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7-Eleven operator turns profitable

7-11
DUY NGUYEN-UNSPLASH

7-ELEVEN operator Philippine Seven Corp. posted P425.38 million in attributable net income in the third quarter, turning around from its P181.05-million net loss a year ago.

The turnaround comes after revenues rose 46.7% to P16.06 billion for the July-September period, its quarterly financial report shows. Revenues from contracts with customers were the largest contributor with P15.75 billion, 44.8% higher than a year ago.

Philippine Seven’s other income surged by nearly 10 times to P281.78 million from P30.18 million in 2021. Revenues from fees collected by 7-Eleven stores for withdrawals from their automated teller machines (ATMs) are lodged under other income.

Meanwhile, the company’s expenses reached P15.49 billion in the third quarter, up by 38.4% from P11.19 billion in the previous year.

For the nine-month period, the company’s attributable net income stood at P1.32 billion, reversing the P583.95-million net loss incurred a year ago.

Philippine Seven’s year-to-date topline rose by 38.7% to P44.69 billion from P32.22 billion in the same period last year.

Revenues from contracts with customers were the biggest contributor with P44.19 billion, which increased by 38.7% from P32.22 billion in 2021.

Other income was also higher by more than five times at P430.37 million from P76.92 million in the previous year.

Year-to-date expenses amounted to P42.94 billion, up by 30.2% from P32.98 billion in its financial showing last year.

By the end of the third quarter, the nationwide store network of 7-Eleven reached 3,282, broken down as 52% corporate-owned and 48% franchise-operated.

“The sales of our stores near offices are about 10% below 2019, while those near residences already exceeded pre-pandemic level,” the company said.

So far in 2022, the company opened a total of 236 new stores and counted 27 closures, which the company said was better than the 104 new store openings and 63 closures last year.

In its report, the company said that it has a total of 1,965 ATMs across Metro Manila and the rest of Luzon.

“We expect to end this year with 2,500 ATMs in our system and shall include our stores located in Davao City in Mindanao,” it said. — Justine Irish D. Tabile

Import plan expected to erode fishing communities’ livelihoods

PHILIPPINE STAR/ MICHAEL VARCAS

PAMBANSANG LAKAS ng Kilusang Mamamalakaya ng Pilipinas (PAMALAKAYA), an organization of small fishermen, said the fish import program planned for late in the year by the Department of Agriculture (DA) will depress prices and result in hardship for fishing communities.

PAMALAKAYA said in a statement on Sunday that the 25,000 metric tons (MT) of fish imports will make market prices cheaper at a time when fisherfolk are contending with the high cost of inputs like fuel.

The imports were authorized by DA Special Order No. 1002 signed by Agriculture Senior Undersecretary Domingo F. Panganiban on Nov. 10. The shipments are intended to address possible shortages during the closed season for key fisheries which will run until January.

“Our fisherfolk will be forced to sell their produce at a much lower price in order to keep up with the imported fish that are cheap yet inferior in quality. This means a huge loss to the income of fisherfolk who are already battered with inflation and the high cost of production,” PAMALAKAYA Spokesman Ronnel S. Arambulo said.

The DA authorized imports of round scad (galunggong), bigeye scad, mackerel, bonito and moonfish for wet markets. Of the 25,000 MT, 80% is to be allocated to registered importers in the commercial fishing industry, while 20% going to fisheries associations and cooperatives.

The DA special order requires all import permits be issued on or before Dec. 15, valid until Jan. 30.

PAMALAKAYA called for an end to the practice of declaring closed fishing season.

 “The farmgate price of local galunggong in Zambales is at P120/kilogram, compared to the P220-P240 per kilogram market price. When imported galunggong floods the market, middlemen and traders will bargain (with fisherfolk for) cheaper prices,” the group said.

PAMALAKAYA asked President Ferdinand R. Marcos, Jr. to abandon the import plan and instead improve the productivity of the fishing industry.

“Being the concurrent Agriculture Secretary, Mr. Marcos is duty-bound to undertake measures that will strengthen fishing production, instead of continuously relying on imports,” Mr. Arambulo said. — Revin Mikhael D. Ochave

Geely Philippines opens first-ever ‘in-line store’

PHOTO FROM GEELY PHILIPPINES

LAST MONTH, Sojitz G Auto Philippines Corp. (SGAP) continued to increase its efforts to bring the Geely brand closer to more car buyers in the country, via the opening of its first-ever in-line store.

Located within SM City Taytay in Rizal Province, the Geely store, according to SGAP President and CEO Yugo Kiyofuji, “is a realization of (Geely Philippines’) goal to give… customers a more convenient access to (its) vehicles.” He added, “This is a step in going beyond the usual dealerships that we currently have.”

During the celebration of Geely Philippines’ third year in the country last month, Mr. Kiyofuji emphasized that aside from shifting more toward improving the quality of the dealers to satisfy the customers, Geely continues to explore other possibilities in making sure that the brand continues to adapt to its customers’ needs.

The SM City Taytay mall store is under the management of Geely North EDSA, a dealership directly owned by SGAP. The outlet can display up to three cars simultaneously, and customers can also conduct test drives of all Geely vehicles upon inquiry.

With 34 Geely dealerships operating nationwide, the company has declared that it is set on getting to 40 dealer outlets soon.

Buy a watch, save a Philippine Eagle

SEIKO 3rd Philippine Limited Edition Prospex watch

SEIKO has released another Philippine Limited Edition Prospex diver’s watch, again relying on the theme of a Philippine icon.

In 2020, Seiko released a watch inspired by the Tubbataha Reefs. The year after, it released a watch inspired by the Philippine sunrise. In both instances, the brand donated a portion of the sales to causes, such as in marine conservation.

This year, it released the new Prospex, inspired by the Philippine Eagle. Tinted red to evoke sunlight on the wings of the eagle, it carries the 6R35 caliber mechanism with a water resistance of up to 200 meters. It also features an automatic movement with manual winding capacity and approximately 70 hours power reserve.

There are only 1,000 pieces in the market, with special packaging in red and a box with an eagle head etched in gold.

“We also want to inspire hope for the Philippine Eagle,” said Timeplus Corp. CEO and President Karl Dy, which distributes the Japanese brand in the Philippines.

The watch was launched during an Oct. 26 dinner in Makati. During the launch, Mr. Dy announced that Seiko has adopted a Philippine Eagle in Davao through the Philippine Eagle Foundation. The eagle is named Eiko, which apparently means “flourishing or prosperous child.”

“Part of the proceeds of the sales for this [watch] will go to the shelter, care, and food of Eiko,” said Mr. Dy.

The Philippine Eagle is an endangered species, with conservation organization The Peregrine Fund counting fewer than 500 individual eagles in the wild. A Philippine Eagle mating pair needs about 4,000-11,000 hectares of forest land to thrive in the wild, depending on the number of prey items in the area, said the website of the Philippine Eagle Foundation. As such, sales of the watch will also contribute to reforestation efforts. For every purchase of the watch, a tree will be planted in the Sierra Madre region under the buyer’s name.

“You are also part of this momentous occasion,” said Mr. Dy.

The watch is available through any Seiko Boutique nationwide, as well as its online platform, shop.seikoboutique.com.ph. The watch costs P45,000. — JLG

Credit Suisse’s overhaul move draws scrutiny

REUTERS

LONDON/ZURICH — Credit Suisse’s recent decision to exit certain investment banking activities is drawing scrutiny from at least two investors and a proxy adviser who told Reuters they are worried about how the Swiss bank managed potential conflicts of interest of two directors.

The move to break up the lender and spin off the investment banking business was seen by analysts as a way for Credit Suisse to focus on its more profitable wealth management franchise. But the investors are questioning how some of the decisions were taken.

Board member Michael Klein had begun working on the turnaround with Chairman Axel Lehmann and other Credit Suisse officials in early February, according to a person familiar with the situation.

In late October, Klein stepped down from the board to work on the division that will be spun off and rebranded CS First Boston. He is set to become chief executive officer (CEO) of the unit in 2023, pending regulatory approvals. The company will be a preferred long-term partner for Credit Suisse, the bank has said.

Ethos Foundation, which represents Swiss pension funds that own more than 3% of Credit Suisse, told Reuters the bank needs to show it conducted a thorough search when it picked board member Mr. Klein to run the investment bank unit.

“We wonder whether the board conducted an adequate recruiting process” for the investment bank chief, Ethos CEO Vincent Kaufmann said by e-mail on Monday.

In addition, Roger Said of proxy adviser Actares, which works for individual investors including Credit Suisse shareholders, told Reuters there is the risk that both Mr. Klein and Blythe Masters, another bank board member who also advised on the reorganization, “could profit at Credit Suisse’s expense.”

Mr. Klein recused himself from board discussions and voting after he was informally offered the CEO job on Oct. 21, just six days before the reorganization was announced, said the source familiar with the situation.

Credit Suisse declined to comment beyond Mr. Lehmann’s remarks on Oct. 27 when the bank unveiled the restructuring. “It goes without saying (we are) very, very mindful of conflict of interest,” Mr. Lehmann said then in relation to both Mr. Klein and Mr. Masters.

Since 2021, Mr. Masters has also served as a consultant to Apollo, the US buyout fund which Credit Suisse picked as the preferred buyer of one of the bank’s trading businesses. Apollo has invested in Motive Partners, a New York-based investment firm co-founded by Mr. Masters to invest in companies in North America and Europe.

Spokespeople for Mr. Klein, Mr. Masters and Apollo declined to comment.

The bank’s top two backers — shareholder Harris Associates and Saudi National Bank, which is investing in the upcoming capital increase — told Reuters they support Credit Suisse in the way it handled governance in response to the investor criticism.

At issue is whether Mr. Klein and Mr. Masters — both members of the board’s committee on the bank’s strategic overhaul — may have influenced key decisions to favour their own interests.

“In both cases, there is the possibility of conflicts of interest,” Actares managing director Mr. Said told Reuters by e-mail.

“The bank must show how it deals with this risk and communicate transparently,” even if the two board members have abstained from voting on the reorganization, he said.

In Mr. Lehmann’s October remarks, he said the two directors “needed to abstain from any voting and were only allowed to potentially contribute from a more technical perspective, so helping to create the fact base for a decision making. This is all very well documented.”

Harris Associates, which has said it has a stake of around 10%, backed the bank’s handling of any potential conflicts of interest.

“We believe they have properly dealt with situations where there have been conflicts,” Deputy Chairman David Herro said in an e-mailed comment.

AT ARM’S LENGTH
Battered by a series of scandals and mounting losses, Credit Suisse last month embarked on a turnaround plan that will see the bank raise 4 billion Swiss francs ($4.16 billion) of capital from investors and cut thousands of jobs.

The investment bank spin-off and the sale of the securitized products unit to Apollo are key planks of the reorganization.

Mr. Klein, a 59-year-old former Citigroup rainmaker who runs advisory boutique M. Klein & Co., has been a Credit Suisse board member since 2018. Over the years he became the go-to adviser to Saudi Arabia using his own boutique to help the country’s sovereign wealth fund craft deals to diversify the kingdom’s economy away from oil and gas.

To help finance its turnaround, Credit Suisse will raise money from Saudi National Bank (SNB), part owned by the kingdom, which is investing 1.5 billion Swiss francs in exchange for a stake of up to 9.9%. SNB may also invest directly in CS First Boston, the Saudi bank had said.

SNB told Reuters in an e-mailed statement on Friday that over the course of its recent decision to invest in the equity of Credit Suisse, it had not come across any information that might raise concerns over the governance of the bank and was supportive of the transformation plan announced by Credit Suisse on Oct. 27.

SNB also said it could not comment on future plans for CS First Boston “at this early stage.”

Mr. Klein and Credit Suisse also have discussed combining M. Klein & Co. into CS First Boston, according to one source familiar with the discussions.

Andreas Thomae, corporate governance specialist at Germany’s Deka Investment, which manages around €360 billion ($369.5 billion) in assets and owns a small stake in Credit Suisse, said Mr. Klein running CS First Boston and the prospect of Mr. Klein bringing his own boutique into CS First Boston “rings alarm bells.”

“There is a massive conflict of interest. In our view, this is a violation of corporate governance principles,” Mr. Thomae said.

A senior official familiar with the matter said any transaction for CS First Boston to absorb Mr. Klein’s boutique would be carried out at arm’s length and would be subject to strict regulatory scrutiny.

In his e-mail, Ethos’s Mr. Kaufmann said the governance around the restructuring “should be very clean and raise no concerns of potential conflict of interest even if only ‘in appearance,’ CS needs to restore trust and such doubts won’t help to address this.”

Mr. Klein’s rise to CEO of CS First Boston — a business that could have annual sales of $2.5 billion — took some bank insiders by surprise, two sources familiar with the bank’s restructuring told Reuters.

Until early October, as discussions on the reorganization became more advanced, David Miller, Credit Suisse’s investment banking and capital markets boss, was still in the running for the top job at CS First Boston, these sources said.

Mr. Miller, contacted through a spokesperson, declined to comment. — Reuters

ProPak Philippines to highlight better packaging technology

IMPROVEMENTS in processing, manufacturing, and packaging technology will be featured by ProPak Philippines at the World Trade Center in Pasay City on Feb. 1 to 3, 2023, the event’s handler said.

Mark Prakasvudhisarn, Informa Markets event manager, said in an interview during the media launch in Makati City last week that ProPak Philippines is estimated to feature 250 exhibitors involved in processing machinery, technology, and materials in the sectors of filling, quality assurance, testing and measurement, maintenance, and their related fields of automation.

Other exhibitors in the three-day fair include firms engaged in instrumentation, transportation, refrigeration, storage, pollution control, labeling, printing, water treatment equipment, plastics processing, and wrapping machinery.

“On the visitor side, we are expecting over 8,000 high-quality attendees where 50% are decision makers, management, and purchase influencers,” Mr. Prakasvudhisarn said.

ProPak Philippines will also introduce courses from the Australian Institute of Packaging; packaging consultations for micro, small, and medium enterprises, as well as talks and workshops in manufacturing and packaging.

Some of the groups supporting ProPak Philippines 2023 include the following: Department of Trade and Industry, Department of Science and Technology, Philippine Association of Food Technologists, Inc., Philippine Pharmaceutical Manufacturers Association, and Production and Operations Management Association of the Philippines.

Other involved groups include Philippine Printing Technical Foundation, Association of Laguna Food Processors, Inc., Association of Filipino Franchisers, Inc., Filipino International Franchise Association, One Town, One Product, GS1 Philippines, and British Chamber of Commerce in the Philippines.

Antonio Tanael, Philippine Printing Technical Foundation president, said that the local market demand for packaging has been growing. He added that the main markets for the industry are food packaging and pharmaceutical companies.

Philippine Pharmaceutical Manufacturers Association President Higinio P. Porte, Jr. said that packaging costs contribute about 30% of the total production costs of their products.

“A big component of the cost of medicine is more on the packaging process and packaging material. The raw material is sometimes cheaper,” Mr. Porte said. — Revin Mikhael Ochave

Farmers regenerating soil in frantic race to save ‘skin of the Earth’

REUTERS

WINNIPEG/NAIROBI/SHANGHAI — In America’s dusty Corn Belt this spring, the land was drowning. In China’s Yangtze river basin, it’s bone dry. Farmers in both are fighting a losing battle to save the soil that produces our food.

Carolyn Olson figures she did everything she could to protect her 1,100-acre farm near Cottonwood, Minnesota. She grows three-foot-high tall-grass buffer strips around her fields to protect the soil and in winter plants crops to provide ground cover.

But torrid rainstorms in May washed away so much soil during planting season that she expects the crop to suffer.

“When you get that much rain, almost four inches in about an hour, even your best practices fly out the window,” said the 55-year-old, whose farm has been in her husband’s family since 1913.

By contrast, there’s not enough water in the vast Yangtze basin, which produces a third of China’s crops. Scientists are resorting to firing rockets into clouds to “seed” them with rain artificially in the hope of replenishing soil drained of nutrients by sizzling temperatures.

It’s no silver bullet, though.

From the United States and China to Kenya, human efforts to preserve soil are proving no match for increasingly extreme weather, which is damaging the living system and depleting its ability to produce food, according to Reuters interviews with dozens of farmers, scientists and other soil specialists.

Soil erosion could lead to a 10% loss in global crop production by 2050, according to the UN’s Food and Agriculture Organization (FAO). With the world’s population forecast to rise by a fifth to nearly 10 billion by then, malnutrition and famine is set to affect more and more people.

Few places are in deeper crisis than the pasture lands of northern Kenya, where ever-deepening drought has denuded the land of vegetation, exposing the soil to damage and confounding efforts to adapt farming methods.

“The soil left there is very vulnerable, like the skin of the Earth … you’re not wearing clothing when the sun’s beating down,” said Leigh Ann Winowiecki, a Nairobi soil scientist at CIFOR-ICRAF, a research center on the benefits of trees for people and landscapes.

UN scientists say it can take up to 1,000 years for nature to produce 2-3 cm of soil, making preservation critical.

Plants grow by absorbing sunlight and carbon dioxide. They cycle the carbon into the soil, feeding microorganisms that in turn create the conditions for more plants to grow.

Extreme weather, some of it caused by climate change, not only damages crops but also erodes the soil and depletes nutrients such as carbon, nitrogen and phosphorus from the complex ecosystem, according to specialists.

This leads to land degradation — the decline of its ability to sustain plant life, and by extension animal and human life.

One-third of the world’s total land area is already degraded by erosion, nutrient depletion or in other ways, according to the United Nations.

Ronald Vargas, a soil scientist and secretary of the FAO’s Global Soil Partnership, said extreme weather was accelerating soil degradation already set in train by deforestation, over-grazing by livestock and improper use of fertilizer.

“Land degradation is a vicious cycle. Once you have degraded soils, and you have these bad (weather) events, then you have very bad second consequences,” Mr. Vargas said.

On the FAO’s projected loss in global crop production, he added: “This 10% represents a real issue to food security.”

The American Midwest, parched for rain this summer, is actually getting wetter over time.

Rainstorms over three days in mid-May washed away up to three tons of dirt per acre in two dozen Minnesota counties, according to data from the Daily Erosion Project, an Iowa State University initiative to estimate soil loss.

Rachel Schattman, assistant professor of sustainable agriculture at the University of Maine, said the US Midwest and Northeast were especially vulnerable to land erosion because they were receiving more extreme amounts of rain than normal, a trend expected to continue through the end of the century.

In the Yangtze river basin, wetter weather would be welcome. Farming belts in the region, stretching from Sichuan in the southwest to Shanghai on the east coast, received 40% less rainfall than normal over the summer and baked in record-high temperatures.

Liu Zhiyu, an official at the Chinese water ministry, said in August that a third of the soil in six key farming provinces along the upper and middle reaches of the Yangtze” was drier than is optimal as a result of the drought. In around a tenth of the rural counties in those provinces, soil was suffering from “severe water depletion.”

China’s cloud-seeding program offered some relief, with 211 operations launched in August alone to induce rainfall over 1.45 million square km of parched farmland, but experts say it’s no long-term solution.

“Artificial rainfall can only be the icing on the cake,” Zhao Zhiqiang, vice-director of China’s weather modification office, said at a media briefing in September. He did not say whether the operations were successful.

Similarly, other measures such as digging thousands of new wells and encouraging farmers to switch crops to boost yields have limited impact.

Farmers around the shrunken Poyang Lake in Jiangxi province told Reuters that all kinds of crops were severely underdeveloped as a result of the lack of rainfall.

Hu Baolin, a 70-year-old from Xinyao village, said his rapeseed hadn’t even flowered, and his pomelo fruit was a third of its usual size.

In the farming district of Hukou in Jiangxi, many sesame, corn, sweet potato and cotton plantations have dried up, said a 72-year-old resident who only gave his surname Chen as he picked over a baked field for rice to take home to feed his chickens.

Some experts are optimistic that the world can step back from peril, in some places at least.

The FAO drafted an action plan this year that seeks to improve and maintain the health of 50% of global soils by 2030, adopting practices like crop rotation and agroforestry, a land-use system that plants trees in and around crop and pastureland.

Cristine Morgan, chief scientific officer at the North Carolina-based Soil Health Institute, said soils could regenerate if farmers applied better methods more broadly.

“We always think something new is going to save us,” Morgan said. “But we really just need to change our behavior.”

Options include not tilling soil to reduce erosion, and planting off-season cover crops to prevent erosion and nutrient loss.

The practices are only used on 25% and 4% of US farm acres respectively, according to estimates from BMO Capital Markets, which said that overhauling growing systems created up-front costs for farmers, with yield losses in early years.

In Kenya, though, the damage is dire.

“The soil never used to be this sandy when I was young,” said Maliyan Lekopir, 50, a cattle and goat farmer in the Samburu region, kicking dirt up in the air.

“This place used to be so beautiful. Giraffes, zebras, gazelle used to graze next to our goats. Now all the animals are gone and the streams have dried up.”

Indeed the land is desiccated in the country, where prolonged droughts have become more common since 2000, with the current one the worst in four decades.

More than 60% of the country’s total land is deemed highly degraded, and more than 27% very highly degraded, according to Kenya’s environment ministry, taking into account factors such as vegetation cover and its ability to resist erosion.

This is despite efforts by green groups encourage farmers to use no-till or minimum-till agriculture and employ agroforestry.

None of the children playing in Lekopir’s village in northern Kenya remember a real rainy season. They’ve grown used to raising camels and dodging the growing web of dusty gullies, none of which were present during Lekopir’s youth.

The drought has made the water sources this village relies on increasingly stagnant, making kids sicker, Lekopir said. To keep the remaining cattle and goats alive, herders often have to walk hundreds of miles in search of water or pasture.

Grass has disappeared from much of Kenya’s vast pastures, leaving the land prone to future compaction or erosion, said soil scientist Winowiecki at CIFOR-ICRAF.

So much soil has eroded in Kenya, India and many other places around the world that the ground’s seed bank — grass seeds ready to sprout once rain falls — has also been depleted, meaning restoring some areas would require manually reseeding it, said Tor-Gunnar Vagen, CIFOR-ICRAF’s principal scientist.

“The whole system is at a tipping point. Climate change is just accelerating all of that.” Reuters

Alec Baldwin files lawsuit in deadly Rust shooting

ALEC BALDWIN in the sitcom 30 Rock.

ACTOR Alec Baldwin filed a lawsuit on Friday against the armorer and three other crew members over the deadly shooting on the set of the Western movie Rust, in which a gun that Mr. Baldwin was using during rehearsal killed cinematographer Halyna Hutchins.

Mr. Baldwin’s suit was filed in Los Angeles County Superior Court as a cross complaint stemming from a previous suit in which a different member of the crew named Mr. Baldwin and the others as defendants.

It is one of many pieces of litigation stemming from the tragedy of Oct. 21, 2021, which is also under criminal investigation and could result in New Mexico state charges.

Mr. Baldwin’s cross complaint names armorer Hannah Gutierrez-Reed, first assistant director Dave Halls, prop supplier Seth Kenney, and prop master Sarah Zachry.

An attorney for Ms. Gutierrez-Reed, Jason Bowles, said in an e-mail on Saturday that, “Baldwin is responsible for this tragedy.”

Attorneys for Mr. Halls and Mr. Kenney did not immediately respond to requests for statements in their clients’ defense. Reuters could not locate an attorney for Ms. Zachry.

All four were also named as defendants along with Mr. Baldwin in the original lawsuit filed by a script supervisor who claimed the shooting caused her severe emotional distress.

Mr. Baldwin’s cross complaint alleges negligence and seeks damages to be determined at trial for the “immense grief” he endures.

“This tragedy happened because live bullets were delivered to the set and loaded into the gun, Gutierrez-Reed failed to check the bullets or the gun carefully, Halls failed to check the gun carefully and yet announced the gun was safe before handing it to Baldwin, and Zachry failed to disclose that Gutierrez-Reed had been acting recklessly off set and was a safety risk to those around her,” Mr. Baldwin’s cross complaint said.

The suit was written by Luke Nikas, an attorney for Mr. Baldwin who is with the firm Quinn Emanuel.

Ms. Hutchins was killed when a revolver Mr. Baldwin was rehearsing with during filming in New Mexico fired a live round that hit her and movie director Joel Souza, who survived.

In a television interview, the actor said he did not pull the trigger of the Colt .45 revolver and it fired after he cocked it.

An FBI forensic test of the single-action revolver found it “functioned normally” and would not fire without the trigger being pulled. — Reuters

Dashboard

PHOTO FROM MAZDA PHILIPPINES

Mazda Philippines recently turned over the first batch of the MX-5 Miata Club Philippines (MCP) 25th Anniversary Edition units to owners in a simple ceremony at the Mazda Center of Excellence in Cabuyao, Laguna. Eight of the 25 new owners of the limited-run MX-5 roadster personally received their units from Mazda Philippines President Steven Tan. Car number 001 went to Eddie Salonga, the founding president of the MCP. “It is truly heart-warming to see how the love of one car, the MX-5, has brought many people together,” said Mr. Tan. “It’s not just a testament to the timelessness of the MX-5’s qualities, but today, we also see the continued love and passion the Miata Club Philippines has shown. Truly, they have helped cement the MX-5 as a cultural icon.” Shown at the 8th Philippine International Motor Show (PIMS), the Mazda MX-5 MCP 25th Anniversary Edition celebrates Mazda’s special relationship with the MCP — the oldest single-made car club in the Philippines. Founded in 1997, MCP now has 150 members.

Collapsed FTX hit by rogue transactions, analysts saw over $600 million outflows

HONG KONG/SINGAPORE/LONDON — FTX was engulfed in more chaos on Saturday when the crypto exchange said it had detected unauthorized access and analysts said hundreds of millions of dollars of assets had been moved from the platform in “suspicious circumstances”.

FTX filed for bankruptcy on Friday, one of the highest profile crypto blowups, after traders rushed to withdraw $6 billion from the platform in just 72 hours and rival exchange Binance abandoned a proposed rescue deal.

FTX Chief Executive John J. Ray III said on Saturday that the company was working with law enforcement and regulators to mitigate the problem, and was making “every effort to secure all assets, wherever located”.

“Among other things, we are in the process of removing trading and withdrawal functionality,” he said.

The exchange’s dramatic fall from grace has seen its 30-year-old founder Sam Bankman-Fried, known for his shorts and T-shirt attire, morph from being the poster child of crypto’s successes to the protagonist of the industry’s biggest crash.

Mr. Bankman-Fried, who lives in the Bahamas, has also been the subject of speculation about his whereabouts and he denied rumors on Twitter that he had flown to South America. When asked by Reuters whether he had flown to Argentina, he responded in a text message: “Nope”. He told Reuters he was in the Bahamas.

The turmoil at FTX has seen at least $1 billion of customer funds vanish from the platform, sources told Reuters on Friday. Mr. Bankman-Fried had transferred $10 billion of customer funds to his trading company, Alameda Research, the sources said.

New problems emerged on Saturday when FTX’s US general counsel Ryne Miller said in a Twitter post that the firm’s digital assets were being moved into so-called cold storage “to mitigate damage upon observing unauthorized transactions”.

Cold storage refers to crypto wallets that are not connected to the internet to guard against hackers.

Blockchain analytics firm Nansen said it saw $659 million in outflows from FTX International and FTX US in the last 24 hours.

A separate blockchain analytics firm Elliptic said that around $515 million worth of cryptoassets were “suspected to have been stolen,” while $186 million were likely moved into secure storage by FTX.

Crypto exchange Kraken said: “We can confirm our team is aware of the identity of the account associated with the ongoing FTX hack, and we are committed to working with law enforcement to ensure they have everything they need to sufficiently investigate this matter”.

FTX was not immediately available for comment about the outflows or Kraken’s statement.

In its bankruptcy petition, FTX Trading said it has $10 billion to $50 billion in assets, $10 billion to $50 billion in liabilities, and more than 100,000 creditors. Ray, a restructuring expert, was appointed to take over as CEO.

A document that Mr. Bankman-Fried shared with investors on Thursday and was reviewed by Reuters showed FTX had $13.86 billion in liabilities and $14.6 billion in assets. However, only $900 million of those assets were liquid, leading to the cash crunch that ended with the company filing for bankruptcy.

The collapse shocked investors and prompted fresh calls to regulate the cryptoasset sector, which has seen losses stack up this year as cryptocurrency prices collapsed.

“Things will continue to simmer after the FTX crash,” said Alan Wong, operations manager of Hong Kong Digital Asset Exchange.

“With a gap of $8 billion between liabilities and assets, when FTX is insolvent, it will trigger a domino effect, which will lead to a series of investors related to FTX going bankrupt or being forced to sell assets.”

Crypto market maker Jump said on Twitter late on Saturday that it had an undisclosed exposure to FTX, adding that the firm remains well capitalized.

MARKET FALLOUT
Since its founding in 2019, FTX had raised more than $2 billion from top investors including Sequoia, SoftBank, BlackRock and Temasek. In January, FTX had raised $400 million from investors at a $32 billion valuation.

SoftBank and Sequoia Capital said they were marking their investments in FTX down to zero.

Cryptocurrency exchange Coinbase Global Inc COIN.O will also write off the investment its ventures arm made in FTX in 2021, according to a person familiar with the matter.

Bitcoin fell below $16,000 for the first time since 2020 after Binance abandoned its rescue deal for FTX on Wednesday.

On Saturday it was trading around $16,800, down by more than 75% from the all-time high of $69,000 it reached in November last year.

FTX’s token FTT plunged by around 91% this week. Shares of cryptocurrency and blockchain-related firms have also declined.

“We believe cryptocurrency markets remain too small and too siloed to cause contagion in financial markets, with an $890-billion market cap in comparison to US equity’s $41 trillion,” Citi analysts wrote.

“Over four years, FTX raised $1.8 billion from venture capital and pension funds. This is the primary way financial markets could suffer, as it may have further minor implications for portfolio shocks in a volatile macro regime.”

The US securities regulator is investigating FTX.com’s handling of customer funds, as well its crypto-lending activities, a source with knowledge of the inquiry said.

Hedge fund Galois Capital had half its assets trapped on FTX, the Financial Times reported on Saturday, citing a letter from co-founder Kevin Zhou to investors and estimating the amount to be around $100 million. — Reuters

Profit taking drags PLDT share price

PLDT, Inc. was the ninth most actively traded stock last week as investors took profit after news came out that the telecommunications company is selling more towers.

A total of P775.72 million worth of 501.36 million shares exchange hands at the local bourse from Nov.  7 to 11, data from the Philippine Stock Exchange (PSE) show.

The company’s shares finished at P1,530 apiece on Friday, down by 0.7% week on week. Year to date, the stock’s price decreased by 15.6%.

Jeff Radley C. See, an analyst at Mercantile Securities Corp., said in a Viber message that PLDT continues to sell more towers and focuses on the improvement of its connection.

“This shows bullish sentiment to investors as they are focusing on infrastructure,” he said, adding that this is “essential in offering efficient service to their clients.”

In a press briefing last week, EdgePoint Infrastructure, a telecommunications infrastructure company, said that it was keen on buying more towers from PLDT.

In April, EdgePoint’s local subsidiary, Comworks Infratech Corp., completed a P35-billion sale and leaseback deal with PLDT for 2,934 towers. It will take over these assets by the middle of 2023.

Rastine Mackie D. Mercado, China Bank Securities Corp. research director, said in an e-mail that PLDT’s movement last week was largely driven by continued profit-taking after its 17% rally over the past month.

Mr. Mercado also pointed to continued foreign interest in the stock despite the selling pressure.

PLDT saw net foreign buying in three out of the four trading sessions last week. Net foreign buying of PLDT shares amounted to P73.89 million from Nov. 7 to 11, PSE market data show.

In the third quarter, PLDT’s attributable net income climbed by 79.6% to P10.64 billion after revenues rose 6.8% to P51.53 billion. Its nine-month profit reached P27.38 billion, up 45.3% from a year ago, as revenues rose 6.3% to P152.92 billion.

It said that the company is reviewing its consolidated capital expenditure for 2022, which could exceed the initial guidance of P85 billion.

“We currently don’t have a revenue forecast for PLDT, but we think revenues will continue to be driven by sustained demand for data and the continued recovery of its legacy call and text business, especially in light of better mobility conditions,” added Mr. Mercado.

For next week, Mr. Mercado sees continued selling pressure on PLDT, though losses may be more modest. He placed the stock’s support level at P1,480 and its resistance level at P1,625.

For Mercantile Securities’ Mr. See, the stock might move sideways for now between P1,500 and P1,550. He put PLDT’s support levels at P1,500 and P1,450, and its resistance levels at P1,580 and P1,650.

Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has a majority stake in BusinessWorld through the Philippine Star Group, which it controls. — Lourdes O. Pilar

Farm climate innovation commitments double to $8B

REUTERS

SHARM EL-SHEIKH, Egypt — An initiative led by the United States and the United Arab Emirates (UAE) to help agriculture adapt to climate change and reduce emissions through innovation has doubled investment commitments to $8 billion and extended its reach, it said on Friday.

The Agriculture Innovation Mission for Climate (AIM for Climate) was launched one year ago and seeks to accelerate innovation in “climate smart” agriculture globally up to 2025, as the world races to contain global warming below 1.5 degrees Celsius.

At the COP27 climate change talks in Sharm el-Sheikh it announced commitments for $7 billion of investments from 42 governments, and $1 billion in innovation initiatives aimed at smallholder farmers in developing economies, new technologies, agro-ecological research and methane reduction.

Farming is on the frontline of extreme weather but is also a major contributor to global emissions that cause warming.

AIM will help farmers deal with challenges that have become more apparent this year, said US Secretary of Agriculture Thomas Vilsack: productivity losses linked to climate change, and higher input costs resulting from the COVID-19 pandemic and the war in Ukraine.

“I think there’s an opportunity here for us — for the United States in particular — but for large scale agriculture, to help inform smallholders about the knowledge and information we’re getting about more efficient use, more precise use of fertilizer and other inputs which can lower costs for farmers and also without jeopardizing productivity,” Mr. Vilsack told Reuters in a call. 

Agriculture could get to net zero “a bit faster than maybe some of the other industries that are commonly discussed when we talk about climate,” he said. “I think there’s just tremendous carbon sequestration capacity, there’s tremendous opportunities to reduce methane, there’s tremendous opportunities to convert agricultural waste into a variety of products that would significantly reduce the greenhouse gas footprint of agricultural production.”

Mr. Vilsack said the UAE, which imports about 80% of its food and will host the COP28 climate talks in 2023, wanted to help shore up production in food exporting countries as well as boosting self-reliance through innovation. — Reuters