GMA Network raises capital to P5B
By Zinnia B. Dela Peña
The Philippine Star 01/06/2006
http://philstar.com/philstar/NEWS200601060708.htm
Broadcast firm GMA Network Inc. is seeking the approval of the Securities and Exchange Commission (SEC) for the increase in its authorized capital from P2 billion to P5 billion in preparation for its planned initial public offering (IPO).
Based on documents filed with the SEC, the new capitalization will consist of P3.5 billion worth of common shares with a par value of P1 and P1.5 billion worth of preferred shares with a par value of 20 centavos.
The capital increase has already gained the approval of the network’s major shareholders.
The amount of P3 billion consisting of 1.5 billion common shares with a par value of P1 and 7.5 billion preferred shares with a par value of 20 centavos have been subscribed to by stockholders and have been fully paid for by means of stock dividends.
GMA plans to offer between 20 to 30 percent of its stock to the public by the first or second quarter of 2006. It earlier attempted to undertake an IPO but misunderstandings among the three major shareholders of the company eventually led to the shelving of the IPO until 2006.
At that time, the company expected to generate around P9 billion in proceeds from the maiden offering of its shares.
GMA is eyeing a net profit of more than P2 billion this year, driven by the impressive performance of its international operations and the successful launch of its UHF channel. In 2005, the network said it likely posted a P2-billion net income, 30 percent higher than the P1.5 billion reported in 2004.
Profits of GMA network, which operates Channel 7, are expected to rise 15 percent this year with the launch of more innovative shows suited to meet the taste of the Filipino viewing public.
Airtime revenues are projected to hit P9.4 billion by the end of the year while operating capex is seen to reach P7 billion.
In the nine months ending September last year, GMA chalked in a net income of P1.7 billion compared with only P1.098 billion the previous level as it continued to lead TV viewership ratings in the mega-Manila area.
GMA hopes to penetrate Europe, Rome and England this year to tap the huge market of overseas Filipino workers in these areas.
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