New Showroom Normal
For car buyers and enthusiasts, here are a few changes that might happen in dealerships/casas when the lockdown period ends to curb the spread of COVID-19.
Full story here: https://bit.ly/3aHim1h.
PHL to return to global bond market
THE Philippine government is set to return to the global bond market, announcing on Monday its plan to issue multi-tenor dollar-denominated bonds.
According to data from the Bloomberg Terminal, the papers to be offered will be 10-year and 25-year dollar-denominated senior unsecured bonds.
National Treasurer Rosalia V. de Leon declined to provide further details.
The proceeds of the fundraising activity will be used for general purposes and budgetary support, according to Bloomberg.
The bond issue has set a price guidance at “CT10+220 basis points (bp) area” for 10-year tenor, with CT10 referring to 10-year US Treasury bonds, and “3.375% area” for the 25-year notes. The notes will also carry semi-annual fixed interest rates.
Bloomberg said the volume of the offer for the two tenors will depend on the US benchmark size.
The benchmark size for Philippine global bond sales based on previous issuances ranges between $500 million and $700 million.
Debt watcher S&P Global Ratings on Monday assigned a “BBB+” long-term foreign currency issue rating to the proposed dollar-denominated notes.
“The notes represent direct, general, unconditional, unsecured, and unsubordinated obligations of the sovereign, and rank equally with the sovereign’s other unsecured and unsubordinated debt obligations,” S&P said in a statement yesterday.
The joint bookrunners for the transaction include Citigroup, Inc., Credit Suisse Group AG, Goldman Sachs (Asia) L.L.C./ Morgan Stanley, Standard Chartered Bank and UBS Group AG, according to Bloomberg.
The government’s initial borrowing plan was set at P1.4 billion with a borrowing mix of 75:25, in favor of domestic sources, but Ms. De Leon said earlier this month that the revised mix could now range between 70:30 and 72:28.
The Development Budget Coordination Committee is currently reviewing its macroeconomic assumptions in light of the ongoing pandemic.
Ms. De Leon earlier postponed the government’s plan to tap the panda or yuan bond market amid the coronavirus pandemic.
In January, the government raised €1.2 billion out of bids worth €4.3 billion from its offer of two tenors of euro-denominated bonds, broken down into €600 million each for three-year and nine-year papers.
The bonds carry coupon rates of 0.1% for the three-year bonds and 0.7% for the nine-year papers, a spread of 40 bps and 70 bps over benchmark rates, respectively.
Meanwhile, the Treasury sold $1.5 billion in 10-year dollar-denominated global bonds in January 2019 priced 110 bps above benchmark rates. The offer was met with strong demand, with total bids reaching $4 billion.
In May last year, the government also raised 2.5 billion renminbi (RMB) or $363.3 million via three-year panda bonds at a coupon of 3.58%. The offer was met with strong demand with total bids reaching RMB11.25 billion.
The Treasury also issued ¥92 billion ($860 million) following a multi-tenor offer of yen-denominated bonds in August last year. Broken down, ¥30.4 billion was raised via three-year samurai bonds at a coupon rate of 0.18%, ¥21 billion from five-year papers priced at 0.28%, ¥17.9-billion from seven-year securities at a 0.43% coupon, and ¥22.7 billion through 10-year bonds priced at 0.59%. — B.M. Laforga
NOLCO extension for small firms eyed
THE Department of Finance (DoF) is proposing the extension of the net operating loss carry-over (NOLCO) by two years for small firms which are facing nearly P500 billion in losses as a result of strict lockdown measures.
In a statement on Monday, Finance Secretary Carlos G. Dominguez III said extending the NOLCO to five years from the current three-year period would require approval by Congress, as it is provided for under the National Internal Revenue Code (NIRC).
“We will propose to Congress an extended NOLCO of five years for net losses that will be incurred in 2020. This means that a small business’ losses this year may be deducted from their income for up to the next five years for tax purposes,” Mr. Dominguez was quoted as saying.
The Finance chief said that extending the tax deductibility of losses incurred in 2020 will allow small businesses to “recoup” losses they suffered during the Luzon-wide enhanced community quarantine (ECQ), which started in mid-March.
DoF estimates showed small companies may suffer around P465.3 billion in financial losses due to strict protocols of the ECQ, which forced many to temporarily halt operations or employ a skeletal force.
Small businesses that operate in shopping malls and other outlets are expected to post P461 billion in losses, while those who have remained open but at reduced capacity will record P4.3 billion in losses.
“The longer NOLCO period will have the effect of lowering the tax payments between 2021 and 2025 of affected small businesses by a combined estimated total of P139.6 billion,” Mr. Dominguez said.
Under the NIRC, net operating losses of businesses that have not been previously offset as a deduction could be carried over as a deduction from their gross revenues over the next three taxable years immediately following the year of such loss.
Sought for comment, Albay Representative and House Economic Stimulus Cluster Co-Chairman Jose Maria Clemente S. Salceda said they will include the NOLCO extension provision under the proposed Economic Stimulus Act bill.
“It’s one of the tools we will include — a scalpel in the operating room for economic recovery,” Mr. Salceda said in a Viber message.
He estimated that the impact of the coronavirus pandemic on asset quality of businesses could reach P3 trillion.
Meanwhile, the government also assured that it will provide credit guarantees for small businesses affected by economic fallout from the pandemic. This will cover up to P120 billion worth of loans, according to the DoF.
“The credit guarantee program will provide small businesses easier access to bank financing, which tends to contract during crisis periods,” Mr. Dominguez said, adding that these could help small firms improve their cash position and settle other expenses. — Beatrice M. Laforga
Philippines may miss out on expected boom in ICT services
By Jenina P. Ibañez
Reporter
THE Philippines may miss out on an expected global boom in the information and communications technology (ICT) sector amid the coronavirus pandemic.
The National ICT Confederation of the Philippines (NICP) President Michael Tiu Lim said in a recent phone interview that many small businesses, especially those in the countryside, are unable to implement work-from-home (WFH)schemes due to a lack of adequate internet infrastructure.
The United Nations Conference on Trade and Development (UNCTAD) in a report last week said that while the pandemic dealt a “severe blow” to the services sector, particularly in tourism, hospitality, and retail, the ICT services sector will see windfall opportunities.
However, rapid growth in ICT services such as teleworking, video streaming, gaming, and e-commerce will mostly be seen in developed countries, the UNCTAD said.
UNCTAD International Trade Director Pamala Coke-Hamilton said the boom in the ICT sector may not compensate for the loss of income from personal service sectors like tourism, especially in developing countries.
NICP’s Mr. Lim said there’s been growth in some ICT companies, such as food delivery apps.
“But on the other side of the coin, there are companies that are service oriented… who are hardest hit,” he said, citing tourism and restaurant mobile applications that have seen reduced demand.
“So it’s a double-edged sword. There are certain sectors in the ICT industry that are doing well, and the others will not be doing well. In the overall balance, I think companies that don’t do well outweigh the companies that do well, unfortunately.”
Mr. Lim said that there are opportunities for ICT companies as more businesses start working from home and make use of their services, noting an increase in demand for online meeting apps.
“But the question is, how ready are our SMEs (small- and medium-sized enterprises) to go to work from home? There are a lot of problems right now with work from home, especially in the countryside. And the main issue is not only the policies of the companies but even the physical connectivity,” he said, adding that many businesses are still geared towards social, in-person activities.
“Some employees don’t even have proper 4G or 3G connectivity at home to enable them to connect to their work.”
TOURISM SLUMP
The Philippine tourism sector continues to suffer as global travel grinds to a near halt.
Tourism Congress of the Philippines (TCP) President Jose C. Clemente III said in a phone interview on Thursday that the industry expects 18-24 months before a return to normal.
“The last ones that will recover (in the tourism industry), based on the sub-sectors, will be tour operators, travel agents, and the MICE (meetings, incentives, conferences, exhibitions) industry,” he said, explaining that those sub-sectors attract mass gatherings.
He said airlines will have to wait and see what travel demand will be like after borders are reopened, noting that tourism will probably not return to normal until a COVID-19 vaccine is developed.
Mr. Clemente noted that part of the hotel industry, especially in Metro Manila, remains in operation due to the demand from outsourcing companies housing their workers and the repatriated overseas Filipino workers.
But he said the industry cannot yet quantify the effect of the pandemic on revenue projections, noting that some companies have already started cutting costs and laying off workers.
“It’s hard to say because a lot of this is foregone travel…which we cannot really quantify anymore.”
The best-case scenario, Mr. Clemente said, would involve a return to a semblance of normalcy after a year. The worst-case scenario — “some companies that were there pre-COVID will not be there after all of this.”
FUTURE OF SERVICES
Mr. Lim said small businesses must put business continuity plans in place as WFH measures become the new norm.
“Improving the ICT infrastructure, yes that is definitely needed. Work-from-home strategies in the countryside are not as effective as here in Metro Manila because certain areas where employees live don’t have decent coverage.”
Mr. Clemente sent recommendations to the tourism department, detailing in a position paper that the industry needs the expedited provision of low or interest-free loans, lower rental rates for offices and event venues, waived participation fees for trade shows, and funding for marketing to the domestic market “as soon as practicable.”
In the medium term, TCP is calling for the waiving of corporate and income taxes for 2020 among accredited tourism stakeholders and incentives such as tax credits, among others.
The Department of Tourism (DoT) in a mobile message said it has incorporated suggestions from the Tourism Congress in its recovery program, which waives participation fees to trade shows, includes a “beefed up” marketing campaign, and develops post-pandemic health protocols.
“(The TCP) has been continually apprised of the efforts undertaken by the Philippine government to mitigate the impact of this global health concern on the country’s tourism stakeholders, such as the expedited provision of low or interest-free loans to DOT-accredited stakeholders, capacity enhancement programs, alternative livelihood training for cooperatives and representation to various government offices on matters relevant to the travel and hospitality sector.”
BusinessWorld reached out to the Department of Information and Communications Technology, but has not yet received a response.
Further monetary easing ‘still in the agenda’ — Diokno
BANGKO SENTRAL ng Pilipinas Governor Benjamin E. Diokno said on Monday that further monetary easing through rate cuts and reduction in reserve requirement ratio (RRR) remain on the table to ensure the country’s economic stability amid the coronavirus disease 2019 (COVID-19) crisis.
“We’ll do anything to get us through this crisis, so that’s still in the agenda. But right now, as you know monetary policy works with a lag, we will observe how the banking industry will behave,” Mr. Diokno said in an interview with ABS-CBN News Channel (ANC).
The central bank has already slashed policy rates by 125 basis points (bps) this year to cushion the impact of the pandemic on the economy. The latest of which is the 50 bps off-cycle rate cut which brought down reverse repurchase rate to a record low 2.75%.
Meanwhile, overnight lending and deposit have been lowered to 3.25% and 2.25%, respectively.
In total, the BSP has slashed rates by a total of 200 bps since 2019, fully reversing the 175 bps rate hikes in 2018 when inflation went to a multi-year high.
Whether or not another rate cut will come sooner will depend on inflation trend, according to Security Bank Corp. Chief Economist Robert Dan J. Roces.
“They’ll likely assess trajectory of inflation to help decide when appropriate to cut policy rates further while keeping real rates in positive territory,” Mr. Roces said in an e-mail.
For UnionBank of the Philippines, Inc. Chief Economist Ruben Carlo O. Asuncion: “There might be another 25 bps depending on more data points, i.e., April inflation. Or it could also be another 50 bps because 2.25% essentially is still above the BSP new inflation average for 2020 at 2.0%.”
Since the Monetary Board (MB) canceled its May 21 meeting after the off-cycle rate cut, the next scheduled policy-setting meeting will be on June 25.
In terms of RRR cuts, it can be recalled that Mr. Diokno promised to bring it down to a single digit by the end of his term in mid-2023.
Given that the central bank has again reduced RRR for universal and commercial banks by 200 bps to 12% in early April, Mr. Diokno said that they are now “ahead” of their goal as he still has three more years to further bring down the RRR.
For now, RRR of thrift and rural banks have been maintained at four and three percent, respectively. However, the BSP has reduced minimum liquidity ratio for standalone thrift and rural banks by 400 bps to 16% until yearend in a move to boost liquidity amid the pandemic.
“Further cuts in RRR by least another 200 bps as hinted by the MB would help further reducing borrowing costs and infuse about P200 billion into the banking system,” Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said.
Mr. Diokno has been authorized by the central bank to reduce RRR by a total of 400 bps in total for the whole of 2020.
Analysts are of the view that BSP still has space left to further cut RRR.
“We still have a high level of RRR compared to other neighboring countries and it is part of the plan since the time of the late Governor Nestor A. Espenilla,” Mr. Asuncion said.
“RRR is also still potent with central bank affording to cut by another 200 bps authorized, or even further if the situation needs it, though they’ll likely stop at 10%,” Mr. Roces said. — Luz Wendy T. Noble
Ayala Land says REIT plan still on
By Denise A. Valdez, Reporter
AYALA LAND, Inc. (ALI) is keeping its real estate investment trust (REIT) plan on the table despite challenges brought by the coronavirus disease 2019 (COVID-19) pandemic.
Ayala Land Offices Head Carol T. Mills told BusinessWorld that ALI continues to coordinate with the Securities and Exchange Commission (SEC) regarding its REIT application.
“ALI is still pursuing and we are keeping our REIT application with the SEC updated and active,” she said in an e-mail Monday.
But she noted the timing of the offering will depend on market conditions.
ALI filed its REIT application with the SEC in February to do a primary offer up to 478,639,700 shares, a secondary offer of up to 430,775,700 shares, and an over-allotment option of up to 23,932,000 shares, with each share priced at P30.05, which would raise up to P15.1 billion in net proceeds.
This is the country’s first REIT application, following the SEC’s adjusted REIT guidelines launched in January.
ALI’s REIT plan involves three commercial buildings in Makati central business district: the 24-storey Solaris One, the mixed-use development Ayala North Exchange, and the five-storey McKinley Exchange.
Based on its prospectus, ALI wants to use proceeds from the offer for future investments in real estate and general corporate purposes. It is planning to buy Teleperformance Cebu from its subsidiary ALO Prime Realty Corp. and other real estate properties in Metro Manila and key regions.
While REITs are ideally a viable investment opportunity because it allows people “to be invested in real estate without having to worry about fake titles or managing properties,” PNB Securities, Inc. President Manuel Antonio G. Lisbona said the ongoing pandemic may scare investors away.
“REITs value is derived from rental income and the value of the underlying assets. Not sure how investors will accept an offering at this time,” he said in a text message on Monday. “Given the uncertainties resulting from the pandemic, many investors will probably be leaning towards keeping liquid.”
Philstocks Financial, Inc. Research Associate Piper Chaucer E. Tan said the same thing, noting if the quarantine will last any longer, it may be a challenge for ALI to attract investors.
“How will REIT be a viable investment instrument for investors if office spaces, malls and residential spaces are not utilized due to the quarantine measures by the government?” he said in a text message.
But Mr. Tan said if it pushes through, ALI’s offering would be an opportunity for investors with different risk appetites, like conservative ones and institutional investors, because REITs give regular dividends to shareholders.
“Stocks in real estate are so attractive because of the [industry’s] growth… If we are able to contain this virus, have a vaccine or a cure for this, I think the economy will bounce back, including real estate, like a ‘V-Shape’,” he said.
PNB Securities’ Mr. Lisbona also said if ALI’s offering becomes successful, it will help provide liquidity for its REITs’ operations and funding for future acquisitions in anticipation of lower property prices.
ALI said last week it is deferring all project launches this year to trim costs and keep liquidity amid the ongoing COVID-19 pandemic. It also slashed its budget for capital expenditures to P70 billion from the original P110 billion.
Earnings of the company grew 13% to P33.2 billion last year due to higher contributions from new leasing formats. Shares in ALI at the stock exchange grew 30 centavos or 1.04% to P29.20 each on Monday.
Meralco core net income up 2% to P5.7B in first quarter
By Adam J. Ang
THE Manila Electric Co. (Meralco) on Monday reported a 2.1% growth in core net income in the first quarter to P5.72 billion as energy sales proved strong amid the global coronavirus disease 2019 (COVID-19) pandemic.
This came despite a 7.1% drop in the listed utility’s gross revenues to P70.03 billion in the January-March period, compared with the P75.38 billion recorded in the same period in 2019.
In a virtual briefing, the country’s biggest distribution utility said its electricity revenues, which make up 97% of its total revenues, decreased to P67.91 billion, compared with P73.63 billion in the preceding year.
According to Betty C. Siy-Yap, Meralco’s senior vice-president and chief financial officer, the lower share of generation and transmission pass-thru charges in the electricity revenues was “mainly due to the decrease in WESM (Wholesale Electricity Spot Market) prices driven by the improved supply condition in the Luzon grid, lower generation charges after implementing the new PSAs (power supply agreements) starting Dec 26, 2019, and lower fuel costs throughout the first quarter of 2020.”
“Distribution revenue grew by 9% to P15.6 billion reflecting the impact of higher volumes distributed, including the sales mix,” she added.
Recently, Meralco invoked a force majeure provision in their power supply contracts which brought down generation costs for its customers.
The lowered revenue came as its energy sales went up 4.8% to 10,879 gigawatt-hours (GwH), of which around 10% or 1,117 GwH was estimated beginning March 17 when it postponed the meter reading for their customers’ bills upon the implementation of the enhanced community quarantine (ECQ) to contain the spread of COVID-19.
Industrial sales volume decreased over 2%, lagging behind the other two segments, residential and commercial, which recorded a growth of 12% and 5%, respectively.
In the March billing period, about 33% of the utility’s energy sales were estimated based on consumers’ electricity consumption from the past three months.
Meralco added over 251,000 customers in the quarter, mostly from its residential business, to 6.93 million customers in total.
Further, its reported net income in the quarter was at P2.62 billion, lower by 53.8% compared to P5.67 billion in the same quarter last year, attributed to its share in the impaired investment of P2.7 billion in Singapore-based PacificLight Power Pte Ltd.
As the power utility attended to both power restoration activities during the Taal Volcano eruption in January and the ECQ from March 15, which “severely limited the deployment of people and transport of materials and equipment” for its fixed-asset projects, the company only utilized P4.2 billion of its total capital expenditure in the first quarter, according to Ms. Siy-Yap.
On April 11 and 20, the utility resumed its meter reading. It announced that it will reopen most of its business centers on May 4.
Meralco Chairman Manuel V. Pangilinan, who is also present at the virtual briefing, said he is expecting a continued earnings decline by the second quarter.
“So far, what we are experiencing for the April month is a decline in our volume, and that’s likely to hold for the entire second quarter. With the lower volumes and lowered revenues, it is likely that the second-quarter results will come in below the first-quarter results,” he said.
Despite this, Mr. Pangilinan said in a separate statement: “[W]e remain optimistic that we will see a recovery in the overall business environment starting the second half of 2020.”
Meanwhile, Meralco PowerGen Corp. (MGen) President and Chief Executive Officer Rogelio L. Singson reported that site preparation activities of the ultra-supercritical coal-fired power plant was suspended due to the ECQ. The plant has two units, each with an identical capacity of 600 megawatts (MW) under MGen’s wholly owned subsidiary Atimonan One Energy, Inc.
Mr. Singson also said that the suspension of the site works at the 50-MW solar project by PowerSource First Bulacan Solar, Inc. in San Miguel, Bulacan would cause at least two months of delay before it can commercially operate. The renewables plant was expected to run by the end-2020.
On Monday, shares in Meralco slipped by 1.56% to close at P252 each.
Meralco’s controlling stakeholder, Beacon Electric Asset Holdings, Inc., is partly owned by PLDT Inc. Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has interest in BusinessWorld through the Philippine Star Group, which it controls.
Lockdown brings P7-B monthly losses to local airlines — ACAP
By Arjay L. Balinbin, Reporter
AIRLINES in the Philippines suffer losses of P7 billion per month of lockdown apart from their accumulated losses of around P4 billion from travel refunds because of the coronavirus disease 2019 (COVID-19) crisis, the Air Carriers Association of the Philippines, Inc. (ACAP) said.
“If you aggregate the amounts for the members of ACAP, if you look at the average, the fixed cost that they incur, in other words this is the cost that they have to pay even if they are not flying, is around P7 billion a month,” ACAP Executive Director and Vice-Chairman Roberto Lim told BusinessWorld in a phone interview on Monday.
ACAP is composed of Philippine Airlines, Inc. (PAL), Cebu Air, Inc. (Cebu Pacific), Philippines AirAsia, Inc., Air Philippines Corp. (PAL Express), and Cebgo, Inc.
“If you are not flying and there’s a fixed cost of P7 billion, you are paying that amount without any revenue so you have to get it somewhere. You have to get it from your reserves or you have to borrow money to pay that. So you consider that losses,” he explained.
As for passenger revenue losses due to the COVID-19 crisis, he said: “Siguro mga P4 billion na, kasi noong February mga P2.7 billion and the refunds keep on coming.” (Perhaps, the amount has reached P4 billion because in February our estimate was P2.7 billion and refund requests keep on coming.)
For an airline to reduce its fixed costs, he said it should try to secure waivers for taxes and other fees.
“Syempre (Of course) you try to preserve your workforce, so that’s why most of them have paid their workforce… But we can only do so much in reducing fixed costs,” he explained.
In its recent estimates, the International Air Transport Association (IATA) said local airlines in the Philippines will see their passenger revenues drop by $4.481 billion this year as it expects passenger demand to decline by 47%.
IATA said its estimates are based on a scenario of severe travel restrictions lasting for three months, with a gradual lifting of restrictions in domestic markets, followed by regional and intercontinental.
Mr. Lim said: “It will be more if the travel demand does not come back.”
Conrad Clifford, IATA’s regional vice president for Asia Pacific, identified the Philippines as among the priority countries in the region that need to take action.
IATA said the government needs to provide airlines with direct financial support; loans, loan guarantees and support for the corporate bond market; and tax relief.
ACAP member-airlines recently appealed for government help, as the “catastrophic impact” of the COVID-19 pandemic threatens their survival. Mr. Lim said the group has yet to receive a reply from the government.
ACAP asked the government to provide a credit guarantee scheme “that guarantees the banking sector’s loans and credit lines, most of which are secured with collateral, to remove its aversion to the poor credit risk of the airline industry under the present operating environment.”
The group also requested the government to give them access to emergency lines of credit to fund six months of operations of airlines and other aviation-related companies, “in order for the industry to remain viable until overall demand recovers.”
ACAP said airlines need a “long-term facility with attractive rates or a guarantee facility to allow them to restructure their debt at manageable levels, and secure better terms from aircraft lessors, bankers and creditors.”
Lastly, the local airlines also sought a full waiver of all navigational and airport charges, which include airport office rentals and land leases, until the end of 2020.
How restaurants cope: react quickly, sell inventory, take care of your own, mind your brand
EVERYONE has taken a hit during this lockdown. Even the restaurants we once went to to taste something new and to escape from the dreariness of normality have taken some bad blows. In a webinar earlier this month hosted by Bounceback PH, RJ Ledesma of Mercato Centrale interviewed restaurateurs about how they were coping during the pandemic, and how they plan to serve food in the future.
Audrey Tanco-Uy, Bizu’s Managing Director, was proactive in her approach. She sensed disaster when the catering arm of the bistro and patisserie chain started getting cancellations from clients. “One week before the lockdown, it was already getting scary for us, mainly because we are also in the event industry. Our clients were backing out on contracts.” As the malls where her restaurants were located began to lock down, Ms. Tanco-Uy knew that her inventory would eventually spoil, so she liquidated them by selling the raw materials to her employees, who needed food anyway.
“What really provides anxiety for all of us are the coming (months). I was doing a forecast, and even in June, it might even be worse for us, when there’s less foot traffic. At the same time, we’ll have to pay for our fixed costs (like rent). It can get even worse from there. Everybody is uncertain right now,” she said.
Meanwhile, Eric Dee, COO of Foodee Global Concepts (which brought Michelin-starred brands FOO’D, Tsuta, Hawker Chan, and Tim Ho Wan to the country, among others), had the same instinct. “We had to decide very quickly. I think we were one of the few that shut down our doors prior to the announcement of the lockdown.” With 4,000 employees, they made sure that they would receive their paychecks and other packages. “We helped our internal staff first. I think that’s more important, that we help internally first before helping outwards.”
Raymund Magdaluyo, President of the Red Crab group, and Wolfgang’s Steakhouse partner said, meanwhile, “What they teach us during times like these: what you want to do is convert as much of your current assets to cash.” He did this by selling 20% of their steaks to cover allowances and assistance to their staff. “I’m prioritizing the core employees, and the most vulnerable.” He’s already seen what the future may hold for some of his branches: “To be honest with you, I don’t think after this crisis all the stores will be opening. I’ve identified a few stores that maybe I won’t reopen.”
As some will note, many restaurateurs have resumed operations by doing delivery and takeout business. Ms. Tanco-Uy jumped into action early. She and her team took a two-day break after the announcement of the lockdown — and then opened up their commissary with 10% of the workforce. They started with bread, seeing as this was an immediate necessity — or, as we say these days, an essential. “It gave us good publicity as well. Not many people were willing to go out of their way to produce food for people who needed it.” Eventually, they went back to producing the pastries they’re known for: a two-pronged approach to keeping relevant. “Bizu is known for celebrations, for bringing joy to homes,” she said. As Easter weekend rolled in, she found her chance. “We marketed it like we were normal, that we are not a business operating during the crisis. We tried to communicate that it’s Easter. There is joy, there is hope. That there’s still love.
“That’s something I would like to share as a key takeaway: instill market to your people,” she said. “I just want to reiterate that you still have to stick to your brand. Don’t act like a company in crisis mode. Continue communicating; telling people about who you are. They have to still have an imprint on who you are.”
On a practical note, Ms. Tanco-Uy sends out her deliveries independent of third-party apps. “They would get 20% of my sales, and at the same time [the service is not that regular]. They won’t be able to build it up.” Seeing that a lot of riders were now jobless, Ms. Tanco-Uy set up her own delivery fleet, citing the advantages of consistency. She also noticed that for deliveries, people still like to make calls, and the only matter is digitizing and capturing their orders and payments.
Meanwhile, Mr. Dee said that a lot of restaurants have begun to operate on limited basis, but says, “I think some have done it prematurely.”
“The new protocols that have to be put in place just to operate are very different to what we’ve been used to,” he said. As a precaution for example, the company purchased 5,000 quick-testing COVID-19 kits for their employees. For now and the future, he said, “Now is the time to be more vocal about your safety protocols. Not only for your staff, but also for your consumers.” For him, the questions asked now are not if the food is good, but if the food is safe.
While the obvious answer for everyone might be converting their operations to delivery and takeout only in the near-future, Mr. Magdaluyo points out, “It’s not overnight that you get to shift mindsets towards deliveries.”
He does say though that some things will definitely change: the desirability of certain locations, for example. “I now look for places with big outdoor spaces… malls probably have to change the way they design.”
Recalling 9/11 in New York, he said that people believed that nobody would step into restaurants anymore. “Ako talaga, naniniwala ako na kakain pa rin ang tao sa restaurant (I really believed that people will still eat in restaurants).
“Ang scenario na puro takeout lang? Bullshit ‘yan. (As for the scenario that it will only be take out? That’s bullshit).
“Dine-in will not die… it might take time, but people will still get coffee,” he said. Restaurants around the world have survived how many pandemics.” — Joseph L. Garcia
AEV slashes year’s budget by 36% to P47 billion as quarantine hits businesses
ABOITIZ Equity Ventures, Inc. (AEV) is slashing its 2020 capital expenditures (capex) by about 36% to P47 billion in a bid to cut spending as it factors in the impact of the coronavirus disease 2019 (COVID-19) pandemic.
In a statement Monday, the listed holding firm of the Aboitiz Group said it was removing P26 billion from its initial capex of P73 billion to “[consider] the impact [of the pandemic] on the group’s and country’s future growth.”
It said most of the reductions were originally allocated for its infrastructure, power and land units covering operating, maintenance and expansion costs.
“Most of our businesses are in industries that are vital to keeping the economy running. Filipinos need electricity, food products, and money, for example. And for our other businesses, we have been prudent in capital expenditure spending so this should not be much of a problem,” AEV President and Chief Executive Officer Sabin M. Aboitiz said in the statement.
The implementation of an enhanced community quarantine (ECQ) since middle of March had varying effects on AEV’s different business segments.
Power unit Aboitiz Power Corp. said it noticed a slowdown in power demand, but consumption is starting to rise because of the warmer weather. The first unit of its GNPower Dinginin Ltd. Co. power plant in Bataan is set to start operations by the second quarter of 2021.
Banking unit UnionBank of the Philippines observed a tenfold increase in digital customers since the start of the ECQ. It has now boosted its services to allow direct fund transfers to remittance centers nationwide.
Pilmico Foods Corp. said its facilities and farms remained operational during the ECQ period. It plans to continue the integration of Pilmico and Singapore-based Gold Coin Management Holdings, Inc. this year, which will “[optimize] synergies in procurement, cross-selling across countries, and shared services in its corporate services units.”
Infrastructure arm Aboitiz InfraCapital, Inc. is still reviewing the impact of the pandemic on its projects, particularly those in the airport sector. Its bulk water supply unit Apo Agua Infrastructura, Inc. is coordinating with contractors on how to address the ECQ in Davao City.
Real estate unit Aboitiz Land, Inc. is continuing plans to build townships and logistics facilities as it anticipates a surge in demand after the pandemic. “AboitizLand expects the local real estate market to be quite resilient, with the large unmet demand for housing a significant contributing factor,” it said.
Construction unit Aboitiz Construction, Inc. also remains in operation for projects in Balamban, Cebu and Mindanao. For projects in areas under ECQ, work is still suspended at the moment.
“Digital infrastructure investments in previous years and regular business continuity planning has allowed us to cope with the adverse impact of COVID-19. While it’s anyone’s guess how the future will unfold, we assure our stakeholders that we are fully equipped and prepared to guarantee the continuity of all business transactions,” Mr. Aboitiz said.
AEV booked a net income of P22 billion last year, 1% lower from a year ago, due to a double-digit profit decline in its power unit because of power outages. Shares in AEV at the stock exchange gained P1.85 or 4.55% to P42.50 each on Monday. — Denise A. Valdez
Like Money Heist? Learn more about it through an online lecture
INSTITUTO Cervantes de Manila is holding an online lecture featuring Javier Gómez Santander, the head writer and co-executive producer of the popular Netflix series La Casa de Papel (Money Heist) on April 28, 7 p.m., via Zoom.
In his lecture, Mr. Gómez Santander will talk about his career as a screenwriter and his work on the Emmy Award-winning crime drama series, including “secrets and details of the creation” of Money Heist, according to a release.
Before being involved in the series, he worked as a radio, press, and TV journalist for 15 years.
The series first aired in 2017 and was created by Alex Piña. It follows two well-planned robberies led by the Professor (played by Álvaro Morte) and his gang on the Royal Mint of Spain and the Bank of Spain.
Money Heist was initially intended as a two season limited series but when streaming service Netflix acquired the global streaming rights, the show was renewed for two more seasons. The fourth season aired in April.
The show’s creators also released a behind-the-scenes documentary about the series on the same day that the fourth season was released. The documentary, titled Money Heist: The Phenomenon, showed “the audience some facets of the show involving the producers and the cast.”
The show received several awards including Best Drama Series at the 46th International Emmy Awards in 2018. In the same year, Netflix named the series as the “Most Watched Non-English Language Series” and one of the most watched series overall on the service.
The online lecture with Mr. Gómez Santander is presented by Instituto Cervantes de Manila in collaboration with the Embassy of Spain in the Philippines.
It will be in Spanish with simultaneous English translation. Questions in English and Spanish will be entertained.
Admission is open to all and is free on a first-come, first-served basis via Zoom. For further information and updates on the event, visit http://manila.cervantes.es or Instituto Cervantes’ Facebook page: www.facebook.com/InstitutoCervantesManila. — Zsarlene B. Chua
Singularly pleasing blend of genres
Azur Lane: Crosswave
Sony PlayStation 4/Personal Computer via Steam
CHINESE developers Shanghai Manjuu and Xiamen Yongshi had a hit in their hands when Azur Lane made its way to mobile platforms in 2017. Aside from banking on stellar features that combined shoot-‘em-up, simulation, and role-playing game elements, it stood out for its unique interpretation of World War II ships. Indeed, its use of moe anthropomorphism to present shipgirls gave it the industry support it required to cross the borders of the world’s most populous country and venture into Japan within six months of its release. And while Compile Heart’s offering didn’t quite reach the scale of already-established titles from fellow publishers Kadokawa Games and DMM.com, it nonetheless managed to claim a base big enough to allow it to cross over to popular culture.
If nothing else, Azur Lane has proven its capacity to stay relevant for the long haul. Between the release of manga and anime adaptations, it found its way to the personal computer and Sony PlayStation 4 via a reworked narrative and presentation. Even as Azur Lane: Crosswave features cel-shaded three-dimensional graphics and new characters, however, it has wisely kept its winning formula: It combines an easy-to-pick-up but nonetheless engaging battle system with a humor-laced and fan-service-heavy story thread. That said, the latter doesn’t make any pretentious; for all its seeming richness and faithfulness to franchise canon, it ultimately comes off as a contrived call for action.
Fortunately, the combat is worth the setup. Azur Lane: Crosswave’s Story Mode has newcomers Shimakaze and Suruga steer other ships of the Sakura Empire through seven chapters’ worth of encounters with counterparts from the Eagle Union, the Royal Navy, and Iron Blood. While in the Joint Military Exercises, gamers get to do crafting and equipping, and even some experimentation after productive exchanges of blueprints. Combined with loot spawning after any given battle, the new items then serve as upgrades for the next mission. And so on and so forth, with the stylized setups tested against enemies at sea and in air.
The configuration of six ships, with three controllable and three for artificial-intelligence support, works like a charm, although Azur Lane: Crosswave can be uneven. Engagements are engrossing, but some go by quickly (okay, very quickly). Battlegrounds are fairly large squares, albeit with invisible boundaries that identify themselves mostly by accident. More characters are unlocked over time, and with hardly any difficulty. For good measure, the Extreme Battle Mode gives gamers the opportunity to go for standalone skirmishes that yield special gear; more than a hundred are on tap.
Needless to say, the presentation is at par with Idea Factory’s standards — which is to say uniformly topnotch. Characters and backgrounds are vibrant and replete with visual information, and the well-acted Japanese voice tracks blend well with music and ambient sounds. It’s just too bad that the visual-novel approach to furthering the narrative keeps things static outside of the occasional facial twitches. Thankfully, the work remains rock solid during combat, with the level of detail so stellar as to be distracting.
Azur Lane: Crosswave isn’t cheap by any means. Its PlayStation 4 version carries a $49.99 tag, although geographical pricing lops off three-fifths of the price on Steam for PC gamers on this side of the globe. In any case, it provides reasonable value for money with its singularly pleasing blend of genres. Those familiar with the series name, or with Compile Heart’s library of releases, certainly won’t be disappointed. Highly recommended.
THE GOOD:
- Excellent audio-visual presentation
- Unique gameplay
- Faithful to source material
- Engaging combat elements
THE BAD:
- Weak narrative
- Screens can stay static for long periods
- Fairly short campaign
RATING: 8/10
POSTSCRIPT: Rune Factory 4 Special isn’t exactly new. In fact, it’s a direct port of the RPG developer Marvelous worked on and released eight years ago for the Nintendo 3DS. That said, it’s a worthy addition to the already-expansive library of titles on the Switch as arguably the best in the Rune Factory series. While littered with elements followers of the franchise — and, yes, of other releases in the genre — know too well, it elevates itself with its crafty use of crafting, pun wholly intended, as critical to character development. And it’s certainly aided by a compelling story arc that has gamers invested in outcomes.
Rune Factory 4 Special begins with the main character heading to Selphia to deliver an offering to its deity, only to suffer from amnesia following a fight with hijackers. Ejected from the airship, he (or she, depending on gender choice at the start of the game) is then mistaken for royalty and tasked with running the town. Which he does even after the arrival of the real prince (who would rather do other things). And so he goes after its upkeep, maintains crops, makes friends, and even takes monsters as pets — all while, on whim and fancy, exploring dungeons in an effort to get to the bottom of a bigger mystery.
If Rune Factory 4 Special sounds a lot like a fantastic Animal Crossing: New Horizons, that’s because it is. It certainly puts its Harvest Moon roots to good use with a polished take on farming; better tools and better grounds make for better fruits of labor. And, in this regard, it makes use of a sophisticated crafting system that accounts for items picked up after battles, as well as of intertwined skill trees that improves character stats. Gamers are continually provided with incentives to level up, and thus have the wherewithal to keep exploring dungeons for rare finds, which are then crafted for town improvement.
The cycle is evident, and, in Rune Factory 4 Special, repeated at leisure. Those who have already played the original on the 3DS will have no trouble getting hooked anew. Meanwhile, gamers picking it up for the first time on the Switch will be pleased to note the smoothness of the interface despite the absence of a second screen. Controls are spot-on and intuitive, and rightly serve to help rather than hinder. The visuals have been reworked for high-definition appreciation, but the unavoidable reliance on a dated source material is clear. Moreover, the translation has rendered the text sharp but small — perhaps too small for comfort. It fares much better aurally, and benefits from the option to toggle between Japanese and English voice tracks.
In typical Rune Factory fashion, Rune Factory 4 Special is likewise into relationship-building. Depending on gamers’ preferences, any of six characters from the opposite gender can be wined and dined, and then married. Make no mistake, though; wooing takes effort, and compatibility concerns do arise. Parenthetically, it bears noting that randomly triggered town events are crucial to progression. In other words, it’s a boon to those perfectly fine with idyllic settings and setups, and far from perfect for those who feel like time is a valuable resource that cannot be wasted.
On the whole, Rune Factory 4 Special earns its $59.99 sticker price, and not just because of the additional content not previously available on the 3DS. Filled with surprising depth and integration, it figures to keep gamers occupied for tens, even hundreds, of hours on end.
THE GOOD:
- Pace dependent on choice
- Deep and engaging
- Interesting characters
- Varied gameplay elements
- Smooth interface
THE BAD:
- Reliance on dated source material
- Still blocky visually
- Text can be too small to read without straining
- Randomly triggered events required to progress
RATING: 9/10
THE LAST WORD: Paris-based independent game developer Parallel Studio aims high with EQQO, an adventure that leans on Ethiopian mythology for visual cues and on the Prague Philharmonic Orchestra to bring creator Nicolas Bredin’s compositions to life. The good news is that it hits more than misses its targets in presenting the tale of the title character, a blind child pushing an egg through a temple filled with obstacles, as told by his mother. There are five chapters all told, each increasing in difficulty and requiring exploration and puzzle solving in equal measure.
EQQO relies on various perspectives to consider the tasks at hand. Gamers need to continually move the camera to predetermined angles, either through the Switch Joy-Cons or by touchscreen controls, in order to comprehend the choices they have, and thereby need to make in order to progress. Those steeped in similar gameplay mechanics — notably from The Legend of Zelda series — will hit the ground running. Otherwise, there’s a learning curve that needs to be negotiated. In either case, enjoyment won’t be compromised.
All told, EQQO lives up to billing. It’s not perfect, particularly in the way its implementation of gyroscope functions can induce no small measure of discomfort. It‘s also short at under five hours from start to finish. Nonetheless, it’s a steal at $6, and lives up to billing as an emotive experience that won’t easily be forgotten.
THE GOOD:
- Lives up to billing as an emotive experience
- Visually stunning homage to Ethiopian mythology
- Superb score
- Puzzles challenging, but not to the point of frustration
THE BAD:
- Camera angles can be hard to control
- Visual discomfort on occasion
- Short
RATING: 7.5/10