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Tuesday, December 02, 2003
Philippines
economic and corporate news summary QCR03
Philippine
central bank stays out of currency market as peso slightly firms
Shell
Philippine Exploration looks for partner for offshore Palawan drilling
Philippines
urges OPEC to consider welfare of oil importers in Vienna talks
Philippines'
First Gas Power may put up new plant if it fails to acquire Sucat
Philippines'
Lepanto plans to revive copper mining business
Philippines'
ICTSI sees sustained volume growth at Manila terminal
Philippine's
Meralco tariff hike not politically motivated - Arroyo spokesman
Manila
shares close firmer on stronger Wall St, regional markets, peso
Philippines'
M3 growth slows to 2.6 pct yr-on-yr in Oct from 3.4 in Sept
Matsushita
Electric Philippines says Panasonic to sell own products
Philippine
Ayala to issue redeemable preferred shares to pay loans due 2004
Control
of Philippines' Salcon Power transferred to two shareholders
Philippines'
PLDT resumes direct circuit service with Sprint, MCI
Philippines'
Ayala Corp declares 0.03 peso/share cash dividend
Philippines
customs Nov revenues 8.99 bln pesos vs 8.84 bln target
Philippines'
SPI expects PPM tender offer in late December or early January
Philippine
Stock Exchange lifts trading suspension on Atlas Consolidated
Philippine
govt plans to go to international debt market in January - report
Philippines'
acting finance chief vows to maintain fiscal discipline
Philippines'
Meralco files claim to recover excess income tax
INTERVIEW-Canada's
Sun Life Financial says to boost China life insurance ops
Philippines'
Digitel sees further operating losses in 2004
Forex
- Philippine peso closes stronger on strong dollar inflows
Monday, December 01, 2003
Philippines'
Meralco says rate hike to boost annual revenue by 1.9 bln pesos
Philippines
economic and corporate news summary PZQ78
Philippines'
Napocor plans 250 mln usd bond issue in Q1 2004 - source
Manila
shares close higher on technical bounce; Meralco gains
Philippines
may be better off importing rice - IRRI economist
Matsushita
Electric Philippines will not sell Panasonic products from April 1
Forex
- Philippine peso firmer on strong dollar inflows, technical correction
Manila
shares up late morning on technical bounce; Meralco gains boost index
STOCKWATCH
- Philippine Meralco shares up early on rate hike approval
Philippine
Philex Oct copper/gold/silver output gross value 285.40 mln pesos
STOCK
ALERT - Philippines' Petron firmer after winning fuel supply contracts
Philippine
ERC approves Meralco's 0.12 pesos/kwh tariff hike
Philippines'
PLDT announces cash dividends on preferred stocks
Philippine
central bank likely to keep policy rates steady for rest of year
| Philippines economic and corporate news summary QCR03 |
BEIJING (AFX-ASIA) - A summary of Philippine economic and corporate news at 1000 GMT -Philippines customs Nov revenues 8.99 bln pesos vs 8.84 bln target -M3 growth slows to 2.6 pct yr-on-yr in Oct from 3.4 in Sept -Philippine central bank stays out of currency market as peso slightly firms -Philippines urges OPEC to consider welfare of oil importers in Vienna talks -Philippines' acting finance chief vows to maintain fiscal discipline -Meralco tariff hike not politically motivated - Arroyo spokesman -Shell Philippine Exploration looks for partner for offshore Palawan drilling -Ayala Corp to pay maturing loans in 2004 with preferred share issue proceeds -Ayala Corp to issue 1.5 bln pesos redeemable preferred shares -Ayala Corp declares 0.03 peso/share cash dividend -Matsushita Electric Philippines says Panasonic to sell own products -PLDT resumes direct circuit service with Sprint, MCI -SPI expects PPM tender offer in late December or early January -Control of Philippines' Salcon Power transferred to two shareholders -First Gas Power may put up new plant if it fails to acquire Sucat -ICTSI sees sustained volume growth at Manila terminal -Lepanto plans to revive copper mining business xiaojing.jiang@xfn.com |
| Philippine central bank stays out of currency market as peso slightly firms |
MANILA (AFX-ASIA) - The central bank said it did not intervene in the currency market today, as the peso re-gained more ground against the US dollar. At the Philippine Dealing System, the peso closed at 55.49 to the dollar after trading in a range of 55.45-55.55 on volume of 166.0 mln usd. It closed at 55.52 yesterday. "We did not intervene. There's no need to," central bank governor Rafael Buenaventura told reporters. The central bank expects the peso to enjoy a strong boost this month after falling to a record low of 55.85 on Thursday (Nov 27) due to pre-election political jitters, supported by remittances of Filipino workers abroad, which normally peak as the Christmas holidays draw near. edelacruz@afxasia.com |
| Shell Philippine Exploration looks for partner for offshore Palawan drilling |
MANILA (AFX-ASIA) - Shell Petroleum Exploration BV (Spex) said it is considering getting a strategic partner for a drilling project in offshore Palawan. Spex managing director Jeremy Cliff said they may farm out a portion of their Geophysical Service Exploration Contract (GSEC) 99, which allows them to drill the area. "We are willing to find a potential partner. We plan to make GSEC 99 another Malampaya-type (of operation)," he said. Spex is the major operator of the 4.5-bln usd Malampaya deep water gas-to-power project in northwest Palawan. The Malampaya gas is now being used to run power plants supplying the electricity requirements of metropolitan Manila and nearby provinces. Cliff said Spex plans to drill a well in GSEC 99 within the next 18 months but wants to bring in a partner first to finance a portion of the project, which is estimated to cost about 15.0-20.0 mln usd. afxmanila@afxasia.com |
| Philippines urges OPEC to consider welfare of oil importers in Vienna talks |
MANILA (AFX-ASIA) - Energy Secretary Vincent Perez has urged the Organization of Petroleum Exporting Countries (OPEC) to carefully consider the impact on oil importing countries, such as the Philippines, of any decision involving world oil production levels when it meets in Vienna on Thursday. He warned that any further production cut will likely derail economic growth, particularly for those highly dependent on imported oil such as the Philippines. "Any downward adjustment in world oil production will seriously exert pressure in an already volatile market," Perez said in a statement. "World oil prices have risen in the last three months (since) OPEC in its September meeting decided to reduce production. Any further (production cut) will imperil the sustained growth of world economies, particularly those of oil importing countries such as the Philippines." The energy department said OPEC ministers will meet to assess its decision to set world oil production quota at only 24.5 mln barrels per day (bpd) to meet its desired 22.0-28.0 usd per barrel price band. The Philippines imports about 269.8 thousand bpd of crude and another 94. 6 thousand bpd of refined oil. edelacruz@afxasia.com |
| Philippines' First Gas Power may put up new plant if it fails to acquire Sucat |
MANILA (AFX-ASIA) - First Gas Power Corp, a unit of First Philippine Holdings Corp, may consider putting up a new power plant if it fails to acquire the National Power Corp's 600-megawatt Sucat facility in Manila, company vice chairman Peter Garrucho said. "Acquiring Sucat is just one of the options we are looking at. We can start a greenfield," he said. First Gas has expressed its intention of bidding for the Sucat plant, which would be the principal user of natural gas transmitted via a planned 100-kilometer pipeline between Batangas and Manila. "We need to see the anchor load in place before making any decision on the pipeline," Garrucho said. First Gas currently operates the 1,000-MW Santa Rita and 500-MW San Lorenzo plants, which are both running on Malampaya natural gas from Palawan. afxmanila@afxasia.com |
| Philippines' Lepanto plans to revive copper mining business |
MANILA (AFX-ASIA) - Lepanto Consolidated Mining Co said it plans to revive its copper mining business, encouraged by improving world copper prices. The company, which is also into exploration and mining of gold, silver, lead, zinc, ores, metals, minerals, oil, gas and coal, estimates that there are still about five mln tons of copper reserves at its Benguet minesite in the northern Philippines. Lepanto chairman Felipe Yap, however, said the company will have to resume drilling first at the site before copper production can start as the place has been shut since 1997. "We want to revisit our copper mining, but to do this, we have to do one more year of drilling," he told reporters. "We need to spend about 4 to 5 mln usd for the re-drilling." He said the company will try to do more drilling next year. (1 usd = 55.50 pesos) afxmanila@afxasia.com |
| Philippines' ICTSI sees sustained volume growth at Manila terminal |
MANILA (AFX-ASIA) - Port operator International Container Terminal Services Inc (ICTSI) said it expects to sustain volume growth at the Manila International Container Terminal (MICT), where it recently serviced its one-millionth container for the year. It marks the second time in ICTSI's history that the MICT hit the one million mark in a year. The first time was on Dec 18 last year. "We remain enthusiastic that volumes at the MICT will be sustained, if not, increase every year," ICTSI senior vice president and MICT general manager Francis Andrews said. MICT handled 823,909 TEUs (20-foot equivalent units) in the nine months to September, up about 8 pct from 764,791 TEUs in the year-earlier period. "Terminal activities are getting brisker," Andrews said. ICTSI booked a net profit of 98.0 mln pesos in the third quarter to September, down from 137 mln a year ago due to higher interest charges on additional long-term borrowings. In the nine months to September, ICTSI said net profit was substantially lower at 320.0 mln pesos, versus the year-earlier's 3.6 bln pesos, which included an extraordinary gain from the sale of a subsidiary. (1 usd = 55.50 pesos) edelacruz@afxasia.com |
| Philippine's Meralco tariff hike not politically motivated - Arroyo spokesman |
MANILA (AFX-ASIA) - President Gloria Arroyo has not cut any deals with the Lopez group, major shareholder of Manila Electric Co (Meralco), spokesman Ignacio Bunye said in response to comments that Meralco's recent rate hike could be part of an agreement to support Arroyo's bid in the May polls. The Energy Regulatory Commission (ERC) has allowed Meralco to raise its tariff by 0.12 pesos per kilowatthour effective Jan 1. "First of all, the President does not make any deals. Secondly, the President will always take into account the (people's) welfare," he said at a news briefing. Although Arroyo is unhappy with the ERC decision, the presidential palace is not considering to make an appeal against the tariff hike. The Lopez group controls more than 20 pct of Meralco, but the government also owns a substantial stake. The Lopez group also controls ABS-CBN Broadcasting Corp. In a telephone interview with AFX-Asia yesterday, ERC chairman Manuel Sanchez himself ruled out any political pressure behind the latest tariff hike for the country's biggest power distributor. The latest rate hike was the second since May, when the ERC approved a 0. 0865 pesos per kWh increase in Meralco's distribution rate through the unbundling of power charges. Meralco expects the additional tariff increase to boost its revenues by 1. 9 bln pesos annually, and help it undertake projects to improve its service and pay maturing loans. Meralco retails electricity to metropolitan Manila and nearby provinces. (1 usd = 55.50 pesos) edelacruz@afxasia.com |
| Manila shares close firmer on stronger Wall St, regional markets, peso |
MANILA (AFX-ASIA) - Share prices closed higher on sustained bargain-hunting, encouraged by gains on Wall Street and in the regional markets, as well as the peso's further recovery from a record low against the US dollar last week, dealers said. They said the market could be entering a period leading to a traditional year-end rally, although political concerns remain with presidential elections due next year and that may limit gains. The composite index closed up 15.57 points or 1.18 pct at 1,336.83 on volume of 254.28 mln shares valued at 695.16 mln pesos. It moved between 1, 324.98 and 1,341.86. In the broader market, gainers led losers 28 to 19 while 38 stocks were unchanged. At the Philippine Dealing System, the peso averaged 55.492 to the dollar by noon on volume of 116.5 mln usd. It closed at 55.52 yesterday, sustaining its recovery from a record low of 55.85 that was touched on Thursday, amid political jitters and on a potential sovereign ratings downgrade by Moody's Investors Service. The central bank expects the peso to get a strong boost this month mainly from foreign exchange remittances from Filipino workers abroad, which normally peak during the Christmas holidays. "After having reached oversold level even before it absorbed recent negative news, the market staged a technical recovery. Although political concerns are still there, the market reacted positively to the gains in the US market as well as in the regional markets," Summit Securities president Harry Liu said. He said the peso's recovery also helped to lift sentiment, which was undermined recently, especially after popular movie actor Fernando Poe Jr announced his bid in the May presidential elections. Analysts warn that Poe's mass appeal, notwithstanding his lack of experience in public office, could help him beat expected candidates such as President Gloria Arroyo, Senator Panfilo Lacson, and perennial survey topnotcher Raul Roco. Top-traded Philippine Long Distance Telephone was up 30 at 805 pesos on 166,810 shares following a 0.22 usd gain in its New York-listed American Depositary Receipts last night to 13.99. Ayala Land was up 0.10 at 5.50 on 24.25 mln shares. Manila Electric B, available to foreign investors, was up 0.75 at 23.50 on 3.7 mln shares, while Meralco A rose 0.25 to 15 on 1.1 mln shares. The stock sustained its upside triggered by the Energy Regulatory Commission's provisional approval of a 0.12 pesos per kilowatthour rate increase for Meralco effective Jan 1, 2004. Meralco expects the tariff hike to boost its earnings by 1.9 bln pesos annually. The country's largest power distributor is also seeking to recover what it claims to be "excess" income tax arising from its ongoing refund of overcharges amounting to as much as 30.5 bln pesos. Globe Telecom was up 20 at 740. SM Prime continued to buck the trend, down by a further 0.10 at its support level of 6.30 on 3.2 mln shares. Ayala Corp was up 0.10 at 4.90 after declaring a 0.03 peso per share cash dividend and announcing its plan to issue 1.5 bln pesos worth of redeemable preferred shares to raise funds to refinance loans falling due in 2004. The all-shares index closed up 3.82 points at 847.51. The commercial-industrial index was up 36.99 at 2,011.23. Property was up 0.21 at 540.56, mining up 15.39 at 1,636.20, and oil up 0. 06 at 1.39. Banking and financial services gained 0.22 to 418.76. edelacruz@afxasia.com |
| Philippines' M3 growth slows to 2.6 pct yr-on-yr in Oct from 3.4 in Sept |
MANILA (AFX-ASIA) - The country's M3 money supply growth slowed to 2.6 pct year-on-year to 1.64 trln pesos as of end-Oct, from 3.4 pct growth in the previous month, the central bank said. The central bank said it was due to slowing growth in credit to both the public and private sectors. Net foreign assets also grew at a slower rate of 17.4 pct year-on-year, after expanding by 18.1 pct in September, the central bank said in a statement, citing preliminary figures. Credits to the public sector grew 10.8 pct year-on-year in October, slower than the 18.7 pct rise in the previous month. Credits to the private sector increased by 2.4 pct year-on-year, compared to 2.6 pct growth year-on-year in September. The central bank, however, said it expects the broad indicators of economic activity to encourage stronger domestic demand going forward, which would accelerate M3 growth. It cited a better-than-expected 4.4 pct year-on-year expansion in GDP in the third quarter, a 5.1-pct year-on-year increase in sales of Manila Electric Co in September, and hefty 81.9 pct year-on-year growth in passenger car sales in October. (1 usd = 55.50 pesos) edelacruz@afxasia.com |
| Matsushita Electric Philippines says Panasonic to sell own products |
MANILA (AFX-ASIA) - Matsushita Electric Philippines Corp (MEP) said Panasonic Industrial Asia PTE Ltd will take over the sale and distribution of Panasonic indutrial products in the Philippines from MEP's industrial division. MEP said Panasonic Industrial is now in the process of securing a permit from the government to set up a branch office in the Philippines. Yesterday, MEP said it will no longer sell Panasonic products in the Philippines from April 1, 2004. Its unit Panasonic Industrial Sales Philippines, which handles its local Panasonic distribution business, will operate only until March 31. It gave no reason for its decision. edelacruz@afxasia.com |
| Philippine Ayala to issue redeemable preferred shares to pay loans due 2004 |
MANILA (AFX-ASIA) - Conglomerate Ayala Corp said it will issue redeemable preferred shares worth up to 1.5 bln pesos to raise funds to refinance loans maturing next year. The issue will have a five-year maturity and par value of 1.00 peso per share while the price is pegged at 5.00 pesos per share. The dividend rate is a fixed rate based on five-year Mart 1, with the shares redeemable in full via cash payment of 100 pct of issue price at the end of the fifth year from issue date. MART 1 is the benchmark rate for buying and selling government securities in the secondary market. MART stands for the Money Market Association of the Philippines. The shares are not convertible to common shares, are non-voting and with no preemptive rights, Ayala Corp said. Ayala Corp has interests in banking, telecommunications, electronics, water supply, and property development. It told the stock exchange that its board of directors approved the preferred share issue at yesterday's regular meeting, together with the declaration of a regular cash dividend of 0.03 pesos per share. (1 usd = 55.48 pesos) edelacruz@afxasia.com |
| Control of Philippines' Salcon Power transferred to two shareholders |
MANILA (AFX-ASIA) - Salcon Power Corp said two of its shareholders, JAD Holdings Inc and Intrepid Holdings Inc, have taken control of the power producer by acquiring an additional 1.428 mln shares each. "The said number of shares translates to a corresponding 18.82 pct equity and consequent effective control (of Salcon Power) in favor of JAD Holdings and Intrepid Holdings," Salcon told the stock exchange. JAD Holdings and Intrepid Holdings now have the right to vote for a total of 281.28 mln shares each in Salcon Power. No other details were available. At 10 am, Salcon Power was up 0.02 peso at 2.04. (1 usd = 55.50 pesos) edelacruz@afxasia.com |
| Philippines' PLDT resumes direct circuit service with Sprint, MCI |
MANILA (AFX-ASIA) - Philippine Long Distance Telephone Co (PLDT) said it has resumed its direct circuit telecommunications service with US-based Sprint Communications, allowing the transmission of voice traffic to and from the circuits of both carriers. PLDT told the stock exchange it has also reached an interim agreement covering termination rates with MCI "In view of this agreement, PLDT is now awaiting the lifting of the US FCC's (Federal Communications Commission) payment suspension order in favor of PLDT," PLDT said. The Philippines' dominant carrier said it has yet to conclude an agreement on termination rates with AT&T. PLDT made the disclosure to confirm recent newspaper reports it has unblocked calls from both Sprint and MCI. The FCC earlier ordered US carriers to suspend payments to local carriers for processed inbound calls from the US. The decision was based on claims that PLDT and other local telcos were blocking calls from two US carriers to force them to pay higher termination fees. edelacruz@afxasia.com |
| Philippines' Ayala Corp declares 0.03 peso/share cash dividend |
MANILA (AFX-ASIA) - Ayala Corp said it will pay a 0.03 peso per share cash dividend to shareholders on record as of Dec 19. Payment is set for Jan 21. Ayala Corp has interests in banking, telecommunications, electronics, water supply, and property development. (1 usd = 55.50 pesos) edelacruz@afxasia.com |
| Philippines customs Nov revenues 8.99 bln pesos vs 8.84 bln target |
MANILA (AFX-ASIA) - Customs revenues in November reached 8.99 bln pesos, exceeding the government target of 8.84 bln, Bureau of Customs commissioner Antonio Bernardo said, citing preliminary figures. From January to November, customs collections totalled 96.44 bln pesos, versus the target of 91.93 bln. (1 usd = 55.52 pesos) edelacruz@afxasia.com |
| Philippines' SPI expects PPM tender offer in late December or early January |
MANILA (AFX-ASIA) - SPI Technologies Inc said it expects PPM Ventures Ltd to launch a tender offer for all the issued and to be issued share capital of the database services provider later this month or early January. PPM Ventures, which is owned by Prudential plc, one of the UK's largest institutional investors managing over 2.0 bln euro, was expected to launch a tender offer at the previously indicated price of about 84.0 mln usd. SPI's majority shareholders earlier agreed to sell their holdings to PPM Ventures, an international company providing private equity finance and specializing in medium and large buy-outs and institutional purchases. "Discussions between SPI and PPMV are still ongoing and it is now anticipated that the proposed tender offer will be launched sometime in the latter part of December or the early part of Jan 2004," SPI told the stock exchange. edelacruz@afxasia.com |
| Philippine Stock Exchange lifts trading suspension on Atlas Consolidated |
MANILA (AFX-ASIA) - The Philippine Stock Exchange said the trading suspension on shares of Atlas Consolidated Mining & Development Corp shall be lifted today after the company finally submitted copies of its 2002 annual report. The stock last closed at 0.90 pesos. (1 usd = 55.52 pesos) edelacruz@afxasia.com |
| Philippine govt plans to go to international debt market in January - report |
MANILA (AFX-ASIA) - The government is considering going to the international debt market again in Jan 2004 to fully cover its 1.8 bln usd financing requirement for next year, the Philippine Daily Inquirer reported. The report quoted acting Finance Secretary Juanita Amatong as saying: "We could take advantage of the market and borrow at a favorable rate. The spreads remain good so we are closely watching the market." Yesterday, an official of the state-owned National Power Corp (Napocor) said the company plans a 250 mln usd bond issue in the first quarter of 2004 to partly cover its next year's funding requirements. The official said the Power Sector Assets and Liabilities Management Corp, or PSALM, is holding talks with ING Barings, which may arrange the deal. PSALM was created by the government to absorb the assets that Napocor will soon privatize. Napocor reportedly needs 1.2 bln usd to finance its operations and pay loans in 2004. The government recently raised 1.05 bln usd via the re-opening global bond issues due 2014, for an additional amount of 750 mln usd, and 2025 for 300 mln usd. That borrowing was intended to complete its funding requirement this year and pre-fund some of its 2004 requirement. (1 usd = 55.52 pesos) edelacruz@afxasia.com |
| Philippines' acting finance chief vows to maintain fiscal discipline |
MANILA (AFX-ASIA) - Acting Finance Secretary Juanita Amatong said the government will maintain its fiscal discipline as she takes over the Department of Finance. "We will not veer away from fiscal discipline. We are committed to work to raise revenues through improved administrative measures," she said yesterday, her first day as finance chief. President Gloria Arroyo appointed her after her predecessor, Jose Isidro Camacho, decided to resign. Camacho has been praised for ensuring that the government observes fiscal discipline in the past few months. The October fiscal figures showed the budget deficit at 21.17 bln pesos, lower than the ceiling of 22.33 bln, thanks to higher revenue collection during the month. In the 10 months to October, the deficit reached 163.88 bln pesos, below the ceiling of 171.88 bln. The government thus remains confident that it would be able to contain this year's budget deficit within its full-year target of 202.00 bln pesos. The Philippine Daily Inquirer, meanwhile, reported that the government may have stayed under its 18 bln peso budget deficit ceiling in November as revenues and expenditures appeared to be on target. The report quoted Bureau of Customs commissioner Antonio Bernardo as saying that the agency likely met its 8.84 bln peso collection target in November. Bureau of Internal Revenue commissioner Guillermo Parayno, meanwhile, pins his hopes for increased collections in November on an agreement with banks for voluntary payment of back gross receipts taxes. The agency has set a 41 bln peso collection target for November. (1 usd = 55.52 pesos) edelacruz@afxasia.com |
| Philippines' Meralco files claim to recover excess income tax |
MANILA (AFX-ASIA) - Manila Electric Co said it has filed its claim to recover excess income tax arising from the company's ongoing refund of overcharges amounting to as much as 30.5 bln pesos. The company did not provide other details in its disclosure to the stock exchange, except to say that the claim was filed on November 27. Meralco, in a previous disclosure, said it overpaid the Bureau of Internal Revenue "more or less 9.0 bln pesos" in income tax. Meralco said the refund of overcharges effectively wiped out the company's net profits from 1994 to May 2003, when excess charges were collected from customers. As such, tax payments the company made during that period should also be returned, the company said. The Supreme Court early this year ordered Meralco to refund customers it has overcharged since 1994 after the court favored the decision of the Energy Regulatory Board, which prohibited Meralco's practice of charging income tax as part of its operating expenses. (1 usd = 55.52 pesos) cecille.yap@afxasia.com |
| INTERVIEW-Canada's Sun Life Financial says to boost China life insurance ops |
---- by Jill Wong ---- HONG KONG (AFX-ASIA) - Sun Life Financial Services of Canada Inc says China's life insurance market offers huge opportunities due to rising incomes and opening up of more cities to foreign insurers following the country's entry into the World Trade Organisation. Sun Life Financial, which recently opened an office in Beijing, says it is already looking to expand to other Chinese cities. "The opportunities in China are huge. The market is under-penetrated and there's growth in various spectrums, like the emerging middle class and higher income groups," Douglas Henck, president of Sun Life Financial Asia, told AFX-Asia. "We're now working on which other cities we're going into," he added. Sun Life's first entered China in April 2002 through a joint-venture in the northern city of Tianjn with the China Everbright group. The latter remains its joint-venture partner for the Beijing operation. "We went into Tianjin first because we were the first foreign investor in northern China. The growth potential in Tianjin is not as high as in Shanghai or Guangzhou," he added. Henck said China is a growing pie where returns will outweigh the pressures from growing competition from both domestic and foreign players. "For first-time investors, not having a joint venture partner may be easier, but we're quite comfortable with our partner," Henck added. Henck said Sun Life Financial is the fourth largest player in the Tianjin market. In Hong Kong, the company has a one pct market share of the territory's life insurance business, with most of the growth coming from investment-linked products in the last 2-3 years. Under WTO rules, foreign insurers can enter China through setting up 50-50 joint venture with a Chinese partner. However, foreign insurers are currently only allowed to sell policies to individuals, and not on a group level. But that restriction is set to be eased next year, boosting the market's potential. By end-2004, foreign insurers will be able to provide insurance on a group level to both foreigners and Chinese. Geographic restrictions for foreign insurers will also be lifted by end-2004. Currently, foreign insurers are allowed to operate in some 15 cities. Sun Life Insurance is one of the largest Canadian life insurers with 348. 5 bln canadian dollars under management. Its key markets also include the US, United Kingdom and other countries in Asia. (1 usd = 1.3 canadian dollar) jill.wong@afxasia.com |
| Philippines' Digitel sees further operating losses in 2004 |
MANILA (AFX-ASIA) - Digital Telecommunications Philippines Inc (Digitel), the operator of the Sun Cellular mobile phone brand, expects to post further operating losses in 2004 since the company will have to spend more on the launch and marketing of its wireless brand. Sun Cellular has been competing in the highly-profitable domestic wireless business since early this year. Digitel president and chief executive officer Lance Gokongwei, however, told reporters that the company will likely breakeven in terms of earnings before interest, tax, depreciation and amortization (EBITDA), an indicator of cash flow, by early 2005. He gave no figures though. "Next year, we continue to expect an operating loss, moving toward an EBITDA breakeven proposition for our wireless business beginning 2005," he said. Digitel booked a net loss of 722.8 mln pesos in the first nine months of 2003 after posting a net profit of 18.9 mln in the same period a year ago, as revenues from the fixed-line business fell while its spending, mostly related to the launch and marketing of its wireless brand, increased. Gokongwei said Digitel is considering spending 250.0 mln usd on the maintenance and expansion of its wireless business, and about 10.0-12.0 mln usd on the fixed-line segment in 2004. Digitel expects to grow its wireless subscriber base to 800,000 by the end of the year, after having signed up about 660,000 subscribers as of end-October. It is hoping to gradually increase the subscriber base of its Sun Cellular to around 1.5 to 2.0 mln by end-2004. (1 usd = 55.52 pesos) afxmanila@afxasia.comn |
| Forex - Philippine peso closes stronger on strong dollar inflows |
MANILA (AFX-ASIA) - The peso rallied from last week's sharp fall to close stronger against the US dollar, on the back of huge influx of dollars from overseas Filipino workers (OFW) and banks, dealers said. The recovery also followed President Gloria Arroyo's stern warning to foreign exchange speculators not to manipulate the peso, stressing the central bank has the tools to defend the unit. The peso today closed at 55.520 after trading between 55.47-55.72 on volume of 156.40 mln usd. It ended at a record closing low of 55.73 Friday, after hitting an all-time low of 55.85 on Thursday. "Basically, it's the OFW remittances that are boosting the peso. But as soon as these remittances begin to dry up, we expect the currency to come under pressure anew," a local bank dealer said. Traditionally, dollar inflows peak during the first two weeks of December in the run-up to the Christmas holidays. During this period, corporates will also start hedging their requirements for the following year, dealers said. Dealers doubt whether the recovery will allow the peso to recover to the 54.00 level, even with the stronger inflows, given lingering domestic concerns ahead of the 2004 presidential election. Late last week, the peso touched a record low of 55.85 to the US dollar on political and economic uncertainties, including a possible ratings downgrade from Moody's Investor Service and the presidential bid of movie star Fernando Poe Jr. Dealers said they expect the peso to trade within a wide range of 55. 40-55.70 in the coming sessions, with the bias on the local currency strengthening. cecille.yap@afxasia.com |
| Philippines' Meralco says rate hike to boost annual revenue by 1.9 bln pesos |
MANILA (AFX-ASIA) - Manila Electric Co expects its tariff hike to boost revenue by 1.9 bln pesos annually, Meralco chief finance officer Daniel Tagaza said after the company got a provisional authority from the Energy Regulatory Commission (ERC) to raise its tariff by 0.12 pesos per kilowatthour. The rate hike, the second for Meralco in about six months, will take effect Jan 1, 2004 and will help it raise funds for various capital expenditures programmed for next year. Meralco president Jesus Francisco told reporters that with the additional cash flow from the rate hike, the company has decided to increase its capex budget for 2004 to 6.5 bln pesos from the original plan of 5.5 bln. The latest rate hike came about seven weeks after Meralco filed its petition for a 0.1358 pesos per kwh rate increase. Meralco had sought a provisional approval for the rate increase in order to tackle cash flow pressure arising from the need to operate and maintain its electricity network, undertake capital projects, service maturing loans and refund customers for overbillings. The power firm is currently refunding overcharges dating back to 1994, which it expects to cost more than 30 bln pesos. (1 usd = 55.60 pesos) afxmanila@afxasia.com |
| Philippines economic and corporate news summary PZQ78 |
BEIJING (AFX-ASIA) - A summary of Philippine economic and corporate news at 0500 GMT -Philippine govt 10 mths interest savings 9.9 bln pesos vs 7 bln at end-Sept -Philippine central bank likely to keep policy rates steady for rest of year -ERC approves Meralco's 0.12 pesos/kwh tariff hike -ERC chief rules out political pressure in latest Meralco rate hike -ERC chief says rate hike to help Meralco undertake projects -Philex Oct copper/gold/silver output gross value 285.40 mln pesos -Digitel plans 260 mln usd capex for 2004 -Matsushita Electric Philippines will not sell Panasonic products from April 1 -PLDT announces cash dividends on preferred stocks xiaojing.jiang@xfn.com |
| Philippines' Napocor plans 250 mln usd bond issue in Q1 2004 - source |
MANILA (AFX-ASIA) - State-owned National Power Corp (Napocor) plans a 250 mln usd bond issue in the first quarter of 2004 to partly cover its next year's funding requirements, a company source said. The official said the Power Sector Assets and Liabilities Management Corp, or PSALM, is holding talks with ING Barings, which may arrange the deal. No other details were available. There have been market talk that PSALM has sought fresh terms for Napocor's borrowings from interested investment banks. PSALM was created by the government to absorb the assets that Napocor will soon privatize. The national government recently raised 750 mln usd for Napocor through the issue of 10.5-year global bonds to partly cover its 1.2-bln usd financing requirement for this year. For 2004, Napocor reportedly needs another 1.2 bln usd to finance its operations and pay loans. The disclosure of the company's borrowing plan follows last week's statement by Moody's Investors Service of a possible downgrade of its Philippine sovereign ratings due to heightened political uncertainties in the run-up to the May elections. Former finance secretary Jose Isidro Camacho, whose resignation from President Arroyo's Cabinet took effect yesterday, had shrugged off Moody's warning, saying the agency is just aligning its ratings with those of Standard & Poor's Ratings Services and Fitch Ratings. (1 usd = 55.60 pesos) edelacruz@afxasia.com |
| Manila shares close higher on technical bounce; Meralco gains |
MANILA (AFX-ASIA) - Share prices closed higher as select stocks staged a technical bounce following recent declines, dealers said. Sentiment improved due to the peso's recovery after touching an all-time low of 55.850 to the US dollar on Thursday, they added. Gains in shares of Manila Electric Co and its parent First Philippine Holdings, which followed the provisional approval by the Energy Regulatory Commission (ERC) of a 0.12 pesos per kilowatthour tariff increase for Meralco effective January 1, also gave the market a boost. The composite index closed up 7.39 points, or 0.56 pct, at 1,321.26 on volume of 190.28 mln shares valued at 643.4 mln pesos. It moved between 1,314. 43 and 1,329.60. In the broader market, gainers led losers 27 to 17, while 40 stocks were unchanged. At the Philippine Dealing System, the peso averaged 55.608 to the dollar by noon on volume of 108.40 mln usd. It finished at a record closing low of 55.730 on Friday. Despite the market's positive start for the week, dealers said the sustainability of the gains remains uncertain as investors will continue to factor in political uncertainties in the run-up to the May presidential elections. "The market staged a technical rebound, helped by positive developments such as the peso's recovery against the dollar," DA Market Securities president Nestor Aguila said. "Meralco's rate hike approval also helped to lift the key index." Top-traded Meralco B, open to foreigners, was up 1.00 peso at 22.75 on 5. 78 mln shares while Meralco A was up 0.75 at 14.75 on 759,700 shares. First Philippine Holdings was up 0.75 at 18.75 on 1.51 mln shares. ERC chairman Manuel Sanchez said the provisional tariff increase should help Meralco undertake projects that will improve its service delivery, and help assure foreign investors of a fair return on their investments in the Philippines. Meralco supplies electricity to metropolitan Manila and nearby provinces, with the number of customers totaling 4.0 mln. But Aguila said the market is likely to continue consolidating near the 1, 280-1,300 range before Christmas as it factors in political uncertainties ahead of next year's polls. SM Prime bucked the trend, closing down 0.10 at 6.40 on 17.7 mln shares. An analyst said the stock tested support at 6.30. Philippine Long Distance Telephone was up 20 at 775 on 101,860 shares. A local newspaper reported that PLDT has fully opened up its network to US carrier Sprint Communications following a directive from the National Telecommunications Commission for the carriers to immediately resolve their dispute over termination rates. PLDT also earlier settled a similar dispute with US carrier MCI International, which had asked the US Federal Communications Commission international bureau to lift its order prohibiting payments to PLDT. Ayala Corp was up 0.05 at 4.80 on 13.25 mln shares. Prime Gaming Philippines was up 2.00 at 20 on 638,400 shares, boosted by cross sales. Petron Corp was up 0.06 at 2.16 on 3.87 mln shares, following a newspaper report that the oil refiner has been awarded two fuel supply contracts by state-owned National Power Corp (Napocor) worth 1.1 bln pesos. The all-shares index was up 7.34 points at 843.69. The commercial-industrial index was up 12.13 at 1,974.24. Property was down 3.10 at 540.35, while mining was up 10.59 at 1,620.81. Oil was unchanged at 1.33. Banking and financial services gained 1.68 to 418.54. edelacruz@afxasia.com |
| Philippines may be better off importing rice - IRRI economist |
LOS BANOS, Philippines (AFX-ASIA) - Despite playing a key role in Asia's Green Revolution, the Philippines may never attain rice sufficiency and could be better off importing cereals, an International Rice Research Institute (IRRI) economist said. The Philippines hosts the IRRI, which developed modern rice varieties that dramatically raised yields from the mid-1960s. Yet for all but three out of the last 135 years, the Southeast Asian nation has been a net importer of the cereal and prices have been higher than most, IRRI economist David Dawe told reporters during a press tour of the research facility south of Manila. IRRI director-general Ronald Cantrell said the first thing visiting Filipino presidents ask is why, despite hosting the IRRI, the Philippines cannot produce enough rice for itself. Dawe said the conundrum is a function of "nature" and the decision on whether to devote state resources to attain rice self-sufficiency is "ultimately an issue that needs to be decided by Filipinos. I obviously am not one," said the American. "Self-sufficiency has a cost if you want to do it and in the case of the Philippines that cost is borne by the poor." He added: "As an economist, I would say that the Philippines would be slightly richer if it didn't focus on self-sufficiency." Along with other traditional Asian net rice importers Indonesia, Malaysia and Sri Lanka, Dawe said arable land is in short supply in the Philippines, where only 30 pct are planted to rice. The soil itself is "more suited to growing coconuts and maize" and lacking the major river systems and rainfall patterns available for the heavily water-dependent crop in such areas as Bangladesh, Thailand and Vietnam. "God made that land for growing rice," Dawe said. |
| Matsushita Electric Philippines will not sell Panasonic products from April 1 |
MANILA (AFX-ASIA) - Matsushita Electric Philippines Corp said it will no longer sell Panasonic Industrial products in the Philippines from April 1, 2004. Its unit Panasonic Industrial Sales Philippines, which handles its local Panasonic distribution business, will operate only until March 31, it told the stock exchange. It gave no other details. edelacruz@afxasia.com |
| Forex - Philippine peso firmer on strong dollar inflows, technical correction |
MANILA (AFX-ASIA) - The peso rebounded from last week's sharp fall to trade firmer mid-morning on the back of strong dollar remittances from Filipino workers abroad and dollar-selling by banks with long positions, dealers said. At 10.58 am, the peso averaged 55.615 after trading between 55.540 and 55. 720 on volume of 89.00 mln usd so far. It had ended at a record closing low of 55.730 on Friday. "The market is starting to calm down. Things are starting to settle after last week's knee-jerk reaction to surprising developments," a local bank dealer said. The peso fell to a record of 55.85 to the US dollar last week following negative news, which dealers said included Finance Secretary Jose Isidro Camacho's resignation, a possible ratings downgrade from Moody's Investors Service and an announcement by actor Fernando Poe Jr that he would contest the presidency. Dealers said dollar remittances from overseas Filipino workers have surged and will likely peak in the first two weeks of December in time for the Christmas holidays. The peso is seen trading within a wide range of 55.50 and 55.75 today, with an upward bias. "At lower levels, some corporates may want to start hedging for next year's requirements," said a local bank dealer, who expects the peso to end the year at 55.500 level. cecille.yap@afxasia.com |
| Manila shares up late morning on technical bounce; Meralco gains boost index |
MANILA (AFX-ASIA) - Share prices were higher in late morning trade, staging a technical rebound following recent losses, dealers said. Boosting the composite index's upside were gains in shares of Manila Electric Co and its parent First Philippine Holdings, which followed the provisional approval by the Energy Regulatory Commission (ERC) of a 0.12 pesos per kilowatthour tariff increase for Meralco effective January 1. At 11.11 am, the composite index was up 9.21 points, or 0.70 pct, at 1, 321.80 on volume of 138.3 mln shares valued at 344.08 mln pesos. It has moved between 1,314.43 and 1,329.60 so far. In the broader market, gainers led losers 28 to 12 while 23 stocks were unchanged. "The market is now staging a technical recovery after having absorbed bad news last week. A lot of stocks had reached oversold levels," Regina Capital Development Corp analyst Gomer Tan said. Dealers said the peso's continued recovery from its all-time low of 55. 850 to the US dollar was helpful to the market. At the Philippine Dealing System, the peso averaged 55.615 to the dollar on volume of 90.5 mln usd. It finished at a record closing low of 55.730 on Friday. Dealers were, however, uncertain if the market would be able to sustain its rebound given lingering political concerns in the run-up to the May presidential elections. Top-traded Meralco B, open to foreigners, was up 1.00 peso at 22.75 on 3. 9 mln shares while Meralco A was up 0.75 at 14.75 on 517,800 shares. First Philippine Holdings was up 1.00 at 19 on 1.01 mln shares. ERC chairman Manuel Sanchez said the provisional tariff increase should help Meralco undertake projects that will improve its service delivery, and help assure foreign investors of a fair return on their investments in the Philippines. Meralco supplies electricity to metropolitan Manila and nearby provinces, with the number of customers totaling 4.0 mln. edelacruz@afxasia.com |
| STOCKWATCH - Philippine Meralco shares up early on rate hike approval |
MANILA (AFX-ASIA) - Shares of Manila Electric Co were higher in early trade after the Energy Regulatory Commission (ERC) allowed the country's largest power distributor to raise its rates by 0.12 pesos per kilowatthour starting January, dealers said. At 10.41 am, Meralco B, open to foreigners, was top-traded and up 1.00 pesos at 22.75 on 3.33 mln shares. Meralco A was higher by 0.75 pesos at 14.75 on 424,100 shares. Meralco parent First Philippine Holdings rose 1.00 to 19 on 955,200 shares. The composite index was up 15.53 points, or 1.18 pct, at 1,329.40. ERC chairman Manuel Sanchez said the provisional tariff increase should help Meralco undertake projects that will improve its service delivery. Meralco supplies electricity to metropolitan Manila and nearby provinces, with the number of customers totaling 4.0 mln. Sanchez ruled out any political pressure behind the latest tariff hike for the country's biggest power distributor, whose major shareholder, the Lopez family, is speculated to be supporting the bid of President Gloria Arroyo for a full term in the May polls. "It is naturally positive for Meralco as it will improve its cash flow. It also sends a strong signal that the government is listening to the business community," Citiseconline.com analyst Mark Alan Canizares said. Another analyst said that with Arroyo's economic policies often viewed as populist, especially after implementing a power rate reduction program in previous months, the ERC decision addresses the issue of regulatory risks for businesses. He noted that the decision also follows recent Supreme Court rulings that were viewed to be unfavorable to the business community, such as the nullification of a contract covering the operation of a new terminal at the Manila international airport, and another contract involving a reclamation area at the Manila Bay. ERC's Sanchez himself said the ERC's decision should be taken positively by the public. "With this decision, we are assuring foreign investors of a reliable return on investment if they come in. This is important for us since we are inviting more foreign investors to take a look at the local power sector," he said. On the part of Meralco, he said the rate increase would help it improve its return on rate base. Meralco has been on technical default of its debt deals with Asian Development Bank and the World Bank for failing to meet the required 8.0 pct return-on-rate-base (RORB) level. At end-2002, it had posted an RORB level of around 3.0 pct. (1 usd = 55.62 pesos) cecille.yap@afxasia.com |
| Philippine Philex Oct copper/gold/silver output gross value 285.40 mln pesos |
MANILA (AFX-ASIA) - Philex Mining Corp said it produced in October 1.663 mln kilograms of copper, 229,167 grams of gold and 242,406 grams of silver with an estimated gross value of 285.40 mln pesos. The company earlier reported an output with a value of 285.50 mln pesos for September. Shipments of copper, gold and silver in October were valued at 375.72 mln pesos, Philex told the stock exchange in a disclosure. (1 usd = 55.619 pesos) cecille.yap@afxasia.com |
| STOCK ALERT - Philippines' Petron firmer after winning fuel supply contracts |
MANILA (AFX-ASIA) - Petron Corp was firmer in mid-trade following a newspaper report that it has been awarded two fuel supply contracts by the state-run National Power Corp worth 1.1 bln pesos. Petron was up 0.06 pesos at 2.16 on 1.39 mln shares. A major news daily said the contracts cover the fuel requirements of two of Napocor's oil-fired power plants. Petron has yet to confirm the report. (1 usd = 55.621 pesos) cecille.yap@afxasia.com |
| Philippine ERC approves Meralco's 0.12 pesos/kwh tariff hike |
MANILA (AFX-ASIA) - The Energy Regulatory Commission (ERC) said it has allowed Manila Electric Co (Meralco) to raise its tariff by another 0.12 pesos per kilowatthour effective Jan 1, 2004, to help the company undertake projects that will improve its service delivery. "We have given them a provisional authority to increase their rates. This is to ensure reliable and continuous delivery of service by Meralco to the public," ERC chairman Manuel Sanchez told AFX-Asia. Meralco supplies electricity to metropolitan Manila and nearby provinces. Sanchez ruled out any political pressure behind the latest tariff hike for the country's biggest power distributor, whose major shareholder, the Lopez family, is speculated to be supporting the bid of President Gloria Arroyo for a full term in the May polls. "In making a decision like this, any timing is always bad. But the ERC is an independent body and there is no pressure on us from anybody in making this decision," he said in a telephone interview. The latest rate hike, the second in about six months, was unexpected since in his earlier statements, Sanchez had expressed doubts if the ERC could issue a provisional authority for the company to raise its rate as early as this year. Meralco filed its petition for a 0.1358 pesos per kwh rate hike only in October. Meralco had sought a provisional approval for the rate increase in order to tackle cash flow pressures arising from the need to operate and maintain its electricity network, undertake capital projects, service maturing loans and refund customers for overbillings. The power firm is currently refunding overcharges dating back to 1994, which it expects to cost more than 30 bln pesos. "It took us almost seven weeks to look at the justification of the rate hike by Meralco," Sanchez said. But he said the ERC's decision should be taken positively by the public. "With this decision, we are assuring foreign investors of a reliable return on investment if they come in. This is important for us since we are inviting more foreign investors to take a look at the local power sector," he said. On the part of Meralco, he said the rate increase would help it improve its return on rate base. Meralco has been on technical default of its debt deals with Asian Development Bank and the World Bank for failing to meet the required 8.0 pct return-on-rate-base (RORB) level. At end-2002, it had posted an RORB level of around 3.0 pct. The ERC approved on May 30 a rate hike of 0.0865 pesos per kWh for Meralco, through the unbundling of power costs, enabling the utility to return to profitability in the second quarter. The company booked a net profit of 391 mln pesos in the April-June period, from a net loss of 325 mln in the first quarter, also supported by increased sales. In the third quarter, Meralco's net profit increased 103 pct to 574 mln pesos from 282 mln pesos in the year-earlier period, on the back of a rate increase and a modest rise in power sales. (1 usd = 55.63 pesos) edelacruz@afxasia.com |
| Philippines' PLDT announces cash dividends on preferred stocks |
MANILA (AFX-ASIA) - The Philippine Long Distance Telephone Co said its board of directors has approved the following cash dividends: - 1.029412 usd per share on PLDT's Series III convertible preferred stock, payable on Jan 15, 2004 to holders on record as of Dec 19. - 12.285 mln pesos on Series IV cumulative non-convertible redeemeable preferred stock, payable on Dec 15, 2003 to holders on record as of Dec 12. - 4.675 pesos per share of Series V convertible preferred stock, payable on Jan 15, 2004 to holders on record as of Dec 19. - 0.09925 usd per share on Series VI convertible preferred stock, payable on Jan 15, 2004 to holders on record as of Dec 19. - 10.179725 yen per share of Series VII convertible preferred stock, payable on Jan 15, 2004 to holders on record as of Dec 19. - 1.00 per outstanding share of Series H 10 pct cumulative convertible preferred stock, for the annual period ending Dec 31, 2003, payable on Jan 30, 2004 to holders on record as of Dec 24. - 1.00 peso per share of Series L 10 pct cumulative convertible preferred stock, for the annual period ending Dec 31, 2003, payable on Jan 30,2004 to holders on record as Dec 24. - 1.00 per share of Series M 10 pct cumulative convertible preferred stock, for the annual period ending Dec 31, 2003, payable on Jan 30, 2004 to holders on record as of Dec 24. - 1.00 per share of Series Y 10 pct cumulative convertible preferred stock, for the annual period ending Dec 31, 2003, payable on Jan 30, 2004 to holders on record as of Dec 24. (1 usd = 55.626 pesos = 109.89 yen) cecille.yap@afxasia.com |
| Philippine central bank likely to keep policy rates steady for rest of year |
MANILA (AFX-ASIA) - The policy-making Monetary Board will likely keep the central bank's policy interest rates unchanged for the rest of the year despite the weak peso, central bank governor Rafael Buenaventura said. He said the "sufficient" liquidity in the banking system gives the monetary authorities the flexibility to keep the closely-watched central bank overnight rates steady at 6.75 pct for borrowing and 9.00 pct for lending. "The regime of low interest rates abroad is ending next year. But the Philippine central bank probably has sufficient flexibility to stay at our current rates," Buenaventura told reporters. He said raising interest rates to address the peso volatility is "unnecessary." At the Philippine Dealing System, the peso averaged 55.638 to the US dollar on volume of 55.5 mln usd as of 9.41 am, after closing at a record low of 55.73 on Friday. On Saturday, President Gloria Arroyo warned speculators against putting pressure on the Philippine unit, stressing that the government had the tools to defend the unit. "I must warn speculators not to test the government's policy determination, " Arroyo said after the peso hit a record low of 55.85 to the dollar on Thursday. "The central bank has the tools to maintain the stability of the exchange rate." Arroyo added that authorities would use monetary tools "willfully and competently" as it did in the past. The peso's slide was partly blamed on the announcement that movie star Fernando Poe, a high-school drop-out with no government experience, was going to run against Arroyo for the presidency in May, raising fears he might become the country's next leader. Arroyo also said pressure on the peso would ease "if people can shake off the election fever and get on with more productive endeavours." edelacruz@afxasia.com |
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