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Solon files bill seeking to suspend fuel excise taxes

A HOUSE LEADER has filed a bill that seeks to bring down fuel excise taxes until 2025 to address high costs due to the rise in global oil prices. 

House Deputy Speaker Rufus B. Rodriguez filed House Bill 10246 on Thursday that seeks to bring back the excise tax on fuel products from Jan. 1, 2022 to Dec. 31, 2025 to the rates provided under the National Internal Revenue Code before it was amended. 

This would set the excise tax on regular gasoline at P4.35 per liter (/L), unleaded at P5.35/L, while diesel, kerosene, and liquefied petroleum gas will not be taxed. 

Republic Act No. 10963 or the Tax Reform for Acceleration and Inclusion Law raised excise tax on fuel in three tranches from 2018 to 2020. These rates are now at P10/L for gasoline, P6/L for diesel, P5/L for kerosene, and P3/L for liquefied petroleum gas. 

The Department of Finance has warned that the suspension of excise taxes on petroleum would result in as much as P131.4 billion in foregone revenues for 2022, which could affect the country’s economic recovery from the coronavirus pandemic. 

As of Oct. 26, pump prices for gasoline and diesel have increased by P20.80/L and P18.45/L respectively year to date, according to Energy department data. — R.L.C. Ku 

World Bank proposes grant for BARMM conflict monitoring project

REUTERS

THE World Bank has proposed extending a $738,000 grant to fund a conflict and data analysis project for the Bangsamoro Autonomous Region in Muslim Mindanao (BARMM). 

In a letter agreement dated Oct. 28, the World Bank, as administrator of the state and peace-building fund, proposed the grant in response to a financial assistant request made on behalf of International Alert. 

The grant is financed out of a trust fund based on periodic contributions from donors. The World Bank in May said it started to manage the trust fund receiving foreign financing for BARMM development, with the Australian government and the European Union pledging contributions. 

The Philippines Conflict Monitoring Project aims to provide conflict data and analysis for the development of policy responses. 

This includes the development of a real-time online database for conflict incidents in selected areas of the region and the creation of a 10-year report compiling data and analysis on conflict patterns in the region.  

An annual report on the findings of the analysis and a methodology paper on analyzing gender-based violence in the region will also be created. 

The project will then move on to the development of thematic policy notes, providing technical assistance to local governments and academic partners in conflict monitoring, disseminating a violent conflict report, supporting a conflict resource center through data, and carrying out a communication campaign. 

Finally, the program would require technical support for project management and the creation of a knowledge management system to share information. — Jenina P. Ibañez 

PCC clears JERA Asia’s acquisition of stake in AboitizPower

featuTHE Philippine Competition Commission (PCC) has cleared JERA Asia Private Ltd.’s pending share sale with listed power firm Aboitiz Power Corp. 

“On October 28, 2021, the Company was advised that the PCC issued an acknowledgement…that based on the PCC’s evaluation of the documents and information submitted by the parties, the proposed acquisition by JERA Asia of 27% equity interest in AboitizPower does not breach the prescribed compulsory notification thresholds under the Philippine Competition Act and its Implementing Rules and Regulations,” Aboitiz Equity Ventures, Inc. (AEV) said in a disclosure on Friday. 

AEV is the parent firm of AboitizPower. 

The commission also said the transaction is not “mandatorily notifiable.” 

Parties in an acquisition or merger must notify the PCC for transactions exceeding P1 billion and cannot execute the agreement until 30 days have lapsed, according to The Philippine Competition Act. 

Last month, AEV announced its plan to sell 27% of its stake in AboitizPower. 

Upon the sale’s completion, AEV will own a controlling stake of 52% in the listed power firm. 

JERA Asia is a wholly owned unit of Japan-based power generation firm JERA Co. 

Aboitiz Group President and Chief Executive Officer Sabin M. Aboitiz has said the transaction unlocks significant capital, which will be used to fund the group’s growth initiatives. 

AEV previously said AboitizPower is open to collaborating with JERA Asia in developing liquified natural gas projects and exploring the use of new power generation technologies, among others. 

AEV shares improved by 0.41% or 20 centavos to finish at P48.40 apiece on Friday. Meanwhile, AboitizPower shares inched up 0.16% or five centavos to close at P32.15 each. — A.Y. Yang 

Copyright registrations surge by 64%

COPYRIGHT registrations rose by 64% to 1,538 in the first nine months of 2021, surpassing the figure recorded last year, the Intellectual Property Office of the Philippines (IPOPHL) said on Friday. 

“Over the pandemic, our creative people…continue to do work. In fact, this is shown by the increasing level of copyright registrations before the Bureau of Copyright and Related Rights (BCRR), we have surpassed the 2020 level,” Emerson G. Cuyo, the IPOPHL Director of the BCRR, said in a virtual briefing on Friday. 

Copyright filings reached 940 last year. 

As of September 2021, the country’s copyright registrations have reached 10,148 since applications opened in 2011, the IPOPHL said. 

Daniel S. Hofilena, senior consultant of the IPOPHL, said copyright deposits were already picking up pace in the first quarter this year compared to the previous year. 

The filings rose by 91% to 444 from January to March 2021 from the 233 recorded in the same period last year, he said. 

“We’ve got a lot of creatives who are more aware of their rights because of the programs of the IPOPHL. At the same time, it can be said that the pandemic has spurred our creative industry,” Mr. Hofilena said in a mix of English and Tagalog. 

Earlier this month, the IPOPHL launched “Juan for the World”, a program which aims to protect the trademarks of micro, small and medium enterprises under the Madrid Protocol by the end of 2024. 

The protocol is an international trademark filing system which allows for single and cost-effective applications for registration. — A.Y. Yang 

BoI approves P603-M hospital project in Cagayan Valley

THE Board of Investments (BoI) has approved the P603-million general hospital project of Cagayan United Doctors Medical Center (CUDMC), which will augment capacity to help cater to critical coronavirus disease 2019 (COVID-19) patients. 

CUDMC is a five-storey hospital offering laboratory and diagnostic services, BoI said in statement on Friday. 

It has 18 critical care unit beds with a five-bed intermediate care unit. It will also have eight negative pressure isolation rooms and a laminar flow system operating room, among others. 

The hospital is expected to employ about 652 people. It is expected to generate about 514 jobs in the first four years of its commercial operations. 

The approved project will provide 100 additional beds for COVID-19 patients in the Cagayan Valley region, which now has a 78.8% bed occupancy rate for these cases, according to data from the Health Department.  

As a new operator of a level 2 general hospital, CUDMC can avail of lower income taxes and investment incentives as the project falls under Healthcare and Disaster Risk Reduction Management Services, as stated in the Corporate Recovery and Tax Incentives for Enterprises Act and the current Investment Priorities Plan. 

“Due to the stark concern on the spike of COVID-19 cases coupled with the limited hospital care capacity for patients, the project will augment the hospital capacity in Region II to cater for COVID-19 patients with critical symptoms,” Trade Undersecretary and BoI Managing Head Ceferino S. Rodolfo was quoted as saying. 

“Gains of such undertaking are doubling investments in the area of medical equipment and devices, manufacturing of medical supplies and pharmaceuticals, research and development, life sciences, and innovation,” Mr. Rodolfo added. 

Philex Mining eyes P3B from stock rights offering

Philex Mining Corporation is looking to raise up to P3.15 billion from its planned stock rights issue offering (SRO). 

In a disclosure to the stock exchange, the listed company said the board of directors approved a plan to undertake a stock rights issue offering (SRO) for eligible shareholders. 

Phile Mining Chairman Manuel V. Pangilinan, CEO Eulalio B. Austin, Jr. and Chief Finance Officer Romeo B. Bachoco were authorized by the board to set the terms and conditions of the SRO, including determining the “final issue size which shall be up to P3.15 billion.” 

The final terms will still need to be ratified by the board. 

“The net proceeds from the SRO, together with debt being arranged by a leading local financial institution and internally generated cash of Philex Mining, will be utilized for the development of the Silangan Copper and Gold Project through wholly owned subsidiaries Silangan Mindanao Exploration Co., Inc. and Silangan Mindanao Mining Company, Inc. and for general corporate requirements,” the company said. 

Philex Mining said the First Pacific Group, a major shareholder, is “highly supportive” of the SRO. 

THIRD QUARTER RESULTS  

Meanwhile, Philex Mining reported a P721.3-million net income in the third quarter, up 46% from the same period a year ago, “mainly due to higher copper prices, favorable foreign exchange rates and managed operating expenses.” This brought the nine-month net income to P1.880 billion, 105% higher from a year ago. 

Core net income for the July to September period jumped 55% to P716 million, bringing the nine-month core profit 116% higher to P1.865 billion. 

Philex Mining saw higher revenues due to the “favorable” foreign exchange rate and high prices for gold and copper. 

Revenues rose 13% in the third quarter to P2.656 billion, helping drive nine-month revenues 22% higher to P7.742 billion. 

“This is attributable to the significant increase in the realized price of copper since 3Q2020 resulting into a higher contribution of revenues from copper at 52% of total revenues for 9M2021 from 40% of total revenues for 9M2020,” the company said. 

Revenue contribution from gold slid by 59% in the first nine months of the year due to “slightly lower gold output.” 

“With higher metal prices and a better economic outlook for the mining industry moving forward, we can maintain the momentum of last year’s exemplary performance into this year, notwithstanding the pandemic and the challenges we have faced in our operations,” Mr. Pangilinan said in a separate statement. 

Philex Mining is one of the Philippine units of Hong Kong-based First Pacific, the others being Metro Pacific Investments Corp. and PLDT Inc. Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has interest in BusinessWorld through the Philippine Star Group, which it controls. — BADA  

Gokongwei-led URC sees net income jump 25% in Q3

Universal Robina Corp. (URC) reported a P2.47 billion net income attributable in the third quarter this year, up by 25% from a year ago as sales inched up nearly three percent.   

In a regulatory filing, the Gokongwei-led consumer food company reported P27.92 billion in revenues in the quarter ending September, from P27.2 billion a year ago. 

For the nine-month period, URC saw a 40% increase in net income attributable to P10.52 billion from P7.5 billion year on year. 

Revenues were flat in the first three quarters at P85.8 billion from P85.1 billion, as domestic sales of the branded consumer foods (BCF) segment dropped.  

The BCF segment, which manufactures snacks, noodles and beverages, saw sales dip by 2.5% to P60.37 billion during the nine-month period. It accounted for 70.4% of URC’s total sales.  

Domestic sales of branded snacks such as Chippy and Cloud 9 went down by 4.9% to P44.24 billion during the nine-month period. URC attributed this to the “high base (in 2020) fueled by pantry stock up with Taal eruption and the start of the pandemic shifting household spending to pantry essentials.”  

International sales, on the other hand, went up by five percent to P16.13 billion in the January to September period. 

“In constant US dollar terms, sales increased by 6.7% driven by Indo-China and Indonesia despite COVID challenges. Vietnam significantly grew by 17.7% driven by resurgence in beverage sales particularly C2 while Thailand recovered with 8.2% sales growth coming from strong domestic performance,” URC said. 

Sales from the packaging division climbed by 37.8% to P1.19 billion in the first nine months of the year from P860 million on the back of better pricing and higher volumes.  

URC’s agro-industrial group saw sales slide 7.4% to P8.54 billion from P9.22 billion in the same period last year.   

Meanwhile, sales from the company’s commodity foods group amounted to P15.71 billion, 19.7% more than the P13.12 billion logged the year earlier.   

On Friday, shares of URC at the stock exchange declined by seven percent or 10 centavos to close at P138 per share. — Keren Concepcion G. Valmonte  

Converge completes P6-B subsea cable project

Converge ICT Solutions, Inc. is scheduled to complete the P6-billion domestic submarine cable project, which connected the country’s three major islands to its national “fiber backbone,” on Sunday.  

“Not only does this ensure availability of the service nationwide, but with the network design, we’re assured to have a resilient backbone that’s able to carry the tremendous data traffic driven by our million-plus customers,” Dennis Anthony H. Uy, chief executive officer and co-founder of Converge, said in a statement on Friday.  

The company’s 1,800-kilometer subsea cable will make “its final landing” in Coron, Palawan on Sunday (Oct. 31).  

Converge uses a 48-fiber core optical cases, which is said to run on 400G and 800G technology, allowing more bandwidth for the transfer of data through the cable.   

Visayas and Mindanao were said to be connected during the first phase of Converge’s subsea backbone rollout in Bogo, Cebu and Cagayan de Oro. In the second phase, the company “closed the loops” by re-entering Visayas via Roxas City, Capiz in Panay and in Mindanao through Buena Vista.   

This is said to be supported by its 20 cable landing stations across the country.  

The company said its subsea cables would allow customers to have access to its fiber services “even in the case of fiber cuts.”  

“All these features on the network design and technology simply mean the connection on our network is more stable, more resilient, and less prone to failure or outages – wherever you are in the country,” said Converge Chief Operating Officer Jesus C. Romero.  

Converge said it is on track to meet its target of serving 55% of Philippine households by 2025.  

Shares of Converge at the local bourse declined by 3.20% or P1.05 on Friday, closing at P31.80 apiece.  — Keren Concepcion G. Valmonte  

The Keepers Holdings sets FOO price to P1.50 per share

The Keepers Holdings, Inc. set the price for its follow-on offering (FOO) at P1.50 per share, which is the lowest end of its already discounted price range.   

At this offer price, the company may raise up to P4.5 billion for the sale of three billion common shares.   

The company revised its FOO price range to P1.50 to P2 per share, down from the previous range of P2.00 to P2.50. It said it received approval from the Securities and Exchange Commission to adjust the price range on Oct. 26.    

“Given the string of public offerings in the local market this year, this may help gather more interest in the company’s [FOO], as well as providing some space for the issue to appreciate in value,” Darren Blaine T. Pangan, trader at Timson Securities, Inc., said in a Viber message.    

“This would entice more investors with the lowered final offer price, which provides greater potential upside in the future, especially if the economy re-opens or recovers further,” Rizal Commercial Banking Corp. (RCBC) Chief Economist Michael L. Ricafort said in a separate Viber message.   

The Lucio L. Co-led firm is involved in the liquor distribution business.  

RCBC’s Mr. Ricafort said that the reopening of restaurants and hotels once lockdowns are further eased may also provide an upside for the firm.   

“Liquor consumption increases alongside with any boost in consumer spending, which accounts for about 70% of the economy, as would be partly boosted before the elections,” Mr. Ricafort said.   

The Keepers Holdings entered a share-swap transaction with another Co-led listed firm, Cosco Capital, Inc., for shares in Montosco, Inc., Meritus Prime Distribution, Inc., and Premier Wine and Spirits, Inc.   

Cosco Capital was issued 11.25 billion of The Keepers Holdings’ shares in exchange.   

The company also increased its authorized capital stock to P2 billion from P327.6 million. It consists of 20 billion common shares with a par value of 10 centavos per share.  

As a result of the decrease in public float to 0.34%, shares of The Keepers Holdings were suspended and last traded at the stock market on July 7, closing at P2.95 each.    

The Keepers Holdings is conducting the follow-on offering to comply with the public float requirement. Its estimated public float post-offer stands at 20.94%. — Keren Concepcion G. Valmonte  

MPIC partners with SAP for future-proofing

Metro Pacific Investments Corp. (MPIC) has partnered with multinational software company SAP SE to future-proof and simplify its business processes.  

“One of our key objectives is really to future-proof our business and, in doing so, future-proof all our other stakeholders, including our partners, investors, employees, and even ourselves,” MPIC Chief Financial Officer and Chief Sustainability Officer Chaye A. Cabal-Revilla said during an online briefing on Friday.  

SAP offers solutions aimed at simplifying business processes, as well as standardized metrics and analysis tools designed to minimize carbon footprint. 

“If we can have a good reference for what we are doing for MPIC, this will translate into all of those other transformations to intelligent enterprise that [we] will be having to all our 1,800 customers here in the Philippines,” SAP Philippines Managing Director Edler R. Panlilio said. 

“While moving customers to intelligent enterprise, I think we are really driven by that purpose of SAP to really put sustainability at the forefront of these transformations,” he added. 

SAP has 102,400 employees from more than 140 countries, including the Philippines, and has more than 22,000 global partners, according to its website. 

“I think everyone will agree with me that the biggest disruption if we don’t act now is really climate change,” Mr. Panlilio said. 

“Now is really the time to act on it, and that’s part of our sustainability efforts,” Ms. Cabal-Revilla said. 

MPIC is one of three key Philippine units of First Pacific, the others being Philex Mining Corp. and PLDT, Inc. 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. — Arjay L. Balinbin 

Semirara Mining nets P4 billion in Q3

Semirara Mining and Power Corporation (SMPC) reported P4 billion in net income in the third quarter, surging more than five times from P750 million during the same period a year ago as prices and demand for coal increased. 

In a regulatory filing, the listed miner said its P4.01 billion income is “its highest-ever quarterly net income for the period.”  

“The surge in earnings was mainly due to the double-digit rise in Semirara coal sales and average selling price (ASP), as the strong rebound in post-pandemic economic activities, low inventory, production disruptions and stockpiling for the coming winter season widened the global supply and demand gap for coal,” SMPC said. 

Revenues doubled to P14 billion in the third quarter from P7.2 billion a year ago. This was driven by revenues from coal which soared 215% to P9.72 billion, while power revenues inched up 3.7% to P4.27 billion.  

Coal accounted for the bulk of SMPC’s sales, while Semirara-Calaca Power Corporation accounted for 17% and Southwest Luzon Power Generation Corporation accounted for the remaining 5%.  

The company said the average selling prices of its coal soared 82% to P2,831 per metric ton (MT) in the July to Sept. period from P1,558 per MT in the same period last year.  

However, production of coal, however, dropped by 39% to 2 million metric tons (MMT) this quarter from 3.3 MMT in the same quarter last year due to heavy rains affecting the company’s water seepage management efforts in its Molave pit.  

“We expect our coal segment to continue to do well for the rest of the year because of elevated coal prices and sustained strong demand from China,” SMPC President and COO Maria Cristina C. Gotianun said in a statement.  

On the other hand, the power segment was affected by the higher plant outages in the third quarter.  

“Total power sales fell by 34% to 1,032 GWh as three of the four SMPC plants were down for various periods during the quarter. Improved market conditions due to demand recovery to pre-pandemic level has served as a cushion from the full impact of lower plant availability,” the company said.  

Meanwhile, SMPC said its consolidated net income of P10.29 in the first nine months of 2021 has already exceeded its pre-pandemic annual income of P9.7 billion.  

“Stable coal production and reduced internal usage amid a tight market allowed the Group to take advantage of accelerating China demand, record-high coal prices and the weak peso. However, this was tempered by the prolonged forced shutdown of SCPC Unit 2 and higher replacement power purchases,” the company said.  

Excluding a non-recurring P133-million loss this year mainly from the deferred tax remeasurement due to the effectivity of the CREATE Law and a one-time gain of P61 million from a financial contract, consolidated core net income jumped 256% to P10.43 billion. — Bianca Angelica D. Añago  

Supply chain challenges push IMI to Q3 loss

Integrated Micro-Electronics, Inc. (IMI) swung to a $1.28-million net loss attributable to equity holders of the parent company in the third quarter from a $9.1-million profit during the same period in 2020, citing challenges arising from the global supply chain snarls and lockdown restrictions. 

In a statement, the manufacturing arm of AC Industrial Technology Holdings, Inc. reported revenues from its contracts with customers inched up two percent to $319 million during the July to September period. 

“Customer demand is still strong and we continue to win projects in strategic segments of the industry. However, the extended component shortage is forcing us to delay a significant amount of business,” IMI President Jerome S. Tan said in a statement on Friday.  

IMI’s wholly-owned businesses saw revenues grow by five percent year on year to $249 million, while revenues for VIA optronics and Surface Technology International (STI Ltd.) went up by four percent to $77 million.   

IMI said business margins and growth remain dampened by the global supply chain issues and local lockdown restrictions that have affected the recovery of major suppliers in the component industry.  

“Just as supply chain challenges were starting to show signs of easing, rising [COVID-19] Delta cases in chip manufacturing regions has pushed back the recovery timeline. The situation has been further complicated by global shipping bottlenecks and expensive logistic expenses in 2021,” Mr. Tan said.  

Global freight expenses have soared amid port congestion and shortages of shipping containers. 

“The industry is now forecasting a staggered recovery in 2022, which is when we expect to clear the order backlogs in our facilities,” he added.   

For the January-to-September period, IMI narrowed its net loss attributable to equity holders of the parent firm to $5.32 million, 55% lower than the $11.89 million in the same period last year.  

Nine-month revenues grew by 23% to $972.97 million from $788.62 million a year ago.  

Shares of IMI declined by 2.42% or 22 centavos to close at P8.88 apiece on Friday. — K.C.G.Valmonte  

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