Nation at a Glance — (03/28/19)
News stories from across the nation. Visit www.bworldonline.com (section: The Nation) to read more national and regional news from the Philippines.
How to find freedom and launch your career as a digital nomad
Freedom Summit Philippines kicks off the Freedom Summit group’s global tour of conferences targeted towards digital nomads. Founder and career blogger Ricky Shetty envisions the event series to be the first to organize legs in every continent, culminating in a cruise to Antarctica.
“We might get a lot of penguins in the audience [on that one],” he said.
His ambitious project is all in line with their core message that people can build careers that are lucrative, flexible, and geographically-independent. That is, free — free in terms of money, time, and location — thanks to the suite of digital tools available to workers today.
Shetty is himself an avid traveler, having visited 81 countries across six continents working as a blogger and internet marketer — with wife and three kids in tow. Through this series, he hopes to share some of the strategies he’s cultivated, as well as bring together local and international experts to speak on topics including:
- Building a successful, structured career as a freelancer
- Generating passive income
- Establishing thought leadership
- Successfully striking work-life balance
Launching in Asia, Shetty is pulling together five events between now and April, with stops in Malaysia, Singapore, Indonesia, and Thailand.
Freedom Summit Philippines will take place on March 30 and 31, at GroundUp Coworking in Paranaque City. SparkUp readers get a special 40 percent discount off of ticket prices by using the promo code: BUSINESSWORLD at checkout.
Senate sends 2019 budget to Duterte
By Camille A. Aguinaldo
Reporter
THE BICAMERAL DEADLOCK over this year’s P3.757-trillion national budget — which threatened to drag overall economic growth — ended on Tuesday as Senate President Vicente C. Sotto III announced that he has signed, with “reservations,” and transmitted the spending plan to Malacañang.
“We are informing that I already signed the budget… it is now going to be an enrolled bill; we sent it to the President but I placed my reservations on the signature. I have incorporated a note that says my signature is in reference to my attached annotation,” he told reporters in a press briefing at his Senate office.
His reservations — in a note attached to the measure — focused on post-ratification changes made by the House of Representatives.
Sought for comment, Socioeconomic Planning Secretary Ernesto M. Pernia replied in a mobile phone message: “It looks like the long delay did not result in a major change in the budget — which time could have been used by the President to consider needed revisions, e.g., for line budget item vetoes.”
“Meanwhile, Q1 growth rate already likely to be trimmed.”
The inter-agency Development Budget Coordination Committee the other week slashed its 2019 gross domestic product growth forecast to 6-7% from 7-8% originally as the government operates on a reenacted budget, while the National Economic and Development Authority — which Mr. Pernia heads as director-general — has estimated separately that operating on a reenacted budget until April would cut full-year growth to 6.1-6.3%.
The government had been banking on front-loading infrastructure work this quarter, ahead of the 45-day ban on public works ahead of the May 13 midterm elections and weather disturbances next semester. The reenacted national budget left new projects unfunded.
Mr. Sotto said the Senate has transmitted to Malacañang the version of the national budget with the changes made by the House of Representatives, leaving President Rodrigo R. Duterte to decide on the provisions questioned by senators.
Presidential Spokesperson Salvador S. Panelo said in a statement that Mr. Duterte would scrutinize the national budget before signing it.
“We assure our people that the President will go over the enrolled bill, scrutinize it and sign it should the same be in accordance with our Constitution and the laws,” Mr. Panelo said. “As we approach the midpoint of the Duterte administration, we remain determined to build on the significant gains that we have started in the first two-and-a-half years and continue to stay on the right track to deliver real and lasting change to our people.”
Asked by reporters if Mr. Duterte would the sign the national budget with the House’s questioned changes, Mr. Panelo said, “It would depend on him. If he feels it’s not in violation with the Constitution, he can sign it immediately.”
“Knowing the President, he will act on it immediately because we need a new budget… Maybe in a few days,” he added.
In his note attached to the national budget transmitted to Malacañang, Mr. Sotto said his signature on the measure was limited to the items approved by the Senate and House in the bicameral conference committee and subsequently ratified.
“In particular, it is my view that it is unconstitutional that P75 billion worth of programs/projects under the Local Infrastructure Program of the Department of Public Works and Highways was funded through internal realignments after the Bicameral Conference Committee Report was ratified,” the Senate leader stated in his note.
He said in his note that Mr. Duterte “may wish to consider disapproving” the questionable provisions by vetoing them.
It was the idea of the Senate Minority Leader Franklin M. Drilon for Mr. Sotto to sign the national budget and to attach his reservations, according to Senator Panfilo M. Lacson in the same briefing.
“What we have done is propose this language to the Senate President, Senator (Senate Majority Leader Juan Miguel F.) Zubiri, Senator Lacson, Senator (Loren B.) Legarda and (Senate President Pro Tempore Ralph G.) Recto in order that we maintain our position that these insertions are unconstitutional, but at the same time, not prejudice national interests by holding on to the unsigned General Appropriations Bill,” Mr. Drilon told reporters in the press briefing.
“We maintain the view that this is unconstitutional but we must find a solution to the impasse in the budget and serve the interest of the nation.”
Messrs. Lacson and Sotto added that they have notified the House and the Executive Department by relaying the information to San Juan City Rep. Ronaldo B. Zamora and to Executive Secretary Salvador C. Medialdea prior to the transmittal of the national budget to Malacañang.
Manila Water waives April bills’ minimum charge
By Victor V. Saulon
Sub-Editor
AYALA-LED Manila Water Co., Inc. will waive the water bill of its customers who were severely affected by the water shortage in March, while waiving the minimum charge of the rest of its customers for the month, in a move that its top official expects to cost at least P150 million.
“We are announcing a voluntary and one-time bill waiver scheme in March to be reflected in the April bill of customers,” said Ferdinand M. Dela Cruz, Manila Water president and chief executive officer, in a press conference at the utility’s head office in Quezon City on Tuesday.
He described the “most severely affected” or hardest hit customers as those without water for at least seven days — whether continuous or intermittent — from March 6 to 31. These customers will not be charged for their water consumption this month.
He said the minimum charge is for 10 cubic meters (cu.m.) covering water, environmental and sewer charges. The charge will be waived for the rest of the company’s customers in Metro Manila’s east concession zone. Consumption beyond 10 cu.m. will be billed.
“We understand the profound frustration that our customers have expressed in the past three weeks,” Mr. Dela Cruz said, as he again apologized to customers for the supply shortage that is beyond a typical service interruption.
He said the decision on the bill waiver was reached with inputs from the Metropolitan Waterworks and Sewerage System (MWSS) corporate and regulatory offices.
Mr. Dela Cruz said 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 households is P133.56 a month and for commercial customers, P606.84 a month.
The east concession zone has been experiencing a water supply deficit since March 6, although the shortfall has been brought down to 107 million liters per day (MLD) from 150 MLD at the height of the shortage.
The deficiency came about as water demand reached 1,750 MLD against a 1,600 MLD supply. A new water treatment plant failed to meet its target launch in late 2018 due to technical issues.
Mr. Dela Cruz said there are still “pockets, sitios or streets with intermittent no water situations resulting from operational adjustments and pressure management.”
He said that, as of March 25, the concessionaire’s eight- to 12-hour water availability that reaches the ground level of homes has reached 97%, or from a high of 61 severely affected barangays down to eight barangays.
“We continue to focus on our service recovery efforts,” Mr. Dela Cruz said.
By the end of the month, he expects the availability level to reach 99%, even as he said that he did not want to give “false expectations and false hopes and create more confusion.”
“We will continue to post the specific mechanics. By end of today we will finalize that. We will have to get the actual consumption by the end of March,” he said.
Mr. Dela Cruz said estimated losses from the scheme could reach around P150 million if confined to the waiver of the minimum charge. Loss estimate on the waived bill based on the actual consumption will be finalized by the end of the month.
“Hindi po siya maliit na amount dahil malaki rin ‘yung coverage nu’ng area, typically ito po ‘yung matataas na lugar, (It’s not a small amount because the coverage area is big, typically customers in elevated places),” he said.
MWSS Administrator Reynaldo V. Velasco, who jointly presided over the press conference with Manila Water, said the bill waiver program is applicable to the “extraordinary” situation at hand.
“We cannot ask for more because that is voluntary,” Mr. Velasco said, adding that there are penalties that can be imposed by the MWSS regulatory office apart from the waiver adopted by Manila Water.
“That one that is in the concession agreement is in the hands of the regulatory office.”
Sought for comment, Laban Konsyumer, Inc. (LKI) President Victorio Mario A. Dimagiba said the concessionaire’s move is “laudable” but would not satisfy all who were inconvenienced, including businesses that stopped operating because of the water shortage. “LKI appreciates that the apology is now accompanied by reparation or compensation by Manila Water. It could have been better if their waiver scheme is good till 24/7 service is restored,” he said.
Manila Water provides water and used water services to Mandaluyong, Pasig, San Juan, Marikina, Pateros, Taguig, Makati, southeastern part of Quezon City, as well as San Andres and Sta. Ana in Manila. It also serves towns of Rizal province, including San Mateo, Rodriguez, Antipolo, Cainta, Taytay, Angono, Binangonan, Baras and Jalajala.
Manila Water shares ended flat at P24.60 apiece on Tuesday.
Consortium for NAIA rehab gets end-April ultimatum
By Denise A. Valdez
Reporter
THE DEPARTMENT of Transportation (DoTr) may drop the proposal of a consortium made up of some of the country’s major conglomerates to take over Ninoy Aquino International Airport (NAIA) rehabilitation if it is unable to finalize its contract terms for the project by next month.
Transportation Secretary Arthur P. Tugade said in a media briefing on Tuesday that he wants a definite decision on the group’s proposal by end-April, as discussions on its concession terms have been under way since September last year.
“Doon sa NAIA, merong consortium of seven dyan kung saan tumatagal na ’yung usapan. Kaya sinabi ko, gusto ko na lagyan ng cap. Sabi ko by April 30, pag hindi pa tayo nagkasundo-sundo, gagawin na namin ’yung mga proyekto on the DoTr side. Kasi gusto ko mapabilis ’yung desisyon sa unsolicited proposal ng consortium (On the NAIA rehabilitation, there is a consortium of seven that has been taking long to firm up its proposal. So I wanted to put a cap to this. I told them that if we have not agreed on anything by April 30, the DoTr will do what it can on its own, because I want a quick decision on the consortium’s unsolicited proposal),” he said.
Asked to clarify what the DoTr will do with the proposal past Apr. 30, Mr. Tugade said, “Ang sasabihin ko, ayaw ko nang makipag-usap sa consortium of seven (I will say I don’t want to talk to the consortium anymore).”
The consortium formed by seven of the country’s top conglomerates bagged original proponent status (OPS) from the DoTr in September for its P102-billion proposal to rehabilitate and expand the country’s main air gateway. It is expected to increase the airport’s capacity from the current 30.5 million annual passengers to 47 million in two years and to 65 million in four years.
The seven companies are Aboitiz InfraCapital, Inc.; AC Infrastructure Holdings Corp.; Alliance Global Group, Inc.; Asia’s Emerging Dragon Corp.; Filinvest Development Corp.; JG Summit Holdings, Inc. and Metro Pacific Investments Corp.
After gaining headway through the OPS, the group proceeded to discuss with the DoTr the concession terms of the project, before it is submitted to the National Economic and Development Authority (NEDA) for evaluation.
The DoTr planned to do this by end-2018, but the two parties have yet to arrive at an agreement to date.
Sought for comment, NAIA consortium Spokesperson Jose Emmanuel “Jimbo” P. Reverente said in a mobile phone message on Tuesday only that the group will “comply with the stated deadline of Secretary Tugade.”
Asked for the specific points of contention between the private proponent and the DoTr, Mr. Tugade replied: “Kung ano ’yung mga improvements na ilalagay. Remember, meron silang tinatawag na (people mover) — ’yung mga ganyan. Eh bilisan na nila ’yun, isumite na nila sa amin ’yun. (Details of improvements that will be undertaken. Remember, they talked about a people mover — things like that. They should act faster because we want to submit this proposal to NEDA already).”
Mr. Tugade also aired the possibility of reviewing alternatives should the consortium’s proposal fall through. “May proseso ’yan eh, diba, na unsolicited. Pag pinagawa, pag hindi na-ano yung isa, i-entertain mo ‘yung pangalawa, kung gusto namin ‘yun (There’s a process for unsolicited proposals. If we ask for something, and the other one cannot do it, you entertain the second to see if we will like it),” he said.
Aside from the consortium, the tandem of Megawide Construction Corp. and Indian company GMR Infrastructure Ltd. — which is behind the Mactan-Cebu International Airport — also submitted last year a $3-billion proposal to rehabilitate NAIA. This was set aside to prioritize the consortium’s proposal, which was submitted earlier.
Meanwhile, the P735-billion Bulacan airport proposal of San Miguel Corp. unit San Miguel Holdings Corp. (SMHC) is expected to undergo Swiss challenge next month.
“Inaayos namin ’yung (We’re preparing the) terms of reference for the Swiss challenge. Pagka naayos na natin ito (Once we will have finalized it), hopefully within the next two weeks matatapos na itong negotiation na ito, ipa-publish na natin ito (we will finish negotiations and we will publish a call for other proposals),” Transportation Undersecretary for Aviation Manuel Antonio L. Tamayo said in the same briefing.
Under the Swiss challenge, the government will invite third parties to match the original proposal within a 60-day period.
Fintech group sets financial inclusion objectives
By Melissa Luz T. Lopez
Senior Reporter
A NEW INDUSTRY BODY has set goals for financial inclusion, as its members look to bring 25 million Filipinos aboard the formal financial system through the use of digital technology.
FintechAlliance.ph on Tuesday launched the Governor Nestor A. Espenilla, Jr. Institute for Growth towards National Inclusion, Transformation and Empowerment (IGNITE) which provides a private sector approach to get more adults to use banks and online financial services.
Financial technology (fintech) players attended yesterday’s Inclusion and Digital Transformation Summit and set goals for inclusion.
“Designed to promote inclusive businesses, IGNITE welcomes low-income segments of the population into the formal economy through this disruptive digital financial innovations,” said Lito M. Villanueva, chair of FintechAlliance.ph.
The body targets to include what it calls the “financial access-deficient segment” — or what used to be the “unbanked” — to get their own accounts and transact through formal platforms.
IGNITE targets to equip 25 million adult Filipinos with basic deposit accounts, which they will use for financial transactions. These refer to entry-level accounts that have no maintaining balances and dormancy fees, and can be used for transactions below P50,000.
The group is also looking to reduce the number of unbanked towns and provinces to 25% from 35% currently, as well as allow a fourth of cooperatives, rural banks and micro-finance firms to roll out inter-operable digital products and services.
The multi-stakeholder team is named after the late Mr. Espenilla, who passed away Feb. 23 after battling tongue cancer. He is best known for his Continuity Plus Plus agenda which put a premium on wider access to financial services.
These take off from the self-imposed goal of the Bangko Sentral ng Pilipinas (BSP) to bring 20% of all local payment transactions onto the digital space by 2020, coming from a one percent base back in 2013.
New BSP Governor Benjamin E. Diokno said he is keeping this target, which he inherited from Mr. Espenilla. “I fully support and will carry forward our financial inclusion agenda so that financial services are made more accessible to a great number of Filipinos,” Mr. Diokno said in his keynote speech.
Mr. Villanueva took his oath as president of IGNITE, while Mr. Espenilla’s wife, Ma. Teresita F. Espenilla, will serve as its chairperson. She is a microfinance specialist for the United States Agency for International Development.
Other members of the group’s board of trustees are Finance Undersecretary Gil S. Beltran, Trade Secretary Ramon M. Lopez, Budget Undesecretary Lilia C. Guillermo, CARD MRI founder and managing director Jaime Aristotle B. Alip, Senior Financial Sector Specialists Kelly Hattel of the Asian Development Bank and Gay Santos of the International Finance Corp., SunLife Financial Philippines Country Head and Chief Executive Officer Rizalina G. Mantaring, Microsoft National Technology Officer Richard Bon Moya, National Confederation of Cooperatives Chief Executive Officer Sylvia O. Paraguya, and Producers Savings Bank Corp. President Gilda E. Pico.
Digitizing payments and remittances is expected to lead to a “highly efficient” fund flow that, in turn, will help fuel economic growth, while making these services cheaper and more accessible.
LRWC to raise P4.4B from private placement
By Arra B. Francia, Reporter
LEISURE & Resorts World Corp. (LRWC) has approved the issuance of shares via private placement to several investors, which could bring in P4.38 billion in fresh capital.
In a disclosure to the stock exchange on Tuesday, the listed gaming firm said its board of directors has approved and authorized the issuance of 1.22 billion common shares out of its unissued capital stock.
The shares were priced at P3.60 each, representing a premium over the firm’s closing price of P3.30 on Nov. 29, 2018.
The shares were issued to six firms, namely Fortunegate Holdings Philippines, Inc., Millennium Pan Asia Business Management Services, Inc., XII Capital Inc., and Diamond Fortune Holdings, Inc. with 230 million shares each. Leisure Advantage, Inc. was issued 176.65 million shares, while Euphonious Holdings, Inc. was issued 121 million shares.
Fortunegate Holdings, Millennium Pan Asia, and Diamond Fortune also have interests in casino operations in the country and abroad.
LRWC will use the proceeds of the private placement to refinance existing debt and for general corporate purposes.
The company is currently planning a $550-million integrated resort in Boracay in partnership with Macau-based casino giant Galaxy Entertainment Group.
The 23-hectare project will also house a casino, although the company earlier said that the casino component will only cover 7.5% of its total floor area. This means that bulk of revenues from the project should come from the resort, which will have hotel rooms and other amenities such as wellness centers, bars, lounges, and fine-dining restaurants.
The project will target families and Galaxy’s database of clients across the region, as well as travelers and Chinese tourists in Boracay.
LRWC targets to open the Boracay resort by 2021.
Incorporated in 1957 originally as Atlas Fertilizer Corp., LRWC underwent a corporate restructuring program that changed its primary purpose to that of a real estate firm focused on the leisure segment.
Its subsidiaries include AB Leisure Exponents, Inc., which operates traditional, electronic, pulltabs, and rapid bingo games. It also has a 69.68% interest in First Cagayan Leisure & Resort Corp., which has license to develop, operate, and conduct internet and gaming enterprises in the Cagayan Special Economic Zone Free port.
LRWC’s net income attributable to the parent fell 27% to P266.04 million in the first nine months of 2018, amid a flat revenue growth at one percent to P7.42 billion in the same period.
Shares in LRWC jumped 3.20% or 12 centavos to close at P3.87 each at the stock exchange on Tuesday.
Avida breaks ground for Verge
AYALA LAND, Inc. (ALI) has started construction of its P7.4-billion residential condominium in Mandaluyong City, following the strong sales seen from its first project in the area.
In a statement posted on its website, the listed property developer said that its midrange brand, Avida Land Corp., has broken ground for Avida Towers Verge earlier this month. The three-tower project will stand along Reliance Street corner Mayflower Street, Mandaluyong City.
The first tower will consist of 34 floors housing a total of 1,020 residential units, ranging from junior one-bedroom and one-bedroom layouts. The units span 22-24 square meters (sq.m.) and 34-36 sq.m priced at P4.2-4.4 million and P6.7-7.7 million, respectively.
Avida Land is targeting young professionals working in Makati, Bonifacio Global City, and Ortigas for the Verge project.
Aside from residential units, Verge will also offer seven commercial units for lease.
Avida Land is currently turning over units for its first project in the area, Avida Towers Centera. The company said it has almost sold out all 2,526 residential units in the four-tower project,
“Most of them are end-users, of which 54% are 35 years old and below. They were from Mandaluyong and all over Metro Manila. The market is composed mainly of young working millennials looking for units closer to their places of work,” Avida Land Vice-President for Project and Strategic Management Group Apollo B. Tanco said in a statement.
Mr. Tanco noted that prices of Centera units have risen by 40% since its launch, commanding rates of P139,000 per sq.m. by the time it closed sales for the fourth tower.
“Mandaluyong is a prime real estate hotspot…While prices of condo units significantly rise in the area over time, it continues to be at a mid-level price range compared to other cities in the country,” Mr. Tanco said, citing a Colliers International study saying that Mandaluyong is the top condominium market in terms of unit take-up in the past two years.
The company has also leased out more than 70% of the 32 retail units located on the first and second floors.
ALI plans to launch P130 billion worth of projects this year, including two estates in Tarlac and Batangas. It has also committed to spend P130 billion in capital expenditures to support the rollout of residential, office, commercial, and retail developments this year.
The company will be issuing P8 billion in fixed rate bonds to finance its aggressive spending plan, in addition to bank debts and internally generated funds.
ALI’s net income climbed 16% to P29.2 billion in 2018, as revenues also surged 17% to P166.25 billion.
Shares in ALI jumped 1.48% or 65 centavos to close at P44.50 each at the stock exchange on Tuesday. — Arra B. Francia
Samsung likely to miss earnings expectations as chip prices slide
SEOUL — Samsung Electronics Co. Ltd. said on Tuesday first-quarter profit would likely miss market expectations due to falls in chip prices and slowing demand for display panels, in an unprecedented statement ahead of its earnings guidance.
The announcement came after the Apple, Inc. supplier and rival told shareholders last week that slack global economic growth and softer demand for memory chips, its core business, would weigh on operations in 2019. “The company expects the scope of price declines in main memory chip products to be larger than expected,” Samsung said in a regulatory filing preempting its earnings guidance due next week.
Samsung did not elaborate on the purpose of its filing. A company official confirmed the global leader in smartphones, televisions and computer chips had not previously provided comment before its official earnings estimate.
The firm was forecast to post a 7.2 trillion won ($6.4 billion) operating profit for the January-March period, according to Refinitiv SmartEstimate, more than 50% below the 15.6 trillion won recorded in the same period a year ago.
Its sales were expected to fall to 53.7 trillion won from 60.6 trillion won a year ago, Refinitiv shows.
“Inventories piling up on its memory chip side and the weak performance of its display panels business due to bad sales of Apple’s iPhones are hurting profitability for Samsung,” said Lee Won-sik, an analyst at Shinyoung Securities.
DRAM chip prices fell more than 20% on average in the first quarter, according to DRAMeXchange, a unit of Trendforce that traces memory chip prices.
Daiwa Securities forecast Samsung’s display panel division to swing to an operating loss of 620 billion won in the first quarter, while the semiconductor business’ operating profit would shrink.
RECOVERY TIPPED
Uncertainties over US-China trade tensions and China’s sluggish economy are clouding the outlook for global electronics makers, analysts say.
Chipmakers in particular have been hit hard by a glut in the global semiconductor industry triggered by weakening smartphone sales and falling investment from data center companies.
Samsung told shareholders at its annual general meeting last week that sales of memory products would likely revive in the second half of the year after a tough first half.
Investors also took heart when US chipmaker Micron Technology Inc forecast a recovery in the memory chip market around the middle of the year.
Daiwa Securities on Tuesday reaffirmed a buy rating on Samsung, saying it expected demand for memory chips and organic light-emitting diode (OLED) panels to improve from the second half of 2019.
Samsung Electronics shares were down 0.2% as of 0237 GMT while the broader market was 0.3% higher.
“Samsung is giving a signal to the market so that investors can be prepared and there will be no surprise when Samsung posts its first-quarter earning guidance next week,” said Park Jung-hoon, a fund manager at HDC Asset Management that owns Samsung Elec shares.
“Its shares are not reacting a lot, though, as concerns over its first quarter have been reflected.” — Reuters
ATN sees surging demand for rock aggregates
ATN Holdings, Inc. has partnered with AlphaRock Mining Corp. to double the volume of rock aggregates it produces, potentially generating P12 billion in revenues in the future.
In a disclosure to the stock exchange on Tuesday, the listed firm said its board of directors has issued the notice to proceed for a five-year contract with AlphaRock Mining worth P760 million. The contract involves the land development of ATN’s 256-hectare property in Montalban.
Under the contract, AlphaRock should deliver 2.4 million tons of rock aggregates per year in the next five years.
The partnership with AlphaRock Mining forms part of ATN’s plans to take advantage of the demand for rock aggregates due to the government’s infrastructure program.
“With the monstrous demand dwarfing Mega Manila rock aggregate supply chain, the company shall sign a 5-year contract in the amount of P760 million with AlphaRock Mining as the second development contractor, with contractual commitment for 12 million tons and double ATN production for the Build, Build, Build program,” the company said.
ATN cited the need for high-quality infra rock aggregates for two Japan official development assistance-funded infrastructure projects, namely the P356-billion Metro Manila subway project and the P149-billion North Rail project. If 10% of the allocated capital spending for these projects will be used for rock supply, ATN noted that they create a P50-billion demand for rock aggregate requirements.
“ATN received strong buyers’ interest for 10,000 truckloads of 3/4” & 3/8” aggregates urgently needed every month to construct Mega Manila tollways, subways, railways, flood control projects, elevated highways, power plants, sea ports, bridges, airports, 1,000 high-rise buildings, factories and land reclamation,” the company said.
The company currently has P240 billion worth of high quality rock reserves in its Montalban property. It also noted that its rock reserves offer the shortest distance to the ODA-funded projects at only 15 kilometers.
ATN’s target of P12 billion in revenues from the contract is based on an annual volume of 2.4 million tons per year priced at P1,000 per ton. It however noted that the production volume estimates may be affected by adverse weather conditions, a change in political climate, or the slowdown of the budget rollout for infrastructure projects.
The company booked a net loss of P645,699 in the nine months ending December 2018, even as gross revenues surged 71% to P16.83 billion in the same period.
Shares in ATN jumped 5% or seven centavos to close at P1.47 each at the stock exchange on Tuesday. — Arra B. Francia
Passenger information system to be installed in LRT, MRT
PHAR Philippines, Inc. and Trackmate Business Solutions, Inc. have teamed up to install a passenger information system called Tube in Metro Manila’s trains.
In a statement, PHAR and Trackmate said over 1,000 screens will be installed across the train system in Metro Manila.
The Tube system has already been installed in the Light Rail Transit Line 2 (LRT-2). For Metro Rail Transit Line 3 (MRT-3) and LRT Line 1, it will be installed by early April and July, respectively.
“With the system from Tube, an easier and more comfortable commute awaits LRT and MRT passengers as this new technology will keep them abreast with real-time information and other vital train service information apart from keeping them entertained. This improved technology works parallel with the mission of LRTA [Light Rail Transit Authority] to give Filipino commuters an enhanced mobility and world class transport system,” LRTA Administrator Reynaldo I. Berroya said in a statement.
Patented in the Philippines, Tube will provide commuters real time information on the next station, as well as when there is an emergency or disruption in operations. It also has a built-in closed-circuit television (CCTV) which will inform operators of the current situation inside the train.
Commuters will also be provided with news, weather reminders, traffic situation, and short videos from local creators.
PHAR is an international media and marketing firm that mainly caters to airlines, airports, transit systems, smart cities, and retail destinations. Trackmate Business Solutions is a global positioning system (GPS) provider and fleet management system developer in the Philippines. — Vincent Mariel P. Galang
Treasury makes full award of T-bonds
By Karl Angelo N. Vidal, Reporter
THE GOVERNMENT made a full award of reissued seven-year Treasury bonds (T-bond) on offer on Tuesday amid overwhelming demand as investors continued to park their funds in longer-dated securities.
The Bureau of the Treasury (BTr) raised P20 billion as planned from its T-bond offer yesterday after receiving bids totaling P73.685 billion, more than thrice the amount the Treasury wanted to offer.
The seven-year papers, which carry a coupon rate of 6.25%, fetched an average rate of 5.934%, 15.3 basis points lower than the 6.087% fetched when the debt papers were last offered on Feb. 12.
At the secondary market, the seven-year IOUs were quoted at 5.946%, based on the PHP Bloomberg Valuation Service Reference Rates.
After the auction, Deputy Treasurer Erwin D. Sta. Ana said the Treasury saw market preference towards longer tenors.
“Obviously, we see demand from the intermediate to long sections of the curve with this auction and it just shows that there’s still liquidity in the system (given that we saw) more than P73 billion in tenders,” Mr. Sta. Ana told reporters yesterday.
He added that market participants prefer to park their funds on the longer end of the curve, amid decelerating local inflation as well as the dovish stance of the US Federal Reserve (Fed).
On Friday, Bangko Sentral ng Pilipinas (BSP) Deputy Governor Diwa C. Guinigundo said the country appears to be “out of the woods” as far as inflation is concerned as he projects price increases to continue to slow this year.
“The downward trajectory will continue in 2019, but in 2020 it will be generally stable at around three percent,” Mr. Guinigundo had said. “It has stabilized, and the negative base effects shall have dissipated by maybe up to the third or fourth quarter of the year.”
The Monetary Board decided to keep the key policy interest rate unchanged at 4.75% on Thursday, remaining at a decade-high, as current settings remain “appropriate” even as inflation has eased further.
The central bank also scaled down its inflation forecast for the year to three percent, well within the 2-4% target band.
“As we have said before, contributors (for the strong demand on longer-dated bonds) would be the inflation path. The BSP has revised its inflation target for the year, and of course the dovish comments from the Fed, so naturally our GSEDs (government security eligible dealers) are behaving this way,” Mr. Sta. Ana said.
Last week, the US central bank said there will be no interest rate hikes this year amid an economic slowdown, a departure from its previous pronouncements that it will raise benchmark rates thrice this year.
Sought for comments, a bond trader said the auction result was well within the market expectation of an average rate of between 5.95% and 6.05%.
“Given the benign inflation and low inflationary expectations, there’s still demand for long tenors,” the trader said in a phone interview.
Meanwhile, DBS Group Research projects state-issued bonds to continue outperforming its Asian counterparts, with 10-year government bonds garnering the highest total return of 9.6%.
“In our view, RPGBs (Philippine government bonds) could continue to shine though the expected drivers of outperformance have likely shifted,” DBS Group Research Duncan Tan said in an e-mail. “New Bangko Sentral ng Pilipinas (BSP) Governor Benjamin Diokno is perceived to be more pro-growth and dovish than his predecessor.”
Apart from the central bank’s easing bias, Mr. Tan added that flows could also support the local bond’s performance.
“Externally, the global economic and monetary environment could be conducive to a pick-up in foreign demand. Against the backdrop of a mild global synchronized slowdown, Philippines’ more domestically-driven and high-growth (6-7%) economy puts it in a favorable light.”
The BTr is looking to borrow P360 billion during the first three months of this year through a mix of Treasury bonds and bills. The state also raised P235.935 billion from the sale of five-year retail Treasury bonds earlier this month, which are meant to support the state’s spending plans for 2019.