050807: Shares close firmer on Dow's gains; PLDT earnings disappoint

May 08, 2007
Updated 14:48:17 (Mla time)
Rocel Felix
Xinhua Financial News Service

(UPDATE) MANILA, Philippines -- Share prices closed slightly higher, helped by another record close for the Dow Jones industrials overnight, but Philippine Long Distance Telephone Co. (PLDT) retreated after reporting flat first quarter earnings, dealers said.

Higher expenses and tax payments offset better revenues at the country's largest telecommunications firm, causing its net profit to slip to P8.575 billion for the three months to March from P8.581 billion in the same period last year.

However, its core income, which strips out the impact of foreign exchange and derivative gains, was 11 percent higher at P8.4 billion, compared to core earnings of P7.6 billion a year earlier.

Dealers said some investors also exercised restraint ahead of the May 14 midterm congressional polls.

The 30-company composite index edged up 4.06 points or 0.12 percent to settle at 3,333.95, after moving between 3,329.89 and 3.357.88.

The broader all-share index rose 9.55 points to 2,121.04.

Gainers beat losers 60 to 44, while 57 stocks were unchanged.

A total of 2.6 billion shares worth P4.7 billion were traded.

Dealers said the composite index managed to breach the 3,325 resistance level as some investors took their cue from the Dow's bull run. The Dow Jones Industrial Average crossed 13,300 for the first time on Monday, securing its 20th record close since the start of the year.

"We have to confirm in the next few sessions if that level could hold. If it does, the next resistance would be 3,400," said Gomer Tan, an analyst at Regina Capital Development Corp.

Tan said while market sentiment was generally bullish, investors remained guarded ahead of next Monday's congressional elections.

"If the political exercise is peaceful though, the market will likely go up since a credit rating upgrade (for the Philippines) is expected after the polls," added Tan.

Most international credit rating firms have put their review of the country's credit ratings on hold, opting to wait for the results of the elections.

However, other dealers said expectations of strong first quarter corporate earnings are outweighing election jitters.

"Investors are responding more to positive earnings. Except for one senatorial candidate calling for a repeal of the expanded value-added tax law, there is no economic platform being sounded off as anti-market," said Jose Vistan Jr., head of research at AB Capital Securities.

Top-traded PLDT shed P15 or 0.58 percent to P2,550.00 after the release of its flat quarterly earnings, reflecting market's disappointment.

But PLDT chairman Manuel Pangilinan said the company expects its core profit for the full year to come in at P33 billion, the top end of its guidance.

He said PLDT, controlled by Hong Kong-listed First Pacific Co. Ltd. with a 29 percent stake, also remains committed to distributing 70 percent of its core profit this year to its shareholders, half of which will be declared in August.

Despite flat profits, "PLDT's revenue is still higher, and it is expected to continue growing as the company expands its related business and as it looks for new revenue stream," said Ron Rodrigo, an analyst with Unicapital Securities.

PLDT rival Globe Telecom Inc. gained P45 or 3.61 percent to P1,290.

Other advancers include SM Investments Corp., which rose P7.50 or 2.07 percent to P370 and unit, mall operator SM Prime Holdings Inc., which inched up P0.25 or 2.17 percent to P11.75.

Property developer Ayala Land Inc. climbed P0.25 or 1.39 percent to P18.25 while Megaworld Corp. fell P0.05 or 1.41 percent to P3.50.

Food and beverage conglomerate San Miguel Corp.'s A-shares were steady at P64.50, while its B-shares closed up P1.50 or 2.04 percent at P75. The company will announce its first quarter results later Tuesday.

http://services.inquirer.net/express/07/05/08/html_output/xmlhtml/20070508-64745-xml.html

050807: PLDT profit flat in first quarter,sees high-end of '07 core

May 08, 2007
Updated 11:06:45 (Mla time)

Reuters

MANILA, Philippines -- Philippine Long Distance Telephone Co. (PLDT), the country's largest listed company, said on Tuesday its first quarter profit was flat year on year, helped by sustained wireless phone growth and rising data services revenue.

PLDT, the country's most valuable listed company with a market value of $10 billion, said its core earnings, which strips out currency and derivative gains, was up 11 percent to 8.4 billion pesos ($177 million) in the quarter from the same period last year.

The company, partly owned by Hong Kong's First Pacific Co. Ltd. and Japan's NTT group, said it had net income of P8.58 billion in the first quarter, the same level as a year earlier.

Analysts forecast PLDT's net profit at P34.99 billion this year, nearly flat from P35.1 billion in 2006, according to Reuters Estimates.

PLDT said core earnings in the year would come in at the high end of a projected P32-33 billion.

The company, Asia's tenth largest mobile phone operator, is trying to diversify its broadband and data services to fuel growth as its historically profitable mobile phone business faces a maturing domestic market.

PLDT is expected to benefit from higher mobile phone usage in the second quarter in the run-up to the May congressional polls.

Shares of PLDT slid 0.39 percent to P2,555 after the company's results announcement while the main index climbed 0.45 percent.

http://services.inquirer.net/express/07/05/08/html_output/xmlhtml/20070508-64714-xml.html

 

050807: Cebu Holdings profit rises 52%

May 08, 2007
Updated 10:08:18 (Mla time)

Xinhua Financial News Service

MANILA, Philippines -- Cebu Holdings Inc., a property developer which is 47.2 percent owned by Ayala Land Inc., said its net profit in the first quarter rose 52 percent year-on-year to P112.4 million on the back of increased sales.

Revenue jumped 89 percent to P486.8 million for the three months to March, driven mainly by the improved performance of its Ayala shopping center in Cebu province in central Philippines, the company said in notes accompanying its results.

Ayala Land is expected to announce its first-quarter results on Wednesday.

http://services.inquirer.net/express/07/05/08/html_output/xmlhtml/20070508-64705-xml.html

050807: Robinsons Land buys another land parcel in Fort Bonifacio

By Zinnia B. Dela Peña
The Philippine Star 05/08/2007

Robinsons Land Corp. (RLC), the property unit of Gokongwei holding firm JG Summit Holdings Inc., has acquired another property in the fast-growing Bonifacio Global City in Taguig.

The lot, measuring 9,819 square meters, is strategically located in the prime section of the Global City South District, RLC said in a statement.

This latest acquisition follows its recent purchase of 9,118 sqm. property along the upscale McKinley Drive corner Fifth Avenue, bringing RLC’s major twin acquisitions close to two hectares of prime property, the single largest block of property available in Bonifacio Global City.

The property will be developed into a three-tower premium residential condominium supported by upscale retail shops plus a commercial component, RLC said.

The project, dubbed as The Trion Towers, will be launched in the third quarter of this year.

Flat and loft-type units will be available in 1-bedroom, 2-bedroom and 3-bedroom models — all designed to address the discerning tastes of mega Manila’s populace, Fil-Ams, balikbayans, professionals, investors and expatriates.

RLC is now finalizing the master-plan to fully maximize usage of the property. It plans to pattern the project after master developments in bustling cities like Shanghai and Dubai.

"One major design aspect is the introduction of buildings in a triangle formation, where each tower is linked by a bridgeway via a podium-like activity theme park — all buildings will be designed to fittingly embrace the ‘central park’, fully maximizing the residential wellness, green-livability and value of the property," RLC said.

RLC president Frederick Go said the acquisition manifests the company’s continued confidence on the country’s economy and the real estate industry as well.

Other properties within the Global City are the two sold out projects — the 38-story Fifth Avenue Place, the 43-story Mckinley Park Residences and the recently-launched The Fort Residences.

RLC has earmarked around P15 billion in the next two years for the development of new malls, office buildings and housing projects, and acquisition of new properties. About 40 percent of the programmed capital budget will be used to build new malls in Dumaguete, Bulacan, Paco in Manila, Tagaytay and Davao as well as to refurbish existing shopping centers in Ermita, Manila and Bacolod.

Around 30 percent will go to the establishment of new office buildings catering to business process outsourcing firms. RLC is currently constructing seven residential condominium buildings: Fifth Avenue Place and McKinley Park Residences in Fort Bonifacio Global City, Gateway Garden Ridge and One Gateway Place in Robinsons Pioneer Complex, One Adriatico Place, Two Adriatico Place and Otis 888 Residences in Manila; and two office buildings — Robinsons Cybergate 2 and Robinsons Cybergate 3.

For its mall expansion, RLC is redeveloping a portion of Robinsons Galleria mall, called West Wing, which is expected to be completed before the end of the year. It is also expanding Robinsons Place Manila by constructing The Midtown Wing and constructing Robinsons Place Otis 888, a strip mall fronting its residential development project in Paco, Manila.

 

http://www.philstar.com/philstar/NEWS200705080706.htm

050807: Megaworld allots P1B for Makati condo proj

By Zinnia B. Dela Peña
The Philippine Star 05/08/2007

Upscale property developer Megaworld Corp. will invest P1 billion in the development of a 35-storey residential condominium building in Makati City.

In a disclosure to the Philippine Stock Exchange, Megaworld said the Greenbelt Chancellor project will be its first pre-furnished condominium in the Greenbelt area. This, however, is Megaworld’s third project in Greenbelt after the Greenbelt Parkplace and Greenbelt Radissons.

The P1 billion investment, it said, will cover the construction and furnishing of the condominium units.

Unit prices will range from P3 million to P13.4 million, Megaworld said.

Greenbelt Chancellor’s target market includes entrepreneurs, foreign-based Filipino professionals, overseas Filipino workers and doctors due to its proximity to the Makati Medical Center.

“Megaworld is taking the idea of convenience to a higher level by making the units pre-furnished. All the buyers and future residents need to do is move in and they will find all their desired appliances and furniture already ideally set up,” the company said.

The company is eyeing a net income of P2.9 billion this year or an increase of 42 percent from the previous year’s P2.04 billion, mainly coming from residential sales worth P15 billion.

Megaworld has launched several phases in existing developments, spurred by strong demand for residential projects. Among these include Phase 2 of McKinley Hills which is now 70 percent sold, Manhattan Gardens Tower 2 and Bellagio 4.

Megaworld is targeting to build at least 500,000 square meters of office space in the next five years as it seeks to address the tight supply of premium space for the burgeoning business process outsourcing (BPO) sector. The company hopes to complete about 200,000 to 250,000 sqm. of office space—almost 50 percent of its target—in 2007 and 2008 alone.

The Eastwood City CyberPark in Quezon City, the country’s first information technology (IT) park accredited by the Philippine Economic Zone Authority, remains Megaworld’s foremost supplier of office space. It is home to over 60 firms—half of which belong to the BPO and IT-enabled services sector—and a 15,000-strong workforce.

Megaworld currently has five new high-tech office projects at Eastwood, namely the E-Commerce Plaza which shall make available about 20,000 sqm. of office space by yearend, the second phase of 1880 Eastwood Avenue which will offer some 35,000 sqm. of leasable space and is slated for completion by the second quarter of 2008.

The company has allotted $1.2 billion over the next five years for the development of BPO office buildings and new township projects aimed at further boosting growth and earnings potential and increasing shareholders’ value.

 

http://www.philstar.com/philstar/NEWS200705080705.htm

050807: Index surges 51 pts on back of strong Wall St

The Philippine Star 05/08/2007

Share prices closed 1.57 percent higher yesterday, extending gains in line with regional markets after another record breaking Wall Street performance Friday, dealers said.

The composite index finished up 51.41 points at 3,329.89, just off the day’s high of 3,330.58. It hit a low of 3,278.48.

The broader all-share index rose 21.82 points to 2,111.49.

Gainers led losers 60 to 44, with 63 stocks unchanged. Turnover was 3.12 billion shares worth P4.89 billion.

"Investors saw bargain-hunting opportunities following last week’s consolidation, especially in companies that are expected to do well this year based on the first-quarter results that are trickling in," said Astro del Castillo of First Grade Holdings.

However, he said that with only seven days to go before the May 14 mid-term congressional elections, investors might be tempted to lock in profits quickly.

Bank of the Philippine Islands (BPI) jumped P4.50 to P68.50 after the country’s second largest lender reported a 28 percent year-on-year increase in net profit to P3.2 billion in the three months to March.

Philippine Long Distance Telephone Co. (PLDT) was up P45 to P2,565 ahead of the release Tuesday of quarterly results at the country’s dominant telecommunications firm.

Globe Telecom rose P25 to P1,245.

Ayala Land advanced 50 centavos to P18. The property developer will release its financial report on or before Wednesday.

San Miguel A and B shares were unchanged at P64.50 and P73.50, respectively, on the eve of the release of its first quarter results.

Finance Secretary Margarito Teves yesterday said tax collection is improving, after the government reported on April 23 that the deficit widened in March as it collected less than expected.

Rising revenue "is very good for the market," said Lamberto Santos, chairman of AB Capital Securities Inc. "Better collection, if sustainable, signals the government is on track to meeting its target of a balanced budget next year without imposing additional taxes." Shares also rose on optimism inflation will stay within the government’s forecast, Santos said. Bangko Sentral ng Pilipinas (BSP) Governor Amando Tetangco said inflation will be at the "lower end" of the bank’s four percent to five percent forecast this year. – AFP

 

http://www.philstar.com/philstar/NEWS200705080704.htm

050807: Globe allots P17B for 2007 capex

By Mary Ann ll. Reyes
The Philippine Star 05/08/2007

Globe Telecom is spending at least P17.1 billion ($350 million) this year and another P21.5 billion ($440 million) next year as the company focuses on new areas of growth, particularly broadband and 3G or the third-generation mobile communications technology.

Total capital expenditures for the first quarter of 2007 amounted to P3.1 billion or 34 percent higher than last year’s P2.3 billion as Globe deepened its geographic coverage to 95.2 percent and increased its population reach to 98.5 percent. The number of cell sites reached 5,963 as of end-March 2007.

Company officials expect spending for the second quarter of 2007 to be higher than the P3.1 billion during the January to March 2007 period, ramping up until the end of the year.

Of the $350 million that will be spent this year, around $190 million will be for broadband rollout encompassing both wireless and wireline network.

Globe is planning to expand the number of 3G cellsites to 1,500 within the year from 1,000 as of end-2006. Globe has around 500,000 3G phones in its network of which around 100,000 are actively using 3G.

Officials disclosed that they do not expect capex spending to increase next year, but an additional $90 million will be spent for Globe’s participation in a new cable project spearheaded by VSNL International, a member of the Tata Group of India, which will set up a trans-Asian submarine cable system that will link the Philippines to Hong Kong, with connectivity via the TGN Pacific network to Japan, Guam and the US.

Globe president and chief executive officer Gerardo Ablaza said that the increased spending in cable investment might be offset by a decreased spending in 2G. "We do not expect any big increases in capex levels next year," he pointed out.

Ablaza noted that mobile business has reached its maturity stage but there is still a lot of room for growth.

With cellular penetration rate expected to reach 60 percent by 2010 compared with 49 percent as of end-2006, Ablaza said there are still 15 million SIMs that that can be sold.

"There will still be growth in wireless but no longer the exponential growths that we’ve experience in the past. If we want more robust growths, it will have to come from new sources of revenues such as broadband," he added.

Globe posted core net earnings (net income before bond redemption costs and foreign exchange gains or losses) of P3.7 billion for the first quarter of 2007, a 12 percent improvement over the P3.3 billion registered for the same period in 2006 and 80 percent higher that the fourth quarter 2006 figures.

Ablaza said it is too early to tell if there will be a significant lift in earnings due to the May elections.

"We are quite pleased that the first quarter has shown a 12 percent growth year-on-year. The revenue growth for the wireless business is important to us. This is the first double digit growth that we’ve had in the last 18 to 24 months. OFW remittances helped on the consumption side but it is not clear whether the incoming elections have played a role. But we hope that the elections will bring about positive results for our business," he explained.

Reported net income was at P2.6 billion, 25 percent lower than the P3.45 billion in the first quarter of 2006, but six percent more than the P2.4 billion registered in the last quarter of 2006. The reduction was largely due to the P1.2 billion after tax impact of its bond redemption.

Earnings before interests, taxes, depreciation and amortization (EBITDA) during the January to March 2007 period grew seven percent to P10.4 billion compared to the same period last year while service revenues during the three-month period went up 10 percent to P15.6 billion from P14.2 billion last year, allowing Globe to post new record levels for both service revenues and EBITDA.

As for the EBITDA margin outlook, Ablaza said the company might not be able to continue with 67 percent over the next three quarter of the year due to expected increased marketing spending for the rest of the year. "We expect an early 60s in the next few quarters," he said.

Wireless service revenues expanded by 11 percent year-on-year driven by improvements in both data and voice revenues. Company officials said the sustained popularity of unlimited SMS and bucket voice offers, together with improved top-up values with the introduction of lower AMAX denominations, have been key drivers of wireless revenue growth.

Wireless data performed strongly during the quarter, registering 22 percent year-on-year growth to close at P6.45 billion from P5.2 billion in 2006.

The company’s wireless subscriber base posted significant gains during the first quarter of 2007 as it recorded a 28 percent year-on-year growth to 16.9 million subscribers. The prepaid segment composed of Globe Prepaid and TM brands made up 96 percent of total subscriber base.

Total gross subscriber additions for the period reached 3.3 million but because of lower quarter-on-quarter churn rates, the company ended with strong net additions of 1.3 million for the first quarter.

Meanwhile, wireline service revenues grew by three percent, reporting revenues of P1.64 billion for the period ending March 2007 compared to P1.58 billion in 2006, propelled by higher broadband and corporate data revenues. Improved broadband revenues came from an expanded subscriber base which grew by 167 percent to 69,170 as of end-March while a higher circuit base boosted lease revenues for the data business.

Globe’s consolidated debt is expected to fall to P34 billion by April this year.

 

http://www.philstar.com/philstar/news200705080701.htm

050807: RLC acquires another prime lot in Global City

MALL and property developer Robinsons Land Corp. (RLC) has acquired another 1-hectare lot in the posh Bonifacio Global City (BGC), it said in a statement Monday. This latest buy adds up to the recently acquired 9,118-square meter property at the corner of upscale McKinley Drive and Fifth Avenue. Both are the two largest property blocks available to date within BGC. “This latest acquisition demonstrates RLC’s continued confidence in the company’s projects and on the country’s property sector,” said president and chief operating officer Frederick D. Go. No acquisition price was mentioned for the 1-hectare property. The lot would house RLC’s planned three-tower residential condo project called The Trion Towers. “The company is now finalizing the master plan to fully maximize usage of the property, mimicking the advances made in master developments in bustling cities like Shanghai and Dubai. Dubbed as The Trion Towers, its planned introduction would be sometime third quarter this year,” Go said. A major design aspect is the introduction of buildings in  triangle formation, where each tower is linked by a bridgeway via a podium-like activity theme park. All buildings would be designed to fittingly embrace the central park, fully maximizing the residential wellness, green-livability and value of the property. The Trion Towers would have a commercial component with retail stores. Flat and loft type units would be available in one bedroom, two-bedroom and three-bedroom models. RLC now has five strategically located residential properties in BGC, namely, the 38-story Fifth Avenue Place, the 43-story McKinley Park Residences, The Fort Residences, The Trion Towers and the 9,118-square meter property. Last month, the company said it will spend P2.5 billion for the development of a high-end residential condominium in BGC. The project would be launched within the year. --Honey Madrilejos-Reyes

 

http://www.businessmirror.com.ph/05082007/companies04.html

050807: RP stocks post biggest gain in 2 wks

PHILIPPINE stocks rose the most in more than two weeks. Bank of the Philippine Islands and Philippine Long Distance Telephone Co. (PLDT) led the advance. The Philippine Stock Exchange index gained 51.41, or 1.6 percent, to 3329.89 at the noon close. Advancers outnumbered decliners 60 to 44 in the broader market. Finance secretary Gary Teves over the weekend said tax collection is improving, after the government reported on April 23 that the deficit widened in March as it collected less than expected. Rising revenue “is very good for the market,” said Lamberto Santos, chairman of AB Capital Securities Inc. “Better collection, if sustainable, signals the government is on track to meeting its target of a balanced budget next year without imposing additional taxes.” Bank of the Philippine Islands, the nation’s biggest lender by market value, surged P4.50, or 7 percent, to P88.50. PLDT, the nation’s biggest company by market value, climbed P45, or 1.8 percent, to P2565. Shares also rose on optimism inflation will stay within the government’s forecast, Santos said. Central Bank Governor Amando Tetangco Monday said inflation will be at the “lower end” of the bank’s 4 percent to 5 percent forecast this year. --Bloomberg

http://www.businessmirror.com.ph/05082007/companies03.html

050807: Piltel's 1Q net income down to P1.99B

By Lenie Lectura

Reporter

PILIPINO Telephone Corp. (Piltel), a unit of Philippine Long Distance Telephone Co. (PLDT), reported Monday a lower net income of P1.99 billion in the first quarter of the year from P2.25 billion year earlier. Napoleon Nazareno, who is president of both companies,  said that Piltel’s financial results were mainly due to lower exceptional gains. In previous years nonrecurring items such as deferred tax assets (DTAs) and foreign exchange (forex)  gains/losses have had a significant impact on the company’s net income. Piltel’s debt prepayment and resulting nominal debt balance have closed the gap between reported and core net income figures, Nazareno explained. “There are no more foreign exchange gains,” Nazareno  added. Excluding certain DTAs and the effects of forex valuation, Piltel’s core earnings stood at P1.98 billion during the first three months of the year, up 33 percent from the P1.49 billion recorded for the same period in 2006. “Our  revenues and core income went up brought about by SMS [short messaging service] and voice applications. The first quarter was a good quarter for Piltel. I guess it’s a sign of the election-related revenue,” Nazareno said. The company added 421,000 new subscribers in the first three months of the year, ending the first quarter with about 7.4 million subscribers on Talk ’N Text, the company’s prepaid GSM (global system for mobile communications) service. Nazareno said the poll-related activities done through mobile phones will stir the company’s performance in the second quarter. “We expect more towards nearing  election time,” Nazareno said. During the period, wireless net service revenues increased by 24 percent to P3.13 billion from P2.52 billion in the same comparable period. GSM service revenues make up 95 percent of Piltel’s net service revenues with fixed line service revenues accounting for the balance of 5-percent amounting to P156 million. SMS continues to be the main driver of the company’s revenues as data revenues increased by 27 percent to P1.98 billion from P1.56 billion. Data revenues make up 63 percent of GSM revenues. Moving forward, Nazareno is hopeful that the company will sustain its first quarter results throughout the remaining months of the year. “Hopefully, our quarter bottom line would be sustained. Our performance will now normalize because there will be no forex gain as we have prepaid our debts already,” Nazareno said. Piltel embarked on an aggressive debt prepayment program, which culminated in the complete payment of its restructured debt in December 2006. At end-March, Piltel redeemed all of its outstanding unrestructured bonds amounting to $690,000. Piltel also  sought and received approval from the Securities and Exchange Commission (SEC) for its capital quasi-reorganization. The completion of Piltel’s equity restructuring now puts it in a position to pay dividends to its shareholders. Dividends will be paid to common shareholders once the company has paid cumulative dividends to preferred shareholders, which totaled P2.64 billion as of the end of March 2007. “We can now look at paying dividends to our shareholders and we will begin by paying off the accrued cumulative dividends due to our preferred shareholders which have  remained unpaid to date. Once that is completed and our retained earnings have reached an appropriate level, we should be able to pay cash dividends out of our 2007 income to our common shareholders sometime in early 2008,” Nazareno said. With the full prepayment of restructured debts in December 2006 and the full payment of convertible bonds in March 2007, Piltel no longer has any significant foreign currency denominated liabilities subject to revaluation.

 

http://www.businessmirror.com.ph/05082007/companies02.html