A magnitude 6.6 earthquake struck the Samar region of the eastern Philippines on Tuesday, the European Mediterranean Seismological Centre (EMSC) said, damaging some homes and property in a coastal community.
The Philippines’ seismology agency said there was no risk of a tsunami from the earthquake but warned of the risk of aftershocks.
“The possibility of a stronger magnitude aftershock cannot be discounted,” agency chief Renato Solidum told dZMM radio station.
The quake struck in the sea at a depth of 30 km, EMSC said.
There were no immediate reports of casualties, but Rodrigo Gonhuran, 30, a computer shop technician based near the epicenter, told Reuters it was the strongest quake he had felt in the area.
“My cabinet and other stuff at home fell down and my neighbors’ walls cracked and some collapsed,” he said, speaking from the town of Cataingan, which has a population of more than 50,000 people.
The Philippines, which has a population of 107 million, lies on the “Ring of Fire,” a belt of volcanoes circling the Pacific Ocean that is also prone to earthquakes. — Reuters
Cebu-based developer expands its portfolio with VCMC and USMC
AppleOne Properties, Inc., a leading real estate and hotel developer in the Visayas and Mindanao regions, through its healthcare arm AppleOne Medical Group (AMG), signed into a joint venture with the United Church of Christ in the Philippines (UCCP) to acquire majority shares of two hospitals, the Visayas Community Medical Center (VCMC) in Cebu City and the United Shalom Medical Center (USMC) in Tacloban City.
AMG took an inaugural step in June with the joint venture partnership for VCMC, signified as AppleOne Visayas Medical Corporation. USMC was acquired in July. By the two joint ventures, AMG is taking the helm in developing and expanding VCMC and USMC.
VCMC was founded by UCCP in 1952 as a response to the medical needs from World War II. Since then, the hospital has stood as a well-regarded institution in Cebu. With an alignment in values and social mission stemming from the joint venture, VCMC will stand as a testament to both institutions’ mutual goal of transforming and uplifting Filipino communities through quality healthcare made accessible.
Formerly Bethany Hospital, USMC was a distinguished healthcare establishment in Tacloban until it experienced the devastations brought about by typhoon Yolanda. The hospital remains limited in its medical functions, operating as a medical laboratory for the time being. Under the partnership with AMG, USMC will undergo an expansion of its services and modernization of facilities to become a premier health and wellness facility in the Tacloban area.
AppleOne Properties recognizes healthcare as an industry in need of support yet with tremendous opportunity for growth. AMG was incorporated early this year from the desire to strengthen competencies in the field of health and wellness, provide better access to quality healthcare, and deliver quality medical services with compassion to the communities.
AppleOne Properties President and CEO Ray Go Manigsaca emphasizes this timely venture, “With our strength and expertise in development, and a keen foresight into the market, strengthened with our agile and dynamic approach to all our businesses, we are wholly committed to strengthening the foundation of our healthcare industry with well-equipped and well-supported hospitals around the region.”
Bishop Ermegencio Padillo, Chairman of VCMC, has this to say about the partnership, “Both VCMC and AMG initiated the likings of a strong partnership, characterized with trust, confidence and high spirits. VCMC saw it fit to partner with a group or institution with high moral and social standing, and indeed AppleOne Medical Group was the right choice. With that, I am personally looking forward to growing this partnership in order to provide for the needs of the Filipino people as a whole.”
UCCP Chairman Keith Quebral also shares his thoughts about partnering with AMG, “The partnership shall enable VCMC to perform its mission in accordance with the highest standards of excellence in providing quality healthcare services to those in need. The UCCP views this partnership agreement as a shared healing ministry of the Church that advocates health for all and promotes access to proper medical care.”
AppleOne Properties has over a decade of expertise under its belt. It has developed landmarks of strength and iconic partnerships, along with multi-awarded projects that compete on a global stage. Its subsidiaries include AppleOne Mactan, Inc., the developer of the five-star Sheraton Cebu Mactan Resort, The Residences at Sheraton Cebu Mactan Resort, and Mahi by AppleOne Properties, Inc., as well as Brickwall Construction & Development, the operator of Apple Tree Resort & Hotel, Boardwalk City Residences, and CityMallDanao. Sunsky Development Corp. and AppleOne Equicom Tower also fall under the AppleOne Properties wing. Sunsky is the developer of Diamond Suites & Residences and a forthcoming local brand of hotels while AppleOne Equicom Tower is the first mixed-use development in the premier business district in the Visayas. Recently, it signed a franchise partnership agreement with the International Workplace Group, formerly Regus and the world’s largest provider of workspace solutions, to acquire two existing centers and develop eight more in six cities in the Visayas region.
AppleOne Properties stays true to its commitment to innovation by keeping a portfolio that is diverse and relevant.
For more information AppleOne Properties, Inc., call (+6332) 231-5223.
A man counts a wad of Philippine peso bills at a money remittance center in Makati City, Sept.19, 2018. – REUTERS/ELOISA LOPEZ
By Luz Wendy T. Noble, Reporter
CASH REMITTANCES rebounded in June, as land-based overseas Filipino workers (OFWs) sent more money home as lockdown restrictions eased, the central bank data showed.
Bangko Sentral ng Pilipinas (BSP) reported cash remittances, which are coursed through banks, jumped 7.7% in June to $2.465 billion from $2.29 billion in the same month a year ago, “supported mainly by remittances from land-based workers.”
However, the BSP said there was a continued drop in sea-based workers’ remittances as many were repatriated amid the pandemic.
June saw a recovery in cash remittances, after three months of decline since March when lockdown restrictions were put in place to curb the spread of the coronavirus disease 2019 (COVID-19). Metro Manila was placed under a more relaxed general community quarantine starting June.
Month on month, inflows in June climbed 17% from the $2.106 billion logged in May.
However, for the first half, cash remittances slipped 4.2% to $14.019 billion from $14.638 billion a year ago.
By type of worker, cash remittances from land-based OFWs fell 4% year on year to $10.959 billion in the first semester from $11.411 billion a year ago. Remittances from OFWs working in ships and cruises dropped 5.2% to $3.06 billion.
The United States accounted for 39.7% of the inflows, followed by Singapore, Saudi Arabia, Japan, the United Kingdom, United Arab Emirates (UAE), Canada, Hong Kong (HK), Qatar, and Taiwan. Together, these countries make up 78.9% of the total cash remittances.
“Remittances for January-June from the United States, Japan, Singapore, Oman and Taiwan were among the countries that registered continued growth, while declines were noted in Saudi Arabia, UAE, Kuwait, Germany and the UK,” the BSP said.
The central bank in June said it is projecting cash remittances to shrink by 5%.
Meanwhile, personal remittances that also take into account inflows in kind also rose 7.6% to $2.737 billion in June from $2.545 a year ago. However, year-to-date flows decreased 4.2% to $15.573 billion from the $16.252 billion in the first six months of 2019.
Since the pandemic began, the number of repatriated OFWs reached more than 135,000 as of mid-August. More than 52,000 of them were employed in ships and cruises, while about 82,000 had land-based jobs, according to data from the Department of Foreign Affairs.
THE House Ways and Means Committee approved on Monday a measure extending the estate tax amnesty program by another two years, in light of the ongoing coronavirus pandemic.
House Bill (HB) No. 7068 extends the effectivity of the estate tax amnesty to four years from the original two years under Republic Act (RA) No. 11213 or the Tax Amnesty Act of 2019.
RA 11213, which took effect on May 31, 2019, gave a one-time opportunity for taxpayers to settle unpaid estate taxes as of Dec. 31, 2017. It gave interested parties until May 31, 2021 to avail of the estate tax amnesty.
If passed into law, taxpayers can avail of the estate tax amnesty through 2023.
“The amendment to RA 11213 will enable those who want to take advantage of this program ample time to recoup their resources and get back on their feet so they can still apply and pay their estate tax dues. This will also provide economic relief for many Filipinos at this time of crisis,” HB 7068 stated.
The Bureau of Internal Revenue (BIR) Assistant Commissioner Elenita B. Quimosing said the agency has collected some P1.3 billion from estate tax amnesty as of June, still far from the Finance department’s P6-billion target.
She said P3.403 billion was collected from the tax amnesty on delinquencies, falling short of the P21-billion target. The agency has collected a total of P4.765 billion so far from the two tax amnesty programs.
Baguio Rep. Mark O. Go moved for the approval of the extension of the estate tax amnesty to allow the BIR to meet its target.
“The conditions we have right now are reasons probably that we need to extend the availment of the estate tax,” Mr. Go said.
There is no counterpart measure filed in the Senate, but Senate President Vicente C. Sotto III said he is in favor of the extension of the estate tax amnesty.
Asked if he supports the measure, Mr. Sotto said in a phone message “yes, of course.”
In the same hearing, the House panel also tackled proposals to grant a general tax amnesty, which had been part of the original tax amnesty package until it was vetoed for lack of safeguards against tax evasion.
President Rodrigo R. Duterte vetoed the general tax amnesty for the absence of provisions lifting the bank secrecy for fraud cases and the automatic exchange of information, among others.
The substitute bill granted a general tax amnesty for one year on all unpaid taxes based on the 2018 statement of total assets, which may be availed either with a 3% or 20% rate.
“Kung 3% ka (If you avail the 3%), you will be subject to the examination of the BIR for a period of one year from the payment of the tax amnesty, pero kung (but if you go for the) 20% rate ang gagamitin mo, you will not be subject to the said examination,” House Ways and Means vice- chairperson and AAMBIS-OWA Rep. Sharon S. Garin said.
Finance Assistant Secretary Dakila Elteen M. Napao said the general tax amnesty will allow individuals and companies with unpaid taxes but no pending cases, to have a “clean slate.”
“The amnesty will serve as a sort of a cleaning tool for the BIR on taxpayers,” he said.
Mr. Go, however, questioned the basis for the 20% rate, saying this may burden companies. He recommended to use the income as a basis, instead of the total assets.
“What is the basis of 20%? What we’re saying is the total asset of the company, medyo mabigat ’yun for them. Kung ang issue is the 2018 income nila, ’yun dapat ang basis, ’yung 2018 (that might be too heavy for them. If the issue is the 2018 income, that should be the basis),” he said.
Nueva Ecija Rep. Estrellita B. Suansing, presiding chairperson, asked the Finance department to come up with its calculation for other possible rates for deliberation in the next hearing.
The measure granting a general tax amnesty forms part of the administration’s comprehensive tax reform program. It was noted that collections from the measure will be used as additional funding for the coronavirus pandemic.
THE government is planning to offer Premyo bonds again, National Treasurer Rosalia V. de Leon said on Monday.
In a Viber message, Ms. De Leon told reporters the Bureau of the Treasury (BTr) will start working on the next Premyo bond offer concept.
Ms. De Leon said the next Premyo bonds will also use the Bonds.ph mobile application introduced during the recently concluded sale of retail Treasury bonds (RTB).
The government had raised a record high of P516.3 billion in RTBs early this month at a coupon of 2.625%. Around P48 million of five-year RTBs were bought through the Bonds.ph app that was downloaded nearly 25,000 times from 85 countries.
Ruben Carlo O. Asuncion, chief economist of UnionBank of the Philippines, Inc., said proceeds from another Premyo bond offer could be used to beef up the state’s coffers and support its fight against the coronavirus pandemic.
“This decision may be because of high liquidity. Moreover, this is inline with what economic managers are saying that this pandemic and battling its economic impact may not be just one big punch but may need endurance,” Mr. Asuncion said via Viber on Monday.
This will be the second offering of Premyo bonds, which is part of the government’s bid to attract more small investors to government securities. Last year, the BTr raised P4.961 billion from the sale of the one-year peso-denominated papers.
Currently, Ms. De Leon said the BTr is working on the remaining raffle draws from last year’s Premyo bond sales.
Premyo bonds are government securities that have corresponding raffle entries for cash and non-cash prizes, aside from earning interest.
With the Premyo bonds’ success, Ms. De Leon said in January that they may consider offering the short-tenored securities annually.
The government borrows from local and foreign lenders to plug its budget deficit seen to hit 9.6% of gross domestic product this year. It plans to borrow around P3 trillion this year.
In the first half, state borrowings reached P1.72 trillion, already exceeding the P1.02 trillion raised last year. — Beatrice M. Laforga
Vehicle sales have been affected by lockdown restrictions in Metro Manila. – PHILIPPINE STAR /MIGUEL DE GUZMAN
IMPORTED vehicle sales for the first seven months of the year dropped by 50.9%, outpacing the Association of Vehicle Importers and Distributors, Inc.’s (AVID) expectation of a 40% sales slump for the full year, as the pandemic continues to dampen demand.
In a report released on Monday, AVID said the industry representing 21 member companies and 26 global brands sold 24,607 units in the seven-month period compared with the 50,151 sold last year.
Imported vehicle sales retained its month-on-month uptick, selling 5,100 units in July, or 38% higher than the 3,697 sold a month earlier.
The group said there has been an increase in passenger cars and subcompact SUVs sales because consumers are looking for safe mobility while public transport is restricted. Sales of small utility trucks and vans have also been rising.
AVID President Ma. Fe Perez-Agudo said the industry anticipated and prepared to adapt to the return to a stricter lockdown earlier this month. Metro Manila and nearby provinces are under a modified enhanced community quarantine (MECQ) until Aug. 18, although an announcement on new community quarantine levels is pending.
“Given that we have already bottomed out in the first semester, we believe the second half of the year will be better assuming there are no further lockdowns past Aug. 18,” she said. “Our focus now is to win back consumer confidence and give them the best value during these pandemic times.”
The automotive industry has been adopting digital tools to sell cars, including virtual showrooms.
Passenger car sales plummeted by 55% to 7,890 vehicles in the first seven months compared with the same period last year, with Hyundai Asia Resources, Inc. accounting for a bulk of the sales with 4,054 units.
Light commercial vehicle sales dropped by 48% to 16,561 units, led by Ford Group Philippines, Inc. which sold only 5,873 units or less than half of the 12,217 sold last year.
Commercial vehicle sales fell 73% to the 156 units sold by Hyundai Asia Resources, Inc.
Both local manufacturers and import distributors expect at least a 40% sales slump in 2020.
AVID’s full-year 2019 sales slipped 0.5% to 87,984 from an updated 88,430 units the year before.
Cars sold by manufacturers based in the country saw a 48.7% decline in the first seven months to 105,583 units sold compared with the same period a year ago, a joint report by Chamber of Automotive Manufacturers of the Philippines, Inc. (CAMPI) and Truck Manufacturers Association (TMA) said last week.
Year to date, commercial vehicle sales dropped 47.6% to 75,514 units, while passenger car sales fell 51.4% to 30,069 units. — Jenina P. Ibañez
An armed police officer patrols at a public market, where wearing face masks and face shields is mandatory, amid the coronavirus disease 2019 (COVID-19) outbreak in Taytay, Rizal province, Philippines, Aug. 11. – REUTERS/ELOISA LOPEZ
THE Philippine economy is set to shrink by 9.1% this year, weighed down by the fresh surge in coronavirus infections, a plunge in remittances and slow fiscal delivery, ANZ Banking Group’s research arm said on Monday.
ANZ Research’s latest outlook for the Philippines gross domestic product (GDP) is worse than its previous forecast of -2.5%, and lower than the government’s -5.5% projection.
“In terms of the trajectory, GDP growth is likely to contract by a slightly higher 9.2% y/y in H2 2020 compared with 9.0% in the first half,” ANZ Research Chief Economist Sanjay Mathur and economist Kanika Bhatnagar said in a note sent to reporters on Monday.
ANZ Research expects the economy to shrink by 11.5% and 7.1% in the third and fourth quarters, respectively, as the number of coronavirus infections continue to rise. This month, tighter restrictions were reimposed in Metro Manila and nearby provinces which have hurt consumer confidence.
“These restrictions have come at a time of tenuous recovery in household consumption since its trough in April. Real-time activity indicators capturing visits to retail and grocery stores stalled as soon as daily cases started rising in June,” ANZ Research said.
The Health department on Monday reported an additional 3,314 coronavirus cases, bringing the total to 164,474.
The pandemic also put a strain on economies where remittances of overseas Filipino workers (OFWs) are sourced. Over 21.65 million people have been infected by the coronavirus in more than 210 countries, a Reuters tally showed on Monday.
“While not totally unanticipated, we are seeing an unprecedented drop in remittances from OFWs. While the year-to-date fall of 6.4% in remittances appears benign, the monthly trend is clearly worsening,” ANZ Research said.
Cash remittances in May plummeted 19% year on year to $2.106 billion, the steepest decline in nearly two decades, latest data from the Bangko Sentral ng Pilipinas (BSP) showed. Year-to-date flows have also declined 6.4% to $11.554 billion. Cash remittances, which fuel consumption, could drop by 5% this year, the BSP said in June.
“The situation is unlikely to turn around any time soon as the industries employing most of the OFWs such as retail sales, recreation, and entertainment are still under strain from stringent social distancing rules and precautionary consumer behavior,” ANZ Research said.
More than 135,000 OFWs have been repatriated as of mid-August, according to the Foreign Affairs department.
SLOW FISCAL DELIVERY
At the same time, ANZ Research said the government’s “slow fiscal delivery” was another consideration in its weaker outlook for the Philippines. While state spending climbed 26.6% to P2.014 trillion in the first semester, it noted the figures hide the base effect of the weak spending last year due to the election season and the delayed 2019 budget passage.
“As such, the Philippine government has released less than half of its revised disbursements planned for the year. A front-loading of spending would have been more effective, in our view,” ANZ Research said.
The report also flagged the government’s slow infrastructure spending and frequent revisions to the list of priority projects.
Infrastructure spending decreased 4.3% year on year to P297.9 billion in the first half of the year amid disruption in construction activities during the lockdown, data from the Department of Budget and Management showed.
On the monetary side, ANZ Research said the central bank’s accommodative stance, which includes aggressive cutting of rates, have not led to lower market lending rates.
“Furthermore, credit growth has been weak in part due to commercial banks tightening credit standards and scaling back on credit lines,” it said.
The central bank has slashed rates by a total of 175 basis points (bps) this year, bringing down overnight reverse repurchase, lending, and deposit facilities at record lows of 2.25%, 2.75%, and 1.75%, respectively. It has also reduced the reserve requirement ratio (RRR) for big banks by 200 bps to 12% and by 100 bps for smaller lenders, reducing reserve requirements for thrift and rural banks to three percent and two percent respectively.
Despite this, lending growth in June continued to ease for the third consecutive month. Outstanding loans disbursed by universal and commercial banks inched up 9.6% in June, easing from the 11.3% pace in the prior month, BSP data showed.
ANZ Research said it expects the country’s economy to grow by 8.4% by 2021. — Luz Wendy T. Noble
GMA NETWORK, INC.’s second-quarter attributable net income rose 31.7% to P826.36 million, boosted mainly by lower production costs and partly by a shift in advertising placements from rival ABS-CBN Corp.
In a regulatory filing on Monday, the network reported a 21.8% fall in revenues to P3.22 billion compared with the P4.12 billion posted in the same period last year.
The decline came despite the impact of the coronavirus quarantine restrictions on operations, as it cut production costs by 60% to P677.87 million, resulting in a 5.4% rise in the company’s gross profit to P2.54 billion.
The network said it also benefited from the absence of ABS-CBN’s broadcast operations whose legislative franchise expired in May.
Shares in GMA Network on Monday climbed 3.25% to close at P5.09 apiece.
“The shift in advertising placements resulting from the closure of the Company’s biggest and closest competitor (ABS-CBN) due to the expiration of its free-to-air broadcast franchise in early May provided some incremental revenues,” it said.
The network’s advertising revenues in the second quarter, when it started to receive advertisers from ABS-CBN, stood at around P2.96 billion, 8.9% lower than the P3.25 billion previously.
“The biggest drag came from the absence of political advocacies and advertisements this year, aggravated by the onset of the coronavirus pandemic or lockdown, which disrupted the business landscape across countries,” the network said.
“Meanwhile, this was partly cushioned by the improvement in online advertising sales, which grew by 23% during the first half of 2020,” it added.
In the first half, the company posted an attributable income of P1.4 billion, up 4.5% from the previous year, despite a 14.7% drop in gross revenue to P6.75 billion.
The network’s first-quarter net income declined 19.8% to P574.67 million. Total operating expenses decreased 4.3% to P2.69 billion.
GMA Network Chairman and Chief Executive Officer Felipe L. Gozon said last month the network would defer 30% or around P376 million of its capital expenditure (capex) budget for this year due to the pandemic.
In a disclosure to the stock exchange on June 30, the network said it had set a capex of P1.22 billion this year, which will be financed by internally generated funds.
The network is planning to launch more digital channels this year.
Mr. Gozon also said GMA is free of debt as of end-March, emphasizing its “ability to balance ratings growth with sound financials.” — Arjay L. Balinbin
GT CAPITAL HOLDINGS, Inc. recorded an attributable net profit of P197 million in the second quarter, or about 19 times lower than its bottom line in the same period last year, largely because of a deep plunge in its gross revenue.
In a regulatory filing on Monday, the Ty-led conglomerate reported a 75.6% fall in its quarterly gross revenue to P13.6 billion.
In the first semester, the holding firm posted an attributable net earnings of P2.74 billion, down 61.8% and pulled down by income declines in its banking and automotive businesses.
Its total revenues fell 47.8% to P52.62 billion in the first six months of 2020, compared with P100.75 billion a year ago.
Metropolitan Bank & Trust. Co. recorded a 30% drop in profit to P9.1 billion in the period as it raised loan provisions to P22.8 billion.
Toyota Motor Philippines Corp. netted P1.03 billion, more than four times lower than the P4.43 billion it earned a year ago.
It sold 35,648 units between January and June, lower compared with the 73,454 units sold a year ago. Despite this, Toyota still dominated the local industry with a 38.5% market share in the first semester.
“Digital initiatives were rolled out to provide platforms for car buyers to engage with dealers. Pent-up demand drove new vehicle sales in May, but in June, new reservations increased indicating an encouraging return of buyers to the market,” GT Capital Auto Dealership Holdings Chairman Vince S. Socco said.
“Smaller, more affordable vehicles were popular among those seeking alternative transport solutions. This underscores the essential nature of the auto and mobility sector in the drive to rebuild the economy,” Mr. Socco added.
Federal Land, the conglomerate’s property unit, also posted a lower income of P171 million in the first half, compared with P404 million last year. Its reservation sales expanded slightly by 3% to P9.1 billion, while lease revenues grew by 15%.
Metro Pacific Investments Corp.’s core income fell by 38% to P5.3 billion. This is attributed to a slump in contributions from its toll roads, rail services, water, and power businesses as their operations were affected by government-imposed quarantine policies.
GT Capital’s profits, though lower, were supported by income growth in AXA Philippines and Sumisho Motor Finance Corp.
The health insurance firm’s total life and general insurance gross premiums increased by 11% to P16.7 billion in the period, lifting its net income by 29% to P1.5 billion.
“During this period of uncertainty, GT Capital continues to practice fiscal discipline, resulting in a strong and stable balance sheet, adequate liquidity, and access to credit facilities, in case of need,” GT Capital President Carmelo Maria Luza Bautista said.
“Our Group’s solid core businesses make us well-positioned to ride out the impact of this pandemic,” the official said.
On Monday, shares in GT Capital grew by 5.74% to close at P424 each. — Adam J. Ang
THE Philippine Stock Exchange, Inc. (PSE) revised the lock-up rule for small, medium, and emerging (SME) companies to only cover non-public shareholders.
In a memorandum circular released on Monday, the local bourse said principal stockholders — or those holding at least a 10% interest in a firm, subsidiaries or affiliates, directors, principal officers, and others who can influence the company’s management are the only ones who are mandated to refrain from disposing of their shares for a one-year period from the shares’ listing.
Also subjected to the revised rule are their related parties, including the immediate families of principal stockholders, directors, and principal officers.
“All other stockholders shall not be subject to mandatory lock-up under this provision,” the circular read.
The PSE rule states that shares issued or transferred and fully paid within six months before the start of a firm’s public offering or prior to its listing date, if it is listing by way of introduction, and with a transaction price lower than the offer price, are subjected to a lock-up period of at least a year from listing. — Adam J. Ang
FRUITAS HOLDINGS, Inc.’s bottom line turned to a loss of P27.44 million in the second quarter as it saw an “unprecedented” sales decline during the period, the company said in a regulatory filing on Monday.
The listed food kiosk operator came from an attributable net income of P41.66 million in the same three months last year.
“The sales decline for the second quarter of 2020 was unprecedented as we had to suspend (the) operation of almost all of our stores because of the quarantine. It also coincided with the summer months, when our beverage sales peak,” Fruitas President and Chief Executive Officer Lester C. Yu was quoted as saying in a disclosure to the stock exchange on Monday.
In the first semester, Fruitas’ losses reached P12.35 million, reversing the P51.97-million net income a year ago. Revenues during the six-month period fell by more than half to P462.05 million from P941.19 million previously.
To manage the loss, it cut operating expenses by 40% to P249 million in the period. Its earnings before interest, taxes, depreciation, and amortization (EBITDA) stood at P42 million, lower compared with P141 million previously.
As the government-imposed lockdowns eased in June, the company reopened stores “more cautiously.”
“For June, our sales were already back to 33% of last year, despite Fruitas only operating an average of about 45% of our store network throughout the month,” Mr. Yu noted.
“We will be a more profitable and productive company as the economy slowly reopens while realizing that a return to pre-pandemic levels will take time. We also continue to pivot our business model to derive more contribution from delivery and community stores,” he added.
The owner of Buko Juice, Jamaican Pattie, and Soy & Bean has firmed up the production capabilities of these best-selling brands for both open outlet and delivery platform, believing demand for them will expand soon as the country recovers from the pandemic.
“Better sales mix coming from products with lower direct costs allowed the company to improve gross profit margin for the first half of 2020 to 60%, compared to 58% during the same period last year,” it said.
Fruitas’ shares were unchanged at P1.18 each on Monday. — Adam J. Ang
AYALA-LED AREIT, Inc. is preparing to put up as much as P15 billion in debt securities.
The country’s first real estate investment trust (REIT) told the stock exchange on Monday that its board approved an upcoming filing of the debt notes with a three-year shelf registration to the Securities and Exchange Commission.
“This will provide AREIT the ability to leverage for future acquisitions while preserving cash for dividend distributions,” it said.
The company is set to release P0.59-per-share dividends from the first two quarters of the year on Sept. 15.
“AREIT provides investors regular dividend income derived from prime commercial properties, higher than most fixed-income instruments,” AREIT President Carol T. Mills said.
The REIT firm has a portfolio of three Grade-A properties in Makati City: Ayala North Exchange, Solaris One, and McKinley Exchange, which cover a total gross leasable area of about 153,000 square meters (sq.m.) with a 99.9% total occupancy rate.
It has also decided to pay out dividends on a quarterly basis. The planned distribution dates will be on or before March 31, June 30, Sept. 30 and Dec. 31 of the calendar year.
The REIT Act of 2009 provides for a distribution of at least 90% income of a REIT company to investors each year. AREIT’s dividend ratio, the company said, is higher than the prescribed minimum.
Meanwhile, AREIT said it is on track to buy Teleperformance Tower Cebu, a business process outsourcing (BPO) office property in Cebu IT Park, from Ayala Land, Inc.’s ALO Prime Realty. Upon acquisition, AREIT’s portfolio will rise to over 170,000 sq.m. by yearend.
Shares in AREIT soared by 7.68% to close at P25.95 on its third regular trading day. — Adam J. Ang
