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First-round thoughts

The playoffs of the 2018-19 season of the National Basketball Association has been a fortnight old and so far there is hardly any surprises in the first round with teams expected to do well delivering accordingly.

As of this writing, two opening-round series had been concluded, those between Eastern Conference top seeds Milwaukee Bucks and eighth-seeds Detroit Pistons and fourth-seeds Boston Celtics and number five Indiana Pacers.

Milwaukee and Boston swept their opponents with ease, something that was somehow expected considering the depth advantage they have over their opponents.

The other Eastern Conference pairings are at 3-1, with the second seeds Toronto Raptors ahead of the Orlando Magic and number three team Philadelphia 76ers on top of the Brooklyn Nets.

Again nothing uncanny about that but I have to give credit to the Magic and Nets for not making it easy for their higher-seeded opponents with spirited challenges.

Brooklyn, in particular, has been impressive versus Philadelphia, very much into the game every time and presenting some serious scare.

Never mind if collectively they do not have much playoff experience, they are making things happen and it is something to build on moving forward when they eventually get eliminated.

Out in the West, the two-time defending NBA world champions Golden State Warriors are steady with a 3-1 lead over the eighth-seeded Los Angeles Clippers.

They made the history books for a not-so-flattering reason when they lost a 31-point lead in Game Two to the Clippers and bowed to the defeat.

After that though, the Warriors have responded with dominating back-to-back victories and are seemingly set to go for the jugular come Game Five.

The Denver Nuggets and San Antonio Spurs are knotted at 2-2 and highly likely will see their best-of-seven series go the full route considering how the two teams are finding ways to cancel the advantage of one another every time they meet and compete toe-to-toe.

The Portland Trail Blazers, the fourth seeds in the West, are up, 3-1, over the Oklahoma City Thunder.

On the surface this comes as a surprise but if you happen to be following the series, the way Blazers stars Damian Lillard and CJ McCollum are carrying their team it is little wonder that they are up.

Portland has come to play and bent on exorcising its first-round exit last season and Oklahoma City is just not responding. Next question?

Then there is the Houston Rockets and Utah Jazz where the former is up 3-0 and were actually gunning for a sweep in Game Four as this piece is being written.

If there is a surprise series in the first round of the NBA playoffs this season this has to be it.

The Rockets, on the lead of reigning MVP James Harden, are the better team of the two alright, but did we envision them having their way over the Jazz like that way they are doing it right now? Not really. Right?

But kudos to Houston for it has been playing its chips correctly and up to this point has presented itself as a puzzle to Utah.

While there are hardly any surprises in the first round to date, it still has been an eventful stretch of NBA playoff basketball. And the good thing about it all, it is set to get even more interesting as it goes deeper. Playoff basketball. Give me more of it.

 

Michael Angelo S. Murillo has been a columnist since 2003. He is a BusinessWorld senior reporter covering the Sports beat.

msmurillo@bworldonline.com

Looking forward

The Pistons did all they could against the Bucks yesterday. Down zero to three and facing the very real prospect of a third consecutive postseason elimination without a single win to show for their efforts, they resolved to hit the ground running, and did. They put up a double-digit lead not even halfway through the first period, relying on their trademark physicality and determination to overcome a decided talent gap. And they played with purpose from then on; they challenged every shot, went for every 50-50 ball, and took every risk they could — all while sticking to set patterns.

For a while, the Pistons’ plan worked. Up until late in the third period, they managed to keep the Bucks at bay with a methodical offense that capitalized on six-time All-Star Blake Griffin’s astute playmaking, plus a stout defense that accepted the consequences of frequent contact. They were tough — even rough — on their coverages, in the process keeping their opponents off balance. Unfortunately, all the resulting foul calls negated whatever advantages they erected through judicious, if uncharacteristically efficient, shooting; they sent the competition to the line too often for comfort.

Ultimately, the Pistons couldn’t prevent the inevitable. Perhaps they would have been able to prolong the series were Griffin not ailing from a bum left knee that kept him out of Games One and Two. Against better judgment, he suited up for Game Three and yesterday, and his presence did make them much, much better. Still, it was clear that he suffered from a glaring lack of mobility. Meanwhile, the Bucks’ Giannis Antetokounmpo proved to be in fine form, exhibiting all the skills of a preemptive favorite to for the season’s Most Valuable Player award.

In any case, the Pistons have much to ponder on. Their roster is uneven at best, and there is cause to argue that erstwhile top dog Andre Drummond’s physique and attendant predilections don’t fit the pace-and-space preferences of the modern-day National Basketball Association. The flipside is that they likewise have much to look forward to. At the very least, they have Griffin, who may have to go under the knife but should be fine after proper treatment. They also have Dwane Casey, as good a coach as any in the league.

Considerable work and luck are required for the Pistons to progress, but, if nothing else, they’re patient, they have a foundation to build on, and they have the commitment of owner Tom Gores. And with the right pieces in place, they should soon be done scrambling in the regular season just for one-and-done appearances in the playoffs. It’s not a matter of if, but of when.

 

Anthony L. Cuaycong has been writing Courtside since BusinessWorld introduced a Sports section in 1994.

Job matching startup awarded at global ICT event in Geneva

Social impact tech startup Connected Women was recognized as a champion for e-employment at the World Summit for Information Society (WSIS) Forum held at Place des Nations in Geneva, Switzerland.

Connected Women is a technology-driven social impact start-up that matches entrepreneurs from all over the world with Filipino women looking for remote work. The firm is supported by Facebook #SheMeansBusiness and the Philippines’ Department of Information and Communication Technology (ICT).

Through the Connected Women website, job seekers can apply for virtual work, while entrepreneurs gain access to high-quality, affordable talent. By promoting tech adoption, inclusive innovation and the future of work, this social enterprise also provides digital skills enhancement, continued education and training to the community.

Over two million votes were cast between 1062 nominated projects from across the globe. Following a comprehensive review by an expert group, the International Telecommunication Union (ITU) has recognized 90 organizations for their remarkable efforts of accelerating socio-economic progress.

“How can we maximize the benefits of emerging tech for our societies and economies? One answer is innovation,” said Houlin Zhao, the ITU Secretary-General. “So let’s work together to invest in innovation so that ICTs can accelerate progress on Global Goals and deliver on the promise of the Digital Economy.”

In the e-employment category, Connected Women was awarded as a champion, along with entries from Thailand, United Arab Emirates, India and the USA. “It is an honour for Connected Women to be representing the country in the international stage and for being recognized by a panel of global changemakers as a solution to improving women’s economic empowerment and gender equality through the use of ICT,” said Connected Women co-founder Ruth Yu-Owen.

Meanwhile, on the subject of future of work, CEO and Co-Founder Gina Romero adds, “Technology is a game changer for women and providing access to remote and flexible work means having a choice between staying in the workforce or being forced to drop out.”

“Our vision is to impact the lives of women globally by providing access to technology training, resources and tools to improve businesses, careers and lives. This not only opens up opportunities to Filipino women but also aids entrepreneurs globally to achieve work-life balance while growing their business” according to Michael Yaxley, Executive Chairman of Connected Women.

Being the sole Philippine awardee at WSIS Prizes for this year, representatives from Connected Women made a courtesy call at the Permanent Mission of the Philippines to the United Nations and Other International Organizations Geneva. Ambassador Evan P. Garcia, Permanent Representative, congratulates the team and remarks, “Technology is a catalyst for change and global interconnectedness has great potential to accelerate human progress. Startups like Connected Women are vital to driving inclusive innovation, bridging the digital divide and improving the economic participation of women in the Philippines.”

PCC checks for collusion in power sector

THE PHILIPPINE Competition Commission (PCC) will check allegations of collusion among power plant operators amid recent outages “that may have contributed to price increases in the retail electricity market,” the watchdog said in a press release on Monday.

“The recent spate of scheduled and forced outages in Luzon by different power plants has reportedly reduced power reserves, caused calls for red or yellow alerts, and induced rotating brownouts, which in turn sparked complaints from the public,” the PCC said.

“The PCC shall assess whether the recent power plants’ outages are manipulated to increase electricity prices or are valid unplanned breakdowns that affect supply conditions.”

In a mobile phone message, PCC Chairman Arsenio M. Balisacan clarified that the watchdog was “looking into the recent series of shutdowns and assessing if it merits an investigation.”

Sought for comment, Emmanuel V. Rubio, chief operating officer of Aboitiz Power Corp., said he was not aware of such an issue, while senior officials of other firms involved such as TeaM Energy Corp. and South Luzon Thermal Energy Corp. did not respond to requests for comment.

“The PCC warns power generation companies from engaging in anti-competitive or collusive behavior which is punishable under the competition law with fines of up to P250 million and imprisonment of responsible officers of up to seven years,” the statement read, referring to Republic Act No. 10667 or the Philippine Competition Act.

The PCC also said it welcomes technical reports or audits by the Department of Energy, as well as any lead or information from the public or experts in the field.

“We look forward to the report that DoE will send us as it will help with our assessment,” Mr. Balisacan said of the Department of Energy. “The DoE has previously referred a similar matter to the PCC and that is being treated as a separate investigation.”

The PCC said it is talking with DoE and the Energy Regulatory Comm ission for a memorandum of agreement “to facilitate market competition and investigations in the power sector.” — Janina C. Lim

Hanjin liabilities now pegged at $1.71B

By Janina C. Lim
Reporter

CLAIMS against Hanjin Heavy Industries and Construction Philippines, Inc. (HHIC-Phil) now total about $1.71 billion, according to a recent interview with the firm’s rehabilitation receiver who cited latest assessments and said she has yet to receive a “firm” business proposal.

In an April 5 mobile phone message, HHIC-Phil’s Rehabilitation Receiver lawyer Rosario S. Bernaldo said “regular claims, which include validated and those with lacking documents, amounted to $975 million, while contingent claims amount to around $735 million.”

She confirmed the amounts last week.

Of the regular claims, some $450 million consist of obligations to local banks, Ms. Bernaldo said.

Initial estimates after an Olongapo court placed HHIC-Phil under rehabilitation in January put the company’s liabilities to local banks at a total of $412 billion: $140 million to Rizal Commercial Banking Corp., $80 million to state-owned Land Bank of the Philippines, $72 million to Metropolitan Bank & Trust Co., as well as $60 million each to Bank of the Philippine Islands and BDO Unibank, Inc.

HHIC-Phil’s contingent claims are covered by contracts that entitle a payoff under certain conditions.

The April 12 deadline for the final registry of claims has lapsed but Ms. Bernaldo said she is still open to receiving those with complete supporting documents to prove delivery of services to HHIC-Phil.

“Kung talagang may utang di ka naman prevent na di ka maka-claim just because di ka nakapasok sa deadline. Pero di ka na makaka-participate sa proceedings… I guess by the time we approve the rehab plan di na pwede humabol yung iba (If you are owed money, you should not be prevented from filing a claim just because you did not beat a deadline. You just cannot take part in proceedings… I guess by the time we approve the rehab plan, those that have not yet filed a claim by then will no longer be able to do so),” Ms. Bernaldo said in an April 5 telephone interview.

Ms. Bernaldo said reaching out to creditors abroad and hiring translators to interpret contracts written in Korean complicates her work.

At the same time, she said she is “very optimistic” that the company will not have to undergo liquidation, citing inquiries she, creditor-banks and the Subic Bay Metropolitan Development Authority have been getting from potential white knights.

“Dalawa talaga yung makikita mong (There are two that are really) interested… in advanced stage na, meaning [we have met] three times na nagkita as they have to do due diligence pa. They have to bring experts to see [the shipyard’s] physical, technical capabilities,” Ms. Bernaldo added.

She noted the most interested firms were based in the Netherlands and the United States.

In a roundtable discussion with reporters last week, Trade Undersecretary for Industry Development and Trade Policy Group Ceferino S. Rodolfo mentioned three firms, namely: the Damen Group from the Netherlands, the Naval Group from France and a company from the United States whose name he could not recall, as committing to come back with business proposals.

However, Ms. Bernaldo said “wala pang nag-submit ng firm proposal, ’yun ’yung kailangan ko eh (no one has submitted a firm proposal, which is what I need).”

On Monday, she confirmed via text message: “Wala pa akong nare-receive na (I have not received any) formal proposal from investors.”

“They are still conducting technical due diligence and forming consortiums.”

“It is the interest of the financial creditors na mabilis makakahanap (we promptly find a white knight) because, otherwise, if ubos na pera (if HHIC-Phl runs out of working capital), they (banks) have to maintain it. They have to see to it na babayaran mga tao na nandun (they pay those) who are maintaining it,” Ms. Bernaldo had said on April 5, adding there are 30 workers left to maintain the Subic shipyard.

Besides repaying the loans, the white knight has to pay for a working capital to keep the company in operations. A top official of HHIC-Phil, who asked not to be named, had said that the company will need $12 million monthly to continue operations.

The firm’s operations now remain suspended as HHIC-Phil negotiates for an arrangement with suppliers for it to complete six more vessels in various construction stages, according to Ms. Bernaldo.

Firms eyeing a takeover of HHIC-Phil include International Container Terminal Services, Inc. which said it plans to convert the shipyard into a “multi-purpose” facility.

Waiver of March charge could cost Manila Water nearly P500 million

By Victor V. Saulon
Sub-Editor

AYALA-LED Manila Water Company, Inc. expects the cost of its move to voluntarily waive the minimum charge of its entire client base for March plus the waiver of a full month’s bill of its most severely affected customers to hover below P500 million, its top official said on Monday.

Monday also saw 14 business and industry groups release a joint statement pressing the government to “take immediate action” to improve water supply.

“From the P150 [million], it will definitely add a few more hundreds of millions in my estimate,” Ferdinand M. Dela Cruz, Manila Water president and chief executive officer, said in a press briefing in Makati City after the company’s annual stockholders meeting on Monday.

Asked whether the cost would reach P500 million, Mr. Dela Cruz said: “It will probably hover around that area, but probably just below that number, [based on] my estimate. I just don’t want to give a specific number that will be quoted because the billings are not done.”

Mr. Dela Cruz announced the waiver scheme on March 26 to compensate customers after a water shortage hit customers.

He had said that if the computation were confined to the waiver of the minimum charge alone, the cost could reach P150 million.

“The April billings are not over yet,” Mr. Dela Cruz said, adding that the computation is on a per-customer basis and that the company would disclose “round figures” by May.

He previously said that the minimum charge ranges from P75.84 per month for Manila Water’s lifeline or low-consuming customers, and up to P656.52 for industrial customers. The minimum charge for domestic customers is P133.56 a month and for commercial customers, P606.84 a month.

He said the minimum charge represents 10 cubic meters (cu.m.) covering water, environmental and sewer charges. Consumption beyond 10 cu.m. will be billed. He described the hardest hit customers as those without water for at least seven days whether continuous or intermittently from March 6 to 31. These customers were not be charged for their water consumption in March.

The east zone concessionaire has been experiencing a water supply deficit since March 6, although it has now brought down the shortfall to 107 million liters per day (MLD) from 150 MLD at the height of the shortage.

The deficient supply came about as water demand reached 1,750 MLD while supply remained at 1,600 MLD. A new water treatment plant failed to meet its target launch in late 2018 due to technical issues.

Earlier on Monday, Mr. Dela Cruz told stockholders during the company’s annual meeting that Manila Water has measures to plug the water deficiency.

“Cardona [water treatment] plant is now 50 MLD as committed, so it’s now running for phase one. We expect phase two at around August for another 50 [MLD]. We are now running about 32 MLD of deep wells and then we expect that in the next few weeks of April and through May the cross-border flows committed by the other concessionaire of about 50 [MLD] will add to that,” he said.

“And then we will continue with our push for deep well, so that we will close the 150 [MLD], which will bring us to the regulatory standard of 7 psi (per square inch), 24/7 by the end of May,” he added.

During the meeting, Manila Water Chairman Fernando Zobel de Ayala said that as of April 20, “we have reached up to 99.83% availability. Customers have at least 8 hours of supply per day, of these customers 83% had at least 16 hours of supply, and 56% had 24/7 supply.”

Mr. Dela Cruz said the company has yet to factor in the cost of the one-time penalty to be imposed by Metropolitan Waterworks and Sewerage System.

On Monday, shares in Manila Water fell 1.25% to P23.65 per share.

Also on Monday, 14 business and industry groups released a joint statement pressing “the Executive and Congress to prioritize water security and take immediate action” to improve water supply in Metro Manila.

They called for speeding up development of new raw water sources, “including tapping the full potential of Laguna lake”; promoting water conservation and efficiency partly through new technologies; developing a water security master plan “for Metro Manila and the entire country”; strengthen the National Water Resources Board through an executive order; as well as rehabilitating wetlands, bodies of water and supporting ecosystems.

Issuing the statement were Alyansa Agrikultura; American Chamber of Commerce of the Philippines; Australia New Zealand Chamber of Commerce; Canadian Chamber of Commerce of the Philippines; European Chamber of Commerce of the Philippines; Japanese Chamber of Commerce and Industry of the Philippines, Inc.; Korean Chamber of Commerce Philippines; Makati Business Club; Management Association of the Philippines; Philippine Association of Agriculturists, Inc.; Philippine Association of Multinational Companies Regional Headquarters, Inc.; Philippine Association of Water Districts; Philippine Chamber of Commerce and Industry; and the Philippine Exporters Confederation, Inc. — with Janina C. Lim

Budget dep’t expects contract awards to surge after polls

THE DEPARTMENT of Budget and Management (DBM) sees a “surge” in contract awarding once the 45-day ban on public works lifts after the May 13 mid-term elections.

“We expect as soon as the election ban is lifted, talagang magse-surge ang releases and awards,” DBM Officer-in-Charge Janet B. Abuel said at a House of Representatives Committee on Appropriations hearing on Monday.

Ms. Abuel explained the 45-day ban covers fund release and project implementation, but will not apply to early procurement activities. “Starting last year up to now, nagbi-bid out na po sila, short of award,” she said.

Citing preliminary data from the Bureau of the Treasury, the Finance department said on Thursday last week that state disbursements missed the program by 11% at P777.99 billion in the first quarter, although they edged up a percent from a year ago, as the government operated on a reenacted national budget that left new programs and projects unfunded.

Economic managers in February submitted to the Commission on Elections (Comelec) a list of priority infrastructure projects under the “Build, Build, Build” program that they wanted exempted from the election ban. Comelec, however, required “voluminous documents” for each project, forcing concerned agencies to cut down their list. “The strategy now, considering there is barely a month left before the ban is lifted, is we have required or instructed agencies to just submit the more urgent projects, individually with all the documentary requirements because apparently they cannot give an omnibus exemption,” Ms. Abuel said.

Appropriations vice-chairman Rep. Federico S. Sandoval II of Malabon conducted an oversight hearing on the P4.1-trillion 2020 national budget, aiming to draw lessons from disagreements between DBM and the House, and later on between the House and the Senate, that led to a four-month delay in enactment of the 2019 budget.

When President Rodrigo R. Duterte last April 15 signed this year’s national budget into law, he vetoed about P95.3 billion in appropriations — including P75-billion funds realigned to the Department of Public Works and Highways (DPWH) budget — that he said were not in accordance with his administration’s priorities, slashing this year’s national budget to P3.662 trillion.

“The controversy of the 2019 budget began with the ceiling issue. That’s why we need to know the ceiling now. As we understood as it was presented to us in July 2018, the DPWH had a ceiling of less than P500 billion but when the GAA (General Appropriations Act) came, it was almost P600 billion. That’s why we want to be clarified now. That’s something we want to avoid in this coming budget,” Speaker Gloria Macapagal-Arroyo said in the same hearing.

She then asked the DBM to submit to the committee the budget ceilings for ongoing programs and projects, as well as those for new or expanded programs and projects.

Presidential Spokesperson Salvador S. Panelo on Monday said that Malacañang hopes for stronger support for its reforms in the new 18th Congress that opens on July 22.

“Unang una may bago nang Kongreso (First of all it will be a new Congress).It will not be the present Congress. After election may bago na ’yan (there will be many new faces in the House of Representatives and the Senate),” Mr. Panelo said. — Charmaine A. Tadalan

Aboitiz eyes RE project acquisitions in Vietnam

By Victor V. Saulon, Sub-Editor

ABOITIZ Power Corp. is looking at acquiring renewable energy (RE) projects that are under development in Vietnam with capacities of between 50-100 megawatts (MW) each to take advantage of the feed-in tariff (FiT) scheme being offered in the Southeast Asian country.

Erramon I. Aboitiz, president and chief executive officer of AboitizPower, said the company is considering projects that employ solar and wind energy technologies.

“There are different projects, RE, anywhere between 50 to 100 MW or so are the projects that we’re looking at,” he told reporters in a briefing in Makati City after the company’s annual stockholders’ meeting on Monday.

Asked about the target total capacity for solar and wind, Mr. Aboitiz said: “We’re looking at several. We don’t have a specific target, frankly. We are just being opportunistic in what is available.”

Mr. Aboitiz said Vietnam’s FiT scheme, which offers a fixed rate to RE developers over a given period, is projected to go on for several more years.

“What they’ve done is they have an agreed FiT price that expires within a certain period. I think, for example, the one of wind, the price today expires October 2021. After that, they’ll have a new price,” he said. “The strategy is that they want to really build their RE capacity.”

Mr. Aboitiz said the company’s target RE plant should have to be ready and running by that time, thus he was looking at “projects that have been developed to a certain extent already.”

For solar, he said the new FiT rate should start after June or July this year, thus an “old project” would be an option. A partnership with a Vietnamese partner is the strategy, with the equity dependent on how much it is willing to sell down, he added.

In the local front, AboitizPower Chief Operating Officer Emmanuel V. Rubio said the energy company is bullish on renewable energy, especially solar power, with the government’s stance to implement rules on renewable portfolio standard, a program that requires utilities to source a portion of their requirements power from RE sources.

During the briefing, Mr. Aboitiz announced the appointment of Mr. Rubio as his replacement as president and CEO of the company once he retires at the start of 2020.

“We’re confident that Manny (Mr. Rubio) will continue to bring AboitizPower to greater heights,” he said.

PSA SIGNED
Separately, AboitizPower disclosed on Monday that subsidiary Therma Mobile, Inc. (TMO) had signed a power supply agreement (PSA) with Manila Electric Co. (Meralco).

“This contract is a timely response of both AboitizPower and Meralco to the call of government for stable and reliable power going into the midterm elections and beyond,” AboitizPower Oil Business Unit President and COO Celso C. Caballero III said.

TMO, with four floating power barges moored in Navotas, has a combined gross capacity of 242 MW. The facility went into preservation mode on Feb. 5, 2019, as well as voluntarily disconnected from the grid and de-registered from the energy market.

Meralco has also signed a PSA with Millennium Energy, Inc. for the purchase of 70 MW of electric power, subject to a net dependable capacity test, from the latter’s 100-MW gas-turbine power plant in Navotas Fishport Complex, Navotas City.

On Monday, shares in AboitizPower rose by 0.14% to close at P36 each.

FLI hikes capital spending to P32B

By Arra B. Francia, Senior Reporter

FILINVEST Land, Inc. (FLI) is ramping up spending to P32 billion this year as it plans to further expand its leasing portfolio.

In a statement distributed during its annual stockholders’ meeting Monday, the Gotianun-led property developer said it has allotted P30-32 billion for its capital expenditures (capex) in 2019. This is about 45% higher than the P22 billion it spent last year.

The listed firm allotted P13 billion for development of properties across its three major hubs in Clark in Pampanga, Alabang, and Cebu. About P7 billion will go to land acquisitions, while the remaining balance will be spent for residential and township developments.

FLI is accelerating investments for its recurring income portfolio in an effort to take advantage of the strong demand for logistics, light manufacturing, technology, and e-commerce firms with inventory management needs.

Part of the company’s strategy is to develop industrial parks, including the first phase of New Clark City which spans 64 hectares. Groundbreaking for the 120-hectare property will start this May, with completion slated for 2020. Locators are also seen to start setting up by then.

“(Inquiries) are quite positive. There are different types of locators like factories and also logistics…some people want to do their own warehousing requirements so that will include cold storage as well,” FLI President and Chief Executive Officer Josephine Gotianun-Yap told reporters after the company’s annual stockholders’ meeting in Alabang on Monday.

Ms. Gotianun-Yap noted that most of the interested locators are Asian firms. Lot sizes can range from one to 10 hectares, depending on the locator’s requirements.

For its office and retail leasing segment, FLI looks to end the year with around 934,000 square meters (sq.m.) under its portfolio, compared to 712,000 sq.m. last year. Office spaces account for around 647,000 sq.m., while the retail unit will have 287,000 sq.m.

The expansion of its office, retail, and logistics businesses will allow the property firm to have 1.645 million sq.m. in gross leasable area by 2023. By 2021, FLI’s leasing business will account for half of its total income, although Ms. Gotianun-Yap said they could hit this target much earlier.

Demand from business process outsourcing (BPO) firms continues to drive their office leasing business, while Philippine Offshore Gaming Operators (POGOs) account for about 20% of their total office space. Ms. Gotianun-Yap, however, noted that they are watching their exposure to POGOs to keep a diversified tenant mix.

“We always believe in market and geographic diversification. Anything that adds to the business is okay, but it’s always good to have a good mix,” Ms. Gotianun-Yap explained.

FLI plans to conduct a bond issuance worth between P5-10 billion this year to finance its capex requirements. The last time FLI offered bonds to the public was in 2017, since the firm opted not to have any issuances last year due to high interest rates.

Shares in FLI jumped by a centavo or 0.66% to close at P1.52 each at the stock exchange on Monday.

HARI sales rise 12% in Q1

HYUNDAI Asia Resources, Inc. (HARI) reported a 12.5% rise in first-quarter sales, driven by a reinvigorated local demand for light commercial vehicles (LCVs), trucks and buses.

In a statement on Monday, the official distributor of Hyundai vehicles in the Philippines said sales reached 9,949 units during the January to March period, up from the 8,847 units in the comparable period in 2018.

In March, HARI sold 3,412 units, a 5.9% increase from March 2018’s 3,223 units.

For the passenger car (PC) segment, HARI saw a 12.9% drop in sales to 5,404 units from 6,205 units during the three-month period. PC sales slumped 13% to 1,914 units in March.

However, strong demand for the Reina helped offset the slump in Accent, Elantra and Eon sales. To date, the Reina, launched in February, has sold 1,576 units, accounting for nearly 16% of HARI’s total first-quarter sales.

Meanwhile, sales of Accent models dropped 8.93% to 3,551 units from 3,899 units. The model still accounted for the segment’s bulk at 65.71% in the first quarter.

The LCV segment posted a 70.5% surge, selling 4,306 units in the first quarter, against the 2,526 units sold in the same period last year. In March, sales of LCVs increased 45% to 1,413.

HARI said the LCV sales were driven by the Kona Crossover (1,043 units sold in the first quarter) and H1-000 (1,901 units sold, up 93% year on year). The Kona Crossover and the H1-000 account for 24% and 44% of LCV sales, respectively.

HARI reported sales of commercial vehicles (CV) more than doubled to 239 units in the first quarter, of which H250 accounted for 112 units.

“Driving the ascent of Philippine business is Hyundai’s trucks and buses which closely mirrors the buildup in economic activity as a result of the government’s infrastructure program,” the company said.

HARI said it may establish seven more local dealerships that will mainly sell commercial vehicles, adding to its current portfolio of six CV-dedicated dealerships. — Janina C. Lim

A view of Paradise

By Zsarlene B. Chua, Reporter

WHEN the first Seda hotel opened in Taguig’s Bonifacio Global City in 2013, Ayala Land Hotels and Resorts Corp. (ALHRC) envisioned the brand as focusing on business hotels located in strategic and bustling cities around the country. But in 2017, the company opened its first five-star property, Seda Vertis North, in Quezon City — with 438 rooms and a grand ballroom — making it the largest hotel in the city.

Now, the hotel chain named after the Spanish word for silk has ventured into another hotel category, this time opening a resort in the 325-hectare Ayala-owned Lio Tourism Estate in El Nido, Palawan.

Seda Lio is a 153-room resort hotel on the shores of the four kilometer-long Lio Beach. Opening in August last year, it is the largest of the ALHRC-owned hotels in Lio — it has much smaller boutique hotels there like Balai Adlao (20 rooms), Casa Kalaw (42 rooms), and Hotel Covo (20 rooms).

The resort is targeted towards business travelers, tourists, and those who want destination weddings (in fact, during a media trip in March, the group encountered a beach wedding), which is why it has function rooms for up to 300 people.

The hotel has three room categories, the Deluxe Room (45 square meters), the Suite room (76 square meters) and a Presidential Suite (148 square meters).

For people who are familiar with Seda hotels, Seda Lio bears the same trademarks of the brand: the cream and wood color palette; walls filled with photos taken by Jaime Zobel de Ayala, who, aside from being the Chairman Emeritus of the Ayala Corp., is also an art photographer; and the all-day dining restaurant, Misto, which is present in all Seda hotels.

Unlike other Seda hotels, it has a game room, a two-level infinity pool, a pool bar and a spa.

“[We’ve been having] a lot of incentive travelers and weddings,” Brett Hickey, Seda hotels group general manager, told the media during the trip.

Currently, Mr. Hickey pegs the market as skewed toward foreign travelers. “We’ve had a lot of tour groups from Israel and Europe here,” said Mr. Hickey.

And it’s easy to see why Lio is becoming a hot, premium destination for travelers with its white sand beach and a more relaxed, quiet atmosphere. In fact, it’s so relaxed that Mr. Hickey can sometimes be spotted watering the plants.

“I love coming here,” he said, adding that it is a place to unwind.

Lio also has its own private airport, located a kilometer away from Seda Lio. The airport is operated by AirSwift, another Ayala-owned company. It offers multiple daily flights from Manila to El Nido via Ninoy Aquino International Airport Terminal 4 and daily flights from Caticlan airport in Boracay to El Nido.

IN PURSUIT OF SUSTAINABILITY
Aside from the convenient location and atmosphere, what Mr. Hickey is proud of is the newest Seda property’s sustainability efforts which serves as the blueprint for similar efforts to be introduced in other Seda hotels.

The hotel rooms nixed single-use bottles of shampoo, conditioner, body wash, and lotion in favor of refillable pump bottles; biodegradable materials are used to package other toiletries; and gray water is used to flush the toilets. No plastic water bottles are offered and glass bottles are used instead because the estate has banned the use of plastic.

Curiously, AirSwift offers onboard water bottles to passengers inflight.

Mr. Hickey also said that he is doing a cost analysis in order to replace the toothbrushes and other toiletries for bamboo versions.

“I’m looking at bamboo options [for toiletries] right now, there’s a local supplier [we’re talking to],” he explained.

He added that Lio’s being a premium destination works well with the sustainablility efforts because having higher price points would deter masses of tourists from coming in and compromising the environment.

“In the past 10 years [the number of tourists] swelled: we saw a thousand people on the beach and we thought, ‘well, how sustainable will that be?’” he said, adding that their sustainability efforts in Seda Lio will make their way towards other Seda hotels in the future.

Such is their commitment to sustainability that “no Seda Lio structure [will exceed the height of] the coconut treeline,” and buildings at the beach front are built with “some distance from the water line in anticipation of storm surges,” according to a company release.

Also, only 45% of the entire 325-hectare property is developable and Mr. Hickey noted that when they started the construction for the hotel (and for any other properties in the estate) they tried to lessen the cutting of trees as much as possible.

“The shortest and easiest route [to development] is not necessarily the best route [for the environment],” he said, explaining the need to be careful when developing such a large estate.

WHAT TO DO IN SEDA LIO
Lio beach might have a more relaxed atmosphere than bustling Boracay, but it also has a lot to offer, from trekking trails to touring using bamboo bikes.

One can island hop via small motorized boats, or go big by bringing a group and tour on a yacht as the media did during their trip.

Travelers can book yacht tours with the El Nido Yachting Club and choose from its fleet of speedboats, a 50-foot catamaran sailing yacht, or a traditional wood-hulled boat. Prices range from P4,999 per person to join a boat group tour or P25,000 to charter a speedboat for six people.

Each boat tour includes lunch on board or served picnic-style on a secluded private beach, and the tour lasts from early morning until late afternoon.

The tour, depending on the package, can bring tourists to famed El Nido attractions including the Big Lagoon, the Small Lagoon, the Snake Island sandbar, the Secret Beach, and Shimizu Island.

Those who would prefer staying on dry land can walk along Lio beach towards the Shops@Lio which offer retail and dining options including the vegan restaurant Shaka, which offers big servings of pad Thai, lasagna, and burgers. (The pad Thai is especially good with the well-sauced noodles having a chewy, springy texture.)

Also within the estate is Kalye Artisano, a small artists village that is a pet project of Bea Zobel Jr. and Paloma Urquijo Zobel who came up with the idea of setting up a community-based artisan village.

The village, made up of structures resembling bahay kubo, features a handful of stores selling souvenir shirts, home decor, jewelry, local food products, and artworks.

And if you happen to be in Lio at the right time, you can participate in the Lio Beach Festival (held several times a year), a free music and arts festival for the environment. The festival prides itself in having no trash left behind after its run.

Fox PHL gambles on exorcism film

FOR ITS first foray into scripted entertainment, Fox Networks Group (FNG) Philippines, decided to take a gamble on Mark A. Meily’s Maledicto, a “character-driven horror film” about exorcism and a skeptical priest which is set to premiere on May 1 in cinemas nationwide.

“It started with a pitch-brief. Fox said they were looking for something that was either fantasy or horror but should have a local flavor and regional appear. So when we were coming up with the story, we thought exorcism is something that… exist in all parts of the world and yet the way we experience it [in the Philippines] is our own, it’s very local. We thought it was a good theme to expand on and make a story on,” scriptwriter Jonathan Guillermo told the media during a press conference on April 16 at Solaire Resort and Casino, Parañaque City.

From brainstorming to full film, the entire process took four years, said the film’s director as unlike his other horror films — like 2016’s Cristine Reyes-starrer Elemento about a boy who returns from a field trip with something sinister inside him — Maledicto demanded thorough research about the material.

“We consulted with an exorcist priest and researched on how the Vatican did their exorcisms,” he said.

The film revolves around Fr. Xavi (Tom Rodriguez), a former psychologist turned skeptical exorcist who meets Sr. Barbie (Jasmine Curtis-Smith), a young nun who can see spirits. Together, they try to solve the case of Agnes (Miles Ocampo), a teenager seemingly possessed by a demon.

While acknowledging that exorcism in films “can be a whole genre in itself,” there was a conscious effort by the production team to differentiate Maledicto from predecessors like The Exorcist (1974) and a host of others that came after it by treating it like a horror-procedural.

“That’s how we differentiated [the film] in how… it’s not just this premise for jump-scares. We tried to highlight the procedures and the uniqueness that this is a 21st-century institution that has procedures in place to discern if something supernatural is occurring,” Mr. Guillermo said.

For this “character-driven” horror film, Mr. Meily tried to “design an experience” and not just tell a story. It was initially meant to be a TV series until Fox and its co-producers, Cignal Entertainment and Unitel Productions Inc., decided that they would do a movie first to test the waters.

“That was the original intent [to create a series for Fox Filipino], so we went to Hollywood to figure out how to create a Filipino series and then we looked at the economics of many, many episodes and determined that it probably didn’t make sense to create all these episodes right away and have a theatrical release first to see if there’s traction,” Jude Turcuato, SVP and general manager of FNG Philippines, told the media on the sidelines of the press conference.

He added that if Maledicto does well in cinemas, they have plans for a sequel and a TV series.

Maledicto will be the barometer with which the company will base its decisions on whether to go ahead with producing other scripted original content in the Philippines.

“There’s nothing specific yet. The only one that is specific is there is another script waiting in the wings if this one does well,” said Mr. Turcuato.

“We wanted to do something differently, we want the story to be different, even though exorcism is familiar. We wanted to put all our efforts into one thing because I don’t want to have any regrets… [if we do too many things at once] you get distracted,” he explained.

Maledicto opens in cinemas nationwide on May 1. — ZBC

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