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Tuesday, October 21, 2003
Philippines' BayanTel to invest 650 mln pesos to increase equity in TelicPhil
Forex - Philippine peso closes weaker on month-end dollar demand, deficit
Philippine regulator rules out new rate hike for Meralco this year
Philippine Petron Corp 9 mths to Sept net profit 2.02 bln pesos
Philippines 91-day T-bill rate won't exceed 6.0 pct this year - Buenaventura
Philippines backtracks over claims bio-weapons traces found at JI hideout
Philippine Nat'l Bank 9 mths net profit 127 mln pesos,exceeds FY goal
Philippine Treasury raises 3.0 bln pesos via 20-yr bonds; coupon at 11.375 pct
Manila shares close mixed; PLDT lifts index to 18-mth high
Philippines' ABS-CBN Holdings to list 100,000 PDRs Oct 22 -_PSE
Philippines' Jollibee to list 35,729 common shares tomorrow - exchange
Philippines Ayala Corp says to borrow 100 mln usd to refinance loans due 2004
Forex - Philippine peso slightly weaker early on technical correction, deficit
OUTLOOK-Philippine SanMig Q3 net profit seen at 1.8-2.0 bln pesos vs 1.56 bln
OUTLOOK-Philippine PLDT's Q3 net profit put at 2.50-3.70 bln pesos vs 1.40 bln
Ford Philippines to export CKDs to Thailand, Malaysia starting next year
Philippine govt 9 mths interest savings 6.657 bln pesos

Monday, October 20, 2003
Philippines allowed to tap into US OPIC facility - Camacho
Philippines' Chinatrust 9 mths net profit up 27 pct yr-on-yr
Philippine Globe Telecom buyback of 12 mln shares has no impact on ratings-S&P
Chinatrust Philippines Q3 net profit 138.98 mln pesos vs 62.25 mln
Philippine central bank sees Oct CPI up 2.9-3.1 pct yr-on-yr vs 2.9 in Sept
Philippine Napocor's rate increase to boost 2003 revenue by 11 bln pesos
Philippines' Boulevard Holdings Q1 net loss 0.64 mln pesos vs loss 1.53 mln
Philippines Sept budget deficit 29.138 bln pesos vs 22 bln ceiling
Possible bio-weapons traces found in Philippines raid on JI - army UPDATE
Philippines' Chinabank 9 mths net profit 2.18 bln pesos, exceeds FY goal
DATAWATCH - Philippine Aug imports hurt by political instability - AB Capital
Possible bio-weapons traces found in Philippines raid on JI hideout - official
Manila shares close flat, market awaits Q3 results
SARS not airborne, children at low risk - WHO report
Philippines' BCDA sees 23.8 bln pesos revenues in next 25 yrs
Philippines' ABS-CBN to issue 150 mln usd notes to repay debt, fund capex
Philippines Sept budget deficit 29.138 bln pesos vs 22 bln ceiling
Thailand, Philippines sign cooperative deal on petroleum reserves, investment
Philippine media say Bush visit boosts Arroyo election bid
DATAWATCH - Weak Philippine Aug imports point to Q3 GDP contraction - DBS
Philippines Aug merchandise imports 3.105 bln usd, down 8.5 pct yr/yr
Philippines' GMA Network in talks with two US firms for overseas expansion
Philippines end-Sept FCDU deposits 12.893 bln usd vs 11.951 bln yr-ago
Philippines' i-Bank NPL ratio 13.41 pct as of Sept 19
Philippines' Allied Bank NPL ratio 16.16 pct as of Sept 19
Philippines Sept budget deficit 'about 33 bln pesos' vs 22-bln ceiling -source
Protests, flag-burning mark brief Bush Philippines visit on Saturday
Philippines economic and corporate news summary MPX85
Philippines' Bayantel invests 500.00 mln pesos for fiber optic project

October 16 - 17 
October 14 - 15 
October 10 - 13 
October 8 - 9 
October 6 - 7 
October 3 - 4 
October 1 - 2 


 

Philippines' BayanTel to invest 650 mln pesos to increase equity in TelicPhil


     MANILA (AFX-ASIA) - Bayan Telecommunications Inc will invest 650 mln pesos to increase its equity in telecommunication backbone operator Telecoms Infrastructure Corporation of the Philippines (TelicPhil), BayanTel president and chief executive officer Eugenio Lopez III said.
     The investment will increase BayanTel's stake in TelicPhil to 92 pct from 82 pct.
     The remaining shares are held by other telecom firms, which include Smart Communications, Globe Telecom, Express Telecommunications Co, Eastern Telecommunications Co, Eastern Telecommunications Philippines Inc and Philippine Telegraph & Telephone Corp.
     Lopez said the equity injection will increase the capacity of TelicPhil's National Digital Transmission Network (NDTN), which is the nationwide backbone directly competing with Philippine Long Distance Telephone Co's Asia Pacific Cable Network (APCN).
     Only BayanTel, Eastern Telecom and Digitel would be participating in the capacity expansion undertaking.
     The expansion plan involves boosting NDTN's transmission capacity to 40 gigabits from 5.0 to increase the amount of call and data traffic the network can handle.
     (1 usd = 54.85 pesos)
     cecille.yap@afxasia.com

 

Forex - Philippine peso closes weaker on month-end dollar demand, deficit


     MANILA (AFX-ASIA) - The peso closed weaker against the US dollar as corporates rushed to accumulate more of the US currency to satisfy their month-end financing requirements, dealers said.
     They said disappointing economic data released yesterday also had weighed on sentiment.
     The peso closed at 54.850 after trading between 54.670 and 54.850 on volume of 101.00 mln usd. It closed at 54.640 yesterday.
     "Since the (dollar) inflow season has just started, we could still see some slight demand for the dollar, especially among corporate clients with month-end needs," a local bank dealer said.
     Another dealer said a higher budget deficit for September and a drop in August imports had disappointed investors, raising concerns the peso may come under renewed pressure.
     The government's September budget deficit stood at 29.138 bln pesos, exceeding its 22.000 bln ceiling, as it continued to attempt to pump-prime the economy.
     With the deficit higher than its target for the past two months, analysts are doubtful as to whether the full-year 202.00-bln peso target can still be met, despite the government's optimism.
     Meanwhile, analysts are wary that the 8.50 pct year-on-year fall in merchandise imports in August may have triggered a contraction in the economy in the third quarter.
     Dealers expect the peso to weaken slightly further tomorrow on follow-through buying and on the central bank staying out of the spot market.
     cecille.yap@afxasia.com

 

Philippine regulator rules out new rate hike for Meralco this year


     MANILA (AFX-ASIA) - The Energy Regulatory Commission (ERC) is unlikely to grant this year Manila Electric Co's (Meralco) request for provisional authority to increase its tariff by 0.1358 pesos per kilowatthour, ERC chairman Manuel Sanchez said.
     "I doubt if we could hand down a decision this year. The last filing of Meralco took more than one year and 40 public hearings before it was decided on," he said at news briefing.
     "It's a very long process (and) we are very cautious in studying their application."
     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.
     Sanchez said a second rate hike for Meralco within the year is "impossible".
     Meralco is seeking 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.
     (1 usd = 54.85 pesos)
     afxmanila@afxasia.com

 

Philippine Petron Corp 9 mths to Sept net profit 2.02 bln pesos


     MANILA (AFX-ASIA) - Listed oil refiner Petron Corp reported a net profit of 2.02 bln pesos for the nine months to September, up 10.00 pct from 1.84 bln pesos in the year-ago period, on the back of stronger export sales and lower operating expenses.
     In a statement, the company said export volumes grew 27.00 pct year-on-year in the January-September period, to increase revenue 22.7 pct to 81.1 bln pesos.
     "This was brought about by higher average selling price, which increased around 2.36 pesos per liter," Petron said.
     Total sales volume, however, grew a modest 2.00 pct to 37.00 mln barrels from 36.15 mln a year earlier, despite a steady decline in fuel oil sales to the power sector.
     Export volume stood at 6.51 mln barrels, up 27.0 pct year-on-year. Sales to the retail sector slightly improved by 4.0 pct over the same period last year, although no comparative figures were provided.
     Petron reported that operating expenses declined 7.00 pct to 2.62 bln pesos during the nine months on the back of its ongoing cost management programs.
     "Our investment in an LVN isomerization unit and a gasoil hydrotreater will make our refinery capable of producing (Clean Air Act) compliant gasoline and diesel," Petron public affairs manager Virginia Ruivivar said.
     (1 usd = 54.77 pesos)
     cecille.yap@afxasia.com

 

Philippines 91-day T-bill rate won't exceed 6.0 pct this year - Buenaventura


     MANILA (AFX-ASIA) - The bellwether 91-day Treasury bill rate may keep rising, but it is unlikely to exceed 6.0 pct in the remaining two months of the year, central bank governor Rafael Buenaventura said.
     The government has allowed T-bill rates, including the 91-day rate, to rise at recent auctions in order to align the bellwether rate, in particular, with the central bank's key overnight borrowing rate of 6.750 pct.
     At the auction held Oct 13, T-bill rates rose across the board, with the 91-day rate up at 5.629 pct from 5.506 pct previously.
     Banks use the 91-day T-bill rate to price loans.
     "Interest rates will stay low. At the most, it will hit 6.0 pct (by year-end)," Buenaventura told reporters.
     "It won't go over our policy rate, in the short-term at least."
     National Treasurer Sergio Edeza had predicted that the 91-day might rise to 7.0 pct on a possible build-up of uncertainties in the run-up to the May 2004 elections.
     Buenaventura, however, said the level of liquidity in the market and the relative stability of the peso-dollar exchange rate will help temper the rise in the 91-day T-bill rate.
     (1 usd = 54.771 pesos)
     afxmanila@afxasia.com

 

Philippines backtracks over claims bio-weapons traces found at JI hideout


     MANILA (AFX-ASIA) - Philippine authorities backtracked over claims that a bioterrorism manual and traces of biological weapons had been found at a Jemaah Islamiyah terrorist hideout, Agence France-Presse reported.
     Vice chief of staff Lieutenant General Rodolfo Garcia said examination of powders found at an apartment in Cotobato on the southern island of Mindanao showed they did not contain the tetanus bacteria as originally reported.
     "Our finding is, there were no chemical or biological agents found," Garcia told reporters.
     Police spokesman Senior Superintendent Leopoldo Bataoil also said Garcia's claims yesterday that a bioterrorism manual had been found were not substantiated.
     He said only "notes on bioterror, biotoxic materials" were discovered.
     Garcia's comments yesterday had raised fears that JI, which has been accused of the bombings on the Indonesian island of Bali last year, may have been planning to launch a biological attack in the region.
     The Philippines' anti-terror allies have expressed concern in recent days about JI's activities on Mindanao, a large island that borders Indonesia and Malaysia and has been a hotbed of a decades-old Muslim separatist rebellion.
     The raid in Cotabato came after a man described by Philippines authorities as JI's number two, Indonesian Taufiq Rifqi, was arrested there two weeks ago.
     President Gloria Arroyo issued a statement today calling on the police and military to be accurate in their reporting "so that the public will be informed of the facts and not be unduly alarmed by sensationalized reports."
     She also called on the public to remain calm and cooperate with the authorities who are tracking down suspects from JI, which wants to create an Islamic state across Southeast Asia.

 

Philippine Nat'l Bank 9 mths net profit 127 mln pesos,exceeds FY goal


     MANILA (AFX-ASIA) - Philippine National Bank (PNB) said it booked a net profit of 127 mln pesos in the nine months to September, exceeding its full-year target of 100 mln and reversing the 1.52 bln net loss in the same period last year.
     The bank sustained its recovery on the back of improved net interest margin, higher fee-based gains and a reduction in operating expenses, PNB president and chief executive officer Lorenzo Tan said.
     PNB has been posting net profits monthly since January.
     PNB, which is equally owned by the government and businessman Lucio Tan with 45 pct interest each, had incurred losses due to its bad loans burden that required huge provisions for probable losses.
     In the first nine months of the year, PNB said it booked a net interest margin of 1.17 bln pesos, recovering from a negative interest margin of 19 mln a year ago.
     Interest income rose to 5.42 bln pesos from 4.72 bln, while interest expense dropped to 4.24 bln from 4.74 bln.
     "Improving cost of funds due to a more favorable deposit mix and better pricing of loans and deposits were mainly responsible for the positive margin during the first nine months of 2003," PNB said in a statement.
     Low-cost deposits, meanwhile, grew at a faster pace with the introduction of its Priority One checking account intended for high net worth clients, and the year-long promotion to encourage Filipino workers overseas and their beneficiaries to increase their deposits.
     At end-September, low-cost current account/savings account deposits comprised 43 pct of total deposits, against 40 pct a year ago.
     Total deposits rose by 11.86 bln pesos or 9.0 pct from end-2002 to 149.00 bln.
     Fee-based and other income grew 17 pct to 3.76 bln pesos from 3.22 bln a year ago, due mainly to the adjustment in the pricing of products and services to align these with the market, such as those on remittances and deposit products.
     The bank also gained from recoveries on foreclosed assets, with asset sales amounting to 1.8 bln pesos in the nine-month period.
     PNB set aside 447 mln pesos of its earnings in the nine-month period as provisions for probable losses, substantially higher than the year-earlier 60 mln.
     The bank said it expects to sustain the positive results "as the institutional strengthening initiatives and restructuring efforts are pursued at a more vigorous clip."
     As part of its five-year rehabilitation program that was put in place last year, the bank has focused on resolving a 75-bln peso portfolio of non-performing assets through collection efforts, debt work-outs and restructurings.
     PNB has also set monthly auctions for some of its idle assets.
     Bank officials earlier said PNB is aiming to sell as much as 3 bln pesos of foreclosed assets this year.
     They said the bank's 45 bln pesos worth of non-performing loans, representing about 60 pct of its total loan portfolio at end-September, is expected to be reduced to 53 pct by year-end.
     (1 usd = 54.771 pesos)
     edelacruz@afxasia.com

 

Philippine Treasury raises 3.0 bln pesos via 20-yr bonds; coupon at 11.375 pct


     MANILA (AFX-ASIA) - The Bureau of Treasury (BTr) said it raised 3.0 bln pesos at today's auction of 20-year bonds, with total tenders reaching 7.603 bln pesos.
     The coupon rate was set at 11.375 pct.
     To be able to raise an additional 1.0 bln pesos, the BTr decided to open the tap facility window for 20-year bonds until 3 pm tomorrow, with yield to maturity at 11.354 pct.
     (1 usd = 54.771 pesos)
     afxmanila@afxasia.com

 

Manila shares close mixed; PLDT lifts index to 18-mth high


     MANILA (AFX-ASIA) - Share prices closed mixed, but gains in Philippine Long Distance Telephone (PLDT) due to rosy earnings expectations lifted the key index to its highest level in 18 months, dealers said.
     PLDT's sustained rise sparked interest in other blue chips, as investors continued to position themselves ahead of the release of third-quarter corporate results, they added.
     Gains in select blue chips outweighed losses in other stocks, which succumbed mainly to profit-taking, dealers said.
     The composite index closed up 17.23 points, or 1.26 pct, at 1,386.09 on volume of 768.54 mln shares valued at 755.16 mln pesos. It traded between 1, 374.82 and 1,387.90.
     The index's rise took it to the highest close since April 19, 2002, when it finished at 1,401.36.
     In the broader market, however, losers led gainers 32 to 26, with 41 stocks unchanged.
     The market is seen testing the key index's major resistance level at 1, 400 in the coming sessions after finding support above 1,380 level today, analysts said.
     PLDT, whose American Depositary Receipts advanced 0.41 usd to 13.51 in New York overnight, was top traded and up 35.00 at 765.00 on volume of 537, 630 shares.
     Analysts AFX-Asia polled expect PLDT to report a third quarter to September net profit of 2.50-3.70 bln pesos on the back of sustained robust growth in its wireless business.
     The forecast represents an earnings increase of as much as 164.00 pct over the 1.40 bln pesos posted in the third quarter of last year. The range does not, however, take into account any huge one-off provisions.
     PLDT is scheduled to announce the results in early November.
     Analysts expect PLDT's strong third quarter to boost its chances of meeting its full-year net profit goal of 9.00-10.00 bln pesos.
     "PLDT sustained its momentum, with its ADRs also advancing last night on earnings forecasts. Buying interest spilled over to other blue chips, including Ayala companies," Westlink Global Equities chairman Rommel Macapagal said.
     "PLDT's resistance is seen at around 800.00 pesos."
     Depending on its third-quarter results, particularly whether it will book more one-off provisions in the second half, analysts said PLDT share price could breach 800.00 pesos going forward.
     Ayala Corp, which has announced plans to borrow 100.00 mln usd to refinance loans due 2004, closed up 0.15 at 5.10 on volume 14.52 mln shares.
     Ayala Corp said it will not use the loan to fund the acquisition of the 10.04 mln shares in unit Globe Telecom Inc that it agreed to purchase from Deutsche Telekom unit DeTeAsia Holdings GmbH.
     Globe, which is also seenmaking further gains in the wireless business, rose 5.00 to 760.00 on 80,590 shares.
     Yesterday, Standard & Poor's Ratings Services said Globe's repurchase of 12.00 mln shares from DeTeAsia has had no impact on its ratings or outlook on the company.
     The agency has assigned a "BB" ratings to Globe's foreign and local currency-denominated debts, with stable and positive outlooks, respectively.
     Ayala Corp's property arm, Ayala Land, was up 0.10 at 6.70 on 2.69 mln shares and banking unit Bank of the Philippine Islands up 0.50 at 45.00 on 229,800 shares.
     SM Prime was up 0.10 at 6.80 on 7.09 mln shares.
     San Miguel B, open to foreign investors, was up 0.50 at 62.50 on 323,300 shares and San Miguel A unchanged at 56.50.
     Analysts AFX-Asia polled expect San Miguel to report a third quarter to September net profit ranging from 1.80 bln to 2.00 bln pesos, higher than the year-ago level of 1.56 bln, on improved sales.
     San Miguel's beer sales in Hong Kong and China, weakened by the outbreak of SARS in the second quarter, have recovered and boosted overall revenue for the third quarter, analysts said.
     Pilipino Telephone, an affiliate of PLDT, was down 0.01 at 0.86 on 12.20 mln shares following recent gains.
     The all-shares index was up 5.80 points at 833.69.
     The commercial-industrial index rose 28.89 to 2,033.12, while property advanced 7.43 to 612.66.
     Mining was down 68.04 at 1,640.85 and oil down 0.04 at 1.43.
     Banking and financial services retreated 0.15 to 449.49.
     (1 usd = 54.771 pesos)
     edelacruz@afxasia.com

 

Philippines' ABS-CBN Holdings to list 100,000 PDRs Oct 22 -_PSE


     MANILA (AFX-ASIA) - ABS-CBN Holdings Corp will list an additional 100,000 Philippine Deposit Receipts (PDRs) tomorrow, the stock exchange said in a circular to brokers.
     The listing is in line with ABS-CBN shareholders' move to exchange 100, 000 ABS-CBN common shares for 100,000 PDRs.
     The listing will raise the total number of listed ABS-CBN PDRs to 270.22 mln.
     At 10.54 am, ABS-CBN Holdings was unchanged at 28.00 pesos.
     (1 usd = 54.758 pesos)
     afxmanila@afxasia.com

 

Philippines' Jollibee to list 35,729 common shares tomorrow - exchange


     MANILA (AFX-ASIA) - Jollibee Foods Corp is set to list tomorrow 35,729 common shares made available under the company's stock purchase and option plan, the stock exchange said.
     The listing will bring the number of common shares listed under the plan to a total of 11.77 mln.
     The shares will have a par value of 1.00 peso apiece.
     At 10.52 am, Jollibee was unchanged at 17.25 pesos on volume of 88,000 shares.
     (1 usd = 54.76 pesos)
     afxmanila@afxasia.com

 

Philippines Ayala Corp says to borrow 100 mln usd to refinance loans due 2004


     MANILA (AFX-ASIA) - Ayala Corp said it will borrow, through wholly owned subsidiary AC International Finance Ltd (ACIFL), 100 mln usd to refinance maturing loan obligations in 2004.
     In a disclosure to the stock exchange, the company said BNP Paribas, Standard Chartered Bank and ING Bank are arranging the syndicated term loan facility.
     It also said the loan will not be used fund its acquisition of 10.04 mln Globe Telecom shares, which Ayala Corp has agreed to purchase from DeteAsia Holding GmbH.
     (1 usd = 54.76 pesos)
     afxmanila@afxasia.com

 

Forex - Philippine peso slightly weaker early on technical correction, deficit


     MANILA (AFX-ASIA) - The peso was slightly weaker against the US dollar in early trade on a technical correction after recent gains, dealers said.
     A lower-than-programmed budget deficit and a slowdown in imports further weighed on sentiment, they added.
     At 10.15 am, the peso averaged 54.753 after trading between 54.670 and 54. 830 on volume of 51.50 mln usd. It closed at 54.640 yesterday.
     "The peso is due for a correction after having strengthened in recent days. Negative economic data may have also provided an excuse," a dealer with a local bank said.
     The government's budget deficit stood at 29.138 bln pesos in September, exceeding the ceiling of 22.000 bln, as it continued to spend beyond programmed levels partly to pump-prime the economy.
     The deficit for the January-September period stood at 142.703 bln pesos, below the ceiling of 149.539 bln.
     Analysts, however, expressed doubts over whether the full-year target of 202.000 bln pesos will be met after recent surge in expenditure.
     The country's weak trade performance, as evident in the 8.500 pct year-on-year drop in merchandise imports in August, may have triggered a contraction in the economy in the third quarter, analysts said.
     They attributed the possible contraction to political instability stemming from the July 27 failed military mutiny, which caused the peso to depreciate and exporters to complain of lesser orders from overseas.
     A widening trade deficit, which stood at 1.905 bln usd for the January-August period, is also seen putting pressure on the peso.
     Dealers see the peso trading between 54.500-54.900 for the day, and do not expect the central bank to intervene, given the narrow range.
     cecille.yap@afxasia.com

 

OUTLOOK-Philippine SanMig Q3 net profit seen at 1.8-2.0 bln pesos vs 1.56 bln


     ---- by Enrico de la Cruz ----
     MANILA (AFX-ASIA) - San Miguel Corp is expected to report a third quarter to September net profit in the range of 1.8-2.0 bln pesos, higher than the year-ago level of 1.56 bln, boosted by improved sales, analysts said.
     San Miguel is due to report the results later this month or in early November.
     Beer sales in Hong Kong and China markets, weakened by the outbreak of Severe Acute Respiratory Syndrome (SARS) in the second quarter, have recovered and helped boost overall revenues for the third quarter, they said.
     San Miguel's second quarter to June net profit fell 10 pct to 1.709 bln pesos from 1.890 bln in the same period last year.
     Stronger revenues in the second half, however, will likely boost San Miguel's full-year net profit to between 7.40 bln and 9.50 bln pesos, from 6. 63 bln in 2002, analysts said.
     In the first half of the year, the company booked a net profit of 3.05 bln pesos, up a modest 2.00 pct year-on-year.
     Early this month, the company announced that consolidated sales revenue in the eight months to August grew 11 pct year-on-year to 96.80 bln pesos, helping to bring its operating profit to 7.47 bln pesos. No net profit figure nor comparative operating profit were given.
     San Miguel said domestic beer operations, its main revenue-earner, maintained strong volume growth during the eight-month period, posting a 24. 00 pct year-on-year gain in operating profit of 3.76 bln pesos.
     International beer sales rose 12.00 pct year-on-year during the period, reversing second quarter weakness as sales in Hong Kong and southern China recovered from the slump caused by the SARS outbreak in the first half.
     "I'm expecting San Miguel's net profit in the third quarter to be higher than the second quarter after we saw recovery in sales," Accord Capital Equities research analyst Ron Rodrigo said.
     "Going into the fourth quarter, sales will further rise mainly on seasonal factors."
     San Miguel sales normally peak during the last quarter, particularly during the Christmas holidays.
     "We may also begin to see election-related spending helping to boost San Miguel sales in the fourth quarter," said Citiseconline.com investment analyst Mark Alan Canizares.
     All candidates in the May 2004 elections are expected to have formally declared their political bids by December.
     Canizares sees San Miguel's third quarter net profit at 1.80-2.00 bln pesos.
     "Beer and beverage products are likely to remain the anchor of growth this year, although San Miguel has already been dominant particularly in the domestic beer market," he said.
     Elena Ponceca, senior analyst at Unicapital Securities Corp, said she expects San Miguel's liquor unit Ginebra San Miguel Inc to also enjoy increased sales as the elections draw near, particularly in the countryside.
     "We all know that San Miguel's Ginebra brand is more popular in the rural areas because of its affordability compared to San Miguel's pale pilsen and other beer products," she said.
     Unit San Miguel Pure Foods, which sells processed meats and canned goods, may also benefit from increased consumer spending during the second half of this year and going into the first half of 2004, Ponceca said.
     Operating profit of its San Miguel Food Group hit 586.00 mln pesos on total revenue of 26.00 bln in the eight months to August. The company said the results showed volume gains for poultry and processed meats.
     Also during the eight-month period, consolidated sales revenue of San Miguel's Coca-Cola Beverage Group - including sales of Coke and Cosmos soft drinks and bottled water - rose 15.00 pct year-on-year to 25.90 bln pesos.
     Ponceca sees San Miguel's consolidated net profit in the range of 1.80-2. 00 bln pesos in the third quarter, and 8.00-9.50 bln for the whole year.
     San Miguel, however, is seen remaining conservative with its net profit target of 7.00 bln pesos for 2003, which is also supported by improved sales in the second half of the year.
     "I think we will be able to hit our 7.00 bln peso net profit target this year," Cojuangco said in September.
     Going forward, analysts said San Miguel's continued profitability will largely depend on the outcome of its expansion efforts in the region.
     "Any growth in the future will largely depend on the success of its regional expansion plans," Citiseconline.com's Canizares said.
     San Miguel announced in early September it signed an agreement with Thai developer Amata City Co Ltd for the purchase of an industrial complex in Amata City, Rayong in Thailand for 20.00 mln usd.
     San Miguel is looking to set up food and beverage complexes in at least seven Asian markets -- Thailand, China, Vietnam, Indonesia, Australia, Malaysia and Taiwan -- as part of its regional expansion.
     Its expansion into Thailand will involve manufacturing beverage products such as packaged water, carbonated softdrinks, carbo-natural drinks, juice, tea and energy drinks, snacks and feed mill operations.
     The complex is expected to be operational in 2005.
     San Miguel intends to invest 100 mln usd in each of the seven markets it is looking at, and expects sales in these markets to boost the company's annual revenue by 300 mln usd.
     Analysts said the ownership overhang on San Miguel may not have been a major drag on its operations, with Cojuangco still at the helm and working to transform the company into a major regional player.
     Cojuangco's management of San Miguel has been praised by analysts and investors.
     However, they said Cojuangco's long-running legal battle with the government on San Miguel's ownership prevents the stock's prices from reflecting his long-term plans for the company.
     San Miguel B, available to foreign investors, closed yesterday at 62.00 pesos, while San Miguel closed at 56.50.
     (1 usd = 54.64 pesos)
     edelacruz@afxasia.com

 

OUTLOOK-Philippine PLDT's Q3 net profit put at 2.50-3.70 bln pesos vs 1.40 bln


     ---- by Cecille Yap ----
     MANILA (AFX-ASIA) - Philippine Long Distance Telephone Co is expected to report a third quarter to September net profit of 2.50-3.70 bln pesos on the back of sustained robust growth in its wireless business, analysts said.
     The forecast represents an earnings increase of as much as 164.00 pct over the 1.40 bln pesos posted in the third quarter of 2002. The range does not, however, take into account any one-off provisions.
     PLDT is scheduled to announce the results in early November.
     Most analysts polled by AFX-Asia said a strong third quarter would place PLDT's full-year net profit goal of 9.00-10.00 bln pesos, including provisions, within reach.
     In the first half to June, the company reported a net profit of 1.80 bln pesos after provisions. Prior to the provisions, it stood at 6.60 bln.
     "The subscribers of (its wireless unit) Smart Communications Inc have continued to increase despite earlier expectations of a possible slowdown. So far, there has been no signs of slowing down," Asiasec Equities analyst Oliver Plana said.
     According to market talk, Smart and Pilipino Telephone Corp, another wireless affiliate of PLDT, together posted net additions of 400,000-500,000 subscribers for September alone, bringing their total subscriber base to 11. 50 bln.
     PLDT sees its wireless subscribers exceeding 12.00 mln by the end of the year.
     Plana expects PLDT's third quarter net profit to come in at 2.90-3.50 bln pesos and 9.50 bln pesos for the full-year.
     BPI Securities vice president Roberto Cano, who is projecting a full-year net profit of 9.80 bln pesos for PLDT, said the company's wireless subscriber take-up remains strong, with much of the growth coming from the countryside.
     He sees the fixed-line business contributing "a little" to the bottom line given that the company is still undergoing a multi-billion peso manpower reduction program.
     The country's wireless penetration rate stood at 22.30 pct as of end-June, and the earlier forecast of 25.00 pct could be easily breached by year-end, analysts said.
     Smart continues to build its cellular network in the provinces and has expanded nationwide coverage to 880 cities and municipalities through a network of 29 switches and 3,285 base stations as of the first half of the year.
     Astro del Castillo, a director of the Association of Securities Analysts of the Philippines, said PLDT's third quarter to September net profit could reach 3.40-3.70 bln pesos also because of the introduction of new products and services.
     ING Financial Markets attributed the strong wireless subscriber base growth partly to lower churn rates, following the introduction in May of the now widely available Smart Load, which offers low-denomination over-the-air pre-paid re-loads.
     Around 63.00 pct of Smart's pre-paid subscribers now reload their accounts through Smart Load, while 72.00 pct of Piltel's Talk 'N Text subscribers use this medium, indicating strong acceptance of the product.
     "Smart's successful churn management has resulted in strong growth in the company's mobile subscriber base and higher margins," ING said in a note to investors.
     It said the company is on track to pay PLDT a further dividend of 1.80 bln pesos in the fourth quarter, bringing its pay-out ratio to 100.00 pct of the 2002 net profit.
     "Smart's strong performance should accelerate PLDT's debt reduction and enable PLDT itself to pay a cash dividend in 2005," ING said.
     It believes PLDT's share price rally is not yet over, with Smart continuing to grow its subscriber base. It has raised its 12-month target price for PLDT to 780.00 pesos per share.
     Accord Capital Equities analyst Ron Rodrigo, who is projecting a third quarter net profit of 2.50-2.60 bln pesos, said PLDT may still register one-off provisions during the period, but said they are not expected to be as huge as those in the first half.
     Included in the provisions is 1.30 bln pesos in cash set aside for PLDT's manpower reduction program, which PLDT president Manuel Pangilinan said could be recovered by the company in 12 to 15 months.
     The company expects headcount to be reduced to 9,000 by end-2005 from over 10,000 due to retrenchment and natural attrition. It also booked non-cash provisions of 3.50 bln pesos for investments and other assets to bring its total first-half provisions to 4.80 bln pesos.
     (1 usd = 54.64 pesos)
     cecille.yap@afxasia.com

 

Ford Philippines to export CKDs to Thailand, Malaysia starting next year


     MANILA (AFX-ASIA) - Ford Motor Philippines announced it will begin exporting completely knocked down (CKD) units to Thailand and Malaysia starting next year.
     Ford Philippines vice president Davai Macasadia said the company is looking to diversify its export revenue, which currently comes mainly from shipments of completely built units (CBUs).
     Macasadia said Ford will initially export 20 lots per year, with each lot equivalent to 20 units of autoparts.
     Ford Motor last week announced it would invest an additional 50 mln usd in its Philippine manufacturing facility over the next several years as part of its bid to make the country a hub for its Southeast Asian operations.
     afxmanila@afxasia.com

 

Philippine govt 9 mths interest savings 6.657 bln pesos


     MANILA (AFX-ASIA) - The national government generated savings of 6.657 bln pesos in the first nine months of the year, aided by a low interest rate environment, Finance Secretary Jose Isidro Camacho said.
     Actual interest payments on loans were lower than programmed levels, he said.
     The government programmed interest payments of 175.841 bln pesos in the nine-month period, but actual payments reached only 169.184 bln.
     (1 usd = 54.64 pesos)
     afxmanila@afxasia.com

 

Philippines allowed to tap into US OPIC facility - Camacho


     MANILA (AFX-ASIA) - The US has opened up the guarantee facility of Overseas Private Investments Corp (OPIC) for the Philippines, Finance Secretary Jose Isidro Camacho said.
     "It was a very pleasant development on the occasion of (US President George W) Bush's visit that this was communicated to the government," Camacho told reporters.
     OPIC is a US state-run firm that assists American businesses to invest overseas and complements the private sector in managing the risks associated with foreign direct investments.
     It earlier provided a guarantee to the National Power Corp's 250 mln usd, 15-year unsecured guarantee notes issue.
     Camacho said OPIC has agreed to extend similar assistance to other projects in the Philippines by working together with the Philippine Export Import Credit Agency.
     (1 usd = 54.64 pesos)
     cecille.yap@afxasia.com

 

Philippines' Chinatrust 9 mths net profit up 27 pct yr-on-yr


     MANILA (AFX-ASIA) - Chinatrust (Philippines) Commercial Bank Corp said its net profit in the nine months to September rose 27 pct year-on-year to 473 mln pesos, boosted by sustained growth in loan portfolio and improvement in risk assets quality, treasury gains and prudent spending.
     "The major sources of revenue for the bank continued to be interest on loans and investments, and trading gains. The bank's conscious effort to rationalize expenses also contributed to the improvement in performance," Chinatrust said in its financial statement submitted to the stock exchange.
     Chinatrust said its net loan portfolio grew 12 pct to 10.5 bln pesos as of end-September from 9.4 bln as of end-2002.
     "An improvement in the loan levels of the Taiwanese and middle market segment, as well as the mortgage and personal loan portfolios, accounted for this achievement," it said.
     Chinatrust's non-performing loans ratio, meanwhile, fell to 4.45 pct as of end-September from 4.59 pct as of end-2002, way below the industry average of 14.42 pct of the second quarter of this year.
     About 96 pct of NPLs at end-September were covered with loan-loss provisions, it said.
     Return on assets and return on average equity stood at 3.58 pct and 18.1 pct, respectively, at end-September, compared to year-ago levels of 3.07 pct and 15.81 pct.
     (1 usd = 54.640 pesos)
     edelacruz@afxasia.com

 

Philippine Globe Telecom buyback of 12 mln shares has no impact on ratings-S&P


     MANILA (AFX-ASIA) - Standard & Poor's Ratings Services said Globe Telecom Inc's repurchase of 12 mln shares from Deutsche Telekom AG has no impact on its rating or outlook on the company.
     "The rationale of Globe's share buyback is mainly to improve shareholders' return and obtain an optimum capital structure. The share buyback is not a part of its financial policy. The company is not expected to conduct further buyback in the near term," S&P said in a bulletin.
     Globe earlier announced it will buy back 12.00 mln common shares held by DeTeAsia Holding GmbH at 680.00 pesos each or for a total of 8.16 bln pesos. The shares account for 7.90 pct of Globe's total outstanding common shares.
     Globe said it had cash and cash equivalents of 17.00 bln pesos and unappropriated retained earnings of 13.70 bln pesos as of end-June, which it said it will use to pay for the shares.
     "In addition, the company is able to generate funds from operations of about 18-20 bln pesos annually. The company's leverage and cash flow protection measures are expected to remain within the rating parameters," S&P said.
     Globe received from S&P a "BB" rating for its foreign and local currency-denominated debts, with outlooks of stable and positive, respectively.
     (1 usd = 54.64 pesos)
     afxmanila@afxasia.com

 

Chinatrust Philippines Q3 net profit 138.98 mln pesos vs 62.25 mln


     MANILA (AFX-ASIA) - Chinatrust (Philippines) Commercial Bank Corp's third quarter to September results:
      Interest income - 300.90 mln pesos vs 290.93 mln
      Interest expense - 128.94 mln pesos vs 114.09 mln
      Net interest income - 171.96 mln pesos vs 176.84 mln
      Provision for probable losses - nil vs 109.00 mln
      Other income - 156.91 mln pesos vs 112.53 mln
      Other expenses - 163.40 mln pesos vs 145.49 mln
      Net profit - 138.98 mln pesos vs 62.25 mln
      Earnings per share - 0.74 pesos vs 0.33
     Nine months to September results:
      Interest income - 901.23 mln pesos vs 886.39 mln
      Interest expense - 402.28 mln pesos vs 358.74 mln
      Net interest income - 498.94 mln pesos vs 527.64 mln
      Provision for probable losses - 64.00 mln pesos vs 265.91 mln
      Other income - 509.64 mln pesos vs 567.63 mln
      Other expeses - 426.77 mln pesos vs 453.74 mln
      Net profit - 473.24 mln pesos vs 373.13 mln
      EPS - 2.52 pesos vs 1.99
     (1 usd = 54.64 pesos)
     edelacruz@afxasia.com

 

Philippine central bank sees Oct CPI up 2.9-3.1 pct yr-on-yr vs 2.9 in Sept


     MANILA (AFX-ASIA) - The central bank expects the consumer price index to show a rise of 2.9-3.1 pct year-on-year in October, compared to a rise of 2.9 pct in September, central bank governor Rafael Buenaventura said.
     The inflation rate is seen remaining benign, helped by stable food supply, and with "no surprises on oil prices," Buenaventura told reporters.
     He said the exchange rate has been stable since the early part of October.
     The peso closed today at 54.640 to the dollar, gaining slightly from Friday's close of 54.680.
     Buenaventura said the central bank is maintaining its forecast that the full-year inflation rate will settle near 3.0 pct, lower than the government's target of 4.5-5.5 pct.
     The inflation rate averaged 3.0 pct in the first three quarters of the year.
     afxmanila@afxasia.com

 

Philippine Napocor's rate increase to boost 2003 revenue by 11 bln pesos


     MANILA (AFX-ASIA) - The latest increase in generation charges of National Power Corp will boost the state-run firm's revenue by 11 bln pesos this year and 10 bln in 2004, Power Sector Assets and Liabilities Management Corp (PSALM) president Edgardo del Fonso said.
     This revenue boost, however, is not enough to help Napocor return to profitability, since it could not recover through higher rates those costs arising from contracted obligations with independent power producers, said del Fonso.
     PSALM is the company tasked to absorb the residual assets and liabilities of Napocor after its privatization.
     The Energy Regulatory Commission recently granted Napocor a provisional authority to raise generation charges in the main island of Luzon by 0.34 pesos per kilowatthour and in the Visayas area by 0.33 peso starting this month.
     With the implementation of a new rate-setting formula, called the long-run avoidable cost (LRAC), Napocor's rates now stand at 2.4692 pesos per kWh in Luzon and 2.1258 pesos in the Visayas.
     (1 usd = 54.648 pesos)
     afxmanila@afxasia.com

 

Philippines' Boulevard Holdings Q1 net loss 0.64 mln pesos vs loss 1.53 mln


     MANILA (AFX-ASIA) - Boulevard Holdings Inc's first quarter to Aug 31 results:
      Revenues - 57.19 mln pesos vs 31.30 mln
      Expenses - 56.49 mln pesos vs 32.65 mln
      Net loss - 0.64 mln pesos vs 1.53 mln
      Loss per share - 0.001 vs loss 0.002
     (1 usd = 54.648 pesos)
     afxmanila@afxasia.com

 

Philippines Sept budget deficit 29.138 bln pesos vs 22 bln ceiling


     MANILA (AFX-ASIA) - The government's budget deficit stood at 29.138 bln pesos in September, exceeding the ceiling of 22.000 bln, as it continued to spend beyond programmed levels, the Finance department said.
     In the first nine months of the year, the deficit came in at 142.703 bln pesos, below the ceiling of 149.539 bln.
     Revenues for the month of September totalled 48.290 bln pesos against the target of 47.500 bln. Expenditures amounted to 77.428 bln pesos, exceeding the programmed level of 69.6 bln.
     In the nine-month period, revenues reached 456.646 bln pesos, higher than the 430.894 bln target. Expenditures totalled 599.349 bln pesos against a ceiling of 580.433 bln.
     Finance Secretary Jose Isidro Camacho, however, said the government remains firm in keeping the full-year budget deficit within the 202.000 bln peso target.
     "I want to be clear that the government's objective is to meet its fiscal performance target for the year and not to outperform it. Economic growth is something we cannot compromise with holding on to too tight a budget," Camacho said, as he explained the government continued to take full advantage of the headroom created by the stronger-than-expected revenues posted earlier this year," he told reporters.
     "To make sure we don't overdo it, starting October we would be more restrained in our spending," he added.
     The government has been spending more to spur economic activities and help boost domestic demand.
     Economic planning secretary Romulo Neri earlier said the country's gross domestic product (GDP) is likely to have grown at 4.000 pct year-on-year in the fourth quarter, well within the target of 3.800-4.300 pct for the period, on the back of robust government spending and a recovery in the agricultural sector.
     Belt-tightening measures have shaved GDP growth almost 1.000 pct in the first half of the year, Neri added.
     Camacho said revenue collection for the remaining three months of the year is expected to be within the full-year goal.
     The Bureau of Internal Revenue, the government's main cash cow, is expecting a rebound in collections in October with the implementation of a new taxation scheme for automobiles, Camacho said.
     The BIR's September collection went down 8.400 pct year-on-year to 29.700 bln pesos, which is also 9.000 pct lower than the 32.600 bln target for the month.
     The agency's excise tax collection from sale of vehicles slowed during the month pending the implementation of the new tax measure. Year-to-date, the BIR's performance was still 9.000 pct higher year-on-year at 311.100 bln pesos, but 1.000 pct lower than the 314.200 bln program.
     Collections of the Bureau of Customs were 4.900 pct lower than the target at 8.300 bln pesos, with the shortfall attributed to the weakness in imports due to the peso's depreciation.
     Meanwhile, Camacho attributed the higher expenditures for the nine-month period largely to the 20.700 bln peso increase in disbursements for capital outlay that started in July "as the government implemented a calibrated winding down of payables."
     Net financing for September stood at 13.300 bln pesos, almost flat from 13.200 bln a year earlier.
     For January to September, net financing reached 196.400 bln pesos, 8.100 pct lower than last year and slightly below the programmed level of 197.600 bln pesos.
     (1 usd = 54.644 pesos)
     afxmanila@afxasia.com

 

Possible bio-weapons traces found in Philippines raid on JI - army UPDATE


     MANILA (AFX-ASIA) - Security forces recovered a bio-terror manual and traces of possible biological weapons in a raid on a Jemaah Islamiyah (JI) hideout in the southern Philippine city of Cotabato, the army said today.
     Local police said up to eight local and foreign JI suspects escaped the raid on Sunday in central Cotabato, but left behind what vice chief of staff Lieutenant General Rodolfo Garcia described as possible residues of a "tetanus virus-carrying chemical."
     A "bio-terror manual" was also recovered, Garcia said on ABS-CBN television.
     The raid on a Cotabato apartment unit was launched a day after the visit to Manila of US President George W Bush and more than two weeks after the arrest in Cotabato of Indonesian Taufiq Rifqi, whom Filipino authorities described as the number-two man of JI.
     The group is a Southeast Asian Islamic network blamed for a bombing campaign including last year's Bali blasts that killed 202 people. The US government considers the JI an affiliate of the al-Qaeda group behind the Sept 11, 2001 attacks in the US.
     "Residues of chemicals (found) there are still being analyzed by chemical experts of the police," Garcia said.
     "These were not found in bulk," he stressed. "It takes time to determine" whether they are indeed biological weapons.
     "We were able to get quite a number of documents that will be quite significant" in the course of further anti-terrorist operations, he added without elaborating.
     Cotabato police investigator Superintendent Felipe Napoles said the raid turned up "bomb-making material, electronic components and gadgets, diagrams for homemade bomb-making and Christmas light wiring," as well as computer diskettes.
     Police briefly detained the landlord Lolito Adanza for questioning, but he was later released without charges, Napoles told reporters.
     He said Adanza told police Filipinos had rented the apartment there, but that "foreign-looking men had been frequenting the house."
     Prior to the Bush visit, regional security officials had warned that the Philippines could be the next focus of JI attacks.
     Filipino officials have acknowledged that the JI trained on Mindanao in the 1990s in jungle camps run by the Moro Islamic Liberation Front (MILF), the largest Filipino Muslim separatist guerrilla group in the south.
     MILF spokesman Eid Kabalu Monday repeated previous denials that the MILF hosted the JI training facilities.
     The MILF is set to begin formal peace talks with Manila later this month in a bid to end the 25-year rebellion that has claimed thousands of lives.
     Army Colonel Felipe Tabas, head of an anti-terrorist task force in Cotabato, said the authorities suspect that up to eight JI members had trained in bomb-making in the village of Cararao, in an area that formed part of the MILF's Camp Abubakar training base.
     The camp fell into government hands in a major military offensive in 2000.
     "They probably stayed in that house," Tabas added.
     Rifqi, the alleged JI senior leader, was arrested at a central Cotabato hotel in early October, but the authorities only confirmed his detention two weeks later.

 

Philippines' Chinabank 9 mths net profit 2.18 bln pesos, exceeds FY goal


     MANILA (AFX-ASIA) - China Banking Corp said it booked a net profit of 2. 18 bln pesos in the nine months to September, exceeding the full-year target of 2.00 bln.
     No comparative figures were given.
     The bank said in a statement that earnings were boosted by higher interest income from low-risk investment securities, which made up for continued low demand for loans, as well as by fee-based revenue.
     The bank also attributed the earnings improvement to "prudent management" of operating expenses.
     Loan-loss provisions during the nine-month period totalled 1.59 bln pesos, up 51.10 pct from the same period last year, taking the total loan-loss reserve as of end-September to 6.51 bln pesos, representing 72.6 pct of total non-performing loans.
     Return on equity as of end-September stood at 20.22 pct, while return on assets was at 2.72 pct.
     At end-September, Chinabank's total resources stood at 105.23 bln pesos, with total deposits at 73.60 bln and capital funds at 17.29 bln.
     The bank said its capital adequacy ratio of 28.3 pct as of end-August was one of the strongest in the industry.
     (1 usd = 54.648 pesos)
     edelacruz@afxasia.com

 

Manila shares close flat, market awaits Q3 results


     MANILA (AFX-ASIA) - Share prices closed flat ahead of the reporting season for third quarter corporate results, dealers said.
     The composite index closed up 1.53 points or 0.11 pct at 1,368.86 on volume of 787.72 mln shares valued at 1.13 bln pesos. It traded between 1,362. 87 and 1,374.53.
     In the broader market, losers led gainers 30 to 27, with 38 stocks unchanged.
     Globe Telecom and Philippine Long Distance Telephone led the day's gainers on expectations of sustained earnings strength, dealers said.
     The government's budget deficit of 29.138 bln pesos in September, which came in lower than preliminary figures, exceeded the 22-bln ceiling.
     The 8.50 pct year-on-year drop in merchandise imports, which widened the country's trade deficit in the January-August period and is expected to see exports remain weak in the near term, may have also spurred investors to lock in gains in select stocks.
     The excitement over the Oct 18 visit of US President George W Bush to Manila also waned, dealers said.
     "The market is in a consolidation phase ahead of third quarter earnings reports," BPI Capital Securities analyst Roberto Cano said.
     "Investors are looking at higher price levels for Globe and PLDT. The revaluation is based on expectations that both carriers will exceed their growth targets for wireless subscribers," said Regina Capital Development Corp analyst Gomer Tan.
     "In the case of Globe, the deal among its major shareholders on the Deutsche Telekom stake sale removes the potential overhang on the issue of Globe ownership, and that's also keeping sentiment on the stock positive."
     Globe was top traded and up 10.00 pesos at 755 on volume of 894,290 pesos.
     PLDT rose 25.00 to 730 on 377,910 shares, which followed a 0.08 usd gain in its Asian Depositary Receipts in New York on Friday.
     "Some analysts are now looking at a price of 800 pesos plus for PLDT from a previous price target of about 730-740 pesos," Tan said.
     SM Prime was down 0.10 at 6.70 on 1.91 mln shares.
     Filinvest Land fell 0.02 to 1.16 on 10.13 mln shares.
     Equitable PCI Bank was up 0.50 at 36.50 on 307,800 shares.
     Pilipino Telephone, an affiliate of PLDT, was up 0.03 at 0.87 on 10.12 mln shares.
     The all-shares index was up 3.86 points at 827.89.
     The commercial-industrial index rose 14.71 to 2,004.23.
     Property was down 5.04 at 605.23, while mining fell 21.89 to 1,708.89.
     Oil was up 0.12 at 1.47.
     Banking and financial services shed 5.43 to 449.64.
     (1 usd = 54.648 pesos)
     edelacruz@afxasia.com

 

DATAWATCH - Philippine Aug imports hurt by political instability - AB Capital


     MANILA (AFX-ASIA) - Political instability arising from the failed July 27 military mutiny may be to blame for the significant drop in merchandise imports for August, AB Capital research director Jose Vistan Jr said.
     Merchandise imports dropped 8.50 pct year-on-year to 3.105 bln usd in August, compared to a 1.30 pct year-on-year increase in July to 3.23 bln usd, the National Statistics Office said.
     The August trade deficit was 138.00 mln usd, compared to a deficit of 361. 0 mln usd a year earlier.
     In the January-August period, the trade deficit stood at 1.905 bln usd versus a year-earlier deficit of 513.00 mln usd.
     The peso declined sharply versus the US dollar following the military mutiny, prompting importers to temporarily hold off transactions with their overseas counterparts during the period, Vistan said.
     It was also during this period when exporters complained of lower orders for their products as their trading partners raised concerns over the timeliness of deliveries and the higher costs involved after the peso's depreciation.
     "We have become less competitive than our neighbors, which have already shown signs of recovery in the trade sector... The more politically unstable we are, the less competitive we become since our cost becomes more volatile," Vistan said.
     Vistan said lower imports suggests exports would likely be subdued moving forward as most of the materials used for export products.
     He expects export growth for the year at 2.0 pct, down from his original projection of 4.0 pct, and much lower than the government's 5.0-8.0 pct growth target.
     This indicates domestic demand remains weak, and that the country's economic growth will likely be modest. The government is projecting a GDP growth of 4.2-5.2 pct for 2003.
     "Given this scenario, there's very little incentive for fresh investments, " Vistan said.
     (1 usd = 54.62 pesos)
     cecille.yap@afxasia.com

 

Possible bio-weapons traces found in Philippines raid on JI hideout - official


     MANILA, Oct 20 (AFP) - Security forces have recovered traces of possible biological weapons in a raid on a Jemaah Islamiyah hideout in the southern Philippine city of Cotabato, a senior military official said Monday.
     Possible residues of a "tetanus virus-carrying chemical was among those found" in Sunday's raid, along with a "bio-terror manual", vice chief of staff Lieutenant General Rodolfo Garcia said over ABS-CBN television.
     Filipino as well as foreign suspects whom he refused to name escaped.

 



     MANILA (AFX-ASIA) - Share prices closed flat ahead of the reporting season for third quarter corporate results, dealers said.
     The composite index closed up 1.53 points or 0.11 pct at 1,368.86 on volume of 787.72 mln shares valued at 1.13 bln pesos. It traded between 1,362. 87 and 1,374.53.
     In the broader market, losers led gainers 30 to 27, with 38 stocks unchanged.
     Globe Telecom and Philippine Long Distance Telephone led the day's gainers on expectations of sustained earnings strength, dealers said.
     The government's budget deficit of 29.138 bln pesos in September, which came in lower than preliminary figures, exceeded the 22-bln ceiling.
     The 8.50 pct year-on-year drop in merchandise imports, which widened the country's trade deficit in the January-August period and is expected to see exports remain weak in the near term, may have also spurred investors to lock in gains in select stocks.
     The excitement over the Oct 18 visit of US President George W Bush to Manila also waned, dealers said.
     (1 usd = 54.648 pesos)
     edelacruz@afxasia.com

 

SARS not airborne, children at low risk - WHO report


     MANILA (AFX-ASIA) - Global health experts have ruled out airborne transmission of the SARS virus and concluded that children are at low risk of infection, the World Health Organization (WHO) said Monday.
     The WHO report represents the views of experts in public health, epidemiology and clinical virology, and draws on experiences from all the main outbreak sites, as well as a large number of published studies and unpublished documents, the WHO regional office here said.
     The SARS virus spread from southern China in late 2002 and infected more than 8,000 people around the world, killing nearly 800 people.
     "The report found no evidence that SARS is an airborne disease," the WHO statement said.
     "At all outbreak sites, the main route of transmission was direct contact, via the eyes, nose, and mouth, with infectious respiratory droplets.
     "The finding that each patient infected on average three others is consistent with a disease spread by direct contact with virus-laden droplets rather than with airborne particles.
     "For diseases where the causative agent is airborne, such as influenza and measles, a single person can infect an entire room by coughing. There is no evidence that this occurred with SARS.
     "For this reason, simple infection control techniques, such as frequent hand washing, can go a long way toward slowing the spread of disease."
     The risk of transmission "is greatest at around day 10 of illness," while there has been "no evidence that patients transmit infection 10 days after fever has resolved."
     The WHO said the study found health-care workers are "at special risk", while "children are rarely affected by SARS" with only two reported transmissions from children to adults.
     There have been no cases of disease transmission in schools, nor have there been transmissions to infants by mothers, who were infected during pregnancy.
     "Further investigation is required to determine whether children may have asymptomatic or mild infections," it said.
     "Health-care workers, especially those involved in procedures generating aerosols, accounted for 21 pct of all cases, ranging from 3 pct of reported probable cases in the US to 43 pct in Canada.
     "In some cases, transmission to health-care workers occurred, despite the fact that staff were wearing masks, eye protection, gowns, and gloves."

 

Philippines' BCDA sees 23.8 bln pesos revenues in next 25 yrs


     MANILA (AFX-ASIA) - The state-run Bases Conversion Development Authority (BCDA) said it expects to generate 23.8 bln pesos in total revenues in the next 25 years and about 1.7 bln in 2003 alone from its property development projects in the Fort Bonifacio Global City and Villamor Air Base.
     These properties have a combined area of 62.1 hectares.
     Although BCDA plans to sell a 25-pct stake in Fort Bonifacio Development Corp (FBDC) to raise around 7 bln pesos, the agency will remain part of the group developing Fort Bonifacio properties with its remaining 20 pct stake in FBDC.
     The Fort Bonifacio properties are adjacent to the Makati central business district.
     The BCDA is also developing its 245,966 square meter property inside the Villamor Air Base in Pasay City into a business and technology park in a joint venture with Megaworld Corp.
     It added the complex will also incorporate residential and commercial areas in the business and technology park.
     The BCDA formally turned over the Villamor property to Megaworld on Oct 11, it said in a statement.
     (1 usd = 54.647 pesos)
     edelacruz@afxasia.com

 

Philippines' ABS-CBN to issue 150 mln usd notes to repay debt, fund capex


     MANILA (AFX-ASIA) - ABS-CBN Broadcasting Corp said it plans to issue 150 mln usd notes to raise funds for its debt payments, additional investment in cable television operations and capital expenditure.
     The company said in a disclosure that the notes will be secured by its real property and certain equipment and other assets, and would be guaranteed by some of its subsidiaries.
     It did not give further details.
     Moody's Investors Service last week assigned a prospective "Ba3" senior secured rating to ABS-CBN's notes issue, with a stable outlook.
     Moody's said its rating on ABS-CBN reflects the company's leading position in the country's television market, its sound standalone financial profile and strong free cash flow-generation abilities.
     Standard & Poor's Ratings Services, on the other hand, assigned a "B+" long-term rating and "B" short-term rating to ABS-CBN with a stable outlook, and a "B+" rating to the company's notes issue.
     S&P said "a key constraining factor in ABS-CBN's rating is the financially distressed situation of its owner Benpres (Holdings Corp), which controls 85.00 pct of shareholders' voting rights in ABS-CBN."
     edelacruz@afxasia.com

 

Philippines Sept budget deficit 29.138 bln pesos vs 22 bln ceiling


     MANILA (AFX-ASIA) - The government's budget deficit stood at 29.138 bln pesos in September, exceeding the ceiling of 22 bln, as it continued to spend beyond programmed level, the Finance department said.
     In the first nine months of the year, the deficit reached 142.703 bln pesos, below the ceiling of 149.539 bln.
     Revenues for the month of September totalled 48.29 bln pesos against the target of 47.5 bln. Expenditures amounted to 77.428 bln pesos, exceeding the programmed level of 69.6 bln.
     In the nine-month period, revenues reached 456.646 bln pesos, higher than the 430.894-bln target. Expenditures totalled 599.349 bln pesos against a ceiling of 580.433 bln.
     Finance Secretary Jose Isidro Camacho, however, said the government remains firm in keeping the full-year budget deficit within the 202-bln peso target.
     "To make sure we don't overdo it, starting October we would be more restrained in our spending," he told reporters.
     The government has been spending more to spur economic activities and help boost domestic demand.
     (1 usd = 54.644 pesos)
     afxmanila@afxasia.com

 

Thailand, Philippines sign cooperative deal on petroleum reserves, investment


     BANGKOK (AFX-ASIA) - Thai Energy Minister Prommin Lertsuridej and Philippine Energy Secretary Vincent Perez have signed a memorandum of understanding (MoU) for a joint feasibility study on petroleum reserves and investment.
     In a statement issued by the Thai energy ministry, Prommin said the two countries will share their existing petroleum facilities under the cooperative agreement in order to strengthen their respective petroleum reserves as well as to create business opportunities.
     Thailand has investment in the Philippines through PTT Plc.
     There is currently a shortage in local oil supply in the Philippines where the government is implementing its Clean Air Act. This has prompted higher imports of refined oil to the country through Subic Bay where PTT's subsidiaries in the Philippines have been granted concessionaires for the oil depots, officials said.
     The MoU will also establish a joint cooperation committee that will conduct feasibility study on oil and gas exploration, production and development in both countries and to exchange technical information and research and development efforts, the statement said.
     chiraprapa.koonlachoti@afxasia.com

 

Philippine media say Bush visit boosts Arroyo election bid


     MANILA (AFX-ASIA) - US President George W. Bush's state visit to the Philippines has boosted the election chances of leader Gloria Arroyo in next year's presidential poll, Manila newspapers said today.
     A number of Filipino broadsheets interpreted Saturday's eight-hour visit as an endorsement by Bush of Arroyo, who two weeks earlier had reversed a decision not to seek a fresh six-year term in the May 10, 2004 presidential vote.
     "Bush upbeat on GMA bid," read the banner headline of the Manila Standard, referring to Arroyo by her initials.
     "Palace: Bush visit boosts GMA poll bid," echoed the Philippine Daily Inquirer.
     The Inquirer carried an editorial cartoon showing Arroyo zipping above the waves aboard a speedboat, its bow flying a "Polls 2004" flag and its outboard motor labelled "US Economic and Military Aid".
     "Palace sees poll dividends for Gloria from Bush visit," the Malaya newspaper reported.
     The US leader on Saturday took pains to praise Arroyo during a brief joint public appearance as the two met at Malacanang Palace.
     "I want to remind the people of this country what a great leader you've been when it comes to fighting terror. You've been strong and stalwart, and that's what's needed. We want to continue to help you," he said.

 

DATAWATCH - Weak Philippine Aug imports point to Q3 GDP contraction - DBS


     MANILA (AFX-ASIA) - The country's weak trade performance may have triggered a contraction in the economy in the third quarter, DBS Bank regional economist Wong Chee Seng said.
     The 8.50-pct year-on-year drop in merchandise imports to 3.105 bln usd in August will likely lead to subdued exports performance in the next three months, given the high import content of items being exported by the Philippines, Wong said.
     Despite the weak August shipments, the National Statistics Office today said merchandise imports in the January to August period rose 6.10 pct to 24. 908 bln usd from 23.479 bln in the same period last year.
     The Philippines, however, recorded a trade deficit of 138.00 mln usd in August, compared to a deficit of 361.0 mln usd a year earlier, bringing the deficit for the January-August period to 1.905 bln usd versus a year-earlier deficit of 513.00 mln.
     Imports of electronic products accounted for 47.50 pct of August shipments and were valued at 1.475 bln usd, down 14.90 pct year-on-year.
     "I'm extremely worried with the Philippines being the first country in the region to see its current account and budget to be in deficit at the same time," Wong said.
     This situation discourages investments, he noted.
     "We foresee a contractionary force in play in view of the rising trade deficit," he added.
     He noted that any gross domestic product growth in the third quarter will likely be driven by domestic demand.
     Last week, Economic Planning Secretary Romulo Neri said he sees third quarter GDP growth of 4.00 pct year-on-year, well within the government's target of 3.80-4.30 pct for the period, on the back of a recovery in the agricultural sector and increased government spending.
     GDP grew 3.20 pct year-on-year in the second quarter. On a quarter-on-quarter basis, GDP expanded 0.10 pct in the second quarter, after contracting 0.50 pct in the first quarter, so the economy narrowly avoided a technical recession.
     The government is maintaining its full-year GDP growth target of 4.20-5. 20 pct for 2003, although Neri said it is likely that full-year growth will be closer to the lower end of that target.
     Wong said the weak trade figures will "make the Philippines a less attractive place for investment," and that this may in turn put pressure on the peso to move towards the 55.000 to the US dollar level again.
     At 9.57 am, the peso averaged 54.600 to the dollar after closing at 54. 680 on Friday.
     edelacruz@afxasia.com

 

Philippines Aug merchandise imports 3.105 bln usd, down 8.5 pct yr/yr


     MANILA (AFX-ASIA) - Merchandise imports dropped 8.50 pct year-on-year to 3.105 bln usd in August, the National Statistics Office (NSO) said, compared to a 1.30 pct year-on-year increase to 3.230 bln usd in July.
     In the January to August period, merchandise imports rose 6.10 pct to 24. 908 bln usd from 23.479 bln in the same period last year.
     The NSO said the Philippines recorded a trade deficit of 138.000 mln usd in August, compared to a deficit of 361.000 mln usd a year earlier. It had reported a trade deficit of 265.000 mln usd in July.
     In the January-August period, the deficit stood at 1.905 bln usd versus a year-earlier deficit of 513.000 mln.
     The NSO had previously reported that merchandise exports amounted to 2. 967 bln usd in August, down 2.10 pct year-on-year. In January-August period, exports grew 0.20 pct year-on-year to 23.002 bln.
     Imports of electronic products accounted for 47.50 pct of August shipments and were valued at 1.475 bln usd, down 14.90 pct year-on-year.
     Mineral fuels and lubricants ranked second with a 10.30 pct contribution valued at 320.510 mln usd, up 38.70 pct year-on-year.
     Industrial machinery and equipment were the third on the imports list at 140.060 mln usd, down 14.70 pct year-on-year.
     The NSO said payments for capital goods, which accounted for 40.40 pct of total August imports, dropped 1.90 pct year-on-year to 1.255 bln usd from 1. 280 bln previously.
     Raw materials and intermediate goods, representing 37.50 pct of total August bill, were down 23.70 pct to 1.164 bln from 1.525 bln a year earlier.
     Imports from the US accounted for 20.50 pct of the total August bill, down 16.50 pct to 635.750 mln usd. Exports to the US amounted to 617.330 mln usd, yielding a trade deficit of 18.420 mln for the Philippines.
     August imports from Japan accounted for 19.60 pct of the total at 608.20 mln usd. Exports to Japan amounted to 461.34 mln usd, resulting in a trade deficit of 146.86 mln usd for the Philippines.
     Singapore was the third biggest source of imports in August, with payments of 219.520 mln usd, up 7.80 pct year-on-year, while exports to the city state were worth to 203.550 mln usd. This resulted in a trade deficit of 15.97 mln usd for the Philippines.
     (1 usd = 54.68 pesos)
     afxmanila@afxasia.com

 

Philippines' GMA Network in talks with two US firms for overseas expansion


     MANILA (AFX-ASIA) - GMA Network Inc, the biggest rival of listed ABS-CBN Broadcasting Corp, is in talks with two US-based direct-to-home (DTH) and cable television service providers for its international expansion, GMA senior vice president for finance Felipe Yalong said.
     GMA, which has long been planning an initial public offering, is looking to penetrate the international market by going into DTH business with the help of potential partners.
     "If we can partner two (DTH or cable television operators), then that will be better for our international business. We don't have a definite timetable yet, although we may start by early next year," Yalong told reporters.
     "It's just a matter of launching it... Of building up the organization."
     ABS-CBN did the same in 1995, through ABS-CBN International.
     Yalong gave no specific timetable even for the discussions with the US firms, which he declined to identify.
     afxmanila@afxasia.com

 

Philippines end-Sept FCDU deposits 12.893 bln usd vs 11.951 bln yr-ago


     MANILA (AFX-ASIA) - Foreign currency deposits held by Philippine banks stood at 12.893 bln usd as of end-September, up from 11.951 bln a year ago, latest central bank data show.
     The higher FCDU (foreign currency deposit units) deposits helped to boost the country's foreign exchange reserves, which stood at 16.06 bln usd as of end-September.
     afxmanila@afxasia.com

 

Philippines' i-Bank NPL ratio 13.41 pct as of Sept 19


     MANILA (AFX-ASIA) - International Exchange Bank (i-Bank) said its nonperforming loans (NPL) totalling 2.69 bln pesos accounted for 13.41 pct of its total loan portfolio as of Sept 19.
     No comparative figure was available.
     Specific provisions against loan losses amounted to 1.71 bln pesos, while general provision reached 552.68 mln, according to its published statement of condition.
     Return on equity stood at 12.43 pct.
     i-Bank earlier disclosed plans to undertake an initial public offering in the first quarter of next year to raise 3.0-4.0 bln pesos. The IPO is intended to beef up its capital and finance its expansion.
     The bank was looking to offer about 20 pct of its total equity to the public.
     (1 usd = 54.68 pesos)
     edelacruz@afxasia.com

 

Philippines' Allied Bank NPL ratio 16.16 pct as of Sept 19


     MANILA (AFX-ASIA) - Allied Banking Corp said its nonperforming loans (NPL) accounted for 16.16 pct of its total loan portfolio as of Sept 19.
     As of June 19, its NPL ratio stood at 15.28 pct.
     In its published statement of condition, Allied Bank said its NPLs totalled 8.29 bln pesos as of Sept 19, with general provisions of 384 mln pesos and specific provisions of 4.43 bln.
     Return on equity stood at 8.4 pct.
     edelacruz@afxasia.com

 

Philippines Sept budget deficit 'about 33 bln pesos' vs 22-bln ceiling -source


     MANILA (AFX-ASIA) - The government's budget deficit stood at about 33 bln pesos in September, exceeding the ceiling of 22 bln for the month, a government source said.
     In the first nine months of the year, the deficit reached 146.5 bln pesos, below the ceiling of 149.5 bln, the source said.
     The Department of Finance is expected to announce the official figures before noon today.
     The government said it continued to spend more than the programmed level in September, while revenues fell short of targets.
     The deficit stood at 113.50 bln pesos in the eight months to August, below the ceiling of 127.50 bln.
     However, the deficit in August alone was 18.17 bln pesos, exceeding the 8. 11 bln ceiling, as the government spent more to boost the slowing economy.
     Still, the government is expected to maintain the full-year ceiling at 202 bln pesos.
     (1 usd = 54.68 pesos)
     afxmanila@afxasia.com

 

Protests, flag-burning mark brief Bush Philippines visit on Saturday


     MANILA (AFX-ASIA) - Several thousand anti-US protesters demonstrated in the Philippines' capital Manila and burnt dozens of US flags Saturday during a brief stopover by President George W. Bush.
     After burning the flags, about 7,000 protesters tried to march on the Philippines legislature, where Bush was to deliver a mid-afternoon address, but were blocked by riot police.
     Across town more than a dozen student protesters chanting anti-US slogans tried to enter a park where the Bush was laying a wreath at a monument to national hero Jose Rizal.
     Police beat them back with truncheons and the group dispersed peacefully.
     Bush's eight-hour state visit was however welcomed by about 50 pro-US demonstrators who were herded into a building near the US embassy after they held an overnight party for the president across the street from the mission.
     Bush and his wife Laura flew in from Japan around noon (0400 GMT) for the first state visit by a US leader in this former American colony since Dwight Eisenhower in 1960.
     More than 11,000 policemen secured the Philippine capital as he arrived amid fears of a terrorist attack, which were heightened after the police shot dead Indonesian Jemaah Islamiyah (JI) operative Fathur Rohman al-Ghozi on Sunday.
     Security officials however insisted there were no specific threats against Bush.
     The government says the JI is the Southeast Asian proxy of the al-Qaeda network blamed for the September 11, 2001 attacks in the United States.
     After laying the wreath, the US president held talks with President Gloria Arroyo that were expected to have focused on the threat posed by Islamic militants on their countries' common interests in Southeast Asia.
     The Philippines, a mainly Roman Catholic nation of 82 million people, is struggling with widespread poverty and fighting various communist and Muslim separatist insurgencies as well as Islamic militants allegedly linked to al-Qaeda.
     On Friday communist guerrillas here urged Filipinos to join street protests against the visit, but said they were not planning any violence, including an assassination attempt.

 

Philippines economic and corporate news summary MPX85


     BEIJING (AFX-ASIA) - A summary of Philippine economic and corporate news at 1000 GMT
     -Treasury revises 182-day, 364-day T-bill offers
     -Philippines re-opens global bond issues to raise additional 1.05 bln usd
     -Jan 1-Oct 10 net portfolio inflows up 136.0 pct yr-on-yr
     -Philippines deploys thousands of police, troops in capital ahead of Bush visit
     -Bank of the Philippine Islands NPL ratio 8.63 pct as of Sept 19
     -Union Bank of the Philippines NPL ratio 12.8 pct as of Sept 19
     -Security Bank NPL ratio 11.26 pct as of Sept 19
     -ABS-CBN's proposed 150 mln usd bond issue rated 'Ba3' - Moody's
     -ABS-CBN assigned 'B+' long-term rating, stable outlook by S&P
     -SEC approves Ebecom Holdings name change, extension of term
     -Makati Finance to write off loans, sets dividend policy
     -Metrobank NPL ratio 13.86 pct as of Sept 19
     -Jollibee Foods says to open 7 new stores in California, Hawaii
     -Beyond Cable signs debt restructuring deal - SkyCable chairman
     xiaojing.jiang@xfn.com

 

Philippines' Bayantel invests 500.00 mln pesos for fiber optic project


     MANILA (AFX-ASIA) - Bayan Telecommunications Inc has invested more than 500.00 mln pesos for a fiber optic project that will provide voice and data services to buildings in various business districts in the country.
     The company launched the "I-City" project, short for Intelligent City, that aims to create a "community of buildings" that would enable building tenants to take advantage of Internet protocol-based connectivity services.
     "We'll build this network through partners and tools over six to 18 months so it's not going to be just a BayanTel network. We'll offer the buildings' tenants not just connectivity, but the full range of services that BayanTel has to offer," BayanTel chief consultant Tunde Fafunwa told reporters.
     BayanTel is the telecommunication unit of Benpres Holdings Corp of the Lopez group.
     (1 usd = 54.68 pesos)
     cecille.yap@afxasia.com

 


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