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Apple sells fewer than 500,000 smartphones in China in February amid coronavirus spread

SHANGHAI — Apple sold fewer than half a million iPhones in China in February, government data showed on Monday, as the coronavirus outbreak halved demand for smartphones.

China placed curbs on travel and asked residents to avoid public places in late January, just ahead of the Lunar New Year festival, a major gift-giving holiday. Those restrictions stayed largely in place through most of February.

In total, mobile phone brands sold a total of 6.34 million devices in February in China, down 54.7% from 14 million in the same month last year, data from the China Academy of Information and Communications Technology showed (CAICT).

It was also the lowest level for February since at least 2012, when CAICT started publishing data.

Shares of the iPhone maker fell about 6% amid a broader slump in Wall Street on rising fears of a recession due to a steep fall in oil prices and the fast-spreading virus.

“While this is very nervous time…we caution that Chinese demand in the March quarter is not the trend, but a ‘shock event’ that we believe will be short lived,” Wedbush analyst Daniel Ives wrote in a note.

Android brands, which include devices made by Huawei Technologies and Xiaomi, accounted for most of the drop, as they collectively saw shipments decline from 12.72 million units in February 2019 to 5.85 million, the data showed.

Shipments of Apple devices slumped to 494,000, from 1.27 million in February 2019. In January, its shipments had held steady at just over 2 million.

Research firms IDC and Canalys previously forecast that overall smartphone shipments would drop by about 40% in the first quarter as the virus outbreak hit demand and disrupted supply chains.

Apple’s branded stores in China were shut for at least two weeks in February as fears over the epidemic mounted.

The company’s chief executive, Tim Cook, wrote a letter to investors that month warning it would not meet its initial revenue guidance for the current quarter due to weak demand. — Reuters

Samar gives up its secrets

By Joseph L. Garcia, Reporter

SAMAR is regularly brought down to its knees thanks to its geographical location, which puts it right in the path of storms, including the long nightmare that was Typhoon Yolanda. And yet, when BusinessWorld spent the last days of February there, it was hard to feel that it was a province that knew hardship. In a carinderia (roadside eatery), a couple feasted on what are considered luxuries in the country’s capital: crabs and upland rice. A member of the tour group, who will not be named, scoffed, “And they call us poor.”

It isn’t an exaggeration when this reporter uses the word “poor.” An article from the Philippine News Agency in 2019 identifies Samar province (also known as Western Samar) as among the country’s poorest provinces in the country. Samar province shares this status with its neighbors on Samar Island, Northern and Eastern Samar.

BusinessWorld was on a trip to Samar province because of the provincial government’s launch of its project, Secret Kitchens of Samar. The project aims to make Samar a culinary destination, tied to the local government’s Spark Samar development program, which once aimed to boost tourism in the province. In the process of developing tourist spots and highlights in the province, they also managed to change the face of the province bit by bit. The project was started by former Governor and now Representative Sharee Ann Tan, and is being continued by her brother, the present governor, Reynolds Michael Tan (whom people fondly call Mike). Just in his 30s, he ascended to the position after his mother, Governor Milagrosa Tan, passed away late last year. He was then sitting as vice-governor.

At a dinner with the provincial officers, Tourism Operations Officer John Michael Cristobal (also called Mike) happily announced that the poverty incidence within the province has dropped to 22% from a figure of 43.9% in 2015, and 32.2% in October 2019 (the last two figures are from the Philippine Statistics Authority).

BusinessWorld then got a taste of the riches this poor province may have to offer, honoring its efforts to get up from its knees.

AGRICULTURAL PRODUCTS
Our very first stop was the Sta. Rita Food Processors’ Association, located behind a church. It began as a project of the Department of Trade and Industry (DTI) to help Samarnon (what the citizens of Samar are called) women rise up from the ravages of Yolanda. Others were taught crafts, but this group from Sta. Rita was taught how to make chips from karlang, a humbler cousin of taro. Karlang used to be converted into animal feed, but after being taught to wash it several times, and fry with garlic or other flavorings, the women have managed to turn them into chips that remind one of Pringles. Help from the DTI is key: several more of the small businesses we would see during the tour would thank various government agencies such as the Department of Agriculture (DA), the Department of Science and Technology (DoST), and the Department of Tourism (DoT).

It is said that a word is invented because society has a need for it: it’s the same reason we have different words for rice, like in its seed form, or what it’s called after it’s cooked (palay vs. kanin). It’s no surprise then, that we encountered several words that reflect several variations of food, though they belonged to the same family. An example would be the various kakanin (snack food) we saw in the municipality of Pinabacdao. There’s the plain nilupak made of cassava, but then there was sagmani, made of taro and nuts. Cassava, meanwhile, is processed into thin sheets and fried, resulting in a crispy sheet called piking, topped with coconut sugar. Other towns we visited also had various desserts made out of crispy, toasted rice, while another town boasted its own cheesemaker and tablea (chocolate) maker. Mayette and Norbing Bernales showed us how they processed the tablea, shoving cocoa beans into a roaster — the noise made us lose part of the process as she explained it, but she showed us a metal bowl that contained the sticky and shiny penultimate step, just waiting to be molded and cooled. Mrs. Bernales also showed us how she made the province’s version of cheese, keseo, made of carabao’s milk curds in vinegar, then molded into discs. While the recipe is from her mother, another government agency helped her formalize the process. They were happy to tell us that the provincial government was kind enough to sponsor their trips to the capital during trade fair season, but Mr. Bernales said that since they’ve had a measure of prosperity, they’ve begun to pay their own way.

LIVESTOCK
As we moved closer to the provincial capital of Catbalogan, we began to see how the wealthy of Samar entertained. Juliana Samson, descended from an old Samar clan, welcomed us into her home. She told us how to make tamalos, a pork and peanut dish served at fiestas. While her large sapphire earrings gleamed, she cooked the pork in a process akin to making an adobo (a stew made with vinegar). She took the pork out after about an hour of cooking, and used the dark brown broth from that to make a peanut sauce, mixing it with homemade peanut butter. This is mixed with rice, wrapped in banana leaves, and then steamed — kind of like tamales, except tamales is made with corn. The result is kind of like kare-kare (a stew with peanut sauce), but with more flavor, and an interesting, congealed texture. A version without steaming is called pinipian, which was served to us in chafing dishes at dinner at the hotel we stayed in, Alfreda’s Bed and Breakfast. Once a house occupied by a provincial governor, the rooms are decorated in mid-century style, and display his family’s academic achievements: from the Ateneo de Manila to the University of Pennsylvania.

Meanwhile, two descendants of the local Piczon family, the Paleyan siblings Mary May and Gilbert, showed us how to make bola catalana, yet another festive pork dish, made with ground pork wrapped around sausage and eggs, mixed with pickle relish and cheese. The difference of this dish from more familiar meat loaves is that this is wrapped in lace fat, a membrane that surrounds the internal organs of some animals. This creates a crispy crust around it, like bacon.

Meanwhile, further from Catbalogan and closer to the sea, we met Leonora Nono, a retired principal who showed us how to make humba. While humba in other provinces is sort of like adobo but with black beans, this one from Samar is made with peanuts. She cooked it in an old clay pot, which is, just like the recipe, passed down from one generation to another (she has since lost the lid though).

And thus we began to ask why the project was called the Secret Kitchens of Samar. The governor told us that it is to be developed into a brand with a yellow and purple “S” seal, with about 10 products which were slated to launch on March 12 — the coronavirus scare has dampened those plans, as the event in Shangri-La Plaza in Metro Manila was postponed, according to a statement from an agency. Mr. Cristobal told us, “It comes from the idea that normally, our elders here, when they cook, they’re alone. They close the doors, the windows. They don’t really share their recipes.”

Karina Tiopes, Director, Department of Tourism Regional Office VIII, added, “The recipe is handed down from generation to generation, to select members of the family.” In jest, she then pointed to one of her colleagues and said that he wasn’t able to inherit his grandmother’s recipe for yet another pork dish. (No prizes for guessing that pork and peanuts are popular here).

I will tell you now though that one of my personal highlights of the trip was sipping and nibbling on an exceptionally fine tinola (light chicken stew) from Calbiga. It was cooked in a pot, boiled with just ginger, turmeric, and lemongrass. It was special, not only because the broth was fine, clear, and tasty, but because the tour party had this served amidst the roaring Lulugayan Waterfalls, a local tourist spot, refurbished with a viewing deck and improved roads.

SEAFOOD
The improved roads didn’t reach the municipality of Pagsanghan, one of our stops. The journey for these wretched crabs took an hour and 45 minutes on a rough road traversing a mountain, that may make you want to grit your teeth and purse your lips.

But I take it back. Those crabs were not wretched. Perhaps it was the long journey on an empty stomach, but the mud crabs served in the municipal hall was one of the best meals I’ve ever had. The town credits its seafood bounty to the fact that it is situated on brackish water, and the mix of saltwater and fresh results in their seafood grows better than the rest.

In the town of Jiabong, meanwhile, nearer the sea, mussel farmers showed us their wares. The green shellfish grow on bamboo stilts, which seem miniscule on land. “Oh, that’s just one of them,” said one farmer. We were shown how the mussels are grown: in tent-shaped bamboo structures several feet high and wide. They’re planted in the sea so the mussels could spawn on them. Boats travel around from structure to structure during the day to scrape off the mussels, and then the shells are brought to shore to be sold. It was in this town that we encountered barbecue made of mussels (served on a stick) and mussels adobo (a lovely and spicy preserve in oil).

We also went to a tinapa maker, who showed us how he made the smoked fish by first cooking it in brine, then smoking it over bamboo shavings. The fish were beautiful in the sunlight, the skin radiating an iridescence that disappears in the smoking process. The people there said that they started in the 1970s, their parents migrating from Cavite. The fishing boat that brought them a measure of wealth in the 1970s disappeared, which was why the family learned how to make smoked fish. In a story that echoes in the fishing villages ravaged by typhoons, a family member said, “Sa dagat siya nadapa. Doon rin siya bumangon (She fell in the sea, and in the sea, she rose again).”

INFRASTRUCTURE
If all the roads in Samar were like those we were on, on the way to Crab City, then the Secret Kitchens of Samar, will remain well, secret. Governor Tan told us that unfortunately, that road is the only one they haven’t finished, and when the funds from the national government arrive, construction will continue. “The roads here, to the municipalities, are concrete, except for Pagsanghan. What we’re doing is to connect all the barangays.”

One can take roads for granted, but roads function just like veins to the heart. Without them, communities can die at a slow pace — or as quickly as possible. Mountainous Samar province has a problem with the militant New People’s Army. The provincial government says that in a series of peace talks, it found out what they were so angry about: roads.

“The reason why they go to the mountains is because there are no access roads; they don’t have opportunities,” said Governor Tan in a mixture of English and Tagalog.

“Through tourism, they get their roads, they’re given opportunities,” he said, citing success stories such as former combatants turning into tour guides, or opening their own local businesses. He also announced that an airport will be built in the provincial capital of Calbiga, which he hopes would be open and operational by the end of the year.

Roads make it easier for everyone. The path to Lulugayan Falls once took four hours: both for locals in the capital and even those who live near it. After roads were built to make the falls more accessible, not only were tourists able to reach it more easily, but the farmers who lived near the falls were able to bring their crops to town, bringing down both cost and prices. We go back to the original project, which was only supposed to boost tourism: “It’s not about tourism alone. It’s [already] a development agenda,” said Governor Tan.

Financial firms around the world ramp up their contingency plans as coronavirus hits

FRANKFURT/NEW YORK — Banks and other large financial companies in major cities across the world ramped up their emergency measures to combat the spread of the coronavirus on Tuesday, with Barclays Plc and BlackRock, Inc. confirming one case in their New York offices.

The steps including telling staff who had been exposed to someone with the virus to self-quarantine for 14 days, splitting operations so that some staff work from home or back-up locations and deep cleaning offices.

Barclays told staff on Tuesday that a trading floor employee in its Midtown Manhattan office tested positive for the virus and told employees who worked near or met with the individual to self-quarantine, according to a memo seen by Reuters.

Morgan Stanley also confirmed that an employee at its Purchase, New York, campus, roughly 45-minutes north of Manhattan, tested positive for the virus.

A BlackRock employee in its 40 East 52nd Street office in New York informed the company on Monday evening that they had been diagnosed with COVID-19, according to a spokesman. The employee had no symptoms, but the company did a deep clean and close colleagues were told to work from home for 14 days, the spokesman said.

The asset manager said business continuity plans were working, including provisions for teams to alternate working from the office and from home to limit exposure.

Starting Wednesday, Citigroup Inc. will divide its entire North America work force into two groups that will alternate working from the office and other places in one-week shifts, according to a source familiar with the plans.

Trading staff will largely report to backup sites and other teams like communications will work from home during off-weeks, the sources said.

Similar arrangements could pose risks for markets continuing to function smoothly, analysts said.

“With several large dealers having announced split staffs and widespread work from home arrangements, we believe markets are about to experience arguably the most significant large-scale operation risk event since 2001,” JPMorgan fixed-income market strategists wrote in a note on Tuesday.

EUROPEAN CASES
In Europe, Deutsche Bank and BBVA reorganized operations after employees were infected.

Deutsche Bank has split some of its trading operations across sites in Frankfurt, while Spain’s BBVA has shut one building at its headquarters in Madrid.

The spread of the coronavirus is increasingly disrupting financial companies’ operations and adds to the impact of a weaker economy on their businesses.

“Banks will see a weakening of their loan book quality as the effects of the virus will reduce global travel and factory output, and dampen domestic demand in Europe,” Moody’s analyst Bernhard Held said.

Private equity firm KKR & Co. Inc. said late on Monday that an employee at its London office had tested positive, causing it to temporarily close both its sites in the city.

Standard Life Aberdeen said on Tuesday it was planning to split its British and US investment teams into groups and have them work separately as part of contingency planning.

Traders at the world’s biggest banks began last week swapping their plush city center offices to work from suburban outposts in New York and London, facing lengthy commutes as their employers attempt to reduce the disruption caused by coronavirus.

The measures by Deutsche on Tuesday are expected to affect dozens of people and last until at least March 27. The bank also split some operations in London on Monday, following similar moves in places including Italy and China.

“We expect no impact on our ability to operate our full range of services for our clients and recognize that this setup will require extra effort and discipline from all,” Deutsche said in a memo to staff. — Reuters

Robinsons Land board clears P15-B fixed-rate bonds

ROBINSONS Land Corp. (RLC) has gained approval from its board of directors to issue up to P15-billion fixed-rate bonds.

In a disclosure to the stock exchange Tuesday, the Gokongwei-led property developer said its board of directors had given the nod for the company to issue peso-denominated bonds.

The issuance will have an aggregate principal amount of P10 billion with an over-subscription option of up to P5 billion.

RLC did not give further details as these are yet to be finalized.

“(The issuance is) subject to the requirements of the Securities and Exchange Commission and the rating process of the Philippine Rating Services Corporation,” it said. “Further details on the offer will be made available to the public once finalized.”

RLC handles the real estate and hotel business of its parent firm JG Summit Holdings, Inc. It reported a 6% increase in net income last year to P8.69 billion, driven by a P1.02-billion jump in revenues to P30.58 billion.

Shares in RLC at the stock exchange gained 95 centavos or 4.75% to close P20.95 apiece yesterday. — Denise A. Valdez

Mask-wearers can be ID’d, China facial recognition firm says

BEIJING — A Chinese company says it has developed the country’s first facial recognition technology that can identify people when they are wearing a mask, as most are these days because of the coronavirus, and help in the fight against the disease.

China employs some of the world’s most sophisticated systems of electronic surveillance, including facial recognition.

But the coronavirus, which emerged in Hubei province late last year, has resulted in almost everyone wearing a surgical mask outdoors in the hope of warding off the virus — posing a particular problem for surveillance.

Now Hanwang Technology Ltd., which also goes by the English name Hanvon, said it has come up technology that can successfully recognize people even when they are wearing masks.

“If connected to a temperature sensor, it can measure body temperature while identifying the person’s name, and then the system would process the result, say, if it detects a temperature over 38 degrees,” Hanwang Vice President Huang Lei told Reuters in an interview.

The Beijing-based firm said a team of 20 staff used core technology developed over the past 10 years, a sample database of about 6 million unmasked faces and a much smaller database of masked faces, to develop the technology,

The team began work on the system in January, as the coronavirus outbreak gathered pace, and began rolling it out to the market after just a month.

It sells two main types of products that use the technology. One performs “single channel” recognition that is best used at, for example, entrances to office buildings.

The other, more powerful, product is a “multi-channel” recognition system that uses “multiple surveillance cameras.”

It can identify everyone in a crowd of up to 30 people “within a second,” Huang says.

“When wearing a mask, the recognition rate can reach about 95%, which can ensure that most people can be identified,” Huang said, adding the success rate for people without mask is about 99.5%.

LOSING FACIAL INFORMATION
A big customer, not surprisingly, is the Ministry of Public Security, which runs the police.

Using Hanwang’s technology, the ministry can cross-reference images with its own database of names and other information and then identify and track people as they move about, Huang said.

“It can detect crime suspects, terrorists or make reports or warnings,” he said.

But the system struggles to identify people with both a mask and sunglasses, he said.

“In this situation, all of the key facial information is lost. In such cases recognition is tough,” Huang said.

The company has about 200 clients in Beijing using the technology, including the police, and expect scores more across 20 provinces to start installing it soon, Huang said.

It is not immediately clear how Chinese citizens are reacting to this new technology.

When it comes to other surveillance tools being used in the fight against the coronavirus, there has been some grumbling on social media but most people seem to be accepting extra intrusion, or even embracing it, as a means to deal with the health emergency.

Although domestic customers have been driving Hanwang’s business, Huang also said he expected more foreign interest, as the virus spreads around the world and more people wear face masks.

“It not only benefits Chinese people, but also, when the technology is applied globally, it can benefit the world,” he said. — Reuters

Reimagining Davao’s fruits for tourism promotion

DAVAO CITY — Durian-camote rolls. Mangosteen panacotta with pomelo bits. Marang puffs.

These are some of the “innovative dishes” that will be featured in a coffeetable book being conceptualized by the Davao Tourism Association (DATA) as part of its marketing campaign for a region known for its bounty of fresh fruits.

“I am so happy to help promote Davao tourism through these innovative dishes,” Chef Clinton Verdaguer Gregorio, who is now part of the Institute of International Culinary and Hospitality Entrepreneurship (IChef) in Davao City, said in an interview.

Mr. Gregorio’s more than two-decade career has brought him around the world, working in kitchens or teaching, including at The Tower Club in Makati City, The Peninsula Manila Hotel, the Holland America Line cruise company, Warwick International, and Warrington in Cheshire, England.

Despite his experience, he said he still gets nervous at every service, like during DATA’s One Culinary Night event which marked its 45th anniversary earlier this year, where new concoctions using local ingredients and traditional dishes were presented by the DATA Chefs’ Club. He was the only invited chef from the academe.

The main challenge for this project, he said, was keeping the distinct flavors of the fruits as he turned them into desserts.

“It’s a bit more challenging… When you taste it, it should be the taste of durian or mangosteen or pomelo to really identify Davao,” he said.

Then there’s the challenge of differing tastes, like for the strong-flavored durian.

“You get nervous because it is always open to criticism. Even though your dishes are perfect, but for some guests it’s not because we have different tastebuds. One of my mentors told me to always put a big question mark even though your dish is perfect because you cannot please everyone,” he said in mixed English and Filipino.

His camote-durian roll, for example, was conceived to give a hint and appreciation of durian flavor, especially for those who are not too keen on the fruit’s strong taste and smell.

His pastries, along with other dishes, will again be featured during the city’s hosting of MICE Con 2020 in October, the country’s biggest gathering for the

Meetings, Incentives, Conventions and Exhibitions sector.

“It is an honor and quite exciting to be part of the culinary chefs in Davao. We (IChef) are the only culinary school in Davao City that is being tapped,” he said. — Maya M. Padillo

Twitter debuts ‘manipulated media’ label on clip of Biden retweeted by Trump

SAN FRANCISCO — Twitter Inc. has used its new “manipulated media” label for the first time on a video clip of US Democratic presidential candidate Joe Biden that was retweeted by President Donald Trump.

The video, posted on Saturday by White House social media director Dan Scavino, showed Biden during a speech in Kansas City, Missouri, in which he said the words “Excuse me. We can only re-elect Donald Trump.”

Biden’s full sentence, which was cut off in the clip, was “Excuse me. We can only re-elect Donald Trump if in fact we get engaged in this circular firing squad here. It’s gotta be a positive campaign so join us.”

Twitter rolled out its new policy, which labels tweets with altered or synthetic media such as so-called deepfakes or more manually edited videos, on March 5.

The tag made its debut on Sunday afternoon, but Twitter said it failed to appear when people searched for the tweet or clicked into it, only when it was seen in timelines. A Twitter spokesman said the company was working on a fix for the glitch.

Scavino, in a subsequent tweet, said “the video was NOT manipulated” and Jenna Ellis, a senior legal adviser to the president, wrote on Twitter: “The clip was accurate and was A CLIP of Biden’s embarrassing gaffe.”

Social media companies are under pressure to police misleading or false information on their platforms ahead of the US presidential election in November, in which Biden and Senator Bernie Sanders are vying to be the Democratic nominee to oust Republican President Trump.

The video, which had millions of views on Twitter, was also posted on Scavino’s Facebook page where it had about 1 million views.

The Biden campaign slammed Facebook Inc. for showing the video on its platforms without labels over the weekend.

A Facebook spokesman said on Monday the company’s third-party fact-checkers had now rated the video as “partly false.” — Reuters

Australian banks well capitalized to withstand virus spread’s disruption

A RESERVE Bank of Australia official said banks are well capitalized to deal with disruptions caused by the virus outbreak. — REUTERS

SYDNEY — Australian banks are well capitalized to withstand the disruption caused to financial markets from the coronavirus outbreak, a senior central banker said on Wednesday as the country’s banks met with the Treasurer.

Reserve Bank of Australia (RBA) Deputy Governor Guy Debelle said the country’s lenders had boosted their finances before the recent disruption in wholesale funding markets and their deposit inflows were “robust” as well.

“They are resilient to a period of market disruption,” Mr. Debelle said in a speech in Sydney.

The comment comes amid fears Australia is on track for its first recession in nearly three decades. Regulators are worried the coronavirus epidemic, which has plunged major stock indexes into bear territory and disrupted money markets, could have a ripple effect across the financial system.

A sharp and rapid fall in stock markets and widening credit spreads would put indebted firms under severe pressure, in turn leading to potential defaults and a rise in bad loans for banks.

Treasurer Josh Frydenberg did not immediately provide details of his meeting with the chief executives of 13 of the country’s biggest banks.

Shares in the Big Four banks — Commonwealth Bank, Westpac, National Australia Bank and ANZ Banking Group — have dived between 15% and 22% since the beginning of February when the virus began spreading outside China. But regulators and the banks themselves are confident the sector is prepared for a shock after lenders bolstered their core tier-I capital ratios to a minimum 10.5% from January.

Australian Banking Association CEO Anna Bligh said the country’s lenders were in “the best ever shape to face this challenge.”

Mr. Debelle said the RBA has not seen “any particular sign” of pressure in its daily market operations to date.

In addition, Mr. Debelle noted that while the spread between the bank bill swap rate — a benchmark used to price loans and other products — and the expected policy rate has risen in recent days, it remains low.

“Nothing at all like what occurred in GFC,” Mr. Debelle said, referring to the 2008 global financial crisis.

The coronavirus has spread rapidly in recent weeks, infecting more than 116,100 people worldwide and killing more than 4,000, according to a Reuters tally.

The RBA last week cut its benchmark rate to a record low 0.5%. Financial futures are pricing in another easing to 0.25% as soon as next month, another factor pressuring bank earnings and profit margins. — Reuters

Cathay projects ‘substantial’ loss as virus follows protests

CATHAY PACIFIC Airways Ltd. expects a “substantial loss” in the first half of 2020 as the coronavirus crimps travel demand, adding to the challenges facing a carrier that’s already been humbled by the political unrest in Hong Kong.

The forecast came as Cathay said its net income tumbled 28% to HK$1.69 billion ($218 million) in 2019, slightly better than the average estimate of six analysts tracked by Bloomberg. Profit in the traditionally stronger second half of the year was only HK$344 million as social unrest and US-China trade tension intensified, Hong Kong’s flagship airline said in a statement Wednesday.

“We were faced with an incredibly challenging environment to operate as the Hong Kong economy slipped into recession,” Chairman Patrick Healy said in the statement. The coronavirus outbreak has exacerbated Cathay’s troubles and put it on course for its first loss in two years. “Travel demand has dropped substantially,” Mr. Healy said.

The airline has slashed capacity to mainland China by 90% and reduced its entire international network by about 40% because of the coronavirus, which has infected nearly 120,000 people and killed more than 4,200 worldwide. Cathay, which is particularly exposed to the virus because close to half of its revenue comes from Hong Kong and mainland China, has also asked employees to take unpaid leave as it tries to weather the latest crisis.

Cathay shares rose 2.5% to HK$10.12 at 3:18 p.m. in Hong Kong. That trimmed their loss for this year to 12%.

Cathay said it is likely to continue cutting passenger capacity in May following reductions of about 30% in February and 65% for March and April in terms of available seat kilometers. It will also reduce flight frequencies. “It is difficult to predict when these conditions will improve,” the company said.

When the virus abates and demand recovers, Cathay could even stand to benefit as competitors collapse or have difficulty returning their services, according to Bloomberg Intelligence analysts James Teo and Chris Muckensturm. Cathay’s “dominance in Hong Kong was already strengthened by its acquisition of HK Express last year, which should serve it well as the city remains a key Asian financial and trade hub,” they wrote in a note.

Airlines globally have been hit hard by the coronavirus outbreak, with the International Air Transport Association saying it could cost the industry as much as $113 billion in lost revenue this year. British airline Flybe collapsed last week as the epidemic ended prospects for a UK state-backed rescue, while carriers from United Airlines Holdings, Inc. and Singapore Airlines Ltd. to Deutsche Lufthansa AG and Qantas Airways Ltd. are slashing flights.

“The situation in 2020 will be much more severe than in 2019” said Luya You, a transport analyst at Bocom International.

Cathay warned about its results before the virus struck as Hong Kong protests led to lower bookings and passengers in the latter part of last year. In addition to the broad drop in tourist numbers, Chinese state-run companies told employees to avoid flying with the airline on business or personal trips after Cathay came under fire from Beijing because some of its workers took part in a general strike and demonstrations.

“Inbound traffic was hit hard, particularly on short-haul and Mainland China routes, while outbound traffic also decreased,” Mr. Healy said in Wednesday’s statement. “Demand for premium travel was weak and we became increasingly reliant on lower-yielding transit traffic.”

“We expect our passenger business to be under severe pressure this year and that our cargo business will continue to face headwinds,” Mr. Healy said.

Cathay said it will continue to bring in new aircraft this year and is maintaining its plan to take delivery of 70 new planes by 2024. Its new subsidiary HK Express reported a post-acquisition loss for 2019 against expectations for a small profit, while Air China Cargo suffered “a significant decline in results as trade tensions escalated.”

“They had a great first half last year and then all of a sudden with the protests the second half was really dismal,” Sobie Aviation analyst and consultant Brendan Sobie said in a Bloomberg Television interview Wednesday. “It’s just gone from bad to worse for Cathay Pacific and they’re in a very challenging position.”

“It’s going to be pretty bad for most of this year probably and will take a while for the Hong Kong market and global market to recover,” Mr. Sobie said. — Bloomberg

Park Inn by Radisson Davao taps local baker for artisan bread

DAVAO CITY — Vanessa Pacheco’s romance with artisan breads started in 2000, when she discovered a passion for baking while living in Canada.

She returned home to Davao in 2017 after completing her Artisan Bread Baking, and Baking Arts Certificates from George Brown College the year before.

By 2018, she started her home-based business, Craft Breads and Pastries, taking in orders from a small network of clients who appreciate the not-your-usual type of goods she bakes.

“Although, we have focaccia, brioche, scones, panettone (here in Davao), the ones that we get here look like these breads but they don’t taste authentic. That is why I wanted to introduce these kinds of breads to the Dabawenyos,” Ms. Pacheco said in an interview.

And there is a market now for these specialty — and more expensive — breads, she said, as the taste of locals evolve along with the city’s growing culinary scene.

Park Inn by Radisson Davao has taken notice of her work and tapped her as partner, starting with the hotel’s breakfast buffet’s bread offerings.

The hotel, strategically located at the back of SMX Convention Center, plans to expand its menu with gourmet sandwiches and toasts as well as classics in collaboration with Craft Breads and Pastries.

Ms. Pacheco said she is aiming to supply other dinning places eventually.

“They can make preparations out of these breads to make it more appealing to the Dabawenyos. Pag natikman nila (Once customers taste it), there is a chance they’ll buy the loaves. Hopefully they can entice Dabawenyos to buy the loaves from me,” she said.

The Craft Breads and Pastries line includes cheese rolls, sourdough, focaccia, brioche, and panettone.

The artisan baker’s favorite is sourdough.

“Sourdough is complicated. It’s crackly on the outside and soft and hot on the inside. The flavor is punchy and the texture is silky-chewy… My sourdough breads, from start to finish, takes three days. From feeding the starter to creating the levain (the yeast), to creating and shaping the dough, to fermenting the dough again and then baking… that is why it is special,” she said during a tasting event at the Radisson’s RBG Bar & Grill.

“I hope sourdough will take off. I was very surprised that focaccia over the holidays was our bestseller,” she said.

Orders to Craft Breads and Pastries be placed online through www.craftbreadsandpastries.com or through 0995-985-4744. — Maya M. Padillo

Netflix to offer ‘competitive, compelling’ P149 monthly plan for Filipinos

AIMING to increase its customer base in the Philippines, American streaming service Netflix is now offering a P149-per-month mobile plan for Filipinos, allowing them to watch movies on their smartphones and tablets.

“We are launching a new plan for the Philippines… We are super excited to announce that it will be offered for P149 only,” Netflix Director for Product Innovation Patrick Flemming told reporters via live video conference from Los Angeles, California on Wednesday.

With the new mobile plan, which is in addition to the existing basic, standard and premium plans, Mr. Flemming said Netflix users will be able to “watch films and shows — uninterrupted and without ads — on one smartphone or tablet at a time.”

The new plan will be officially launched in both the Philippines and Thailand on Thursday. The product had been launched in India, Indonesia, and Malaysia.

Mr. Flemming noted that the Philippines has been an attractive market for the company as Filipinos spend more than three hours per day watching online content on their smartphones.

He also described the new mobile plan’s price point as “super competitive and compelling.”

“Filipinos watch 2x more Netflix on mobile than the rest of the world,” he said, adding that “two out of three Filipinos use downloads on their phones to watch Netflix on the go.”

“We’re enthusiastic to introduce the Mobile plan in the Philippines to make it even easier for anyone with a smartphone to enjoy Netflix. At home or on the go, now more people can watch all the shows and movies Netflix has to offer, wherever and whenever they want,” he continued.

Interested individuals may download the Netflix app or visit its official website to register for the mobile plan for P149 per month.

Its other three existing plans are basic for P369/month, standard for P459/month, and premium for 549/month.

Netflix said customers can pay for their subscription using credit and debit cards, via direct carrier billing with their existing networking provider, or with cash using a Netflix gift code.

Netflix recently reported that its membership had increased by 20% last year.

Membership in the Asia Pacific region grew by 1.75 million in the fourth quarter of 2019, bringing the total to 16.23 million.

It said 95% of its membership growth came from countries outside the US. — Arjay L. Balinbin

Empty offices, full homes: COVID-19 might strain the internet

WITH MORE people working from home to avoid coronavirus, will the internet break? The short answer is probably not. The longer answer is that there will be disruptions.

To protect workers and help stem the spread of COVID-19, companies like Twitter Inc. and JPMorgan Chase & Co. are telling employees who can work from home to stay home. In all, 42 million Americans, about 29% of the US workforce, are able to work from home. And as schools close to keep kids out of harm’s way, the pressure on home networks will grow.

“The weak link in the chain, where the system could get overloaded, is going to be the home broadband network,” said Lisa Pierce, a network expert with Gartner. “People will hit congestion, just like a highway, where the speed goes from 60 miles an hour to 20.”

Residences and neighborhoods served by lower bandwidth cable and copper-wire connections will be among the first affected. Whole families sharing a single Wi-Fi signal, all logging in at once to work or firing up TVs and tablets to stay connected and entertained, should also expect delays.

STRONG BACKBONE
On the whole, the big networks of fiber-optic cable that crisscross the country will continue to operate, hauling internet traffic between cities, according to US phone service giants AT&T Inc. and Verizon Communications Inc.

“As an engineer, I will tell you that we will have the capacity in our system that employees and customers need access to, at times like this,” said Jeff McElfresh, chief executive officer of AT&T Communications, which oversees landline, wireless and TV services. “We can provide the ability to work where customers need to work and help them continue to be productive. It’s something I’m proud of. This is something we do right.”

The phone companies’ underlying confidence in their networks is due, in part, to the fact that the volume of traffic won’t necessarily change. What will change are the patterns. Traffic will originate less from offices with powerful connections and more from residential areas. Cable and phone companies that provide home broadband might develop bottlenecks at network nodes where multiple lines converge.

Among the biggest network cloggers, or bandwidth hogs, will be popular video and social-media services, like Netflix, YouTube, Facetime and Skype, according to Roger Entner, an analyst with Recon Analytics.

“Video is already 70% of all network traffic,” he said. “The moment you add in videoconferencing to all the shows the kids are watching because schools are closed, it could be a problem if everyone is trying to get on at the same time.”

DIFFUSE IMPACT
Problems are likely to range from dropped connections to slow downloads or loss of video feeds. These are familiar conditions in climates where snow days keep folks at home and can test the limits of home broadband capacity.

They’ll vary by region and time of day, depending on traffic patterns, unlike single events that we all experience, for example the disruptions caused by the recent launch of Walt Disney Co.’s Disney+ or glitches on Amazon Prime Day.

Even if home connections are robust, not every company is ready to handle a sudden surge of employees trying to log in to the office network from outside.

Many employers use virtual private networks, or VPNs, as secure, dedicated channels for remote users to access the same network they normally have at work.

Typically businesses allocate enough network capacity to accommodate the everyday needs of a small number of employees working remotely, but a large-scale shift could cause temporary trouble. Adding VPN capacity could take hours or days or maybe even weeks for some companies, according to networking experts.

Preparation can help. For a decade or more, big employers have been developing contingency plans and business-continuity strategies. Information-technology departments have developed checklists or backup procedures and employees have been briefed, or even participated in mock emergencies, to test remote connections at home or in temporary offices.

“We’re in a far better place than we were five or 10 years ago, in terms of network preparedness,” Pierce said. — Bloomberg

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