PLDT Reports Core Net Income of PhP27.9B in 2016

Makati—(PHStocks)—PLDT Inc. (PSE: TEL) (NYSE: PHI) today announced its unaudited financial and operating results for the full year 2016 with consolidated service revenues, net of PhP9.6 billion in interconnection costs, amounting to PhP147.6 billion, three percent (3%) less than the previous year. Excluding international and national long distance (ILD and NLD) revenues and interconnection costs, consolidated service revenues added up to PhP133.5 billion, only one percent less than 2015.

Consolidated core income reached PhP27.9 billion, 21% lower than the prior year, mainly due to lower EBITDA and costs arising from higher capital expenditures to
support ongoing expansion of the fixed and mobile networks of PLDT and its mobile subsidiary Smart Communications. Net of asset sales, accelerated depreciation, onetime provisions and subsidies, as well as lower taxes from deferred tax assets recognized during 2016, Recurring Core Income amounted to PhP20.2 billion.
Consolidated Core EBITDA declined by 6% to PhP65.8 billion, representing a margin of 42%, due largely to lower wireless service revenues and higher provisions, moderated by lower cash operating expenses. Including one-time provisions and handset subsidies, the underlying EBITDA amounted to PhP61.2 billion. Consolidated EBITDA margin on this basis stood at 39% after improvement were posted in the 3rd and 4th quarters.

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IDC Welcomes New Board Member

Makati—(PHStocks)—Listed sustainable builder Italpinas Development Corp. (PSE: IDC) announced the addition of Januario Jesus Gregorio III B. Atencio to its board of directors, last March 1, 2017.

Atencio has been the President and CEO of 8990 Holdings Inc. (PSE: HOUSE) and its eleven (11) other real estate subsidiaries. He was also the founder of the Center for Housing Advocacy and Independent Synergies (CHAIRS), and has likewise been a Private Sector Representative of the Housing and Urban Development Coordinating Council (HUDCC) from 2011 up to 2016.

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SM Prime Proposed Bond Issue Rated PRS Aaa

Pasay—(PHStocks)—SM Prime Holdings Inc. (PSE: SMPH) has filed with the Securities and Exchange Commission an application for a permit to sell for the issuance of fixed-rate bonds in the amount of ₱15 billion comprised of seven (7)-year Series “G” Bonds due on 2024 with an over-subscription option of up to ₱5 billion. The issuance is part of the Company ₱60 Billion Shelf Registration of Fixed Rate Bonds approved by the Commission on 8 July 2016 under SEC MSRD Order No. 11 series of 2016 dated 12 July 2016.

The Philippine Rating Services Corp. (Philratings) assigned a rating of PRS Aaa to SM Prime’s proposed bond issue. The bonds are part of the company’s proposed 3-year Debt Securities Program of up to PhP60 billion. The rating for SMPH’s outstanding bonds amounting to PhP50 billion was likewise maintained at PRS Aaa. PhilRatings assigned a Stable outlook for the ratings of the proposed and outstanding bonds.

PRS Aaa is the highest rating assigned by Philratings, denoting that such obligations are of the highest quality with minimal credit risk and that the issuing company’s capacity to meet its financial commitment on the obligations is extremely strong.

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Holcim Philippines Records Strong Performance Amid Increased Competition

Taguig—(PHStocks)—Construction solutions provider Holcim Philippines Inc. (PSE: HLCM) posted another strong financial performance in 2016, amid increased competition from local players and imports attracted by the country’s robust economy and strong building activity.

Holcim Philippines’ 2016 revenues grew by 7.5% to PhP40.3 billion from the previous year on higher cement volumes and price.

With higher revenues and manufacturing and distribution excellence, operating EBITDA increased by 14% to PhP10.8 billion from PhP9.5 billion a year ago.

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CRISP Affirms Sta. Lucia Land’s AA+ Issuer Rating

Cainta—(PHStocks)—Credit Rating and Investors Services Philippines Inc. (CRISP) has re-affirmed Sta. Lucia Land Inc.’s (PSE: SLI) “AA+” issuer rating based on the following factors: stable financial performance; expanding landbank; and on-going brand building activities.

Emmanuel A. Leyco, president of CRISP, stated, “CRISP is pleased to note SLI’s stable financial performance, growth and stability through its successful joint venture strategy and its own expanding landbanking activities. CRISP is also very optimistic with the on-going brand building activities that are expected to solidify SLI’s brand reputation and firm market acceptance. This assessment is based on our discussion during our recent meeting, financial statements and other market documents that were reviewed by the committee and CRISP’s own data that were accessed through various sources.”

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Belle Net Profit Up 74% in 2016

Pasay—(PHStocks)—Belle Corp. (PSE: BEL) realized consolidated net income of PhP3.1 billion for 2016, which is PhP1.3 billion (74%) higher than net income of PhP1.8 billion for 2015. Excluding extraordinary items, principally a capital gain of PhP352 million on the sale of 26 million shares of SM Prime Holdings Inc. (PSE: SMPH) in July 2016, Belle’s recurring net income of PhP2.1 billion for 2016 was higher by PhP737 million (55%) over recurring net income for 2015 of PhP1.3 billion. This performance continues Belle’s record of underlying earnings growth.

Due to the company’s strong profitability, it declared a regular cash dividend of nine-and-a half centavos (PhP0.095) per share to its common shareholders on February 28, 2017. This equates to a total dividend payment of approximately PhP1.0 billion payable on March 30, 2017 to shareholders of record as of March 14, 2017.

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EastWest Income Surged 70%

Taguig—(PHStocks)—East West Banking Corp. (EastWest Bank, PSE: EW) registered a net income of PhP3.4 billion in 2016, 70% higher than the PhP2 billion booked in 2015. Its total assets increased by 25% to P292 billion, led by the 51% increase in its consumer loan portfolio.

EW’s core recurring income was up by 25%. The bank sustained its industry-leading net interest margin of 7.7%. Net interest margin, net of provisions for loan losses, was recorded at 4.9%, still the highest among universal and commercial banks. EastWest is the most consumer-focused universal bank in the country with more than half its loan portfolio lent to consumers.

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Philex Mining Reports 2016 Core Net Income of PhP1.657B

Mandaluyong—(PHStocks)—The Board of Directors of Philex Mining Corp. (PSE: PX) has announced that the company generated a core net income of PhP1.657 billion, 83 percent higher than the previous year’s PhP905 million. In the same manner, reported net income more than doubled to PhP1.567 billion (FY2015: PhP776 million) with net income attributable to equity holders of the parent company growing 77 percent to PhP1.589 billion (FY2015: PhP896 million).

FINANCIAL AND OPERATING RESULTS

Production

The FY2016 performance was attributed to better copper output, higher metal prices and favorable exchange rates. Last year’s copper concentrate production of 73,107 dry metric tons (DMT) was the highest recorded since 2008, which was generally attributed to operational improvements. Meanwhile, foreign exchange rates averaged PhP47.80/$1 in 2016 against PhP45.31/$1 the previous year.

Padcal mine operated for 362 days during the period (FY2015: 358 days) and milled 9.4 million tonnes of ore (FY2015: 9.2 million tonnes). The tonnage translated to 35.0 million pounds of copper produced, which was 3 percent more than the previous year’s 34.1 million pounds as copper grades improved to 0.206% (FY2015: 0.205%).

Gold production, on the other hand, reached 103,304 ounces (FY2015: 107,887 ounces) due to lower grades of 0.417 grams/tonne (g/t) (FY2015: 0.438 g/t) and metal recovery as higher-grade content in the current drawpoints gets depleted.

Revenues 

Revenues for 2016 increased 12 percent to P10.272 billion (FY2015: P9.189 billion), with copper accounting for P3.976 billion (FY2015: P3.450 billion) and gold contributing P6.209 billion (FY2015: 5.670 billion) – both higher than the previous year’s levels by 15 and 10 percent, respectively. Revenues from silver amounted to P86.5 million (FY2015: P69.7 million), which was 24% higher from year-ago levels.

The performance was attributed to improved average metal prices during the year. The average realized price for copper was 3 percent higher at $2.35 per pound (FY2015: $2.29 per pound), which complemented the increase in copper output. The average gold price, on the other hand, was 9 percent higher at $1,254 per ounce (FY2015: $1,147 per ounce), which more than offset the lower gold output.

Costs, Expenses and Debt

Despite the 2 percent increase in tonnage, the Company continued to vigilantly manage its costs and expenses, resulting in a 2 percent reduction in consolidated costs and expenses to PhP6.900 billion (FY2015: PhP7.011 billion), with general and administrative expenses (GAE) declining another 10 percent to PhP373 million (FY2015: P414 million). From 2013-2016, GAE declined by an average of 9 percent annually as a result of the Company’s relentless pursuit to constantly improve operational efficiency through innovation, cost rationalization and manpower development.

Meanwhile, the company repaid a total of $8.5 million in debt during the period, which brought total short-term debt to $62.0 million (PhP3.083 billion) as of end-December 2016, from $70.5 million (PhP3.318 billion) as of end-December 2015.

Based on the 2016 results, the Company also declared cash dividends of four centavos per share (PhP0.04/share) to shareholders on record as of March 14, 2017, which will be payable on March 27, 2017.

SILANGAN

The Silangan project’s Definitive Feasibility Study (DFS) is expected to be completed soon and despite the current uncertain regulatory environment, the Company’s wholly-owned subsidiary, Silangan Mindanao Mining Co., Inc. (SMMCI) will be able to proceed to the next stages of project development.

“Contrary to media pronouncements, we are confident that Silangan’s MPSA is valid and legal because it is not within any proclaimed watershed forest reserves or critical watersheds, where mining is prohibited, and was issued following all relevant legal requirements and procedures, including regulatory clearance, that the area covered by the MPSA is open to mining and DENR took its action and made its announcement with no legal basis whatsoever,” said SMMCI President Yulo E. Perez.

PARTNER FOR DEVELOPMENT 

“Specifically, we contributed PhP117 million to our Social Development Management Program (SDMP) in 2016, which was 7 percent more than what we laid out in 2015. Since 2011, we have funded PhP454 million for our SDMP projects to further our goal of financial inclusion and social progress within our areas of operation. In addition, we contributed PhP447 million to our Environmental Protection and Enhancement Program (EPEP) initiatives last year, which included the reforestation of 52 hectares of new areas, maintenance of 150 hectares of existing plantations, care over 75 hectares of agro-forestry land and planting of around 180,000 new seedlings of various species in upland and coastal areas across the different areas where we are present. This brought our total outlays to PhP2.158 billion from 2011-16 to ensure that the natural surroundings around our areas of operations are maintained and restored,” said Eulalio B. Austin, Jr. President and CEO of Philex Mining.

In an earlier statement, PX said, “The company and its subsidiaries are strong partners of the government in protecting the environment and in its fight against poverty and unemployment.”

On top of the EPEP and SDMP expenses, the company paid PhP1.35 billion in taxes, which funds national and local government projects. “We constantly look for ways to improve our operational platform, organizational framework, governance structure, and compliance level to enable us to achieve long-term sustainability and consistently pursue our objective of being a responsible and conscientious mineral resource development company, amid the turmoil in the local mining industry,” added Austin.

In 2016, the company paid a total of PhP1.914 billion in taxes, royalties, SDMP, EPEP and other fees to the national and local governments and the surrounding communities, which was 22% higher than the reported net income for the period.

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