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Friday, May 21, 2004
OUTLOOK Philippine Q1 GDP up 4.3-5.5 pct yr-on-yr on farm growth, consumption
Philippine business less optimistic in Q2 on political concerns - central bank
Philippine fuel prices to rise further on costs recovery - energy secretary
Philippines extends anti-dumping duties on China soap ingredients for 3 yrs
Manila shares close higher led by PLDT on late bargain-hunting
Manila shares turn slightly higher in late trade on bargain-hunting
Manila shares marginally lower early on higher oil prices, interest rates
STOCK ALERT - Philippines' Meralco slightly lower early on profit taking
STOCK ALERT - Philippines' PLDT lower in line with ADRs
Japan's Penta-Ocean, others start Subic Bay project in Philippines - report
Philippines'Neri says Q1 GDP seen up 5 pct yr-on-yr - report

Thursday, May 20, 2004
German suspect in Boracay murders barred from leaving the Philippines
Philippine central bank says unlikely to tighten policy despite inflation
Philippines' Music to resume trade, list more shares tomorrow
Philippines' Jollibee Foods to list additional 8,805 common shares tomorrow
Philippines imposes additional tariffs on imported glass products
Philippine April budget deficit lowest since June 2003, within target
Manila shares close slightly higher on bargain-hunting
Philippine energy dept says total oil inventory to last beyond July
Philippines renews call for regional oil stockpile facility at Subic Bay
STOCK ALERT - Bank of the Philippine Islands up after cash div announcement
Philippine Chinabank's foreign currency rating upgraded to 'BB-' - CIL
Philippines' Pancake House shares trading suspended on acquisition deal
Bank of the Philippine Islands declares 0.80 peso/shr cash div
Manila shares firmer early on bargain-hunting
Philippines' Aboitiz Transport Q1 net profit 61.3 mln pesos vs 50.1 mln
STOCK ALERT - Philippines' Jollibee up on higher cash dividend announcement
STOCK ALERT - Philippines' Petron firmer early on dividend declaration
Manila shares outlook - Mixed to slightly lower on CPI, political worries
Philippines Petron taps Citigroup-led consortium for 100 mln usd loan - report
Philippine central bank may let Piltel debtors to exceed USD overbought limit
Philippine police seek indictments for German, Filipinos over Boracay murders
Philippines' Petron declares 0.20 pesos/share cash div
Philippine central bank sees FY CPI within target, firm oil prices factored in
Philippines says exclusion from US FCC intl list not to affect telcos pact

May 20 - 21 
May 17 
May 13 - 14 
May 11 - 12 
May 6 - 10 
May 4 - 5 
May 2 - 3 
 

 


OUTLOOK Philippine Q1 GDP up 4.3-5.5 pct yr-on-yr on farm growth, consumption


     ---- by Enrico de la Cruz ----
     MANILA (AFX-ASIA) - The Philippines' gross domestic product (GDP) is likely to have expanded 4.3-5.5 pct year-on-year in the first quarter, buoyed by the farm sector's strong showing and brisk private consumption that was boosted by election-related spending, economists said.
     Economists have mixed views on how the economy fared in the first quarter, as some of them expect growth to be faster than the previous quarter's 4.5 pct, while others believe that with oil prices rising since last year, growth would have been limited to 4.3-4.4 pct.
     They, however, agree that the outlook for the coming months is uncertain given the continued increase in oil prices and the possibility of an interest rate hike in the US as early as next month.
     The political environment in the Philippines also remains volatile two weeks after the May 10 presidential elections, which is not helping to restore investor confidence, they added.
     The National Statistical Coordination Board will release the preliminary first quarter GDP data on May 27.
     GDP growth in the first quarter of 2003 stood at 4.5 pct year-on-year.
     "Excellent news from the important agriculture sector leads to an upward revision in first quarter GDP growth forecasts," ING Financial Markets said in a recent report.
     ING also expects the services sector, led by telecommunications, to have driven the acceleration in GDP growth in the first quarter.
     ING projects a GDP growth of 5.3 pct, more upbeat than its previous forecast of 4.3 pct, after agriculture output surged 8.2 pct during the period, the fastest growth seen in the last 15 years.
     The agriculture sector represents a fifth of the Philippine economy.
     Following the strong farm output in the first quarter, ING raised its full-year agriculture growth forecast to 6.9 pct from 4.0 pct, which it said points to a full-year GDP growth projection of 5.3 pct.
     The government is aiming for a 4.9-5.8 pct year-on-year GDP growth for the whole of 2004.
     Economic Planning Secretary Romulo Neri said he expects first quarter GDP growth to come in at 5 pct on the back of strong agricultural growth, noting this ensures full-year growth will be in line with government target.
     Government "intervention" aimed at increasing food production and improving farm productivity amid a dry weather boosted the agriculture sector's output growth in the first quarter, the Department of Agriculture earlier said.
     Song Seng Wun, a regional economist at GK Goh Securities, projects a GDP growth of 5.5 pct for the first quarter, also because of the "unexpectedly strong agriculture expansion and a boost to private consumption" coming from election-related spending.
     But he noted he does not expect exports to be a major contributor to first quarter GDP growth.
     The Philippines recorded a trade deficit of 228 mln usd in March after posting a surplus of 5.0 mln usd in the previous month, as the country's import payments exceeded export revenues.
     In the January-March period, the deficit amounted to 559 mln usd, compared with a deficit of 512 mln a year earlier, and against a deficit of 330 mln usd in the January-February period.
     Merchandise imports in the first quarter grew 6.4 pct year-on-year to 9. 75 bln usd, while exports rose 6.3 pct year-on-year to 9.19 bln usd.
     Chee Seng Wong, a regional economist at DBS Bank in Singapore, also expects GDP growth of 5.5 pct for the first quarter, citing the contribution of election-related spending to private consumption and overall real GDP.
     He said the Philippine economy should win back investor confidence if incumbent President Gloria Arroyo is declared the winner in the May 10 elections.
     Arroyo is expected to continue her reform agenda with strong support from Congress, which is expected to be dominated by her party-mates and political allies in the next three years, Wong said.
     However, despite exit polls showing that Arroyo is likely to have won the elections, the opposition refuses to concede defeat, alleging massive electoral fraud and even threatening to block her proclamation.
     Besides the still uncertain political environment, economists said China's possible slowdown and accelerating inflation amid rising oil prices could also drag growth of the Philippine economy in the coming months.
     ATR-Kim Eng Securities economist Luz Lorenzo expects first quarter GDP growth to have slowed down to 4.4 pct, while Banco de Oro Universal Bank market strategist Jonathan Ravelas is keeping his 4.3 pct growth forecast for the same period.
     "I'm really skeptical about GDP growth accelerating from the previous year. Oil prices have been rising since last year," Ravelas said.
     Higher inflation may force the monetary authorities to tighten liquidity through policy measures, which will limit economic activities, economists said.
     The good news, however, is that the central bank is not yet feeling the pressure to tighten liquidity, they said, noting recent comments frpm central bank officials.
     "We don't have to do something in the foreseeable future. We're seeing inflation still within the 4-5 pct full-year government target," central bank governor Rafael Buenaventura said yesterday.
     afxmanila@afxasia.com
 

 

Philippine business less optimistic in Q2 on political concerns - central bank


     MANILA (AFX-ASIA) - Business sentiment in the Philippines has turned less optimistic as growing political uncertainties related to the outcome of the May 10 general elections dampened the business outlook for the second quarter, the central bank said.
     "The Philippine business sector expects economic growth to continue in the second and third quarters of the year even as political uncertainties reduced business optimism for the second quarter," it said, explaining the results of its second quarter 2004 business expectations survey conducted in April.
     The central bank said the overall outlook index for the second quarter remained positive, but declined to 19.9 pct from 26 pct in the first quarter.
     However, the same survey showed confidence that the economy would bounce back in the third quarter on expectations that growth would accelerate after the elections.
     The business outlook for firms outside metropolitan Manila was affected more by political concerns, the central bank added.
     The average capacity utilization in the industry sector is expected to improve to 76.7 pct in the second quarter, slightly up from the first quarter's 76.2 pct.
     Meanwhile, only 15.6 pct of respondent firms in the industry sector expressed plans for expansion in the third quarter, which the central bank said could be due to political concerns and existing excess production capacity.
     "With increasing business confidence in the economy and expectations of a more stable political environment after the elections, we are confident that a higher economic growth will be realized this year, more jobs will be created, inflation rate will remain low and the peso will be more stable," the central bank said.
     Government had set a 4.9-5.8 GDP growth target for 2004.
     Meanwhile, businesses said stiff competition and low consumer demand will likely constrain production and business activity in the second quarter. Unclear economic laws, higher interest rates, financial problems and limited access to credit were also among the concerns of the business community.
     cecille.yap@afxasia.com
 

 

Philippine fuel prices to rise further on costs recovery - energy secretary


     MANILA (AFX-ASIA) - Energy Secretary Vincent Perez said the public should expect further hikes in fuel prices in the next few weeks as retailers need to recover additional costs arising from higher global crude oil prices.
     "Based on our monitoring, the oil firms still have to increase their prices to recover their foregone revenues. Our internal calculations indicate they need to recover more, but we do not want to give the figures," Perez said.
     He spoke before leaving for the 9th International Energy Forum in Amsterdam.
     Equities market analysts said investors will be watching developments at the Amsterdam forum, which energy officials from about 60 nations, including the Organization of Petroleum Exporting Countries (OPEC), will attend.
     They will want to see if OPEC will accede to mounting global demand to raise crude oil output to stabilize prices.
     Perez said the Philippine Government will join the international clamor for oil-producing countries to help bring down crude oil prices.
     "We will talk to our friends from Saudi Arabia, which has been a long-time investor in the Philippines oil sector through Petron Corp, as well as Kuwait and Indonesia to also consider the situation of all oil-importing countries," he said.
     "Let us see if we can use goodwill so these oil-producing countries will listen to the predicament of those importing oil like the US, Thailand and the Philippines," he added.
     Local oil retailers raised their prices an average 1.00 peso per liter at the weekend.
     Petron Corp corporate communications manager Virginia Ruivivar said the weekend's price increases covers crude cost adjustments from April to early May.
     (1 usd = 55.9 pesos)
     afxmanila@afxasia.com
 

 

Philippines extends anti-dumping duties on China soap ingredients for 3 yrs


     MANILA (AFX-ASIA) - The Department of Trade and Industry said it has extended the anti-dumping duties on imports of soap ingredient sodium tripolyphosphates (STTP) from China for another three years.
     "We have found that the lifting of the imposition of the definitive anti-dumping duty on STTP would result in the continuance or recurrence of the dumping and injury," Trade and Industry Secretary Cesar Purisima said.
     The extension of the anti-dumping duties on STTP came a day after the agency announced that it has imposed additional "safeguard" duties on imported glass to protect the domestic industry.
     In 1999, a government committee acted upon a petition by local firm Chemphil Albright and Wilson Corp (CAWC) to impose anti-dumping duties on STTP imports from China.
     These duties were set to expire in December 2003, but CAWC filed a new petition in June 2003 to continue and even increase the duties.
     The extension of the definitive anti-dumping duties on STTP was imposed on the following exporting firms from China -- Kunming Import & Export Corp (70.22 usd per metric ton) and Yunnan Centsun Industry Co (33.91 usd/ton). For other Chinese exporters the anti-dumping duty is 70.22 usd/ton).
     "This is just a temporary relief that we give to (Philippine) companies which they must take advantage of in preparing themselves for the global environment," Purisima said.
     He added government resorts to anti-dumping measures to protect local manufacturing firms against unfair foreign competition and trade policies.
     
     (1 usd = 55.90 pesos)
     cecille.yap@afxasia.com
 

 

Manila shares close higher led by PLDT on late bargain-hunting


     MANILA (AFX-ASIA) - Share prices closed higher, recovering from earlier losses, on last-minute bargain-hunting in select stocks led by Philippine Long Distance Telephone Co (PLDT), dealers said.
     The 30-company composite index seesawed during most of the session, but ended up 12.71 points or 0.86 pct at 1,484.96 on 64.79 mln shares worth 738. 67 mln pesos, with turnover boosted by cross sales. The index moved between 1, 468.81 and 1,484.98.
     In the broader market, gainers outnumbered losers 23 to 11, while 43 stocks ended unchanged.
     Top-traded PLDT gained 5.00 pesos at 1,000 on 392,150 shares.
     Dealers said investors have remained cautious amid concerns over rising oil prices and prospects of higher interest rates. Technical indicators however suggest most blue-chip stocks have reached oversold levels and a recovery is within expectations.
     Next week, the main index is seen supported at the 1,420 points level, with resistance seen at 1,500.
     Dealers said investors will be watching developments at the International Energy Forum in Amsterdam, a gathering that will be attended by energy officials from about 60 nations, including OPEC members.
     They will see if OPEC will accede to mounting global demand for the cartel to raise crude output to stabilize prices.
     "There remains to be an overhang on global concerns, particularly the record-high prices of oil in the world market, terrorism and an impending increase in US interest rates," Regina Capital Development analyst Gomer Tan said.
     The outcome of the international energy forum at the weekend will likely dictate the market's direction on Monday, he added.
     AB Capital Securities research director Jose Vistan Jr said the market will remain cautious in the near term, although selective stock picking would keep it afloat.
     Second most active Equitable PCI Bank was up 0.50 at 41 on 3.9 mln shares.
     First Philippine Holdings shed 0.50 to 26.50 on 1.1 mln shares.
     Its unit Manila Electric B, available to foreigners, gained 0.50 to 30.50 on 827,200 shares. Meralco A ended up 0.25 at 18.75.
     Ayala Land was up 0.10 at 5.40, while parent Ayala Corp also ended 0.10 higher at 5.20.
     Globe Telecom was up 10 at 810.
     Bank of the Philippine Islands gained 1.00 to 41.50.
     Metrobank rose 0.25 to 24.
     The all-shares index closed up 3.40 at 930.13.
     The commercial-industrial index gained 14.02 to 2,297.93.
     Property was up 4.67 at 524.59 and mining down 3.66 at 1,378.41.
     Oil was down 0.01 at 1.19 and banking and financial services up 7.17 at 451.11.
     (1 usd = 55.90 pesos)
     cecille.yap@afxasia.com

 

Manila shares turn slightly higher in late trade on bargain-hunting


     MANILA (AFX-ASIA) - Share prices rose slightly in late trade, recovering from their weakness early in the session, on bargain-hunting in select stocks, dealers said.
     At 11.30 am, the 30-company composite index was up 3.56 points, or 0.24 pct, at 1,475.81 on 46.48 mln shares worth 246.76 mln pesos.
     Cross sales, mostly in Philippine Long Distance Telephone Co (PLDT), lifted turnover, which stood at 158.44 mln pesos.
     The index has traded between 1,468.81 and 1,476.04 so far.
     In the broader market, losers outnumbered gainers 14 to 11, while 43 stocks were unchanged.
     Top-traded PLDT was up 5.00 pesos at 1,000 on volume of 134,320 shares after an earlier weakness.
     The main index's support is seen at 1,450 points and resistance at 1,500.
     "The market will remain cautious in the near term. However, selective stock picking will keep it afloat," AB Capital Securities research director Jose Vistan Jr said.
     First Holdings shed 0.50 to 26.50 on 625,100 shares.
     Bank of the Philippine Islands gained 0.50 to 41.
     Metrobank was up 0.25 at 24.
     The all-shares index was up 0.71 points at 927.44.
     The commercial-industrial index shed 1.28 to 2,282.63.
     Property was down 0.09 at 519.83 and mining down 3.66 at 1,378.41.
     Oil was down 0.01 at 1.19 and banking and financial services up 3.54 at 447.48.
     (1 usd = 55.89 pesos)
     cecille.yap@afxasia.com

 

 

Manila shares marginally lower early on higher oil prices, interest rates


     MANILA (AFX-ASIA) - Share prices were marginally lower in early trade, as investors traded cautiously on concerns over rising oil prices and prospects of higher interest rates, dealers said.
     As there are doubts if yesterday's technical recovery will continue, market players are staying on the sidelines to await the final outcome of the May 10 presidential election, they added.
     At 10.05 am, the 30-company composite index was down 2.37 points, or 0.16 pct, at 1,469.88 on 8.33 mln shares worth 156.3 mln pesos.
     Cross sales, mostly in Philippine Long Distance Telephone Co (PLDT), lifted turnover, which stood at 143.8 mln pesos.
     The index has traded between a low of 1,469.19 and a high of 1,473.36 points so far.
     In the broader market, losers outnumbered gainers seven to four, while 17 stocks were unchanged.
     Top-traded PLDT was unchanged at 995 on volume of 126,870 shares after an earlier weakness.
     Some bargain hunting may emerge, given that some stocks have already reached oversold levels, dealers said.
     The main index's support is seen at 1,450 points and resistance at 1,500.
     (1 usd = 55.89 pesos)
     cecille.yap@afxasia.com

 

STOCK ALERT - Philippines' Meralco slightly lower early on profit taking


     MANILA (AFX-ASIA) - Manila Electric Co was weaker early as investors cashed in on yesterday's gains, dealers said.
     Second most active Meralco B, available to foreign investors, was down 0. 50 pesos at 29.50 on volume of 86,600 shares and Meralco A down 0.25 at 18.25.
     Investors remain cautious over the sustainability of yesterday's technical rebound and this has prompted profit taking even on the slight gains, they said.
     (1 usd = 55.88 pesos)
     cecille.yap@afxasia.com

 

STOCK ALERT - Philippines' PLDT lower in line with ADRs


     MANILA (AFX-ASIA) - Philippine Long Distance Telephone Co (PLDT) was slightly lower in early trade, tracking the overnight weakness of its American Depositary Receipts (ADRs) in New York, dealers said.
     PLDT, so far top-traded, was down 5.00 pesos at 990 on 126,620 shares.
     Its New York-traded ADRs shed 0.15 usd to 17.80 last night.
     (1 usd = 55.86 pesos)
     cecille.yap@afxasia.com

 

Japan's Penta-Ocean, others start Subic Bay project in Philippines - report


     TOKYO (AFX-ASIA) - A joint venture made up of Penta-Ocean Construction Co, a major marine construction firm, and two other Japanese contractors has started developing the Subic Bay Freeport Zone, located northwest of Manila, the Nikkei Business Daily reported, without citing sources.
     The 11.2 bln yen project is financed by a special yen loan by the Japan Bank for International Cooperation. Penta-Ocean Construction has a 40 pct stake, Shimizu Corp 35 pct, and Toa Corp 25 pct, the newspaper reported.
     The joint venture is scheduled to complete in July 2007 construction of a 560-meter-long, 13-meter-deep container pier that will allow two 45, 000-ton-class container vessels to berth at the same time, the report said.
     The Subic district, once used as a US naval base and returned to the Philippines in 1992, is turning into an international commerce, finance and tourism center. The port development is part of that, as well as a move to ease cargo traffic at Manila Port, the report said.

 

Philippines'Neri says Q1 GDP seen up 5 pct yr-on-yr - report


     MANILA (AFX-ASIA) - The Philippines' gross domestic product (GDP) is likely to have expanded 5 pct year-on-year the first quarter to March on the back of strong agricultural growth, the BusinessWorld daily reported, quoting Economic Planning Secretary Romulo Neri.
     The agriculture sector's healthy performance in the quarter will ensure the economy grows in line with government's 2004 projection of 4.9-5.8 pct, he added.
     Agricultural output in the first quarter grew 8.2 pct year-on-year, the highest rate posted in 15 years. The agriculture department attributed the growth to government "intervention" to raise food production and improve farm productivity.
     "We could hit 5 pct (growth) in the first quarter... For the whole year, we are still optimistic about the 4.9-5.8 pct (target)," Neri was quoted as saying.
     He added that growth in the service sector, mostly due to the telecoms industry, has been "largely" stable, while the robust growth in agriculture will likely offset weakness in the manufacturing output.
     cecille.yap@afxasia.com

 

German suspect in Boracay murders barred from leaving the Philippines


     MANILA (AFX-ASIA) - A German named by Philippine police as the prime suspect in the murders of three foreigners and a Filipina on the resort island of Boracay earlier this month has been barred from leaving the country, officials said.
     Police said they have issued a "hold-departure order" against Boracay resident Uwe Friesl and four alleged Filipino accomplices while prosecutors decide whether to formally indict the men.
     The five have been identified by police as suspects in the murders of Swiss-born Hong Kong art dealer Manfred Schoeni, German property developer Anton Faustenhauser, Hong Kong-based British architect John Cowperthwaite and a Filipina maid. They all had multiple stab wounds.
     "We are awaiting the arrest warrant against the suspect," national police spokesman Chief Superintendent Joel Goltiao said.
     "We have people monitoring him and we are working with the immigration authorities so that he (Friesl) can not leave the country," he said.
     Police in the island said they have evidence to link Friesl to the murders.
     Prosecutors said they will conduct a preliminary investigation, and if there is probable cause, the German would be charged in court.
     Friesl was Faustenhauser's caretaker at the villa, and police said they found footprints matching those of the suspect in the crime scene.
 

 

Philippine central bank says unlikely to tighten policy despite inflation


     MANILA (AFX-ASIA) - The policy-making Monetary Board is unlikely to resort to policy tightening this early despite the expected acceleration in inflation amid rising oil prices and higher land transport fares, central bank governor Rafael Buenaventura said.
     "We don't have to do something in the foreseeable future. We're seeing inflation still within the 4-5 pct full-year government target," he said.
     He added that if the government is to grant the petitions of labor groups for a wage hike, now is a good time to do it given the still manageable inflationary pressure.
     The central bank said full-year inflation should still settle within the 4-5 pct target even if the sharp rise in oil prices and higher transport and utility rates are factored in.
     Latest simulations made by the central bank show the full-year inflation rate likely to hit 4.5 pct. This assumes that for the succeeding eight months, the consumer price index (CPI) had to record an average of 4.9 pct, sharply higher than the four-month average of 3.7 pct.
     The government, through the Land Transportation Franchising and Regulatory Board, has approved increases in transport fares with effect from next month.
     (1 usd = 55.86 pesos)
     afxmanila@afxasia.com
 

 

Philippines' Music to resume trade, list more shares tomorrow


     MANILA (AFX-ASIA) - The Philippine Stock Exchange (PSE) said trading in shares of Music Semiconductors Corp will resume tomorrow, with the company listing an additional 522,500 common shares.
     The PSE has suspended trading in Music shares since January at the company's request.
     The company sought the suspension to avoid any trading confusion arising from its planned equity restructuring and reorganization.
     In a circular, the PSE said Music will list additional shares, covering the underlying shares of exercised warrants originally issued to Merel Groep NV.
     The PSE, however, also approved the reduction in the number of Music's listed shares, effective tomorrow, by 355.26 mln to 88.816 mln, as a result of the company's quasi-reorganization.
     afxmanila@afxasia.com
 

 

Philippines' Jollibee Foods to list additional 8,805 common shares tomorrow


     MANILA (AFX-ASIA) - Jollibee Foods Corp will list tomorrow an additional 8,805 common shares, arising from the company's tandem stock purchase and option plan, the Philippine Stock Exchange said.
     afxmanila@afxasia.com

 

Philippines imposes additional tariffs on imported glass products


     MANILA (AFX-ASIA) - The Department of Trade Industry (DTI) said it has imposed additional duties on imported glass products, saying a flood of such items has injured the domestic industry.
     In a statement, the DTI said it has imposed duties of 2,655 pesos per ton on figured glass, 5,110 pesos on copper-based glass mirrors, 5,850 pesos on tinted float glass and 4,630 pesos on clear float glass.
     The duties will be reduced by 5 pct after the first year of implementation and a further 5 pct after the second year, it said.
     Trade and Industry Secretary Cesar Purisima said the government has "solid ground" to impose additional duties on such glass products.
     He said the higher tariffs are based on the differentials between the domestic net selling prices and the lowest landed cost of imports.
     The DTI said it acted on Asahi Glass Philippines' petition for "safeguard measures" against imported glass mirrors, figured glass and float glass.
     "Asahi Glass complained that cheap imports from China and other countries are flooding the market, hence injuring the local glass industry," the DTI said.
     (1 usd = 55.8 pesos)
     afxmanila@afxasia.com
 

 

Philippine April budget deficit lowest since June 2003, within target


     (Updating with finance secretary statement, breakdown of revenue data)
     MANILA (AFX-ASIA) - The government incurred a budget deficit of 7.82 bln pesos in April, the lowest monthly deficit recorded since June last year, the Department of Finance (DoF) said.
     Revenues totaled 75.85 bln pesos against expenditures of 83.67 bln.
     "We are very pleased with the April fiscal performance. Notwithstanding the election period, the national government posted a deficit of only 7.82 bln pesos, which is the lowest monthly deficit since June 2003," Finance Secretary Juanita Amatong said.
     "This once again proves that the government remains steadfast in upholding fiscal discipline, which is the anchor of our macroeconomic stability program aimed at fostering further growth."
     The government sets deficit ceilings on a quarterly basis.
     In the first four months of the year, the deficit amounted to 64.7 bln pesos.
     In the first quarter to March, the deficit was 56.85 bln pesos, below the ceiling of 58.9 bln.
     For the second quarter, the ceiling is set at 21 bln pesos.
     Amatong, however, noted that the government's fiscal performance so far remained within programmed level.
     The government aims to limit this year's budget deficit to 197.8 bln pesos, or 4.2 pct of gross domestic product, in line with its goal of achieving a balanced budget by 2009.
     Amatong said measures to enhance revenue generation will continue going forward, such as more intensive tax audits and increased enforcement of tax laws.
     At the same time, the government will continue to seek legislation that will "restructure the present tax system," she said, without elaborating.
     "This will likewise be complemented by improvements in expenditure management through proper matching of government spending with revenue inflows and instituting performance and multi-year budgeting," she said.
     She added that the "peaceful" conduct of the May 10 presidential elections, together with the good fiscal performance during the January-April period, should "significantly allay concerns and anxieties of investors."
     Financial markets are keeping an eye on the Philippines' fiscal numbers, concerned that government spending this election year might exceed the programmed level
     The government's fiscal performance is a major issue that credit rating agencies are looking at, as they continue to assess the Philippines' creditworthiness against the country's burgeoning debt.
     The Bureau of Internal Revenue collected 53 bln pesos in April, a record level in monthly terms, but below the target of 56.3 bln.
     Revenues from the Bureau of Customs in April totaled 10.6 bln pesos, up 20 pct year-on-year.
     Of the total revenues, the Bureau of Treasury contributed 4.7 bln pesos, representing a 27.7 pct year-on-year growth.
     Net financing in the January-April period amounted to 79 bln pesos, 5.2 pct higher year-on-year.
     (1 usd = 55.8 pesos)
     afxmanila@afxasia.com
 

 

Manila shares close slightly higher on bargain-hunting


     MANILA (AFX-ASIA) - Share prices closed marginally higher, with the main index ending its five-day losing streak, on bargain-hunting in select stocks, dealers said.
     They however doubted the sustainability of today's gains as investors traded with extreme caution, immediately cashing in on quick gains, due to concerns over inflationary pressure and delays in the counting of votes cast in the May 10 presidential elections.
     The 30-company composite index closed up 3.93 points or 0.27 pct at 1,472. 25 on 65.06 mln shares worth 747.62 mln pesos, with turnover boosted by cross sales worth 229.13 mln. It traded between 1,466.64 and 1,480.02.
     In the broader market, gainers outnumbered losers 26 to 16, with 28 stocks ending unchanged.
     Philippine Long Distance Telephone Co (PLDT) was top-traded and up 5.00 pesos at 995 on 265,960 shares. Cross sales worth 115.98 mln pesos boosted turnover.
     Dealers said the market was due for a technical rebound after recent sharp falls, with the index at its lowest level in six weeks.
     Post-election concerns, particularly the slow counting of the ballots and allegations of poll fraud against the government, will continue to undermine sentiment, they said.
     Dealers added that investors are also concerned about the impact of higher oil prices and other inflationary pressures on the economy.
     "We expect economic and corporate news to continue to be positive going into the second quarter, but election jitters will dampen optimism," AB Capital Securities research director Jose Vistan Jr said.
     He added the market will likely undergo a technical rebound in the coming sessions, but said the short-term bias remains negative.
     "What we saw today was a combination of a technical rebound and in some cases, a little bit of bargain-hunting," Vistan said.
     2TradeAsia.com said investors will continue to trade cautiously due to concerns about higher interest rates in the US and rising world crude prices.
     "Fresh catalyst must be in place to arrest thinning participation from players until after the final roster of the country's officiated government has been announced," 2TradeAsia.com said.
     Second most active Ayala Land was down 0.10 pesos at 5.30 on 7.19 mln shares. Its parent firm Ayala Corp was also down 0.10 at 5.10 on 5.09 mln shares.
     Petron Corp was up 0.15 at 3.10 on 7.3 mln shares after the country's largest oil refiner announced a 0.20 pesos per cash dividend to be paid to stockholders as of June 2.
     First Philippine Holdings dropped 0.50 at 27 on 816,700 shares.
     Manila Electric B, open to foreigners, gained 1.00 at 30, while Meralco A shed 0.25 at 18.50.
     Bank of the Philippine Islands gained 0.50 at 40.50. The country's second largest lender has declared a cash dividend of 0.80 pesos per share. Payment and record dates have yet to be announced.
     SM Prime gained 0.10 to 6.00.
     The all-shares index was up 12.60 points at 926.73
     The commercial-industrial index gained 4.57 to 2,283.91.
     Property was up 0.02 at 519.92, while mining gained 6.92 to 1,382.07.
     Oil was unchanged at 1.20 while banking and financial services was up 1. 87 at 443.94.
     (1 usd = 55.80 pesos)
     cecille.yap@afxasia.com
 

 

Philippine energy dept says total oil inventory to last beyond July


     MANILA (AFX-ASIA) - The Department of Energy said the Philippines has an ample oil inventory to last beyond July as global crude oil prices continue to rise.
     In an oil situation report, the department said the country's existing oil inventory as of May 10 will last for 50 days.
     It added that an additional 6 mln barrels of crude and finished products loading this month will further beef up supply for it to last an additional 23 days, enough to meet the country's oil requirements beyond July.
     "Another 5 mln barrels, equivalent to 21 days, to be loaded in June (will) extend inventory until Aug 2004," the energy department said.
     But a major newspaper today quoted Energy Secretary Vincent Perez as saying the Philippines is in a "near-crisis level" as rising global crude oil prices continue to influence local prices.
     "We're in a near-crisis level because prices of crude right now only happen during a crisis," Perez was quoted to have said.
     The energy department, however, noted that pump prices of gasoline products in the Philippines remain the lowest in the region, despite recent increases, with unleaded gasoline at 23.33 pesos per liter and diesel at 17. 83 per liter.
     It placed Hong Kong's unleaded gasoline and diesel prices at 83.02 pesos and 46.35, respectively.
     Oil prices in Singapore, Australia, New Zealand, Cambodia and Thailand are also reported to be higher than in the Philippines, the department said.
     (1 usd = 55.78 pesos)
     cecille.yap@afxasia.com

 

Philippines renews call for regional oil stockpile facility at Subic Bay


     MANILA (AFX-ASIA) - The Philippines' the energy department today renewed its call for the establishment of a regional oil stockpiling facility at the former US naval base in Subic Bay, north of Manila.
     Energy Undersecretary Emmanuel de Dios revived the proposal at the second meeting of the Asia Cooperation Dialogue-Energy Working Group (ADC) being held here.
     Speaking at the meeting yesterday he said the government is pushing for the establishment of a joint regional oil stockpiling facility to ensure security of supply and to cushion the impact of rising world crude prices.
     He told delegates that such a facility is urgently needed in the wake of spiraling world oil prices.
     "In today's market of volatile oil prices, it is important that oil-producing and oil-consuming economies discuss areas of mutual concern. Initiatives on the possible establishment of a joint regional stockpiling facility is a key area that must be addressed," he told delegates.
     The Philippines Government offered the Subic Bay Petroleum Depot as a potential strategic and commercial site for the stockpiling facility from the start of the US-Iraq war last year.
     De Dios urged countries participating in the ACD meeting to give priority to discussions on rising oil prices and their effect on energy security.
     The two-day ACD meeting aims to formulate a joint declaration that will focus on policies and strategies on energy supply security for the region.
     The ACD was established during the 34th Association of Southeast Asian Nations foreign ministers' meeting in Hanoi in 2001 with the objective of exploring possibilities of creating cooperation within the energy sector.
     The working group's member-countries are Bahrain, Bangladesh, Brunei, China, Cambodia, India, Indonesia, Japan, Kazakstan, Korea, Kuwait, Laos, Malaysia, Myanmar, Oman, Pakistan, Philippines, Qatar, Singapore, Sri Lanka, Thailand and Vietnam.
 

 

STOCK ALERT - Bank of the Philippine Islands up after cash div announcement


     MANILA (AFX-ASIA) - Bank of the Philippine Islands (BPI) was firmer mid-session, rebounding from previous weakness after the bank declared a 0. 80 peso cash dividend per share on all its outstanding common shares, dealers said.
     BPI was up 0.50 peso at 40.50 on 170,100 shares.
     The country's second largest lender said payment will be made on the 15th day from record date, which will in turn be the 15th day from the bank's receipt of the central bank approval for the dividend.
     
     (1 usd = 55.8 pesos)
     afxmanila@afxasia.com
 

 

Philippine Chinabank's foreign currency rating upgraded to 'BB-' - CIL


     MANILA (AFX-ASIA) - Cyprus-based ratings agency Capital Intelligence Ltd (CIL) has upgraded China Banking Corp's (Chinabank) foreign currency long-term rating to "BB-" from "B+" due to its strong capital adequacy, liquid balance sheet and a high level of loan-loss coverage.
     The bank's financial strength rating was maintained at "BB", while the outlook remains stable.
     "Chinabank utilized the much improved earnings from both 2002 and 2003 to contain its bad loans through increasing provision charges, with loan-loss reserves to non-performing loans rising to above 70 pct (and that to unsecured NPLs over 200 pct). The bank also keeps the bulk of its profit internally," CIL said in a report.
     The ratings agency said it expects Chinabank's net interest income to grow more rapidly as it expands further into the individual consumer market.
     Meanwhile, Chinabank said it will likely overshoot its 2.2-bln peso net profit target for 2004.
     "Major profit drivers are seen to be loan expansion, lost-cost deposits generation and new businesses in cash management and remittances services," the bank said in a statement.
     cecille.yap@afxasia.com
 

 

Philippines' Pancake House shares trading suspended on acquisition deal


     MANILA (AFX-ASIA) - Pancake House Inc shares are suspended from trading effective today for the company to disclose additional information on its acquisition of Dencio's Foods Specialists Inc, the Philippine Stock Exchange (PSE) said.
     Dencio's Foods Specialists is a unit of Manila-based Dencio's Foods Corp, which operates restaurants and offers franchises.
     The PSE did not specify the additional information it needs before lifting the suspension order.
     In a letter to the PSE yesterday, Pancake House said its board had approved the execution of a stock purchase agreement with Dencio's Foods with the price set at 160 mln pesos.
     The deal is subject to the fulfillment of certain conditions and covenants, it added.
     In the letter, Pancake House also announced the board's approval for the execution of a 150-mln pesos term-loan agreement with Metropolitan Bank & Trust Co to finance partly the acquisition of Dencio's Foods Specialists.
     (1 usd = 55.8 pesos)
     afxmanila@afxasia.com
 

 

Bank of the Philippine Islands declares 0.80 peso/shr cash div


     MANILA (AFX-ASIA) - Bank of the Philippine Islands (BPI) said its board of directors has declared a cash dividend of 0.80 peso per share on all its outstanding common shares.
     The country's second largest lender said payment will be made on the 15th day from record date, which will be on the 15th day from the bank's receipt of the central bank's approval of the dividend declaration.
     (1 usd = 55.8 pesos)
     afxmanila@afxasia.com

 

Manila shares firmer early on bargain-hunting


     MANILA (AFX-ASIA) - Share prices were firmer in early trade, led by Philippine Long Distance Telephone Co (PLDT), as investors began to accumulate select cheap stocks following recent declines, dealers said.
     At 10.12 am, the 30-company composite index was up 10.48 points or 0.71 pct at 1,478.80 on 23.8 mln shares worth 198.9 mln pesos. It has so far traded between 1,466.64 and 1,478.80.
     The market's breadth was positive, with 16 gainers and a single loser so far, while 20 stocks have remained unchanged.
     PLDT was top-traded, up 10 pesos at 1,000 on 103,760 shares. Dealers said the stock has reached its oversold level after the sell-offs in previous sessions.
     Dealers added that concerns over prospects of higher interest rates and mounting inflationary pressure due to the rising cost of oil remain, but technical indicators suggest the market is ripe for bargain-hunting.
     Investors were accumulating stocks which either declared dividends or reported improved profitability in the first quarter to March, they said.
     Oil refiner Petron Corp was up 0.10 at 3.05 on 1.91 mln shares after announcing a cash dividend of 0.20 pesos per share for stockholders as of June 2.
     SM Prime gained 0.10 at 6.
     Globe Telecom was up 5 at 790 after recent falls.
     Manila Electric B, open to foreigners, was 1 peso higher at 30. Meralco A was unchanged at 18.75.
     Dealers expect the market to trade in a narrow range, with resistance at 1,500, as global and local post-election uncertainties continue to undermine sentiment.
     (1 usd = 55.79 pesos)
     cecille.yap@afxasia.com
 

 

Philippines' Aboitiz Transport Q1 net profit 61.3 mln pesos vs 50.1 mln


     MANILA (AFX-ASIA) - Shipping firm Aboitiz Transport System Corp's (formerly William, Gothong & Aboitiz Inc) consolidated first quarter to March results:
      Net revenue - 1.9 bln pesos vs 1.8 bln
      Opg expenses - 1.12 bln pesos vs 1.02 bln
      Opg income - 124.6 mln pesos vs 106.96 mln
      Net profit - 61.3 mln pesos vs 50.1 mln
      Earnings per share - 0.041 peso vs 0.033
     (1 usd = 55.8 pesos)
     afxmanila@afxasia.com
 

 

STOCK ALERT - Philippines' Jollibee up on higher cash dividend announcement


     MANILA (AFX-ASIA) - Jollibee Foods Corp was firmer in early trade after announcing a cash dividend of 0.19 pesos per share from its unrestricted retained earnings in 1997 and 1998, dealers said.
     Jollibee gained 0.25 peso to 19.50 on 32,200 shares.
     The country's largest fast-food chain operator said the cash dividend, to be paid on June 28 to stockholders on record as of June 7, is 29 pct higher than last year's 0.15 peso per share.
     The dividend increase comes even after the company made an 11.5 mln usd cash payment in March for the acquisition of an 85 pct share in Belmont Enterprises Venture Ltd, the holding company of Yonghe King fast food chain in China. It also invested 1.5 bln pesos in a new commissary.
     (1 usd = 55.79 pesos)
     cecille.yap@afxasia.com
 

 

STOCK ALERT - Philippines' Petron firmer early on dividend declaration


     MANILA (AFX-ASIA) - Oil refiner Petron Corp was firmer in early trade on a rebound after declaring a cash dividend per share of 0.20 pesos to stockholders on record as of June 2, dealers said.
     Petron was up 0.05 pesos at 3.00 on volume of 533,000 shares.
     Investors have begun taking positions ahead of Petron's dividend payout set for June 28, the dealers added.
     (1 usd = 55.79 pesos)
     cecille.yap@afxasia.com
 

 

Manila shares outlook - Mixed to slightly lower on CPI, political worries


     MANILA (AFX-ASIA) - Share prices will likely open mixed to slightly lower, with the impending increase in transport fares and mounting inflationary pressure undermining investor sentiment, dealers said.
     However, bargain-hunting may emerge after recent declines, they added.
     Yesterday, the 30-company composite index closed at a fresh-six week low, down 7.76 points or 0.53 pct at 1,468.32 on volume of 177.1 mln shares worth 685.1 mln pesos.
     The market's breadth remained negative as losers led gainers 31 to 13, with 26 stocks ending unchanged.
     BPI Securities, in its daily note to investors said prospects of higher interest rates, geo-political worries due to increasing violence in Iraq and the slow pace of the election results counting have continued to weigh on the market.
     "Another concern is a possible increase in transportation fare... there are fears this would trigger a series of price increases which may result in higher inflation," BPI noted.
     The Land Transportation Franchising and Regulatory Board (LTFRB) yesterday approved an increase in transport fares starting next month, largely to reflect the rising cost of oil and a weaker peso against the US dollar.
     The agency has approved the petition of jeepney operators to raise fares by 1.50 pesos to 5.50 for the first four kilometers and a peso each for every succeeding kilometer.
     Ordinary bus fares were also increased to 6.00 pesos for the minimum distance, up from 4.00 pesos. An adjustment of 1.10 pesos for every succeeding kilometer for provincial buses and 1.25 for those in Metro Manila was also approved.
     Economic Planning Secretary Romulo Neri said the government may review its full-year inflation target of 4.0-5.0 pct given the sharp rise in oil prices, the fare hike and prospects of higher utility rates and a possible increase in wages.
     The fare hike alone could already push the consumer price index (CPI) by an estimated 60 basis points, he said.
     Technically, dealers said shares are nearing their oversold levels and investors may begin to accumulate select stocks.
     The main index's support is at 1,450 and resistance at 1,500.
     (1 usd = 55.74 pesos)
     cecille.yap@afxasia.com
 

 

Philippines Petron taps Citigroup-led consortium for 100 mln usd loan - report


     MANILA (AFX-ASIA) - Oil refiner Petron Corp has awarded the mandate for a five-year 100 mln usd loan to the consortium of Citigroup, ING Bank and Saudi American Bank, the Philippine Star newspaper reported, citing company documents.
     Proceeds of the loan will be used to finance Petron's 100 mln usd Clean Air Act-related projects, which include the construction of a hydrotreater and isomerization plants aimed at producing environment friendly fuels, the report said.
     The three banks were also part of the group that arranged and completed a 120 mln usd, three-year loan for Petron in September 2000.
     The report said the consortium outbid other banks including BNP Paribas, BOT-Mitsubishi, DBS Bank, HSBC, Mizuho Corporate Asia HK and some local banks which it did not identify.
     (1 usd = 55.74 pesos)
     cecille.yap@afxasia.com
 

 

Philippine central bank may let Piltel debtors to exceed USD overbought limit


     MANILA (AFX-ASIA) - The central bank may allow creditors of Pilipino Telephone Corp (Piltel) to exceed their dollar overbought limit that would likely result from the corporate rehabilitation of the local telecom firm, central bank deputy governor Alberto Reyes said.
     Afiliate Smart Communications Inc, which intends to take control of Piltel, has earlier asked Piltel creditors to swap their 20-bln peso exposure in the company for either cash, Smart-issued bonds or Philippine sovereign papers.
     Piltel creditors Land Bank of the Philippines and Bank of the Philippine Islands, which together hold 28 pct of Piltel's obligations, however said they would only agree to the debt swap should Smart be able to convince the central bank to exempt from the overbought limit the additional dollar asset holdings that would likely come about from the the transaction.
     "In principle (the proposal) looks okay, but we still have to evaluate it. We'll come up with the decision in two weeks," Reyes said.
     The central bank's overbought limit rule restricts commercial banks' dollar assets to 10 mln usd or 5 pct of unimpaired capital, whichever is lower, to avoid speculative attacks on the local currency.
     Smart has offered to pay Piltel creditors with a combination of Philippine sovereign bonds maturing in 2016 and with Smart bonds maturing in 2014.
     (1 usd = 55.74 pesos)
     cecille.yap@afxasia.com
 

 

Philippine police seek indictments for German, Filipinos over Boracay murders


     BORACAY, Philippines (AFX-ASIA) - Prosecutors said they have been asked by police to indict a German national and four Filipinos for the murders of three foreigners and a Filipino maid on the central Philippine resort island of Boracay earlier this month.
     Provincial prosecutor Lourdes Mayor told Agence France-Presse police have sufficient grounds to charge Uwe Friesl, Chito Catalogo and three other as yet unnamed Filipinos for the crime.
     Friesl and the four Filipinos are being linked to the killings of Swiss-born, Hong Kong gallery owner Manfred Schoeni, German property developer and villa owner Anton Faustenhauser, Hong Kong-based British architect John Cowperthwaite and a Filipina maid.
     All were found stabbed to death on May 2 in Faustenhauser's villa La Dolce Vita on a headland overlooking Boracay.
     "The deputy regional chief of the 6th RCIDU (regional criminal investigation detection unit) Marlon Tayaba filed a case against Uwe Friesl, Chito Catalogo and so far three unnamed Filipinos this afternoon at the provincial prosecutors office for robbery and multiple homicide," Mayor said.
     She said all five are still free but their movements are being monitored by police "until such time a warrant of arrest is issued."
     Mayor said her office will conduct a preliminary investigation and ask the two named respondents to file counter-affidavits.
     If she finds probable cause, Mayor said she would file a case in court.
     Robbery with homicide is punishable by death, she said.
     Police Chief Superintendent Odilardo Magallanes said the principal suspect Friesl was employed by Faustenhauser as a caretaker at the villa.
     "He was the first one to have found the bodies. But investigators found footprints that matched his in the lavatory where the murder weapon was found, " Magallanes told AFP. "The crime laboratory matched the prints."
     Magallanes said Friesl has been apparently living in Boracay for some time and witnesses say they saw him near the villa at the time of the murders.
 

 

Philippines' Petron declares 0.20 pesos/share cash div


     MANILA (AFX-ASIA) - Oil refiner Petron Corp said it has declared a cash dividend of 0.20 pesos per share to be paid to stockholders on record as of June 2, with the payment date set for June 28.
     In a disclosure to the stock exchange, Petron said its board of directors has also approved the allocation of 1.51 mln usd to its "distribution optimizer" project and to advance 80 mln pesos to an affiliate. It did not elaborate.
     The company said its board also agreed to award the contracts for the second phase of its plant reliability excellence program and its point of sale (POS) and back office system.
     Petron closed down 0.10 pesos at 2.95 pesos on 7.79 mln shares.
     (1 usd = 55.74 pesos)
     cecille.yap@afxasia.com
 

 

Philippine central bank sees FY CPI within target, firm oil prices factored in


     MANILA (AFX-ASIA) - The central bank said it expects full-year inflation to remain within the government's target of a 4-5 pct year-on-year increase, with the sharp rise in oil prices and prospects of higher transport and utility rates factored in.
     Latest simulations made by the central bank showed full-year inflation rate likely hitting 4.5 pct. This assumes that for the succeeding eight months, the consumer price index (CPI) had to record an average of 4.9 pct, sharply higher than the four-month average of 3.7 pct.
     "In the very rough translation of the numbers, inflation still lies within the inflation target of 4-5 pct," central bank assistant governor Diwa Guinigundo said.
     He added the simulation has taken into account the impact of oil price increases, a possible wage hike and a higher cost of utilities.
     "It is a question of magnitude, but 4-5 pct is still a reasonable target, " Guinigundo said.
     The Land Transportation Franchising and Regulatory Board (LTFRB) announced today that transport fares would be increased by 1.50 pesos to 5.50 pesos for the first four kilometers for jeepneys and ordinary bus fares to 6. 00 pesos from 4.00 starting next month.
     Last week, oil retailers increased prices of their gasoline products by an average of 1.00 peso per liter to reflect the sharp rise in world crude prices.
     (1 usd = 55.74 pesos)
     cecille.yap@afxasia.com
 

 

Philippines says exclusion from US FCC intl list not to affect telcos pact


     MANILA (AFX-ASIA) - The National Telecommunications Commission (NTC) said the US Federal Communications Commission's (FCC) decision not to restore the Philippines in its list of international routes would not affect existing interim agreements between local and American telecom carriers.
     Being in the US international routes list could mean cheaper rates than international direct dial (IDD) calls.
     "There will be no effect on the interim agreements because these agreements have been mutually agreed upon. The interim agreements are within the benchmark rates so I do not see any reason why the FCC should not approve it," NTC chairman Ronald Solis said.
     The FCC recently turned down the requests of local carriers to include the Philippines in its list of International Simple Resale or ISR, or the practice of routing switched traffic over international private lines that provide cheaper rates than IDD calls.
     It upheld a previous order by its International Bureau, which said Philippine carriers had "whipsawed" US carriers by acting collectively to demand rate increases from the latter.
     The FCC also affirmed the bureau's order for US carriers to stop payments to their Philippine counterparts, whose decision to increase termination rates for inbound calls from the US allegedly forced the US carriers to compete unfairly.
     Local carriers raised termination rates from Feb 1, 2003 to 0.12 usd per minute from 0.08 usd for landline calls and to 0.16 usd from 0.12 for mobile phone calls.
     Some market players are concerned that the new FCC order could nullify the compromise agreement local carriers have signed with their American counterparts.
     The US-Philippine route is the fourth-largest international route based on outgoing US calls, with about 1.7 bln minutes in 2001.
     (1 usd = 55.74 pesos)
     cecille.yap@afxasia.com