Taiwan strait twice this month.

While China’s defense ministry urged Taiwanese not to worry as there was nothing unusual, the act is still viewed as a show of strength by Beijing. — AFP

Saul Alvarez to face Gennady Golovkin in middleweight title rematch

LOS ANGELES — World middleweight boxing champion Gennady Golovkin will fight Saul “Canelo” Alvarez on May 5 in a 12-round rematch of their epic draw last September, promoters announced Monday.

No venue was announced for the showdown on the Mexican “Cinco de Maio” holiday between Mexico’s Alvarez, 49-1 with two drawn and 34 knockouts, and Kazakstan’s unbeaten “Triple G,” 37-0 with one draw and 33 knockouts.

The sensational sequel puts Golovkin’s WBA, IBF and WBC crowns up for grabs after judges rendered a split draw. The first fight, which attracted a record crowd for an indoor Las Vegas fight, also left Alvarez wanting more.

Alvarez, a 27-year-old from Guadalajara, captured two world super welterweight crowns and moved up to become a champion in the 160-pound division by beating Miguel Cotto in 2015.

Golovkin, 35, dominated as an amateur and took Olympic silver before turning professional in 2006. He had a 23-fight knockout streak that ended last March with a unanimous decision win over Danny Jacobs. — AFP

PAGASA observatory open for ‘triple-treat’ moon event tonight

Supermoon poster

THE PHILIPPINE Atmospheric Geophysical and Astronomical Services Administration’s (PAGASA) observatory in UP Diliman will be open to the public today, Jan. 31, for what it calls “a triple treat astronomical event” consisting of a total lunar eclipse, Super moon, and Blue moon. The phenomenon would be visible throughout the country and PAGASA said “lunar eclipses are safe to watch and observers need not use any kind of protective filters for the eyes.” For a magnified view and brighter red coloration, use a binocular or telescope. The eclipse will begin at 6:49 p.m. Philippine Standard Time (PST) and will end at 12:09 a.m. of Feb. 1.

Proposed rules and regulations on crowdfunding

Crowdfunding (CF) platforms have proven to be a popular way to solicit charitable donations and to raise funds for projects or business ventures. With CF platforms, access to funds has expanded for start-up companies and for micro, small, and medium enterprises (MSMEs).

CF generally refers to the financing method of pooling small amounts of money from a large number of people to finance charitable causes, campaigns, projects, or business ventures.

In line with this developing financial innovation, the SEC proposes to regulate CF activities in the Philippines and released its proposed rules and regulations governing CF (Rules) for public feedback. The proposal to regulate CF activities in the Philippines is consistent with the direction taken by other countries, such as the United States, Canada, and Singapore, which have already established regulations on CF transactions.

The rules attempt to strike a balance between the dual responsibilities of the SEC to encourage capital formation and to protect investor interests.

To encourage capital formation and in view of the limited character of the public offering through CF, the rules grant exemption for securities sold or offered through CF from the registration requirement under Section 12 of the Securities Regulation Code (SRC).

On the other hand, to protect investor interests, the SEC incorporated disclosure requirements, registration requirements for intermediaries and funding portals, regulatory framework for intermediaries, and post registration requirements for issuers and intermediaries in the Rules, among others.

DISCLOSURE REQUIREMENTS
Those looking to raise funds (Issuer) will be required to disclose, among others, the nature of its business, financial condition, historical reports of operations, the business plan with respect to the CF offering, the risk factors of investing in its projects, the procedure on how to return funds if the target offering is not met, and the procedure to complete or cancel investment commitment.

REGISTRATION REQUIREMENTS
Entities which facilitate transactions involving the offer or sale of CF securities through online electronic platforms will be required to register as a Funding Portal.

An applicant Funding Portal, which should be registered with the SEC as a corporation and must have at least P50,000 equity, must submit: (i) Registration Statement with information on the principal place of business, legal status and disciplinary history, business activities and types of compensation received by the funding portal, and Web site address/es; (ii) account opening and disclosure rules; and (iii) business conduct rules.

Entities which mediate in the offer or sale of CF securities will be required to file an application with the SEC and to register as Intermediary.

Only securities brokers registered Section 28 of the SRC, investment houses as defined under the Investment Houses Law, and funding portals registered in accordance with Section 30 of the Rules, are eligible to file an application with the SEC and engage as Intermediary in CF transactions.

To register as Intermediary, eligible entities must signify their intention to conduct activities of CF Intermediary and must be able satisfy the criteria set under the Rules.

REGULATORY FRAMEWORK FOR INTERMEDIARIES
Under the Rules, Intermediaries will be required to: (i) Provide investors educational materials; (ii) Take measures to reduce the risk of fraud; (iii) Provide communication channels to permit discussions about offerings on the platform; (iv) Comply with maintenance and transmission of funds requirements; and (v) Comply with completion, cancellation and reconfirmation of offerings requirements.

ONGOING REPORTING REQUIREMENTS
Issuers will be required to periodically file with the Commission an annual report on all its CF transactions, the relevant CF Forms within five (5) business days: (i) after the Issuer reaches 50% and 100% of the target offering amount; (ii) after the Issuer accepts proceeds in excess of the target offering amount; and (iii) after the offering deadline, a disclosure on the total amount of securities sold in the offering.

Intermediaries will be required to keep and maintain records related to CF transactions, which include information related to investors and issuers, records of all communications that occur on or through its platforms, and all daily, monthly and quarterly summaries of transactions effected through the funding portal.

BURDENSOME AND HIGH COST OF COMPLIANCE
As opposed to traditional, exempt, private placement transactions which require one-time submission of Form 10.1 (Notice/Confirmation of Exemption) with the SEC, Issuers in CF offerings would have to continuously comply with the Ongoing Reporting Requirement and incur costs for the same.

Considering the heavier regulatory burdens and higher compliance costs, in conjunction with the P10,000,000 cap on the amount that can be raised through CF, the rules may create an unintended consequence of disincentivizing companies from using CF.

Understandably, the SEC has placed the foregoing requirements to protect the interest of the ordinary investors. However, the rules may have to be revisited to achieve the original intention of providing simple and alternative financing access to start-up companies, without sacrificing the interest of the investing public.

The views and opinions expressed in this article are those of the author. This article is for general informational and educational purposes, and not offered as, and does not constitute, legal advice or legal opinion.

 

Leia Clarissa Veronica R. Veracruz is an Associate of the Corporate and Special Projects Department of the Angara Abello Concepcion Regala & Cruz Law Offices (ACCRALAW).

crveracruz@accralaw.com

(632) 830-8000.

Fresh art at the Fringe

ART NEED not be staid — it can be a comedy show with funny Japanese men, a live painting battle between visual masters, or a painting “battle.”

An advocate of fresh art, Fringe Manila puts art front and center to showcase what’s hip and happening in the arts scene of the Philippines and around the world. It showcases fresh, fun, bold, and disruptive works by emerging and established artists in art genres like theater, music, dance, visual art, film, cabaret, performance art, burlesque, spoken word, comedy, magic, and workshops. For its fourth edition, Fringe Manila returns on Feb. 7 to 25 at different venues around Metro Manila.

“Fringe’s mission is to make art accessible to audiences here in Manila who want to engage with the arts through fresh lenses and experience works that resonate with them,” said Andrei Nikolai Pamintuan, Fringe Manila’s founding board member and festival director.

“We built this festival as an inclusive platform for artists here in the Philippines, Fil-X artists (i.e. Filipino-Canadian, Filipino-American, Filipino-European, etc), and international creatives to present original works that celebrate the diversity of talent that converge in the metro.”

The festival welcomes newcomers to the celebration including GUMBO, an award-winning theater group from Japan whose show, Are You Lovin’ It?, is a surreal comedic romp with dancing Japanese businessman, crazy cartoon mascots, and fast food satire.

Then there is PUP Maharlika’s Karera. Inspired by the urban rat race, Karera is dance-theater production on the survival of the fittest in the urban jungle. It is choreographed by Daloy Dance Company’s Buboy Raquitico.

To be screened during the Fringe fest is an unfinished documentary called Nobenta Nostalgia by Eljay Castro Deldoc, which revolves around 1990s television, told through interviews, monologues, and songs.

This year, the festival brings back crowd favorites such as Deus Sex Machina, SPIT, ADHD Productions, Burlesque PH, and Airdance.

Fringe Manila will also stage the championship round of a live painting competition called Art Battle, where painters compete for votes from the audience for the chance to compete in the Art Battle International.

Meanwhile, there will be performances by Kulintronica, a California-based musician who fuses the sounds of the traditional kulintang with modern electronic music, and Pagbalik, another California-based act performing a sound and dance narrative that reflects what it means to be a Filipino-American.

There will also be a number of workshops during the festival.

“It’s so important for these types of festivals to exist. By bridging independent creatives with small businesses and working with cultural institutions, Fringe works closely with its communities to make the arts a vehicle for meaningful collaborations, and a safe space for ideas and expanding networks,” said Jodinand Aguillon, the festival’s creative producer and a Fringe artist himself.

Since it started in 2015, Fringe Manila — which is under the umbrella of the internationally acclaimed World Fringe Network — has welcomed 30,000 audience members in 45 venues while featuring more than 500 performances and exhibitions by more than 1,000 artists.

Tickets to some Finge performances are available at TicketWorld (891-9999, www.ticketworld.com.ph). For more details and updates, visit facebook.com/FringeMNL or follow them on Twitter and Instagram at @fringemnl or visit fringemanila.com. — NFP de Guzman

Mazda models top US fuel ratings

ITS SkyActiv technology allowed the brand to lead the list of the most fuel-efficient vehicles in the US for the fifth-straight year, Mazda said in a news release. The car maker cited data from the 2017 Light-Duty Automotive Technology, Carbon Dioxide Emissions, and Fuel Economy Trends report by the United States Environmental Protection Agency (EPA) as the source of the information.

It added that according to latest edition of the annual report, Mazda had the highest adjusted fuel economy performance rating among the 13 brands listed in the review. The average manufacturer adjusted fuel economy of Mazda models sold in the US during the 2016 model year was 12.58 kilometers per liter for combined city and highway driving cycle. Mazda said the EPA test also showed it recorded the lowest average CO2 emissions among car makers at 187 grams per kilometer.

Mazda credited its SkyActiv Technology’s range of lightweight engines, transmissions, chassis and car bodies as a key factor to the company’s leadership in the EPA list.

“Mazda has always stood for maximizing performance through efficiency,” said Steven Tan, president and CEO of Bermaz Auto Philippines, Mazda’s local distributor.

SMC gets top credit rating for P30-B fixed-rate bonds

DIVERSIFIED conglomerate San Miguel Corp. (SMC) secured the highest credit rating for its planned P30-billion fixed-rate bond issuance, a local debt watcher said. 

In a statement released Tuesday, the Philippine Rating Services Corp. (PhilRatings) said it has assigned a PRS Aaa issue rating for SMC’s proposed bond offering. This represents the highest rating in the debt watcher’s credit rating scale, indicating the company’s ability to meet its financial obligations.

PhilRatings also gave the bond issuance a stable outlook, which means that the credit rating is unlikely to change in the next 12 months.

The P30-billion fixed-rate bonds is the third tranche of SMC’s three-year debt securities program of up to P60 billion. The first tranche worth P20 billion was listed at the Philippine Dealing and Exchange Corp. on March 1, 2017, which consisted of P6.68-billion bonds due 2022 at 4.8243% per annum, P7.29 billion due 2024 at 5.2840%, and P6.022 billion due 2027 at 5.613%.

The second tranche of the debt securities program, meanwhile, was launched on April 7, 2017, where SMC raised P10 billion from the sale of five-year bonds at 5.1923% per annum.

The bond issuances are among SMC’s refinancing activities in an effort to temper the company’s foreign exchange losses, as the Philippine peso is expected to continue its depreciation. On Tuesday, the local currency depreciated by 23.5 centavos to close at P51.420 against the dollar.

PhilRatings considered SMC’s operating businesses, income streams, and cash flows in coming up with the credit rating. The company booked a net income of P20.9 billion in the first nine months of 2017, following a 20% increase in revenues to P597 billion during the period. 

The debt watcher said SMC’s financials are expected to further improve with the completion of projects in the energy and infrastructure sector.

PhilRatings also noted the strength of SMC’s core businesses in food and beverage, fuel and oil, and infrastructure. The company’s subsidiaries also include investments in energy and packaging. 

“SMC and its subsidiaries’ strong market position, its solid track record and continuous efforts to manage its debt position, backed by growing market demand and supported by a robust domestic economy, makes SMC well prepared for significant future growth,” according to PhilRatings.

Established originally as a single brewery in the Philippines in 1890, SMC now has over 100 production facilities in the Asia-Pacific region, employing more than 23,000 employees. Amid its diversified product offerings, SMC President and Chief Operating Officer Ramon S. Ang last year announced his intention to enter the electronics business in the future.

Shares in SMC rose 90 centavos or 0.63% to close at P144.90 each at the Philippine Stock Exchange on Tuesday. — Arra B. Francia

Warning level raised on another Japanese volcano

TOKYO — Japan raised the warning level on another volcano on Tuesday, exactly a week after a dramatic eruption at another peak killed one man, injured nearly a dozen others and stranded scores of skiers — including foreign tourists — for several hours.

Japan’s Meteorological Agency lifted the warning on Zao, a cluster of volcanoes in northern Japan whose highest point is 1,841 meters (6,040 feet), to 2 from 1, meaning that people should avoid going near the crater.

“There is a possibility of a small-scale eruption,” the agency said in a statement, noting that a number of small earth movements were detected on Tuesday, along with a slight bulging of the ground in one area.

It also warned of the possibility that volcanic rocks could be thrown as far as 1.2 kilometer in any eruption.

The announcement came a week after a member of Japan’s military was struck and killed when rocks from the sudden eruption of the Kusatsu-Shirane volcano rained down on skiers at a mountain resort in central Japan.

Video footage taken by skiers on the mountain, including some from Taiwan, showed black ash boiling up into the sky as stones plummeted down, some punching holes in the metal roof of a ski gondola. Eleven people were injured and around 100 skiers took refuge in a mountain hut for several hours until rescued.

Zao, like Kusatsu-Shirane, is a popular resort area famed for its “snow monsters,” created by water vapor freezing on trees in winter. Its slopes are packed with skiers in winter and hikers in other seasons.

Japan has 110 active volcanoes and monitors 47 of them around the clock. In September 2014, 63 people were killed on Mount Ontake, the worst volcanic disaster in Japan for nearly 90 years. — Reuters

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