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MPIC net income surges nearly four times to P7B

Company officials say banks keen on REIT for tollways, hospitals

By Arjay L. Balinbin, Senior Reporter

METRO Pacific Investments Corp. (MPIC) on Wednesday reported a 272.06% increase in its first-quarter attributable net income, owing to the sale of its stakes in a power producer and a toll road business in Thailand, as well as the recently signed tax incentives law.

MPIC’s attributable net income for the first quarter reached P7.03 billion, up from P1.89 billion in the same period last year, the company said in a statement to the stock exchange.

The company said it benefited from the gain recognized from the sale of Global Business Power Corp. and Thailand’s Don Muang Tollway Public Co. Ltd.

“These recent asset sales underscores MPIC’s commitment to optimizing its portfolio and realizing value for its stakeholders,” it said.

However, the company’s first-quarter core net income fell 26% to P2.5 billion, blaming the decline on the economic contraction caused by the public health crisis.

The pandemic, MPIC said, has resulted in “reduced toll road traffic, light rail services, and commercial and industrial demand for water and power.”

The recently signed Republic Act No. 11534 or the Corporate Recovery and Tax Incentives (CREATE) law that lowered the income tax rates from 30% to 25% also aided the company’s performance in the first quarter, MPIC noted.

“This law eases the company’s future tax liabilities and consequently allows reallocation of resources to further improve operational efficiencies,” it added.

MPIC Chief Financial Officer and Chief Sustainability Officer June Cheryl A. Cabal-Revilla said at an online briefing: “In the first quarter, we actually recognized some positive impact, with the tax rates lowered from 30% to 25%, and that’s about P500 million for the group.”

The company’s operating revenues declined 7.16% to P10.63 billion in the first quarter from P11.45 billion in the same period in the previous year.

MPIC’s power business, which consists of contributions from Manila Electric Co. (Meralco) and Global Business Power, accounted for P2.5 billion or 66% of the total contribution from operations.

Meralco’s core net income fell 11% to P5.1 billion in the first quarter. MPIC said the decrease was “driven by lower energy sales, lower interest income on cash investments, and higher operating expenses.”

Global Business Power’s core net income increased 19% to P522 million because of the CREATE law, it noted.

MPIC’s toll road business saw its core net income fall 15% to P788 million. The decline was due to the “decrease in traffic volumes, higher interest expense and amortization from expanded capital expenditure initiatives in the construction of new roads, and the reduction in contribution from international toll roads owing to the divestment of Don Muang Tollways in Thailand in February 2021.”

“This was partly offset by the positive impact of the CREATE law,” MPIC added.

MPIC said toll roads contributed P800 million or 21% of the total contribution from operations.

The water segment, which consists of contributions from Maynilad Water Services, Inc. and Metropac Water Investments Corp., contributed P500 million or 14% of the total.

Maynilad saw its first-quarter core net income fall 24% to P1.2 billion.

“Amortization and depreciation expenses increased due to substantial investments in the Putatan Water Treatment Plant 2, in the Pasay and Parañaque sewage treatment plants, and continuing upgrades to facilities, partly offset by lower income tax resulting from the CREATE law,” MPIC noted.

The company’s light rail business through the Light Rail Manila Corp. reported a core net loss of P104 million, mainly due to the reductions in capacity and average daily ridership.

MPIC’s hospitals under the Metro Pacific Hospital Holdings, Inc. saw a 6% increase in their consolidated core net income to P285 million.

The increase was “driven by the growth in revenues, further augmented by the positive impact of the tax reduction from CREATE law,” MPIC said.

According to Ms. Cabal-Revilla, MPIC is “poised to hit P12 billion in core income” at the yearend.

REIT AS FUNDING OPTION
MPIC also said on Wednesday it is studying the possibility of pioneering real estate investment trust (REIT) for infrastructure.

“We have been approached by several banks to consider REITs, especially for the hospital business. But we are now the minority shareholder in the hospitals, so it’s really up to the majority shareholders to decide,” MPIC President and Chief Executive Officer Jose Ma. K. Lim said.

Metro Pacific Hospital Holdings President and Chief Executive Officer Augusto P. Palisoc, Jr. said the matter is a “possibility.”

“I think the REIT is a possibility for the hospital group, but we will have to study it very carefully. At the moment, we are very busy with the COVID surge and the vaccination programs that are coming our way,” he said.

For her part, Ms. Cabal-Revilla said: “I think our toll roads group has also been approached to do REITs, but I think they are looking at this from a timing perspective.”

“We’ve been approached… One of our objectives is also to do a public listing eventually. But right now, our portfolio is not yet balanced,” Metro Pacific Tollways Corp. President and Chief Executive Officer Rodrigo E. Franco noted.

REITs require a company to have a recurring income portfolio that investors may put their money into through the purchase of public shares. The new rules of the Securities and Exchange Commission require a minimum public float of 33% and a paid-up capital of P300 million for REITs.

MPIC shares closed 2.44% lower at P4 apiece on Wednesday.

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.

Tan’s LT Group earmarks nearly P10B for capex

AYALALAND.COM.PH
THE company also set some P1 billion for ALI Eton Property Development Corp. — AYALALAND.COM.PH

By Keren Concepcion G. Valmonte

LUCIO C. Tan’s LT Group, Inc. (LTG) is allocating P9.7 billion for capital expenditures (capex) this year, nearly double the previous year’s P5-billion budget as the company expects the slow opening of the economy to “bode well for all businesses in general.”

The listed holding firm is formed by Tanduay Distillers, Inc. (TDI), Asia Brewery, Inc. (ABI), Fortune Tobacco Corp., PMFTC, Inc., Eton Properties Philippines, Inc., Philippine National Bank (PNB), and Victorias Milling Co., Inc.

Nearly half or P4.6 billion of the company’s capex will be allocated for PNB’s digitalization efforts.

During the company’s annual stockholders’ meeting, LTG President and Chief Operating Officer Michael G. Tan said the group’s banking segment is expecting to see more nonperforming loans as the grace period given to borrowers ended in 2020.

“A better economy should pave the way for the need for more loans,” Mr. Tan said.

Meanwhile, the company does not expect its property firm to be as affected compared with other real estate developers since it has more office spaces in its leasing portfolio.

LT Group has increased its capex allocation to P2 billion for Eton Properties after construction was halted last year due to pandemic restrictions.

The company also set some P1 billion for ALI Eton Property Development Corp., its joint venture firm with Ayala Land, Inc.

“We expect the demand for our consumer goods, those of TDI and ABI to show some volume growth or at least remain steady,” Mr. Tan said.

LTG earmarked around P1.5 billion of its capex for TDI and around P700 million for ABI.

“But the volume of PMFTC’s products might still be impacted, as price increases are needed to pass on the annual increase in excise taxes, the last of which was in October 2020,” Mr. Tan said.

LTG also said it was able to secure enough vaccines for over 54,000 of its employees and service providers, as well as for their families.

On Wednesday, LTG shares at the stock exchange went down by 1.36% or P0.18 to close at P13.10 apiece.

Aboitiz group extends terms of CEO, president until 2027

ABOITIZ GROUP

THE board of directors of Aboitiz Equity Ventures, Inc. (AEV) has given the go signal to extend Sabin M. Aboitiz’s term as the listed holding company’s president and chief executive officer until Dec. 31, 2027.

Mr. Aboitiz was supposed to step down at the end of 2024.

“[He] has proven to be a leader who can steer us wisely and resolutely in the right direction, through turbulent waters toward a safe and prosperous harbour in the years to come,” Endika M. Aboitiz, chairman of AEV, said in a statement on Wednesday.

Succeeding his brother Erramon I. Aboitiz, the group’s current president ran the ship beginning Jan. 1 last year. He was lauded by the company for his “decisive leadership, innovative mind-set and ensuring business continuity amid the turbulent economic climate due to the pandemic.”

“The board’s vote of confidence for Sabin comes as AEV and its business units are targeting recovery after the widespread economic disruption caused by the COVID-19 pandemic,” AEV said.

For the first three months of 2021, the Aboitiz group’s income soared by 276% year on year to P7.6 billion from P2 billion.

AEV shares at the stock exchange on Wednesday declined by 1.26% to P35.30 each. — Keren Concepcion G. Valmonte

Yields on BSP’s term deposits drop on steady April inflation

BW FILE PHOTO

YIELDS on the central bank’s term deposits slipped on Wednesday following steady April inflation data and as the peso strengthened in the past days.

Demand for the term deposit facility (TDF) of the Bangko Sentral ng Pilipinas (BSP) hit P583.062 billion on Wednesday, higher than the P510 billion on the auction block as well as the P546.571 billion in tenders logged a week earlier.

Broken down, tenders for the one-week term deposits amounted to P157.385 billion on Wednesday, surpassing the P150-billion offer but failing to beat the P174.267 billion in bids seen during the previous offering.

Banks asked for yields ranging from 1.7% to 1.7499%, narrower than the 1.7% to 1.755% band recorded on April 28. With this, the average rate for the seven-day papers dipped by 0.97 basis point (bp) to 1.7314% from 1.7411% last week.

Meanwhile, the 14-day deposits attracted bids amounting to P425.677 billion, higher than the P360 billion auctioned off by the BSP as well as the P372.304 billion in tenders seen a week ago.

Accepted rates for the two-week papers ranged from 1.7% to 1.76%, lower than the 1.725% to 1.78% band seen last week. This caused the tenor’s average rate to drop by 1.15 bps to 1.7486% from 1.7601% previously.

The BSP did not offer 28-day deposits for the 28th straight week to give way to its weekly offerings of bills with the same tenor.

Term deposits and the BSP’s short term securities are used by the central bank to mop up excess liquidity in the financial system and guide market rates.

Yields on the term deposits declined following the release of April inflation data, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said.

Headline inflation was steady at 4.5% in April, data released by the Philippine Statistics Authority on Wednesday showed. This was slower than the 4.7% median estimate in a BusinessWorld poll held last week but remained higher than the BSP’s 2-4% target for the year for the fourth consecutive month.

Year to date, inflation averaged 4.5%, above the central bank’s 4.2% forecast for 2021.

Mr. Ricafort said the peso’s recent rise versus the dollar also improved market sentiment, resulting in the lower TDF yields seen on Wednesday.

The peso logged a four-day rally to close at P48.025 versus the greenback on Wednesday. This was its strongest finish in more than two months or since its P47.93-a-dollar close on Feb. 15. — L.W.T. Noble

End-March state-backed loans to MSMEs surge by sevenfold

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GUARANTEED LOANS to small businesses climbed as of March as Philguarantee Corp. received more funds, the Finance department said. — BW FILE PHOTO

STATE-RUN Philippine Guarantee Corp. (Philguarantee) saw its guaranteed loans to micro, small and medium enterprises (MSMEs) surge by sevenfold as of March from the end-2020 level after receiving the P5 billion in additional funds from the government’s second stimulus package.

The Department of Finance (DoF) reported on Wednesday that Philguarantee’s overall guaranteed loans to MSMEs jumped by 612% to P1.47 billion as of March from P207 million in December 2020. The statement quoted a report from the state-run firm’s president and CEO Alberto E. Pascual.

The number of small businesses that availed of the MSME credit guarantee program (MCGP) also spiked by 312% to 12,122 as of March from 2,948 at end-2020.

Mr. Pascual said improved processing and evaluation processes helped boost the number of businesses that availed the program.

Most of the beneficiaries were from wholesale and retail sectors, according to Mr. Pascual, with P503.5 million in total guarantee loans extended to 9,113 of these enterprises.

This was followed by the agriculture sector, where 158 MSMEs were able to take out P33.91 million in government-backed loans; the hotel and restaurant sector, with 573 firms receiving P28.45 million in credit guarantees; and the personal services sector with a combined P31.82 million in guarantees.

Philguarantee is implementing the government’s P120-billion MCGP meant to help the sector recover from the coronavirus pandemic’s impact by encouraging banks to lend more.

Republic Act No. 11494 or the Bayanihan to Recover as One Act (Bayanihan II) infused additional capital of P5 billion into the state-run firm to expand the program, P2 billion of which was alloted for MSMEs and the rest for guarantee loans of bigger companies requiring up to P300 million in credit cover.

The Budget department released the additional capital on Feb. 8.

In terms of location, Mr. Pascual said borrowers from all regions were able to tap the facility, with the biggest guaranteed loans going to borrowers from the Calabarzon Region (P135.76 million), Central Luzon (P118.87 million), and the Ilocos Region (P65.82 million).

Around P37.7 billion in loan guarantee facilities have been approved so far for 34 banks since last year. The number of banks actively participating in the program also grew to 14 banks at end-March from just three as of 2020.

Mr. Pascual said 12 more financial institutions are scheduled to submit their lists of businesses eligible for guarantee coverage.

The MSME credit guarantee scheme covers loans worth P100,000 to P1 million availed by micro firms from thrift banks and rural banks. The program provides 50% guarantee cover for working capital loans and up to 80% for term loans of up to seven years for use in capital expenditure projects. — B.M. Laforga

Smart partners with AT&T to launch 5G roaming in US

SMART Communications, Inc., the wireless arm of PLDT, Inc., announced on Wednesday that it is launching its fifth-generation (5G) roaming services in the United States.

Smart is working with mobile services company AT&T to launch 5G roaming services in the US, the Philippine telco said in an e-mailed statement.

“We are the first Philippine operator to launch a complete roaming pack for our prepaid customers in the United States,” said Alice R. Ramos, vice-president and head of Roaming and Consumer Business at Smart.

“The US is among the top destinations of tourists and migrant Filipinos, and this partnership with AT&T propels us forward in our goal to bring our world-class 5G roaming services to them,” she added.

Smart said it now has 22 international partners for its 5G roaming services in 16 countries.

It recently partnered with True in Thailand; Sunrise in Switzerland; SmarTone and Hong Kong Telecommunications in Hong Kong; Pelephone in Israel; Turkcell in Turkey; Ooredoo and STC in Kuwait; StarHub in Singapore; NTT Docomo in Japan; Vodafone in Australia; Zain Kuwait, Zain Saudi Arabia, and Zain Bahrain; China Mobile and China Unicom in China; Etisalat and du in the United Arab Emirates; FarEasTone and T-Star in Taiwan; and KT Corp in South Korea.

Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has a stake in BusinessWorld through the Philippine Star Group, which it controls. — Arjay L. Balinbin

Pinoy food beyond the table

FACEBOOK.COM/FILIPINOFOODMONTHOFFICIAL

THE CULMINATING talk of Filipino Food Month, titled “The Endless Possibilities of Filipino Cuisine,” took the discussion beyond the table and into the fields of tourism and education.

The talk, held over Facebook Live on April 30, brought together the Head of the National Commission of Culture and the Arts’ (NCCA) Committee on Music Prof. Felipe de Leon, Jr., sustainable tourism advocate and co-chair of the Philippine Coffee Board Pacita Juan, and Agricultural Counselor for the Philippine Embassy in Beijing Ana Abejuela.

Mr. De Leon made a case for the continued celebration of Filipino Food Month despite the pandemic. “Ang pinakamalapit sa puso ng mga Pilipino, bukod sa kanyang wika, ay relihiyon; pangatlo ang pagkain. Maski gaano katagal na sa ibang bansa ang isang Pilipino, hindi pa rin niya makakalimutan ang kanyang relihiyon, wika, at panglasa. Talagang hinahanap pa rin niya ang pagkain natin (The thing closest to a Filipino’s heart, aside from their language, is their religion; third is food. No matter how long one stays in another country, they do not forget their religion, language, and tastes. They still really look for our food),” he said. “Para sa akin, importante na mapag-aralan ang pagkain, para lalong maintindihan ang ating kultura (For me, it is important to study food, to better understand our culture).”

Ms. Abejuela, meanwhile, takes a stab at its necessity for purposes of the economy. “When that awareness is awakened, it starts. You like it. If you like it, you buy it, or you eat it in a  restaurant. You cook it at home. At the end of the day, it creates economic activity.”

According to Mr. De Leon, during NCCA’s Heritage Month (celebrated every May), their office collects 150 recipes from all over the country, noting that the most familiar are those found in the lowlands. By his count, there are at least 131 languages spoken in the Philippines — each one corresponding to a unique group, each with their own recipes. “Kapag nakilala natin ang kani-kanilang lutoay naku! — ang laki-laking industriya niyan (When we become familiar with each of their cuisines — my goodness! — what a huge industry it could be).”

“What we need to focus on is the use of local ingredients,” said Ms. Juan in a mix of English and Filipino. “It is timely for us to discover using our local ingredients,” she said, citing difficulties in the shipping and logistics industry due to the pandemic; thus delaying the arrival of imported goods. “We need to ask, ‘Why have we been given this kind of food?’ We need to re-appreciate the local food for those at home, for those who cook — because the consumer is always a co-producer. If it isn’t eaten, it won’t be grown.”

Speaking of producing, Ms. Juan also pointed out how Korean soft power via K-drama has played a role in promoting that country’s cuisine (and by extension, its culture). She urges Filipino entertainment to do the same to inject “more cultural nuance into the script, but the viewer will appreciate it because it’s contextual.”

On a related note, Ms. Abejuela thinks that instilling familiarity with our cuisine (and therefore a love for it) should start at a young age, suggesting the expansion of Home Economics programs in schools. Based on her own experience, “We usually cooked, before, local dishes with the ingredients available, and the ingredients that we have planted,” she said. “It starts with the young. If children are aware of how beautiful and how delicious our dishes are, they will look for them,” she said in a mixture of English and Filipino.

Promotion of Filipino cuisine had been brought up due to the discussion of the more pervasive influence of other Asian cuisines on the world stage: everybody knows what sushi, pad thai, or bulgogi is; but it takes some work to introduce sisig or adobo. “The show-window of a country is when tourism goes up,” said Ms. Juan. “We need that tipping point in the number of tourists who visit us,” she said. “The availability of access to a country’s culture brings the food with it.” She still hopes though, that with the number of Filipinos abroad, our cuisine could make an impression on the world’s palate.

Mr. De Leon agrees. “Ang access, nasaan (Where is the access)?

“When you go to a place, it’s so hard to find Filipino food. Filipinos have to appreciate their own culinary fare [first],” he said in a mix of English and Filipino. “How can we convince other people about the story of our own food?” — J.L. Garcia

Microinsurance premium production down in 2020

BW FILE PHOTO

THE MICROINSURANCE industry’s total premium production dropped by 14.5% last year, but the number of persons covered by these products increased at the height of the coronavirus pandemic, the Insurance Commission (IC) reported on Wednesday.

The IC said in a statement that the total premiums produced by microinsurance companies in the country went down to P7.8 billion in 2020 from P9.12 billion in 2019, citing unaudited financial reports.

The regulator attributed the decline to the strict quarantine measures imposed by the government last year at the height of the coronavirus pandemic.

The nonlife insurance sector posted the largest drop in premiums at P913.51 million, down by 25.46% year on year. This was followed by the mutual benefit association (MBA) sector, which produced P4.46 million in premiums last year, or 15.13% lower from the 2019 level.

The life insurance sector likewise recorded an 8.17% decrease in premiums to P2.42 billion.

“Nevertheless, we are hopeful that these adverse effects are only temporary; and that the situation will improve in the succeeding months. Despite these year-on-year decreases, the microinsurance sector’s premium and contribution production still signified growth [on a quarterly basis],” Insurance Commissioner Dennis B. Funa was quoted as saying.

Meanwhile, the number of lives covered by microinsurance products went up by 11.56% to 50.35 million last year from 45.13 million the year before, breaching the IC’s 50 million goal two years ahead of the 2022 target.

The expansion was led by the life sector, whose microinsurance products’ covered lives rose by 33.48% to 14.7 million in 2020. The MBA sector reported 28.96 million lives insured, up 12.88% year on year.

The growth in the number of lives insured by these two sectors more than offset the 20.96% drop in the coverage of the nonlife insurance sector to 6.69 million last year from 8.47 million in 2019.

Grace periods, the deferment of premium payments, and further extension of various relief measures may have contributed to the lower premiums earned by the industry and the increased number of lives insured, the IC said.

MBAs continued to be the biggest player in the microinsurance industry last year, both in terms of coverage and premiums, with its premium production and total number of lives insured taking market shares of 57.2% and 57.5%, respectively.

For their part, life insurers contributed 31% to the microinsurance industry’s premiums in 2020 and serviced 29.19% of the total market. Meanwhile, the nonlife sector produced 11.7% of total premiums and had a 13.29% share in terms of coverage.

MBAs that led in terms of premiums last year were: CARD Mutual Benefit Association, Inc., Pag-Asa ng Pinoy MBA, Inc.; Tulay sa Pag-unlad Mutual Benefit Association, Inc.; Simbag sa Emerhensiya Asin Dagdag Pasegurohan MBAI; and Alalay sa Kaunlaran Benefit Association, Inc.

Meanwhile, the life insurance firms that recorded the biggest microinsurance premiums last year were: CLIMBS Life and General Insurance Cooperative; Pioneer Life, Inc.; United Coconut Planters Life Assurance Corp.; 1 Cooperative Insurance System of the Philippines; and Country Bankers Life Insurance Corp.

Nonlife insurers that made it to the top five were: CARD Pioneer Microinsurance, Inc.; The Mercantile Insurance Co., Inc.; Pioneer Insurance & Surety Corp.; UCPB General Insurance Co., Inc.; and Visayan Surety & Insurance Corp. — B.M. Laforga

SMIC income up by 5% after cutting costs

SM Investments Corp. (SMIC) reported on Wednesday that its consolidated net income increased by five percent to P9.5 billion in the first three months of the year from P9 billion year on year due to cost-cutting measures.

“We have reduced our operating costs and are benefiting from the high levels of cost efficiency that we focused on during the last twelve months,” SMIC President and Chief Executive Officer Frederic C. DyBuncio said in a statement on Wednesday.

The company closed the January-to-March period with consolidated revenues of P96.9 billion, 13% lower than the P111.2 billion seen last year.

Its banking segment accounted for 54% of its net earnings from core businesses.

BDO Unibank, Inc. generated a net income of P10.4 billion during the quarter, 19% higher than the P8.8-billion income seen in the previous year “on the robust performance from service fee businesses that compensated for the weak demand for loans.”

Loans at BDO dropped by one percent year on year to P2.2 trillion, while total deposits increased by two percent to P2.6 trillion with an 11% rise in CASA (current account and savings account) deposits.

Meanwhile, China Banking Corp. reported a net income increase of 64% to P3.6 billion from the P2.2 billion seen in the same period last year.

China Bank’s net interest income went up by 16% to P9.2 billion due to a 52% interest expense dip.

“This was supplemented by a three-fold growth in fee-based income to P3.6 billion, driven by strong trading and securities gains of P2.2 billion,” SMIC said.

SMIC’s property segment contributed 33% of the company’s net earnings from subsidiaries.

SM Prime Holdings, Inc. finished the quarter with P6.5 billion in consolidated net income, which declined by 22% from P8.3 billion last year. Consolidated revenues fell by 19% to P20.8 billion from P25.8 billion.

Residential revenues grew by five percent to P11.9 billion, revenues in local mall businesses went down by 48% to P5.9 billion year on year, while other business segments contributed P1.6 billion in SM Prime’s consolidated revenues.

SM Retail Inc. generated a first-quarter net income of P1.6 billion, a 36% improvement from P1.2 billion earned in the first three months of 2020. However, revenues declined by 14% to P70 billion from P81 billion.

Food businesses in SM Markets, WalterMart, and Alfamart saved in utility expenses due to the use of energy-efficient lighting and refrigeration.

Meanwhile, non-food stores The SM Store and Specialty Retail also had cost-cutting measures, which led to a 58% growth in net earnings.

“As our businesses adapt to a challenging operating environment and broader economic uncertainties, we continue to innovate and find new ways to service our customers’ needs,” Mr. DyBuncio said.

On Wednesday, SMIC shares at the stock exchange went down by 0.94% to close at P951 each. — Keren Concepcion G. Valmonte

2020 Doreen Gamboa Fernandez Food Writing Award: Bile — More than just an unlikely condiment

PINAPAITAN (soup of beef or goat innards) — WIKIHOW.COM/COOK-PAPAITAN

By Jeanne Rebollido Jacob-Ashkenazi

(Second Prize winner of the 2020 Doreen Gamboa Fernandez Food Writing Award)

OF THE FLAVORS that the human tongue can detect —  salty, sweet, sour, bitter, and savory (umami), bitter is the least acceptable and provokes the most aversion. From an evolutionary perspective, rightly so, as many bitter substances are toxic, and humans are programmed to avoid them.

And yet strangely, bitterness characterizes the well-loved dishes of regional cuisines: Pinapaitan (soup of beef or goat innards), Kilawen (raw or half-cooked beef or goat in vinegar), and Kappukan (boiled innards of goat with vinegar) of the Ilocos, and Kinigtot (a stew of goat meat and innards simmered in spices and bile juice) and Sinanglaw (soup of beef and beef offal flavored with kamias and bile juice) of Pangasinan. These dishes owe their bitterness to bile and, sometimes additionally, chyme (partially digested fodder).

Northern Filipinos are not the only ones partial to bitter flavors. The Dai ethnic group in southern Yunnan is noted for its celebratory banquet called Sa Pie, which includes dishes laced with bile and chyme. Its closest neighbors, the Isan ethnic community in northern Thailand and Laotians, also feature bile in their version of steak tartare called Laap (also spelled Larb). Further afield in Italy, chyme from unweaned calves furnishes the sauce for a Roman dish called Pajata.

What explains the popularity of these bitter substances as condiments? These dishes, with the exception of Sa Pie and Pajata, are drinking foods, usually prepared by men to be eaten with other men. There may be an underlying, unstated theme of machismo on display here through the eating of extremely bitter foods, not dissimilar to extreme chili-eating competitions. However, Ilocanos assert that bile serves to mangpatibker  that it enhances health and is a stamina-builder. Surely there are other pleasant-tasting foods that restore energy and preserve health, such as eggs, fatty fish, lean meats. So what makes bile so attractive as a condiment and flavoring?

A clue may be found in what makes other bitter substances such as coffee, tea, cocoa, beer, alcoholic drinks, or bitter melon acceptable, and eventually palatable and sought-after. Our first experience of these bitter-tasting foods makes us reject them, especially when we do so as children. As we continue eating or drinking them however, we gradually overcome our initial aversion.

Surely psychological and socio-cultural factors are also at play, but research on taste offers solid evidence as to why. The change from outright aversion to liking is apparently due to the 1,000 specific proteins in our saliva. Recent research into ingestive behavior at the University of Buffalo found that what we eat determines the make-up of our saliva proteins, and these in turn modulate our sense of taste. Hence, while the first exposure to bitter foods may be a turn-off, subsequent exposure becomes enjoyable as our salivary proteins reconfigure themselves accordingly (unless we are supertasters of bitterness).

This still doesn’t address why regular consumers of bile-flavored foods believe that doing so enhances their stamina and improves their health. It now appears that bitterness is perceived by bitter taste receptors that exist not just in our tongue, but also throughout the body. What are they doing there? Researchers at the University of Massachusetts Medical School found that bitter taste receptors (called T2Rs, also Ta2Rs) in the respiratory system function as our first line of defense against harmful microorganisms by triggering the release of bactericides. In the digestive system, T2Rs induce the flushing of toxic substances to limit their harmful effects, regulate food intake, and deter parasitic infection. Likewise, T2Rs in the genito-urinary system sense harmful substances during fertilization. Hence, eating bile (among other bitter substances) triggers the body’s innate immunity, thus supporting disease prevention and promoting health.

Chinese traditional medicine has long recognized bile’s therapeutic functions. Ox, water buffalo bile, and goat bile are cited in its oldest prescription records.* The active ingredient of bear bile, the most widely prescribed, was found to be ursodeoxycholic acid (a bile acid), currently medically approved for liver conditions.** This led to further investigations on the functions of bile acids as therapeutic agents. Besides bile’s acknowledged role in fat digestion and absorption of vitamins A, D, E, and K, current biochemical research is clarifying the extensive therapeutic role of bile acids and their interaction with gut microorganisms in liver metabolism and metabolic conditions, such as obesity and diabetes.*** Thus, contemporary bile research staunchly supports the centuries-old adage “bitter in the mouth, healthy in the stomach” —  confirming what lovers of Pinapaitan, Kilawen, Kinigtot, Sinanglaw, Sa Pie, and Laap may have intuitively known all along.

*Wang, David Q-H and Martin C. Carey. Therapeutic uses of animal biles in traditional Chinese medicine: An ethnopharmacological, biophysical chemical and medicinal review. World J Gastroenterol. 2014 Aug 7; 20(29): 9952–9975.

**Hofmann, Alan F. The continuing importance of bile acids in liver and intestinal disease. Arch Intern Med. 1999;159(22):2647-2658.

***Feng CC, Zhang AH, Miao JH, Sun H, Wang XJ, et al. Recent advances in understanding cross-talk between bile acids and gut microbiota. Open J Proteom Genom 2018; 3(1):024-034.

THE DOREEN Gamboa Fernandez Food Writing Award (DGF Award) recently announced the winners of the 2020 competition. The subject matter was “Livestock,” which, in the Philippines refers to cattle, pigs, goats, carabaos, and horses. The DGF Award is now in its 19th year. Named after the late dean of food writers, Doreen Gamboa Fernandez, it was founded to encourage writers to contribute to Philippine food literature. The winning essays of the first 15 years have been published in two books — Savor the Word and Sangkap.

Lugaw Challenge brings a new spin to the essential Filipino dish

LAKSA LUGAW

THE RECENT talk of the town was the viral “lugaw is essential” mishap, wherein some local government officials prohibited a food delivery rider from delivering glutinous rice porridge due to the curfew. Inspired by all the discussion around lugaw, the De La Salle-College of Saint Benilde (DLS-CSB) Culinary Cluster came up with the idea of a Lugaw Challenge, which tasked 10 culinary experts from the School of Hotel, Restaurant, and Institution Management to give their own twist on this favorite Filipino comfort food.

It started when Benilde Culinary Program Chairperson Chef Margarita Marty posted a photo of her enjoying lugaw on social media. “Several faculty members commented that I only eat sosyal na lugaw (fancy lugaw) but this is not true. I often have it for meals,” she recalled. “This continued on until we decided to have a challenge.”

“This is our own little way of supporting the struggling restaurant industry and the riders,” said Ms. Marty.

In two days, the friendly banter ended with an array of mouthwatering recipes seamlessly blended with a variety of rich international flavors. As a nod to Japanese cuisine, chef Erica Aquino’s Miso Shiitake Lugaw comes with miso glazed chicken, spicy pickled wood ear mushrooms, nori flakes, ramen egg and sesame chili oil, while chef Veronica Reyes presented her Laksa Lugaw, made of creamy and fragrant seafood broth topped with poached prawns, fried tofu and soft-boiled egg.

India comes closer to home with chef Kannan Jayaprakash Sreedevi’s Indian-style Lugaw with monggo and coconut. Chef Joel Espiritu Erfe’s Xiao Loo Gaw is a saffron mushroom congee in a pouch with a side of bean sprout salad, crispy pork ears, tofu, poached egg and a mildly spicy calamansi soy dressing. Chef Jade Christopher Marquez Lee merges sous vide egg, crispy pancetta, toasted walnuts and rosemary oil in his Adlai and Wild Mushroom Lugaw. Meanwhile, chef Mike Silbor brings a dash of France in his Prawn Bisque Lugaw of prawn reduction, pan-seared river prawns, beurre noisette and crispy fried leeks.

Chef Roselle Sison-Pangalilingan came up with a Warm Vanilla Cinnamon Spiced Tres Leches Lugaw with Raspberry and Goji Berry Compote, and chef Zemir Herrera-Rollan developed an Oatmeal Curry Lugaw with hard-boiled egg, fried tofu, shredded chicken, toasted garlic and leeks.

In his Lugaw tayo kai-Vegan, chef Jester Arellano uses brown rice, vegetable broth, saffron, and calamansi vinaigrette topped off with shiitake mushrooms, bokchoy, carrots, kangkong (swamp cabbage), malunggay (moringa), and chia seeds.

Completing the set is Ms. Marty’s Lugaw ni Señora, headlined by chorizos (Spanish sausage)and crispy jamones (ham) served with quail eggs, leeks and crunchy garlic.

Through different variations — simple or elaborate — the mighty lugaw remains to be an essential good, especially during this pandemic.

Below are three of the recipes the chefs developed.

LAKSA LUGAW
Recipe by: Veronica Reyes, DLS-CSB Part-time Faculty on Principles of Food Production, Menu Planning Laboratory and Asian Cuisine Laboratory

“The inspiration is the delicacy laksa, but instead of noodles, I utilized glutinous rice. Given that I was exposed to Singaporean cuisine and laksa being my favorite [dish], I have decided to convert it into one of my favorite Filipino dishes — lugaw. Best of both worlds!”

For the recipe I made it the traditional way, because as the saying goes, why fix something it if it ain’t broke!

Shrimp stock:

1.5 kg shrimp heads

1 whole onion, quartered

5 pcs curry leaves

3 pcs Kaffir Lime leaf

3 L water

50 ml Vegetable oil

Laksa paste:

50 gm Ginger

30 gm Turmeric, fresh

50 gm Lemon grass

50 gm Garlic

10 gm Dried Chili

80 gm Onion, red

20 gm Dried Shrimp (hibe)

50 gm Cashew nuts

30 ml Vegetable oil

Soup base:

500 gm Malagkit Rice

1L Shrimp stock

150 mL Coconut Cream

3 pcs Kaffir Lime leaf

30 ml Fish Sauce

15 gm White Sugar

1 Kaffir Lime Zest and Juice

50 ml Vegetable oil

1. To make the stock, sauté the shrimp heads with the vegetable oil. When it turns red in color, add in the rest of the ingredients except the water. Keep on stirring for 5 more minutes. Add the water then bring to a boil. Then skim off the scum from the surface then lower down the heat to simmer for 1.5 to 2 hours.

2. For the paste, chop all the ingredients fairly small. Put everything in a blender or food processor with the vegetable oil. Blend until it becomes a paste.

3. In a large sauce pot, place in the vegetable oil. Sauté the laksa paste until it becomes fragrant, for about 10 minutes.

4. Add in the malagkit rice and sauté for another 10 minutes. Pour in the shrimp stock. Continuously stir for another 5 minutes to ensure that the rice doesn’t stick at the bottom.

5. Add in the Kaffir Lime leaves and fish sauce. Simmer until the rice is cooked. Stir occasionally to make sure the rice doesn’t clump together.

6. Add in the sugar and the zest and juice of the Kaffir Lime.

7. You may poach the prawns and balls in the prawn stock for more flavor.

8. You may now assemble your laksa lugaw by ladling the finished product in a bowl and topped with the fried tofu, prawns, balls and soft boiled egg. Consume while warm.

LUGAW NI SEÑORA
Recipe by: Margarita Marty, DLS-CSB Culinary Program Chairperson

“I was raised in a home strongly influenced by my grandmothers Gloria Mapua Lim and Nena Grey Marty, both excellent cooks. As early as the age of nine, I assisted Lola Gloria in the kitchen and learned how to cook congee. Lola Nena’s culinary influence came in my 20s while I was starting out in my career, for she used chorizo (Spanish sausage) in so many dishes.

I tapped my kitchen memories with my grandmothers and exposure to Spanish ingredients – slow cooked rice came from congee, while chorizo, jamon and boiled quail egg were the natural topping for this hearty lugaw.”

Ingredients:

4 cups chicken stock

1 tsp olive oil

¼ cup onion, finely chopped

1 clove garlic, finely chopped

250 gm Japanese rice

1 pinch of Saffron thread

Salt and Pepper to taste

Toppings:

2 pcs Molinera Spanish Chorizo

6 pcs Santis Snack Chorizo

12 quail eggs (hard boiled)

4 jamon, thinly sliced

1 tbsp Daddy Mikk’s Crunchy Garlic

2 pcs green onion, chopped

1 whole lime

Lugaw:

1. Crush a pinch of salt and saffron in a mortar and pestle to make fine powder. Add 1 tbsp of warm water and allow to soak for a few minutes.

2. Heat olive oil in a cast iron pot over medium heat.

3. Add garlic and onions. Cook until onions are translucent.

4. Add Japanese rice and allow rice to toast.

5. Add the saffron mixture and mix well.

6. Add one cup of water, stirring it constantly, allowing the rice to fully absorb the water.

7. Add the rest of the stock. Bring to a boil and reduce heat allow it to simmer on low heat.

8. Season with salt and pepper as needed

Note: you may need to add stock if the lugaw gets too thick.

Toppings:

1. In a small pan, sauté 2 pcs Molinera Spanish Chorizo to make a crumble.

2. Slice 6 pcs Santis Snack Chorizo. Pan fry in a little olive oil

3. Cut the ham into 2 inch squares. Lay flat on a baking sheet and bake in the toaster oven for 5-7 minutes.

4. Slice the quail eggs in half

When everything is ready, get your most señora-like bowls and ladle the lugaw into the bowls. Top with the two kinds of chorizo, crunchy jamon, quail eggs, Daddy Mikk’s Crunchy Garlic, chopped green onion and drizzle with a bit of chorizo oil. Serve with a slice of lime.

Recipe is good for four servings

PRAWN BISQUE LUGAW
Recipe by: Chef Mike Silbor, DLS-CSB Professor-Lecturer on Principles of Food Production and Menu Planning, Seafood Cookery, Professional Cooking and Filipino Cuisine

“To my knowledge, this type of lugaw has never been done before, for it fuses ingredients and procedures from two very different cuisines. However, despite the dish sounding or looking complicated, it is actually simple to execute. I believe this is the most important aspect of this dish, as it stays within the realm of accessibility and relative affordability.”

Ingredients:

Shrimp Stock:

150-200 gm Prawn Shells/Heads

100 gm White Onion, small

50 gm Carrots/Carrot peel

50 g Leeks

30 gm Celery

1 tsp Thyme, Dried or fresh

1 tsp Tarragon, Dried or fresh

Salt to season

1 tbs Black peppercorn

100 gm Tomatoes/canned tomatoes

Water or Chicken Stock, depends on amount of vegetables and shells used

2 tbs Butter

1 tbs Canola Oil

Lugaw:

3-5 pcs Prawns, U15 — U20, butterflied and deveined

50 gm White Onions, brunoise (finely diced)

10 gm Garlic, brunoise

¼ cup Rice

1 cup Prawn Stock

2 tbs Butter

2 tbs each Leeks, green and white part, julienne

Canola Oil, canola

1 pc Lemon or lime wedge

Shrimp Stock:

1. Cut onion, carrots and celery for a mirepoix  (a flavor base made from diced vegetables cooked — usually with butter, oil, or other fat — for a long time on low heat without coloring or browning). Quarter the tomatoes.

2. Roast prawn heads and shells in a pan with oil and butter. Season to taste.

3. Once roasted, add vegetables and 2 to 3 tbs of water/stock to the pan. Sauté the vegetables while deglazing the pan.

4. Once vegetables are lightly colored, add herbs and tomatoes and cook down until tomatoes are soft and mushy. Season to taste.

5. Add enough stock to submerge all the ingredients.

6. Bring to a boil and lower to a simmer for 30 minutes.

7. Cool down for 30 minutes in an ice bath.

8. Blend everything and strain.

9. Cool down again and keep chilled.

Lugaw:

1. Melt butter and sauté onions until translucent. Add garlic. Sauté further on low heat for 3-4 minutes.

2. Add rice and toss in the mixture until all the grains are coated. Season to taste.

3. Add 1 ladle of stock and bring to a simmer. Once absorbed by the rice, add another ladle of stock.

4. Repeat this process three times.

5. Add in half of the remaining stock to the rice and mix well. Bring to a simmer and don’t cover. Stir occasionally to check that nothing is sticking to the bottom.

6. If the mixture gets too dry, add more stock or water.

7. Once rice is cooked, check seasoning and keep warm.

Garnish Prep: Beurre Noisette

1. Melt butter in a small pot or pan.

2. On low heat, continue to cook butter until the milk solids split from the fat and turn brown.

3. Once brown, transfer the fat part in a small bowl and set aside.

Garnish Prep: Crispy Leeks (optional)

1. Heat up oil for shallow frying.

2. Once hot around 375 degrees centigrade, fry the leeks just before they start to brown.

3. Once fried, drain immediately and blot with paper towels. Try to separate the leeks to help with crisping while paper absorbs excess oil.

Garnish Prep: Prawns

1. Take some beurre noisette and heat up with some canola oil.

2. Season and sear prawns until cooked. Keep warm.

Assembly:

1. Transfer lugaw to a bowl.

2. Top with 3 to 5 pieces of prawns.

3. Drizzle with beurre noisette.

4. Top with leeks and lemon wedge.

Remittances, BPO receipts boost the peso amid pandemic

CASH REMITTANCES from overseas Filipino workers (OFWs) as well as business process outsourcing (BPO) revenues will support the peso even as the Philippines continues to fight a surge in coronavirus infections, MUFG Global Research said on Wednesday.

“The peso’s resilience despite negative investor sentiments is a reflection of inflows from overseas Filipino remittances and business process outsourcing revenues, and lower demand for imported consumer goods amid tighter mobility restrictions in Metro Manila and surrounding provinces,” MUFG Global Research said in a report.

The peso closed at P48.025 versus the dollar on Wednesday, based on data from the Bankers Association of the Philippines. This was the peso’s strongest finish since Feb. 15 when it ended at P47.93 against the greenback.

“The Philippines is one of three ASEAN+India countries to record new peaks in daily COVID-19 cases in April other than Thailand and India. But the Philippine peso’s gains against the dollar are in stark contrast to the Indian rupee and Thai baht’s performance,” MUFG said.

The Philippines has recorded more than one million COVID infections, with 5,683 new cases tallied on Tuesday. Metro Manila and surrounding provinces Bulacan, Cavite, Laguna, and Rizal are still under modified enhanced community quarantine as the government looks to prevent the further spread of the virus.

Meanwhile, data from Johns Hopkins University showed India has more than 20.6 million cases, with reports citing the country’s struggle in handling patients due to the lack of equipment and facilities. Thailand had more than 72,000 cases as of Wednesday.

The firm said the Indian rupee’s depreciation in April was the largest since the start of the pandemic. MUFG added that while the Thai baht marginally appreciated against the greenback last month, it was the second worst performing currency in Asia excluding Japan.

Cash remittances sent home by OFWs rose by 5.1% to $2.477 billion in February from a year earlier, based on data from the Bangko Sentral ng Pilipinas. The growth rate in February was the quickest since the 9.3% logged in September 2020.

The central bank expects remittances to grow by 4% this year. Last year, inflows fell by 0.8% to $29.903 billion, with more than 647,000 OFWs repatriated due to the pandemic, based on data from the Department of Labor and Employment.

For the second quarter, MUFG expects the peso to move within P46 to P49.75 versus the dollar.

Meanwhile, the firm said the peso could play around the P46.25 to P50 per dollar from July to September and trade between P46.25 to P50.25 in the fourth quarter. — L.W.T. Noble