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Alsons considers sale of property business

ALSONS Consolidated Resources, Inc. (ACR) is considering the sale of its property business as part of its transition into a pure energy company.

The listed firm of the Alcantaras said it was examining its options, whether to sell Alsons Land Corp. (ALC) immediately or develop the land unit first before disposing its shares to buyers.

“We are moving to make ACR a pure power company. This will mean the divesting of our property business,” ACR Executive Vice-President Tirso G. Santillan, Jr. said during the company’s recent annual stockholders’ meeting.

“We are still looking for a more effective way of accomplishing this: is it to dispose [of] ALC now or have ALC develop and dispose of its properties later?” he added.

Alsons will do the business sale in a manner that maximizes its stockholders’ value, Mr. Santillan said.

Its property unit runs the 700-hectare Eagle Ridge Golf & Residential Estate in Cavite, its joint venture project with Sta. Lucia Realty Development, Inc. It also manages the 11-hectare Campo Verde with Sunfields Realty Development, Inc.

In the first quarter, the listed firm saw its earnings rose by nearly three times to P310 million over the same period a year ago.

Its “income-driver” 210-megawatt (MW) Sarangani Energy Corp. coal-fired baseload plant mainly contributed to its profit growth. The plant’s 105-MW second unit, which came online in October last year, helped lift the company’s revenues to P2.21 billion in the quarter, compared with P1.22 billion previously.

ACR owns four power generating companies with a combined capacity of 468 MW. Currently, it is building two projects: the 14.5-MW hydropower plant in Maasim, Sarangani province and the 105-MW San Ramon Power, Inc. coal-fired power plant in Zamboanga City, which are expected to commercially run by 2022 and 2023, respectively. — Adam J. Ang

T-bill rates seen easing further

RATES OF Treasury bills (T-bills) on offer on Monday will likely decline as the market continues its flight to safe assets like government securities.

The Bureau of the Treasury (BTr) wants to raise P20 billion via T-bills on Monday: P5 billion each via the 91- and 182-day debt papers and P10 billion from the 364-day securities.

The BTr canceled the auction for 35-day papers scheduled on Tuesday to give way to the ongoing offer of five-year retail Treasury bonds (RTBs).

A bond trader said they expect the rates to slip by 5-10 basis points (bps) from the previous auction for the three-month papers, while the yield on the six-month T-bills may decline by just up to 5 bps.

“While there are no clues on future economic policy yet and while the RTB offering is ongoing, preference is for debt securities at the shorter end of the curve. Also, it seems like the excess liquidity is being mopped up by the ongoing RTB offering,” the trader said via Viber on Friday.

Yields will continue to ease by no more than 10 bps due to “relatively large excess peso liquidity in the financial system recently that could help keep local interest rate benchmarks near record low levels,” said Michael L. Ricafort, chief economist at Rizal Commercial Banking Corp.

“(Another factor is the) slower economic recovery prospects especially should there be stricter quarantine measures amid the recent spike in new COVID-19 cases (that) would eventually support more or longer monetary easing measures including any possible further cut in banks RRR,” Mr. Ricafort said via text message.

T-bill rates dropped across- the-board last week on strong demand, prompting the BTr to make a full award of the P20 billion it offered out of P72.467 billion in bids.

It raised P5 billion as planned via the 91-day T-bills from P23.414 billion in tenders. The three-month papers fetched a lower average rate of 1.454% from the 1.587% logged at the June 13 auction.

The government also made a full P5-billion award of 182-day securities out of bids worth P18.852 billion. The average rate of the six-month T-bills dipped to 1.625% from 1.687% previously.

For the 364-day instruments, the Treasury borrowed P10 billion as planned from bids worth P23.414 billion. The one-year debt papers fetched an average rate of 1.77%, down from 1.782% previously.

Yields on the 91-, 182- and 364-day T-bills were at 1.501%, 1.613% and 1.807%, respectively, at the secondary market on Friday, based on the PHP Bloomberg Valuation Service Reference Rates.

Mr. Ricafort added the surprise 100-bp cut in the reserve requirement ratios (RRR) of thrift and rural banks will infuse around P10 billion in additional liquidity into the financial system, which “could still support any further slight easing in the upcoming Treasury bill auction yields.”

The Bangko Sentral ng Pilipinas (BSP) last week trimmed the RRR of smaller banks by one percentage point to three percent for thrift banks and two percent for rural and cooperative lenders. The reduction will take effect on Friday, July 31.

The move is part of the central bank’s efforts to beef up liquidity in the market amid the ongoing coronavirus crisis. In April, the BSP also reduced the RRR of universal and commercial banks by two percentage points to 12%.

The Treasury is now in the second week of its three-week offer period for the five-year RTBs.

National Treasurer Rosalia V. de Leon said last week the amount raised via the retail bond offer so far has already exceeded the record P310 billion sold in three-year RTBs in February.

The Treasury awarded an initial P192.71 billion in five-year RTBs at a coupon of 2.625% at the rate-setting auction on July 16.

The public offer period is set to run until Aug. 7, unless closed earlier by the Treasury.

The Treasury also opened an exchange offer program for holders of the RTB 10-01, FXTN 05-73, RTB 10-02 and FXTN 07-57 who want to swap their old bonds for the new retail bonds. The amount of bonds eligible for swap is about P321 billion.

The retail bonds will be issued on Aug. 12 and will mature on Aug. 12, 2025. The papers will be listed on the Philippine Dealing and Exchange Corp.

The government has set a P205-billion borrowing program for July and will offer P145 billion in T-bills via weekly auctions and P60 billion in T-bonds to be auctioned off fortnightly.

It borrows from local and foreign lenders to plug its budget deficit seen to hit 8.4-9% of gross domestic product this year. — Beatrice M. Laforga

Sensible and chic: The $185 luxury face mask from Belgium

BRUSSELS — Take a face mask, adorn it with jewels or attach it to a long, flowing neck scarf. What have you got? A pandemic precaution, yes, but also a luxury fashion statement that can cost anywhere from 75 to 160 euros ($87-185).

As mask-wearing becomes part of everyday defenses against the coronavirus, Belgian designers are turning medical masks into chic accessories.

Brussels-based stylist Aude De Wolf has created a “scarf mask” that uses linen, cashmere and other high-quality materials to combine masks with luxurious shawls.

“I was inspired by my mother because she doesn’t like her neck,” De Wolf, who has already sewn some 1,500 free medical masks for hospitals, told Reuters from her workshop.

“You can slip the mask off when you’re in the car and slip it back on in the shops … You could say it’s a luxury product,” she said of the masks, which she is selling for 160 euros ($185) each.

Haute-couture garment and accessory maker Olivia Hainaut has turned her skills to creating masks with sequins, jewels and other flamboyant touches, such as silk flowers. They sell from 75 euros, depending on the work and materials involved.

“These are not masks for everyday wear, perhaps for a party or a wedding … the idea is to bring some joy to something that is very sad,” she said of the pandemic. — Reuters

Supply chain for food, other goods challenged by overloaded shippers

DAVAO CITY — Cargo logistics operations are slowly improving with the easing of lockdown rules, but the industry says supply chains remain challenged due to the workload imposed on freight forwarders and the failure of government agencies in charge of approvals for the movement of goods to fully embrace digital processes.

Elmer U. Sarmiento, president and chief executive officer of Royal Cargo, Inc., said while inventories at the company’s warehouses are now “going down,” it is taking care not to take on more shipments too rapidly in order not to overburden couriers.

“This will exert more pressure on freight forwarders… forwarding companies should be ready and prepared for this,” he said during Friday’s online conference on logistics organized by the European Chamber of Commerce of the Philippines-Southern Mindanao Business Council, in partnership with All Transport Network, and the German, British, and Dutch business chambers.

Mr. Sarmiento also noted that flights and shipping schedules remain irregular, which affects both the domestic and international movement of food and other manufactured products.

Dan C. Lachica, president of the Semi-conductors Electronics and Industries of the Philippines, Inc., said apart from the still-unreliable transportation and high costs, there are also problems with delays at ports.

Meat Importers and Traders Association President Jesus C. Cham said some of the delays can be attributed to some government agencies’ failure to fully embrace the digital shift.

“We all know that government has started digital and doing everything online. One of the major problems that we have encountered is still they don’t want to let go, they still want the final process, a final approval… so they don’t want totally to automate the process,” Mr. Cham said. “They still have the final say, and this final say is giving us a problem… and I think we need to look at that and bring it up with the government,” he said.

Erastus Sandino B. Austria, district collector of the Bureau of Customs (BoC) in Davao, said the BoC and other government agencies are actively trying to reduce the impact of the coronavirus crisis on the supply chain.

“So far, we keep the disruption in the supply chain very minimal,” he said, noting that the bureau is now in the final stages of fully migrating to an online portal. — Maya M. Padillo

Megaworld raises P3 billion from continued lot sale

MEGAWORLD CORP. has generated P3 billion from having completely sold out a residential village in Cavite while under quarantine.

In a statement over the weekend, the Andrew L. Tan-led property developer said it sold all lots at its 18-hectare upscale residential village, Arden Botanical Village, last month.

This despite the challenges of the coronavirus pandemic, and two price increases implemented in January and May.

“Amid the lockdown, we have booked sales from buyers in the Philippines and across the world who were looking for purposeful, more livable spaces to build a house,” said Eugene Em Lozano, first vice-president for sales and marketing at Megaworld.

The project is located within Megaworld’s 251-hectare Arden Botanical Estate in Trece Martires. It was launched almost seven months ago and offered a total of 329 lots to buyers.

“A P7-million lot bought when we started selling late last year can now be sold at almost P9.5 million. Our early takers are so happy with their investments today,” Mr. Lozano said.

The lots are scheduled to be turned over to buyers starting 2024.

“Arden Botanical Village’s concept gave us a convenient push, and the unique concept of Arden Botanical Estate as an integrated lifestyle community was a huge factor in selling this fast even amidst the pandemic,” Mr. Lozano said.

The 251-hectare Arden Botanical Estate, where Arden Botanical Village is located, is a joint development of Megaworld and its listed subsidiary Global-Estate Resorts, Inc. (GERI). Both Megaworld and GERI are allocating P18 billion to develop the project over a 10-year period.

In the first quarter, Megaworld posted a 9% profit decline to P3.5 billion due to the impact of the Taal Volcano eruption and the coronavirus pandemic to its operations. Residential sales were flat at P9.6 billion due to the delayed construction of its ongoing projects.

The company has set a P36-billion budget for capital expenditures this year, lower by 40% from its initial allocation, in consideration of the effects of the ongoing pandemic.

Shares in Megaworld closed at P3.07 apiece on Friday, down seven centavos or 2.23% from a day earlier. — Denise A. Valdez

Peso to weaken on rising local coronavirus cases

THE PESO may depreciate this week due to the continued increase in coronavirus disease 2019 (COVID-19) cases, which could dampen sentiment on the local unit.

The local unit finished trading at P49.33 per dollar last Friday, appreciating by 3.50 centavos from its Thursday close, data from the Bankers Association of the Philippines showed.

It also gained 11 centavos from its P49.44-per-dollar close on July 17.

The peso’s Friday finish was its strongest in more than three years or since the P49.17 close on Nov. 15, 2016, said Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort.

The currency gained as demand for dollars waned due to the surge in US infections, UnionBank of the Philippines, Inc. Chief Economist Ruben Carlo O. Asuncion said.

“The peso still trended toward strength as the US continues its bout against increasing COVID-19 infections,” Mr. Asuncion said in a text message.

Total cases in the US reached more than four million on Thursday. The US new COVID-19 infection rate is at an average of 2,600 per hour, which is the highest in the world, Reuters reported.

Meanwhile, Mr. Ricafort attributed the peso’s gain to less preference for the dollar after the latest weekly US jobless claims data.

The weekly US jobless claims data released Thursday showed nearly 32 million people receiving unemployment benefits in early July.

For this week, local economic data as well as the continued rise in COVID-19 infections will be major factors that could affect the peso, the analysts said.

“Upcoming major Philippine data releases include BoP (balance of payments) as of June as well as bank loans and M3 growth,” Mr. Ricafort said.

The country’s BoP position stood at a surplus of $2.431 billion in May, wider than the $928 million seen a year ago as well as the $1.666-billion surfeit in April, central bank data showed. It was also the biggest since the $2.704-billion surfeit in January 2019.

The BoP position was at a surplus of $4.02 billion from January to May, thinner than the $5.19-billion surfeit in the same period last year.

Meanwhile, M3 or money supply growth was at 16.6% to P13.7 trillion in May, quicker than the 16.2% pace in April.

However, outstanding loans disbursed by universal and commercial banks rose 11.3% in May, slower than the 12.7% growth pace in April.

For his part, Mr. Asuncion said the peso will likely continue its appreciation, although the recent surge in infections, especially in Metro Manila, may affect sentiment.

Confirmed COVID-19 patients in the country reached 78,412 cases as of Saturday, of which 50,763 are active cases, health officials said.

For this week, Mr. Ricafort expects the peso to move around the P49.20 to P49.45 range versus the dollar while Mr. Asuncion gave a forecast range of P49.20 to P49.40. — LWTN with Reuters

Nike, Titan to release latest LeBron shoe collaboration

THE LeBron 17 Low “Titan,” the latest footwear collaboration between Nike and Philippine basketball concept store Titan, is set to be released in the country later this week.

The new shoe has National Basketball Association superstar LeBron James of the Los Angeles Lakers reuniting with Titan since the LeBron 16 Low Titan “Agimat” shoe which was released in 2019.

While the 16 Lows came in an all-navy blue look, the LeBron 17 Low Titan comes in an exclusive red colorway and features an all-over graphic on the upper emblazoned with logos and symbols representing moments in Titan’s 10-year history.

The tongue, meanwhile, has a special crest that features a globe mounted on LeBron’s iconic crown logo, a lightning bolt derived from Titan’s logo, and the words “Para Sa Kadakilaan” (for greatness), which the company translates to “Strive For Greatness.”

“Our partnership with Titan continues to elevate our purpose of serving athletes, bringing Filipino ballers everything they need to continue raising their game. And as LeBron James’ voice and presence continue to resonate with our ballers, how he recognizes and connects Manila to the world with this collaboration is truly meaningful for our athletes on a deeper level,” said Jino Ferrer, Nike Philippines country marketing manager.

For Titan, which opened shop in 2010, the new collaboration takes added significance as it celebrates as well what it is as an organization.

“Titan was born of the Filipinos’ fabled love for basketball and is shaped by its culture and community. Since we first opened in 2010, we have dedicated ourselves to providing a home for the game, those who love it most, and the stories they share,” said Levon Rondina, co-founder and chief brand officer of Titan.

“With our second collaboration with Nike Basketball and LeBron James, we strive to take that dream with us, from Manila to the world. Building off of our brand’s and The King’s shared passion and values, this shoe is a testament to how far a dream can take you, and how far you can take it. Always, for love of the game,” he added.

The Nike LeBron 17 Low Titan is priced at P8,095 and will be available at all Titan stores, the Titan App, and Titan22.com on Aug. 1. It will also be available at Nike Park Fort beginning Aug. 8. — Michael Angelo S. Murillo

Auto exec: ‘The industry is going electric, whether we like it or not’

 

Electrified all-new Land Rover Defender set for Aug. 1 launch

WITH the scheduled local launch on Aug. 1 of the new Land Rover Defender — 37 years after the last all-new iteration — the Jaguar Land Rover (JLR) brand continues to send a clear message about the commitment to its so-called “Destination Zero” mission. Through “autonomous, connected, electrified and shared future mobility, we are committed to a strategy of electrification across our model ranges,” stated the firm on its corporate website.

The portfolios of the storied UK auto marques now already boast “degrees of electrification,” from mild electric vehicles (MHEVs) to plug-in hybrid electric vehicles (PHEVs).

“The global industry is going that way — frankly, whether we like it or not,” averred Coventry Motors Corp. President and All British Cars (ABC) GM Chris Ward in an exclusive interview. Catching up with Mr. Ward at a sneak peek of the Defender (capped by a short albeit delightful stint behind the wheel) proved enlightening on how electrified vehicles can and are steadily taking a foothold in the psyche of the Filipino car buyer.

THE RETURN OF THE DEFENDER
What proved to be my last pre-COVID-19 visit to the ABC showroom on EDSA in Greenhills was back in December 2019 for the reveal of the Land Rover Discovery Sport. Aside from presenting that model, Mr. Ward had discussed the then just-launched Defender (which was unveiled globally at the Frankfurt Motor Show). To be sure, the protracted absence of the iconic nameplate has served to generate excitement and enthusiasm for the vehicle.

But that surely shouldn’t take away anything from the vehicle’s eye-catching, soul-stirring reimagination. While cutting a familiar boxy shape, the Defender reinterprets lines and execution, and enlists the use of high technology to serve up an entirely drivable and foolproof tool for every day roads and more difficult terrain alike.

The Defender comes in five-door (the 110) and three-door (the 90) configurations, and it’s the 110 that will first be available here this week (the 90 is expected to arrive in the Q1 2021). While four engine options are available (two diesel- and two gas-sipping), for now, Land Rover Philippines is bringing in the top-shelf in-line 3.0-liter, six-cylinder power plant with mild hybrid technology. The all-new Ingenium six-banger engine, which debuts in the Defender, serves up 400ps and 550Nm of torque — the latter available from 2,000rpm.

As mentioned, the Defender employs a “small integrated electric motor which gathers energy from regenerative braking, which then is used for instant power from takeoff.” Indeed, despite tipping the scales at almost 5,000 pounds, the vehicle feels nimble and spirited. Land Rover says the Defender can reach 100kph from standstill in 6.1 seconds, up to a top rate of 208kph, with the performance accessed via an eight-speed automatic transmission. A twin-scroll turbocharger and continuous variable valve lift help to boost power.

The vehicle is priced as follows with the various “accessory packs” (each one, maintained Land Rover, “designed to help you make more of your world”) Defender 110 Urban (P6.31 million), Defender 110 Country (P6.36 million), Defender 110 Adventure (P6.44 million), and Defender 110 Explorer (P6.61 million). The even more premium Defender 110 First Edition is priced at P9.39 million.

ELECTRIFYING FUTURE
“You have to take that brave step and just say, ‘Here it is. I’ve trained my people. My people know how to look after it. We’ve got the right product for the market,’” commented Mr. Ward, who at the start of his posting in Manila already shared that electrified vehicles were forthcoming for JLR.

The executive intimated, “There are more PHEVs coming… options for the Evoque, Discovery Sport in next 12 months. We’re just sorting out if it’s right, the pricing. This technology is a little more expensive to manufacture, but there are tech savings.”

It certainly helps that there’s heightened awareness and openness to the more environmentally friendly powertrain. In fact, the arrival of Jaguar’s first all-electric vehicle I-Pace was surely helped along by Filipino customers who Mr. Ward said had been asking about it. “We’ve been getting great press for a car that’s been around for three years. It’s proven; it’s got legs already,” he insisted. “That’s the pull of both the brand and electric vehicles.”

The key to greater acceptance of electrified vehicles of any kind is the adequate addressing of pain points. Reassurance and the lessening of uncertainty are important. Mr. Ward said that when talking to potential buyers of these vehicles, confidence must be inspired in them. In the case of the I-Pace, Jaguar Philippines made it a point to quell concerns about charging — explaining to clients and even helping them get their home charger installed. “These were things that were initially holding them back… It’s about understanding the technology, protocols for charging, etc.”

While JLR has stated its intentions on progressively electrifying its portfolio — a process that is becoming more evident with each new release, Chris Ward clarified that it doesn’t necessarily mean that petrol and diesel options will be removed right away.

Still, the writing on the wall is clear: “Over the next five years or so, not just us, but all the other premium manufacturers as well. You’ll see their lineup moving away from pure internal combustion to a combination or pure EV.”

India water crisis becoming a problem for rice farmers, Modi

ON A SCORCHING summer day in northern India, Ajay Singh sat next to his water pump and scanned his 10 acres of farmland. He once used to grow rice each season to bring in about 150,000 rupees ($2,000) a year, well above the average income in the world’s second-most populous country.

Now on six acres he’s cultivating pearl millet, cow peas, bottle gourd and corn — crops that consume about 80% less water than rice, and also use less labor, fertilizer and electricity. While a water conservation program pays him 7,000 rupees per acre to plant them, it’s still a gamble: Unlike rice, which the government always buys at a set price, these crops have no guaranteed market.

“I am taking this risk because I have a passion to leave enough water for future generations,” Mr. Singh said from his farm in Karnal, an area a few hours drive north of the capital, New Delhi.

India’s 1.3 billion people have access to only about 4% of the world’s water resources, and farmers consume almost 90% of the groundwater available. As global temperatures rise and overuse of water depletes existing resources, the threat to lives and businesses in Asia’s third-largest economy is projected to grow.

Water shortages are already acute: nearly half the country’s population faces high-to-extreme water stress and about 200,000 die each year due to inadequate access to safe water. Stoked by climate change, the water crisis has forced Prime Minister Narendra Modi’s government to try and turn around decades of established farming practices and convince the country’s most powerful voting bloc to change the crops they plant. Water-guzzlers like rice and wheat are out, corn and pulses are in.

“This is just the beginning,” Siraj Hussain, former secretary of agriculture and a visiting senior fellow at the Indian Council for Research on International Economic Relations in New Delhi, said of the program farmers like Mr. Singh have joined. “Sooner or later, it will have to be replicated across the country. Ideally, the central government should finance part of the expenditure in providing incentives to the farmers for making the shift from paddy and sugarcane. States alone cannot afford such an ambitious plan.”

For Mr. Modi, pushing farmers to change is risky business because of their sheer numbers and political power. Farm income is untaxed in the South Asian nation, and water and electricity are heavily subsidized. Lowering the minimum price at which the government buys food grains from farmers could also backfire at the polls.

Although Mr. Modi’s Bharatiya Janata Party dominates parliament after a big win in last year’s election, he needs to tread a fine balance between shifting to less water-intensive crops and ensuring his government produces enough food to feed the poor. That makes incentives like those given to farmers like Mr. Singh an important test for whether India can reverse its chronic water problems.

If the program in Karnal is any indicator, the task isn’t going to be easy.

Few farmers in the rice-growing district, where the water table has been declining by 0.7 meter every year, are keen to experiment with new crops. In its first year in Haryana the project anticipates around 100,000 hectares (247,105 acres) would switch to alternate crops — but that’s only about 7% of the land used for rice cultivation in the northern state.

Farmers love rice and wheat primarily because of stable prices and assured state purchases. These two staples, along with another thirsty crop, sugar cane, are grown in 40% of the country’s gross farmed area but consume about 80% of its irrigation water. Corn and millet may use less water, but their price stability is unproven.

In the long run, experts say water shortages will make crop diversification an inevitability. Currently, India is the world’s biggest extractor of groundwater — more than China and the US combined — accounting for almost a quarter of the total extracted globally. Between 2000 and 2017 its groundwater depletion increased by as much as 23%.

But the change needs to be carefully managed, said Aditya Pratap Dabas, deputy director agriculture and the officer managing the Karnal project. “Changing the farmers’ mindset is the main challenge in implementing the program.”

Heavier tactics backfire. Protests erupted earlier this year when the provincial government tried to restrict rice cultivation to just half the farmed area in some parts of Haryana. The farmers, some backed by the opposition Congress party, said the government couldn’t deprive farmers of the right to grow crops that fetched the best price. — Bloomberg

GMA Network expects to keep jobs

GMA Network, Inc. has no plans to reduce its workforce amid the ongoing pandemic crisis, its top official said.

“While some of our talents were affected when the Network temporarily suspended the production of most of our entertainment and public affairs programs, there is no particular plan, however, to cut jobs due to the pandemic crisis at this point,” GMA Network Chairman and Chief Executive Officer Felipe L. Gozon told BusinessWorld in an e-mailed reply to questions last week.

In March, the network said it would allocate P350 million for the salaries and benefits of its employees, talents and support personnel in light of the government-imposed lockdowns.

The media company operated on a lean workforce and adopted special work arrangements for its employees, talents and support personnel during the lockdown period.

“The impacts of the pandemic and the quarantine controls imposed to arrest the pandemic on GMA are similar to those on other companies. Because of the restrictions, we had to replay some of our high-rating programs. But with respect to our news and some of our public affairs programs, we continued to air them — not with replays — and, of course, we also suffer the setbacks in revenues that went along with the closure of some of the business activities plus lack of transportation, quarantine lockdowns, etc.,” Mr. Gozon said at the company’s annual stockholders’ meeting recently.

“But lately, when the restrictions started to ease, we also started to bring back the showings of our programs in the sense that gradually we are producing more and more live programs, not replays, but on a limited basis to comply with the restrictions imposed by the government. In the coming days, you will see more and more of our programs returning to the air,” he added.

Mr. Gozon also said the company is free of debt as of end-March, emphasizing its “ability to balance ratings growth with sound financials.”

In the first three months of 2020, GMA saw its net income plunge by 19% to P583.42 million with the lack of political ads and the pandemic-induced quarantine imposed in the middle of March. Total revenues were down 7% in the first quarter to P3.53 billion.

“In the next months and years, we will see a transformation of the broadcast industry,” Mr. Gozon said. — Arjay L. Balinbin

Gov’t debt yields end flat

YIELDS OF government securities (GS) barely moved last week following the start of the government’s retail Treasury bond (RTB) sale.

GS yields rose by an average of 0.6 basis point (bp) week on week, based on the PHP Bloomberg Valuation (BVAL) Service Reference Rates published on the Philippine Dealing System’s website on July 24.

At the secondary market last Friday, the 91-, 182-, and 364-day Treasury bills (T-bills) saw their yields go down by 8.6 bps, 4.7 bps, and 3.1 bps, respectively, to 1.501%, 1.613%, and 1.807%.

At the belly of the yield curve, rates of the three-. four-, five-, and seven-year Treasury bonds (T-bonds) went up by 1.1 bps (2.2%), 4 bps (2.337%), 6.8 bps (2.464%), and 10.9 bps (2.683%). Only the two-year debt paper rallied as its rate fell by 1.4 bps to 2.034%

Yields on the 10- and 25-year T-bonds climbed by 13.5 bps (2.857%) and 1.5 bps (3.757%). Meanwhile, the rate of the 20-year paper fell by 13.9 bps to 3.542%.

“Local bonds remained locked in a very tight range on strong two-way demand week-on-week. Market players were observed to be occupied with book-building for the new five-year RTBs, that is why local bond yields just moved sideways across the curve,” Robinsons Bank Corp. Peso Sovereign Debt Trader Kevin S. Palma said in a Viber message.

“However, demand for short-dates remained strong given the elevated liquidity in the financial system,” he added.

Profit taking in some long-term tenors from record-low levels “may have been partly brought about by the new upcoming supply of government securities in view of the latest RTB issuance of at least P250 billion…,” said Rizal Commercial Banking Corp. (RCBC) Chief Economist Michael L. Ricafort.

“New and upcoming bond and equity issuances could have sapped some funds in the financial system towards these new fund-raising activities and away from existing issues, which thereby could have caused the recent bouts of healthy profit taking/downward correction,” he added.

The amount raised from the five-year RTBs already exceeded the record P310 billion borrowed via the three-year retail bond issue last February just a week into the offer period amid robust demand.

The government awarded an initial P192.71 billion of the five-year RTBs during the rate-setting auction on July 16. The P250-billion mark was breached after only four days.

The retail bonds carry a coupon of 2.625% and are being sold in denominations of P5,000 until Aug. 7, unless closed earlier by the Bureau of the Treasury (BTr).

The Treasury also opened an exchange offer program worth P321 billion for holders of the RTB 10-01, FXTN 05-73, RTB 10-02 and FXTN 07-57.

The retail bonds will be issued on Aug. 12 and will mature on Aug. 12, 2025.

“Local yields may continue to trade range-bound [this week]. Potential catalysts that could drive yield action… are the T-bill auction and BTr’s borrowing plan for the month of August,” Robinsons Bank’s Mr. Palma said.

The Treasury is holding a T-bill auction today.

RCBC’s Mr. Ricafort said major catalysts for this week include fund-raising activities such as the continuation of the RTB offering, the country’s first real estate investment trust (REIT) offering, and updates on quarantine measures by the government.

“Locally, any stricter quarantine measures could initially weigh sentiment on the local financial markets and could still cause continued profit-taking, in terms of a healthy upward correction in PHP BVAL yields as an immediate reaction, also amid new GS supply from relatively large RTB issuance,” Mr. Ricafort said.

BPI Capital Corp., the sole global coordinator and stabilizing agent for the REIT offering, told the Philippine Stock Exchange (PSE) last Wednesday that Ayala Land, Inc. will be offering REIT shares at P27 each, lower than the initial P30.05 per share indicated in the prospectus submitted to the PSE and the Securities and Exchange Commission.

The offer period will be from today to Aug. 3, with the listing at the PSE main board tentatively scheduled on Aug. 13. — Marissa Mae M. Ramos

Gli the cat can stay even as Istanbul’s Hagia Sophia changes

ISTANBUL — With thousands of Instagram followers and even a former US president as a fan, Gli the cat is almost as famous as her home, Istanbul’s ancient Hagia Sophia.

But with the decision to turn the museum into a mosque, Turks have been wondering whether Gli will have to move out — with the question cropping up daily on local news outlets and social media.

The grey cat with shining green, crossed eyes, has become a favorite with visitors, including former US President Barack Obama, who was filmed stroking her during a trip in 2009.

Authorities have made clear Hagia Sophia can remain as her home.

Ibrahim Kalin, spokesman for President Tayyip Erdogan, told Reuters that Gli, as well as all other cats in the area, would stay where they were.

“That cat has become very famous, and there are others who haven’t become that famous yet. That cat will be there, and all cats are welcome to our mosques,” he said.

That’s bound to be welcome news to Umut Bahceci, a tour guide who started an Instagram account for Gli four years ago and now has more than 48,000 followers. The account is filled with photos of the cat, some tagged by the tourists who meet her.

“I started noticing Gli every time I went (to Hagia Sophia) because Gli was posing for people like a model,” she told Reuters. “I get messages such as, ‘Gli, we will come to Istanbul to see you.’ This is truly a very nice feeling.”

Hagia Sophia was a Christian Byzantine cathedral for 900 years before it was seized by Ottoman conquerors and served as a mosque until 1934.

A court ruled this month that the building’s conversion to a museum then was unlawful. Erdogan immediately declared the building a mosque once more, with the first prayers held last Friday. — Reuters

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