FMIC to launch P3B fixed-income ETF this year

 

The investment banking arm of the Metrobank group is launching its second exchange traded fund (ETF) later this year.

First Metro Investment Corp (FMIC) president Roberto Juanchito Dispo last week told reporters that it will roll out a fixed-income ETF with an initial capitalization of P3 billion.

"We're very keen on launching an ETF that will track the bond index in the country. The fixed-income market in the Philippines is much deeper than the equity markets. We're laying the groundwork. Hopefully, before end of the year, we will be able to do it," Dispo said.

In introducing its new ETF, Dispo noted the robust Philippine fixed-income market especially with credit rating agencies raising the country’s sovereign debt score to investment grade.

"The recent credit upgrade put us on the radar screen of regional and global investors so the opportunity is very ripe to for us to launch an ETF tracking the bond index. That will allow opportunities for investors to buy directly corporate and government securities issuances simply by investing in that ETF fund," Dispo said.

FMIC was the company behind the country's first ETF, the First Metro ETF, which reflects the performance of the PSE index (PSEi), a basket of 30 publicly traded shares regarded as the benchmark of the market's overall performance.

Considered as the world's fastest growing asset class, an ETF is similar to a mutual fund that tracks an index but is traded on a stock exchange.

To promote awareness on bond trading, FMIC is launching a bond exchange challenge that will be open to all universities in the country.

The competition will be similar to the Stock Exchange Challenge, a partnership with the Philippine Stock Exchange that has attracted about 120 universities. The competition offered a prize money of P150,000 for the winning team.

"We hire the winners. These are the crème de la crème," Dispo said.

- Interaksyon

P35.4B Cavite-Laguna Expressway gets four bids, says DPWH

Four groups on Monday made a bid for the P35.4 billion Cavite-Laguna Expressway project, a public-private partnership initiative of the Department of Public Works and Highways (DPWH).

According to the DPWH, the investors vying for the PPP project are Alloy MTD Philippines of Malaysia, Team “Orion” of Ayala Corp. and Aboitiz Group, MPCALA Holdings Inc. of Metro Pacific Investments Corp., and Optimal Infrastructure Development Inc. of San Miguel Corp.

The department will issue a for the submission and opening date of the financial offer by bidders that will pass the technical hurdle, DPWH Secretary Rogelio Singson told the representatives of the investors. "We hope to complete the process by Friday," he said.

At this point, the Special Bids and Awards Committee and the Technical Working Group will review the legal and technical proposals of the participants and see how well they have met the requirements, DPWH Undersecretary Rafael Yabut said.
The project involves financing, design, construction, operation and maintenance of a four-lane, 47-kilometer tollway linking South Luzon Expressway and Manila-Cavite Tollroad Expressway.

- GMA News

Belle board approves transfer of gaming assets to Sinophil

The board of Belle Corp has approved a reorganization that involves transferring the company’s gaming assets to subsidiary Sinophil Corp.

In a disclosure to the Philippine Stock Exchange, Henry Sy-owned Belle said its board approved the transfer of its 100 percent stake in Premium Leisure Amusements Inc (PLAI) and its 34.5 percent stake in Pacific Online Systems Corp to Sinophil.

Sinophil is another Sy-controlled company that holds investments in gaming and resorts. Before a change in its primary purpose in 1997, Sinophil used to be engaged in oil exploration.

PLAI is part of the consortium that holds the license for City of Dreams Manila, the casino resort that Belle and Melco Crown Philippines are building at the Entertainment City of state-run Philippine Amusement and Gaming Corp (Pagcor).

Despite giving up its interest in PLAI, Belle would continue to receive rental income, as it would retain direct ownership of the land and building on which City of Dreams Manila would rise.

Belle will also retain direct ownership and continue to develop its other assets, principally its properties in the Tagaytay Highlands and Midlands complexes, including surrounding residential and leisure assets of over 800 hectares of undeveloped land.
The reorganization is expected to be completed in August.

Belle earned P309.90 million in the first quarter, a 60 percent drop from the P777.8 million in the same three months of last year.

The 2013 income figure includes a non-recurring gain of P949.6 million received from the Philippine unit of Melco Crown Entertainment Ltd (MCE) upon the commencement of the Macau-based casino operator's lease on Belle's property, the site of the City of Dreams Manila integrated resort project.

Taking out the extraordinary gain, Belle’s consolidated profit would have surged by 174 percent in the first quarter of 2014.

- Interaksyon

Metro Pacific plans P100B capex for 2015-16

Metro Pacific Investments Corp (MPIC) plans to raise capital spending over the next two years for its infrastructure and power businesses.

David J. Nicol, MPIC chief financial officer, told reporters last week that the company's capital expenditures may reach P50 billion each for 2015 and 2016.

"For the group, I could see that Meralco is investing in power generation, and for AFCS and LRT Line 1 Cavite Extension Project, if it will be awarded to us," Nicol said.

MPIC controls Manila Electric Co, and is part of Light Rail Manila Consortium, the lone bidder for the P64.9-billion LRT1 Cavite Extension Project. MPIC also is part of AF Consortium, which earlier won the bidding for the P1.72-billion Automated Fare Collection System, a project that will provide a common ticket for the LRT and MRT train services.

For 2014, MPIC has set aside a P40 billion capex.

Nicol said MPIC, which owns 55 percent of Light Rail Manila, would infuse P4-5 billion in the consortium. Ayala's AC Infrastructure owns 35 percent, while Australia’s Macquarie Infrastructure Holdings holds the remaining 10 percent.

Nicol said MPIC is optimistic that its proposal for the LRT1 Cavite Extension Project complies with the requirements of the Department of Transportation and Communications (DOTC).

He said the consortium expects to make money in the first 10 years of the 32-year contract, earlier than the other bidders' projection of 20 years.

DOTC said the LRT1 Cavite Extension Project involves the construction of 11.7-kilometer track from the terminus of the LRT Line 1 at the Baclaran Terminal, to the Niyog Station at Bacoor.

More than 500,000 commuters everyday use LRT1, which runs from Baclaran in Pasay City to Roosevelt in Quezon City. The southern part of Metro Manila and neighboring Cavite province is home to nearly four million people.

In the first quarter of the year, MPIC reported a consolidated core net income of P2.2 billion, up 15 percent from P1.9 billion a year ago. The conglomerate attributed the growth to higher traffic and increased ownership in Manila North Tollways Corp (MNTC), higher volumes sold at Maynilad Water Services Inc and Meralco, as well as strong organic growth and new investments in the healthcare business.

- Interaksyon

Century Properties to roll out P9.5B worth of residential, office projects in 2H

Century Properties Group Inc is launching P9.5 billion worth of residential and office developments in the second half of the year.

Century Properties director for investor relations Kristina Garcia told reporters last week that the projects that will be rolled out are the Forbes Media Tower in Century City, the sixth tower at Acqua Private Residences in Mandaluyong, and the first residential tower at Azure North in Pampanga.

The property company of former ambassador Jose EB Antonio has budgeted P8-9 billion in capital expenditures this year for its projects.

Century Properties will generate P5.5 billion from the sale of 40,000 square meters of office space at Forbes Media Tower, the first of a network of Forbes-branded projects around the world. The office tower will have a total gross floor area of 64,000 square meters and the remaining 24,000 square meters will be leased out to tenants to boost the recurring income Century Properties.

Forbes Media Tower and Century Spire, a 60-storey residential and office tower, will complete the premium office block in Century City, the property developer's vertical village in the country's premier financial district.

Century Properties expects P2.2 billion in sales from the residential component of the sixth tower of Acqua, which will also house a condotel.

The real estate developer will introduce the maiden residential offering in Azure North with an estimated sales value of P1.8 billion.

Azure North is an eight-hectare mixed-use development in Pampanga that will feature residential, commercial, and office components. This is Century Properties’ first project outside Metro Manila.

Century Properties' profit rose 3 percent to P513.06 million in the first quarter from P500.56 million in the same period last year. Consolidated revenues jumped by a tenth to P2.85 billion from P2.60 billion a year ago.

- Interaksyon

Cebu Pacific passenger traffic up 6.6 pct at start of 2Q

Cebu Pacific’s passenger traffic grew in the single digits at the start of the second quarter of the year.

Data from the Gokongwei-led budget airline show that it flew 1.44 million domestic and international passengers in April, up by 6.6 percent from 1.35 million in the same period last year.

The airline's load factor, which pertains to number of seats occupied per flight, inched up by 0.8 points to 89.8 percent last month from 89 percent last year.

In the first four months, Cebu Pacific's passenger traffic grew by 6.1 percent to 5.18 million from 4.89 million passengers last year. Its load factor went down to 84.4 percent from 85.2 percent in 2013.

Sought for comment, Cebu Air Inc (CEB) spokesperson Jorenz Tanada said the growth in passenger traffic was because of increased presence in key markets, strategic seat sales offering the lowest possible fares and continuous network expansion.

CEB president Lance Y. Gokongwei had said the budget airline would carry in excess of 15 million passengers this year. Including the traffic of recently acquired Tigerair Philippines, CEB expects more than 17 million passengers in 2014.

In March, the shareholders of Singapore's Tiger Airways Holdings Ltd and the Civil Aeronautics Board separately approved the 100 percent acquisition of Tigerair by CEB. The transaction was valued at $15 million.

CEB posted a net income of P164.164 million in the January to March period, down by 85.8 percent from the P1.157 billion in the same three months of last year.

Revenues of P11.76 billion however were 11.6 percent higher than the P10.54 billion in 2013. Passenger revenues amounted to P8.85 billion, up 8.3 percent from P8.17 billion last year.

- Interaksyon

Meralco subsidiary proposes P182-million expansion of Clark facility amid higher demand

Meralco’s subsidiary at the Clark Freeport Zone is seeking regulatory approval for an expansion of its distribution capacity in light of growing demand in the economic zone.

In a filing with the Energy Regulatory Commission (ERC), the Clark Electric Distribution Corp (CEDC) proposed the construction and installation of a new 100-megavolt ampere (MVA) 230-kiloVolt/68 kiloVolt power transformer at its substation.

The new transformer and related equipment would cost P182.25 million, and would result in an increase of P0.04 per kilowatt-hour in the rates of CEDC customers.

The proposed equipment will address the electricity requirements of a number of new locators and the expansion of existing ones scheduled by mid-2014.

Additional demand would come from Taiyo Nippon Sanso Clark Inc's air separation plant, which requires 9 megawatts (MW); the Medical City Hospital, 3.59 MW; the Midori Hotel, 1.40 MW; the Widus Hotel expansion, 1.09 MW; SM's two business process outsourcing multi-storey buildings, 1.75 MW; MSK's industrial development, 3.51 MW; SIA Engineering's expansion, 1 MW; and Yokohama Tire Philippines' load growth, demand from which was not specified.

"These additional loads will be on top of the growth of native load of 5.79 percent in [regulatory year] 2012-2013 and the expected development of the new areas within the Clark Freeport Zone," CEDC said.

Without the construction of the new 100-MVA power transformer, CEDC said the 80 MW limit of the transmission lines that deliver power to the utility will be breached, resulting in overloading.

This "would make it impossible to accommodate these large load projects," CEDC said.

CEDC is 65 percent owned by Manila Electric Co, through subsidiary Meralco Industrial Engineering Services Corp (MIESCOR). The Angeles Electric Corp owns the remaining 35 percent.

- Interaksyon