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Airlines move to soften impact of rising fuel prices on fares

PHILSTAR

By Arjay L. Balinbin, Senior Reporter

LOW-COST airlines in the Philippines said they continue to seek ways to mitigate the impact of the rising fuel prices — exacerbated by the Russia-Ukraine conflict — on airfares.

“The recent surge in pump prices affecting the cost of jet fuel used in all of our aircraft is a concern for all airline companies,” Philippines AirAsia said in a statement to BusinessWorld on Wednesday.

“While we are carefully looking at the possibility of implementing fuel surcharge cost should the situation demands for it, we also want to manage its potential impact on our business,” it added.

At the same time, the airline noted that it is implementing sales and marketing strategies that seek to “circumvent the need to hike prices at the moment as we further study the implications of the year-to-date adjustments of oil prices.”

Oil prices have increased in recent months due to persistent supply issues and geopolitical tensions. Last week, Brent crude exceeded $100 a barrel for the first time since 2014 after Russia invaded Ukraine.

Meanwhile, Cebu Pacific said it is committed to its core mission of providing “affordable and accessible air travel to all.”

“Despite rising fuel prices, we have continuously offered promo fares such as our ongoing month-long P88 seat sale, and of course, our upcoming trademark piso sale in time for our 26th anniversary,” the budget carrier said in a statement to BusinessWorld.

Philippines AirAsia assured the public that despite the future of global oil supply, it will keep up with its goal of providing “high-quality yet attainable travel for guests ready to re-explore and reconnect with the world.”

Flag carrier Philippine Airlines was also asked to comment.

Meanwhile, the International Air Transport Association (IATA) said it expects travelers globally to reach 4 billion in 2024, exceeding pre-pandemic levels (103% of the 2019 total).

In the Asia-Pacific region, IATA said the slow removal of international travel restrictions and the likelihood of renewed domestic restrictions during the coronavirus outbreaks mean that traffic to, from, or within the region will only “reach 68% of 2019 levels in 2022, the weakest outcome of the main regions.”

It said the 2019 levels should be recovered in 2025 (109%) due to a slow recovery on international traffic in the region.

On the Russia-Ukraine conflict, the group said that air transport is resilient against shocks.

“This conflict is unlikely to impact the long-term growth of air transport. It is too early to estimate what the near-term consequences will be for aviation, but it is clear that there are downside risks, in particular in markets with exposure to the conflict,” it noted.

“The impact on airline costs as a result of fluctuations in energy prices or rerouting to avoid Russian airspace could have broader implications. Consumer confidence and economic activity are likely to be impacted even outside of Eastern Europe,” IATA added.

World’s 50 Best Restaurant Awards dumps Moscow for London

THE WORLD’S 50 Best said it will move its annual restaurant awards ceremony from Moscow to London in an announcement just hours after Russia’s invasion of Ukraine and the levying of new sanctions.

The event is scheduled for July. The new plans were revealed Thursday last week on Twitter.

The move comes as the US, the European Union and others simultaneously ratchet up sanctions against the Kremlin and Russian oligarchs seen as benefitting from the policies of Vladimir Putin, who announced his decision to attack Ukraine last week. A spokesperson for Worlds 50 Best declined to provide more details on its decision.

The World’s 50 Best Restaurants list is organized by William Reed Business Media, which is based in the UK. It’s famous for crowning restaurants with the title of No. 1 in the world.  In 2021, the organization named Noma in Copenhagen the top restaurant, based on votes of restaurateurs, chefs, and food writers. The restaurant had won the award four times before. — Bloomberg

Globe enters $350-M deal for data centers

FREEPIK

PLDT partners with RED Engineering for ‘green’ data center

GLOBE Telecom, Inc. announced on Wednesday that it entered into a $350-million joint venture partnership with ST Telemedia Global Data Centres and Ayala Corp. to develop and operate data centers in the country.

Under the deal, ST Telemedia, a global data center company, and Ayala Corp. will subscribe to new shares in KarmanEdge, Inc., which is 100% owned by Globe.

KarmanEdge “will house the carved-out data center business, which has the potential to expand by up to 100-MW (megawatts) capacity in the mid to long term,” Globe said in a disclosure to the stock exchange.

“Post execution of the share subscription agreement, Globe will remain the largest shareholder with a 50% ownership, followed by ST Telemedia with 40% and Ayala Corp. taking up the balance,” it added.

Globe said that the capital infusion by the new partners will result in a post-money valuation of KarmanEdge at more than $350 million.

“Globe will receive proceeds of $100 million from the transaction with the remaining capital injected to be utilized by the business for future expansion & growth,” the company added.

The transaction is expected to be completed within the first quarter.

The project is seen to help speed up Globe’s efforts to scale up its capabilities in the data center space.

According to Globe, over 43% of ST Telemedia’s data centers are operating with power derived from renewable sources.

Globe has been operating data centers in the Philippines since 2001 through its subsidiary Innove Communications, Inc.

“We believe that this joint venture will be well-positioned to become the leader in the data center space in the Philippines,” said Ernest L. Cu, president and chief executive officer of Globe.

PLDT DATA CENTER
Meanwhile, the PLDT group said it is partnering with engineering firm RED Engineering for the construction of its data center in Sta. Rosa, Laguna.

RED Engineering is a global company of specialist building services and information and communications technology engineers.

According to the group, RED has led the drive towards the zero-carbon goal for over a decade.

The partnership “advances the PLDT group’s drive to incorporate renewable energy and best sustainable practices in the operations of our facilities moving forward,” said PLDT and Smart President and Chief Executive Officer Alfredo S. Panlilio.

“This partnership further signifies our commitment to constantly improve operational excellence, global competitiveness and ensure sustainable practices within our core,” he added.

The group announced last month that it would build additional 100 MW of data center capacity, starting with a new hyperscale, telco-neutral, and purpose-built facility in Sta. Rosa, Laguna.

The project will be carried out by PLDT, Inc.’s information and communications technology arm ePLDT.

The project will be the “first of a series of hyperscale data centers totaling to a power requirement of 100 MW over the medium term,” the group said.

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

Cannes film festival bans Russia from 2022 event

PARIS —  The Cannes film festival said in a statement on Tuesday it would ban official Russian delegations from its 2022 festival unless the Ukraine conflict ends.

It added the festival will only admit official Russian delegations if the Ukraine conflict ends in a manner acceptable to the Ukrainian people.

The festival organizers however saluted the courage of people in Russia who have taken the risk of protesting against the aggression and invasion of Ukraine.

“Among them there are artists and movie professionals who have never stopped fighting against the current regime and who are in no way associated with these intolerable acts and with those who are bombarding Ukraine,” they said.

Cannes, one of the world’s top film festivals, was started in 1939, partly in protest against Italian dictator Benito Mussolini’s interference with the then leading Venice film festival.

“Loyal to its own history, which started in 1939 in resistance against the fascist and Nazi dictatorships, the Cannes Festival will always be on the side of artists… who denounce violence, repression and injustice,” it said. — Reuters

SEC approves Tagum Global Medical’s P1-B public offering 

THE Securities and Exchange Commission (SEC) has cleared the P1-billion initial public offering (IPO) of Tagum Global Medical Center, Inc., which is part of the Allied Care Experts (ACE) Group of Hospitals.

“The intended market for the initial public offering will be medical practitioners and their relatives, as well as the public,” the commission said in a statement on Wednesday.

Tagum Global Medical Center was incorporated in 2018 and is currently constructing a seven-story healthcare facility that can house 116 beds. The facility is being built on a 5,000-square meter lot in Davao del Norte’s Barangay Visayan Village in Tagum City.

The company will be offering 36,000 common shares. Its primary offering will be divided into four series, with 3,600 blocks comprising 10 shares each.

The first series with 1,400 blocks will be sold for P200,000 per block, the second series with 600 blocks for P250,000 each, the third series will have 700 blocks sold for P300,000 per block, and the fourth series with 900 blocks for P400,000 each.

According to the SEC, Tagum Global Medical Center could net up to P997.09 billion from its IPO. Proceeds will be used for the construction and development of Tagum Global Medical Center as well as its pre-operating expenses, debt servicing, and for its working capital.

Those who subscribe to the IPO will be entitled to several privileges like discounted medical and dental services in other medical facilities affiliated with the ACE Group of Hospitals. The benefits may also be availed of by the stockholder’s spouse and dependents. — Keren Concepcion G. Valmonte

Hollywood star Sean Penn joins Ukraine exodus to Poland on foot

Sean Penn in The First (2018) — IMDB.COM

DAYS after visiting the Ukrainian capital Kyiv to film scenes for his documentary on Russia’’ invasion, Hollywood actor-director Sean Penn found himself among thousands of refugees fleeing to Poland, joining the exodus on foot.

Mr. Penn, 61, posted a photo to his Twitter feed on Monday showing the movie star wearing a backpack and toting a piece of luggage on wheels as he trudged along the shoulder of a road beside a line of cars stretching into the distance.

“Myself & two colleagues walked miles to the Polish border after abandoning our car on the side of the road,” Mr. Penn said in a caption tweeted with the picture. “Almost all the cars in this photo carry women & children only, most without any sign of luggage, and a car their only possession of value.”

The tweet did not explain why the Academy Award-winning actor and his companions were forced to abandon their vehicle.

A spokesperson in Los Angeles, Mara Buxbaum, told Reuters by e-mail on Tuesday that Mr. Penn had “made it out of Ukraine safely.” She declined to answer other questions about his whereabouts or the circumstances of his departure from Ukraine.

Mr. Penn was in Kyiv last Thursday attending a press briefing at the office of President Volodymyr Zelensky on the first day of Russia’s invasion, recording footage for a documentary chronicling the crisis, Zelensky’s office said in a statement at the time.

“Sean Penn is among those who support Ukraine in Ukraine today. Our country is grateful to him for such a show of courage and honesty,” the statement said.

It said Mr. Penn had interviewed Ukrainian political and military figures as well as journalists as part of the production, for which he initially visited Ukraine in November.

In a statement last week, the actor acclaimed for Oscar-winning roles in Mystic River and Milk praised the Ukrainian people as “historic symbols of courage” and called Ukraine “the tip of the spear for the democratic embrace of dreams.”

“If we allow it to fight alone, our soul as America is lost,” Mr. Penn wrote.

Mr. Penn, whose directorial credits include Into the Wild and The Crossing Guard, is also known for his political activism and involvement in various humanitarian causes, including relief efforts for victims of Hurricane Katrina, the Haiti earthquake of 2010 and Pakistan floods in 2012.

He made headlines in 2016 when Rolling Stone magazine published an interview Mr. Penn had secretly conducted with Mexican drug lord Joaquin “El Chapo” Guzman at his jungle hideout prior to the arrest of the cartel boss.

Mr. Penn is producing the Ukraine documentary for Vice Studios, a US-Canadian digital media and broadcasting company, according to Hollywood trade publication Variety. —  Reuters

Yields on BSP’s term deposit facility rise as demand drops

BW FILE PHOTO
THE CENTRAL BANK’S term deposits fetched higher rates on Wednesday as demand weakened. — BW FILE PHOTO

YIELDS on the central bank’s term deposits inched higher on Wednesday amid lower bids following the government’s retail Treasury bond offering and ongoing geopolitical tensions between Russia and Ukraine.

Demand for the term deposits of the Bangko Sentral ng Pilipinas (BSP) amounted to P456.539 billion, lower than the P500-billion offering as well as the P571.048 billion in bids a week earlier.

Broken down, the BSP’s offer of seven-day papers was undersubscribed, with bids at P186.711 billion against the P220-billion offer. This was also lower than the P259.007 billion in tenders last week.

Lenders asked for yields ranging from 1.65% to 2.39%, higher than the 1.625% to 1.6995% a week ago. This caused the average rate of the one-week papers to increase by 5.41 basis points (bps) to 1.7286% from 1.6745% in the prior auction.

Meanwhile, the 14-day term deposits fetched bids worth P269.828 billion, lower than the P280 billion auctioned off by the BSP and the P312.041 billion in tenders the previous Wednesday.

Accepted rates were from 1.68% to 2.39%, a narrower range compared with the 1.659% to 2.39% band a week ago. With this, the average rate of the two-week deposits increased by 10.96 bps to 1.8978% from 1.7882% previously.

The central bank has not offered 28-day term deposits for more than a year to give way to its weekly auction of securities with the same tenor.

The term deposit facility (TDF) and the 28-day bills are used by the BSP to mop up excess liquidity in the financial system and to better guide market rates.

TDF yields increased this week following the RTB offering, which siphoned off some liquidity from the financial system, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said.

The government raised P457.8 billion through the five-year RTBs which were offered for two weeks until Monday. The bond fetched a coupon rate of 4.875%.

The amount raised was bigger than the P360 billion borrowed by the government last year through an offering of 5.5-year RTBs.

Mr. Ricafort said the market is also still concerned about the ongoing conflict between Russia and Ukraine.

Russian military invaded several areas on Thursday last week, following an announcement by President Vladimir Putin, Reuters reported.

Earlier this week, the two sides agreed to talk without pre-conditions. However, Russia continued to intensify its military invasion in Ukraine. — Luz Wendy T. Noble with Reuters

ACES launches Atletang Ayala to support Olympic hopefuls

THE AYALA Vermosa Sports Hub — AYALA GROUP OF COMPANIES

Ayala Group will hire athletes training for Asian, Olympics Games

THE recently-launched Ayala Center for Excellence in Sports (ACES) announced on Wednesday the creation of the Atletang Ayala program, which has been designed to provide holistic support to the country’s Olympic hopefuls.

Under the Atletang Ayala program, participating Ayala Group companies will provide full-salaried employment opportunities at part-time hours to Filipino national athletes training for the 2022 Asian Games and the 2024 Olympics. This arrangement will allow the athletes the flexibility they need to fulfill their grueling training and competition requirements while receiving a steady income. Athletes selected for the program will also be given free access to the world-class training facilities of the Ayala Vermosa Sports Hub. Finally, ACES has partnered with De La Salle University to offer free enrollment in a selection of courses for Atletang Ayala athletes who wish to continue their education.

“The Ayala Group of Companies has long recognized the special qualities athletes bring to the workplace. A number of our executives, in fact, competed as national athletes, and they have been noteworthy for their commitment, resilience and ability to work in teams. At the Ayala Group we will continue to look for ways to support our national athletes so that hopefully, we can encourage more Filipinos to pursue their sports dreams,” said Jan Bengzon, ACES Program Director.

“We are excited to open the program application process to all qualified national athletes and look forward to working with them to advance their athletic careers towards qualifying for the upcoming 2022 Southeast Asian Games and Asian Games, and hopefully the 2024 Olympics as well. At the same time, we would also like to work with them to advance their careers beyond sports,” he added.

The Atletang Ayala program will be launched after it has identified eight athletes for its inaugural class. All applicants are required to be members of the pool of national athletes in their national sports associations that are competing in medal sports at the 2024 Olympics. Atletang Ayala athletes will be offered a yearly contract that provides for the above benefits and can be renewed annually until the 2024 Olympics, contingent on the attainment of clear performance measures.

“The success of this program will not be determined by the number of athletes who bring back medals, but by the impact these young men and women will have in their communities as they aspire to reach the pinnacle of their respective sports on the global stage,” Mr. Bengzon added.

Interested applicants are encouraged to apply by filling in the form at the following link: https://bit.ly/AtletangAyala. Deadline for application is on March 18, 2022.

For more information, please contact ACES via the following e-mail address: aces@ayala.com

IT-BPO group wants more support from next administration

THE next administration should provide additional support and address issues to sustain the growth of the local information technology and business process outsourcing (IT-BPO) industry, according to the IT and Business Process Association of the Philippines (IBPAP).

IBPAP President Jack Madrid said the next administration should further strengthen the digital infrastructure of the Philippines to allow further expansion in other areas across the country.

“Much progress has been made during the coronavirus disease 2019 (COVID-19) pandemic, but more work needs to be done to allow our telecommunications partners, private sector, and the government giving us more incentives to make internet connectivity more cost-efficient and available across the countryside,” Mr. Madrid said in a television interview on Wednesday.

“We are seeing our big industry players expanding to the countryside and helping [to] propel those local economies. We have the advantage of a very young population and we should seize that demographic advantage,” he added.

Further, Mr. Madrid said the next administration can help implement a permanent work-from-home (WFH) law after practicing the said work arrangement for about two years due to the COVID-19 pandemic.

“[We can] help the government to enact a more permanent, long-term WFH, work-from-anywhere law. This is essential to maintain our country’s competitiveness. This is the big thing that we would like to see as we welcome the new administration,” Mr. Madrid said.

“WFH or what we are now beginning to call hybrid work arrangement is not unique to our industry here in the Philippines. The future of work is happening now and I think what makes our industry unique is that it is work that can actually be performed anywhere. We need to not just defend our sizable market share of the industry, but actually to seize more of the growing demand for talent amongst Filipino employees in our industry,” he added.

According to Mr. Madrid, IBPAP is crafting a plan to allow a smoother transition for BPO firms in terms of adjusting their work arrangements.

“Currently, we are crafting a plan to [create] a smoother transition, providing our member companies a smoother [and] longer runway because after all, we have been working from home for the past two years. We just need a little bit more time securing a healthy and well-organized transition back into what we hope to be a hybrid work environment,” Mr. Madrid said.

Meanwhile, Mr. Madrid said the next administration should also change the current educational curriculum to teach skills required for digitized work.

“More of our work is increasingly complex and increasingly digital and we need to match the expectations of our customers to the needs of the industry for more digitized work. The more complex tasks that are needed, we need to match those skills with the current curriculum of our universities,” Mr. Madrid said.

With the recent implementation of Alert Level 1 in Metro Manila from March 1 to 15, the government has been encouraging the return of employees to onsite work in a bid to boost the country’s economic recovery.

Recently, the Fiscal Incentives and Review Board (FIRB) rejected the proposal of the Philippine Economic Zone Authority (PEZA) to allow the extension of the WFH arrangement of IT-BPO firms while enjoying tax incentives until September this year.

Based on a FIRB resolution issued last year, IT-BPO firms are allowed to conduct a WFH arrangement at up to 90% of its total personnel until March 31 this year while still having tax incentive privileges. — Revin Mikhael D. Ochave

Adele tops IFPI 2021 album charts with hit comeback record 30

LONDON —  British singer Adele has added another accolade to her long list of honors, with her latest record 30 winning the Global Album All Format Chart for 2021, IFPI, the recorded music industry representative body, said on Tuesday.

The album 30, which went to No.1 around the world upon its release in November, also topped IFPI’s Global Album Sales Chart and its inaugural IFPI Global Vinyl Album Chart.

The album, Adele’s fourth, was her first in six years since 2015’s Grammy Award winning 25. Last month, 30 won album of the year at Britain’s pop music honors, the BRITs.

“It has been wonderful to have Adele back and releasing music over the second half of last year,” IFPI Chief Executive Frances Moore said in a statement.

“Her dominance of all three IFPI Album Charts speaks to her unique song-writing talent, her iconic voice and unrelenting global popularity.””

Known for her ballads about heartbreak and nostalgia, Adele said she wrote 30 to explain her divorce to her young son.

“Following its release in Nov. 2021, 30 surpassed over five million physical album equivalent units in 2021 alone, in under two months,” IFPI said.

American singer Olivia Rodrigo’s Sour was second in the Top 10 Global Album All Format Chart, followed by Canadian pop star Justin’s Bieber’s Justice.

ABBA’s Voyage, the Swedish supergroup’s first album in 40 years, was no. 2 in the Top 10 Global Album Sales Chart, followed by K-pop band SEVENTEEN’s Attacca.

For the vinyl album chart, Harry Style’s Fine Line and Fleetwood Mac’s Rumours completed the top 3. — Reuters

LANDBANK online transactions increase 46% to P2.45 trillion

THE VALUE of online transactions done with Land Bank of the Philippines (LANDBANK) surged in 2021 as the lender continued to roll out digital services during the public health crisis.

LANBANK’s electronic banking transaction value jumped by 46% year on year to P2.45 trillion, the state-run bank said in a press release on Wednesday.

The volume of transactions rose by 19% to 136.3 million.

These transactions include mobile banking, government disbursement, retail banking, institutional banking, and bulk credit.

Broken down, LANDBANK’s mobile banking app recorded over 100 million transactions worth a total of P172.39 billion last year. The transaction value more than doubled the 2020 figure.

Its electronic payment facility or Link.BizPortal recorded close to four million transactions. The total value went up by 31% to P10.45 billion.

Meanwhile, LANDBANK’s institutional internet banking platform weAccess logged over 20 million transactions, with the value increasing by 24% to P489 million.

Its iAccess internet retail banking channel saw a 30% jump in transaction value to P15.4 billion.

On the other hand, LANDBANK’s electronic modified disbursement system recorded over 20 million in transactions, with the value rising by 24% year on year to P488.98 billion.

“The LANDBANK Bulk Credit System (LBCS) also posted unprecedented annual growths of 105% and 1,181% for volume and value, respectively,” the bank said.

LANDBANK President and Chief Executive Officer Cecilia C. Borromeo said the bank is delivering digital banking services for the “new normal.” Pandemic-related restrictions allowed for limited face-to-face transactions.

“We will continue to bank on digital infrastructures as we push for greater digital adoption and advance financial inclusion in the country,” she said.

LANDBANK’s net income in 2021 rose by 27% to P21.75 billion year on year due to the lower cost of funds. This was higher than its P19.68-billion profit target for the year. — J.P. Ibañez

Yulo leads sport personalities at MVPSF Gymnastics Center inauguration on Saturday

CARLOS YULO FB PAGE

TWO-TIME world champion Carlos “Caloy” Yulo will be the special guest when the Manny V. Pangilinan Sports Foundation (MVPSF) Gymnastics Center holds its inauguration on Saturday in Intramuros, Manila.

Mr. Yulo, who planed in Monday along with Japanese coach Munehiro Kugeyama and trainer Jumpei Konno, will join several sports officials, including possibly Mr. Pangilinan himself, in the opening of the training facility that the national team will use in preparation for the Hanoi Southeast Asian Games set on May 12 to 23.

Also expected to grace the 3 p.m. ceremony are International Gymnastics Federation (FIG) president Morinari Watanabe, Philippine Sports Commission chairman William Ramirez, Philippine Olympic Committee President Abraham Tolentino and Gymnastics Association of the Philippines head Cynthia Carrion

Japanese Ambassador to the country Kazuhiko Koshikawa was also invited.

The MVPSF reportedly spent millions for the world-class training center and is reportedly erecting a high-ceiling tent beside it that would be used for rhythmic gymnastics.

For PSC, it will reportedly shoulder the monthly rent.

Gymnastics is one of several sports where the country can produce gold medals in international events including the Olympics.

And there is hope that the new facility could help achieve that goal. — Joey Villar

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