Saturday, 23 May 2009

Philippine exports up 15.9% in March from April

http://www.gov.ph/index.php?option=com_content&task=view&id=2000626&Itemid=2

MANILA (PND) --- Philippine exports in March 2009 increased by 15.9 percent over that of February with majority of commodity groups posting month-on-month growth, indicating an easing of the recession in the country’s foreign markets.

Merchandise exports in March 2009 amounted to $2.9 billion compared to $4.2 billion for the same period last year, but better than last February’s $2.5 billion.

The figure represents the sixth consecutive month of export contraction as all major commodity groups, except for forest products, posted significant year-on-year declines.

On a cumulative basis, export revenues for the first quarter of 2009 amounted to $7.9 billion, 36.8 percent lower that the same period in 2008.

The National Economic and Development Authority (NEDA) said in a memorandum to President Gloria Macapagal-Arroyo that the Philippines’ Asian neighbors likewise experienced slowing down of their exports decline in March.

Malaysia’s export decline eased to 15.6 percent in March (from 15.9 percent in February); Hong Kong, 20.5 percent in March (from 22.4 percent in February); Singapore, 21 percent (from 24 percent in February) and China, 17.1 percent (from 25.7percent in February).

Exports of electronics and machinery/transport equipment, two of the country’s major manufactured products grew by 19.9 percent and 6.3 percent, respectively even as garments exports declined by 7.6 percent from Feb. 2009.

The slight rebound in electronics exports for March compared to February followed global trends where global sales of semiconductors grew by 3.3 percent with demand stabilizing somewhat as reported by the Semiconductor Industry Association (SIA).

Sales in the Americas, Europe, and Asia Pacific grew by 5.1 percent, 3.1 percent and 7.8 percent, respectively. Sales in Japan, however, were sharply lower by 9.4 percent from Feb. 2009.

On the bright side, the “global semiconductor manufacturing industry is expected to take a breather in the second quarter, as utilization rises by 60 percent as reported by iSupply Inc., a market research company.

Majority of the country’s electronics exports for March went to China, the Netherlands, United States, Japan and Hong Kong.

Agro-based products exports grew by 8.1 percent in March; mineral products, 5.7 percent, and petroleum products, 7.8 percent. Growth rates of these commodity groups, however, are still in negative territory compared to March 2008.

Export receipts from forest products increased by 22.4 percent and 48.8 percent, for month-on-month and year-on-year, respectively.

The United States remained the biggest market for Philippine goods with 17.3 percent share of total revenues for March 2009, followed by Japan with 15.4 percent share. Other major export markets were China, 106 percent; Hong Kong, 9.4 percent and the Netherlands, 9.2 percent. The aggregated shipments to China, Hong Kong and Taiwan reached 23.3 percent of merchandise exports in March 2009.

Leading exports were semiconductors, electronics data processing (EDP) machines and garments which made up 65 percent of the total shipments to the five biggest export markets in March 2009.

Volvo Philippines upbeat on sales

J.S. Gatuslao
BusinessWorld
http://www.bworldonline.com/BW052309/content.php?id=046

Volvo Philippines said on Friday it expects to keep its 23% market share in the local luxury car segment, maintaining a positive outlook on sales despite the economic slowdown.

Lyn M. Buena, vice-president for marketing, expressed confidence on 2009 sales, saying that "Even with the financial downturn, our current product line-up is performing right on target."

Following this week’s launch of the Swedish carmaker’s first sport utility vehicle (SUV), the XC60, Ms. Buena said results have been "very encouraging." Volvo Philippines said 55 units of the XC60 have been sold so far.

For 2009, Volvo Philippines expects to sell a total of 290 vehicles, with 120 already booked. Last year, the local distributor of the Swedish carmaker sold 250 vehicles.

"Healthy competition helps us be on our best performance, knowing that there are other brands who also vie for the attention of our market. However, all premium brands have a leading edge — ours is safety," Ms. Bueno said.

"There will always be a need for mobility and even with the current financial situation, people still buy cars. It is only a matter of which car brings the best value and best suits their lifestyle," she added.

Philippines' Alliance Global Group hikes profits by 33%

BusinessWorld
http://www.bworldonline.com/BW052309/content.php?id=041

Profits of listed Alliance Global Group, Inc. of Andrew L. Tan went up by a third in the first quarter, a slower growth compared to the more than 50% increase in the same period last year.

In a statement Friday, Alliance Global said net income jumped by 33% to P1.97 billion from January to March, while revenues went up by 6% to P8.86 billion during the first three months of the year.

Alliance Global said its real estate unit accounted for 50% to the company’s revenues. The net income of Megaworld Corp. was flat at P1.02 billion last quarter, even if revenues declined by 5% to P4.45 billion from January to March.

Revenues from food and beverage businesses Emperador Distillers, Inc. and McDonald’s chain operator Golden Arches Development Corp. meanwhile went up by 6% to P3.63 billion last year. The company did not disclose the net income.

"The company, recognizing the resilience of the country, will continue to explore investments in key, high-growth industries in the country, particularly in the tourism sector," Alliance Global President Kingson Sian said.

Alliance Global, through subsidiary Travellers International Hotel Group Inc., last year entered into joint venture with Star Cruises Ltd. to build a "tourism city" dubbed Newport City across Terminal 3 of the Ninoy Aquino International Airport.

Star Cruise is part of Malaysian conglomerate Genting Berhad and is the world’s third largest cruise line operator.

Alliance Global will invest almost $500 million to construct Newport City, which will host the all-suite Maxims Hotel, the five-star Marriott Hotel, and a budget hotel called Remington Hotel. The hotels, which will have a total capacity of 1,540 rooms, are expected to be completed this year.

Travellers will also build Bayshore City in the Manila Bay area, hosting hotels, an entertainment complex, museums and restaurants.

Share in Alliance Global went up by 1.81% or five centavos to P2.80 per share on Friday.

Friday, 22 May 2009

Philippines. Spain seal air deal

Riza T. Olchondra
Philippine Daily Inquirer
http://business.inquirer.net/money/topstories/view/20090521-206376/RP-Spain-seal-air-deal

MANILA, Philippines—The Philippines and Spain agreed to make 28 direct flights available for their respective airlines to serve weekly, as representatives of both countries wrapped up bilateral air services negotiations in Madrid recently.

The two parties allocated daily flight entitlements from Manila to Madrid and Barcelona, and vice versa.

Clark’s Diosdado Macapagal International Airport got 14 weekly flights to and from Madrid and Barcelona.

Other points in the Philippines, except Manila and Clark, were allocated daily flights to and from other points in Spain, except Madrid and Barcelona.

Manila was granted rights to service 200 tons of cargo per week while Clark got 300 tons per week. Both points of origin were allowed daily cargo flights to and from Spain. “The original agreement was signed in 1951 without frequencies,” Civil Aeronautics Board executive director Carmelo Arcilla, who is a member of the Philippine air panel, said.

Currently, there are indirect flights from Madrid and Barcelona to the Philippines and back. The routes are served by Asian airlines such as Singapore Airlines and a number of Middle Eastern carriers such as Qatar Airways.

Philippine aviation officials have not disclosed whether any airline, including flag carrier Philippine Airlines and Spain’s Iberia, expressed interest in serving the direct flight entitlements agreed upon.

This is the eighth air services deal entered into by the Philippines this year.

The Philippines has completed aviation talks with Qatar and United Arab Emirates in January, Kuwait and Bahrain in February, and Brunei and Australia in March, and Singapore earlier this month.

The International Air Transport Association has projected that world travel may decline by 3 percent in 2009.

The Philippines’ transport department views air deals as part of preparations for the eventual recovery of the global economy and the resurgence in air travel.

Transportation Secretary Leandro Mendoza said having more air service agreements would be good for the country.

Neda Board set to confirm approval of Metro Rail Transit line 7 next week

Cai U. Ordinario
Business Mirror
http://www.businessmirror.com.ph/home/economy/10688-neda-board-set-to-confirm-approval-of-metro-rail-transit-line-7-next-week.html

THE National Economic and Development Authority (Neda) Board is set to confirm the approval of the Metro Rail Transit line 7 (MRT 7) before the proponent, the consortium Universal LRT Corp., (ULC) submits the project for financial closing and then implementation.

Ruben Reinoso, Neda assistant director general for infrastructure said the Neda Board will meet next week and may already include MRT 7 on the agenda. However, Reinoso said he could not yet confirm the agenda and whether the rail transit project will be included.

After the Neda Board confirms the approval of the project and financial closure is made, the project can already begin. The project’s implementation has been hanging for more than seven years after the project was proposed.

Reinoso said it is expected that the Department of Transportation and Communications (DOTC) will make a presentation to the Neda Board concerning the Swiss Challenge which transpired late 2008.

However, no other bidder matched the proposal of ULC to the government at the Swiss Challenge. The DOTC is also expected to present the terms of agreement with ULC.

The MRT 7 is the country’s largest transportation project and will extend from North Avenue to Bulacan. Based on the concession agreement between the government and ULC, the MRT 7 will cost $1.235 billion and will link the LRT line 1 with MRT 3.

The 20-kilometer railway will begin in Tala, Caloocan City and pass through the La Mesa dam, Fairview, Batasan, Diliman, Philcoa, before ending at the North Avenue station of the MRT 3.

Once completed, the build-operate-transfer (BOT) project will serve an estimated2 million commuters in Quezon City and Caloocan City. This does not yet include motorists who will be plying a 17-kilometer, six-lane asphalt access road in Marilao, Bulacan, that will lead to the MRT 7 depot in Tala.

Apart from the railway project, the MRT 7 project has a real-estate component, which is estimated to cost $2.2 billion. The ULC will develop 900,000 square meters of commercial space and 2 million square meters of residential space during the concession period.

Initially, the proposal of the government to ULC was to post a 10-percent, or $120-million, performance bond on the MRT 7 and for the proponent for $2.5 billion in property taxes for the real estate and commercial development component of the project.

These were part of the four conditions set by the government through Neda for the project. The other conditions, which were agreed on, included that the bonds would be forfeited in favor of the government in the event that the proponent fails to fulfill its obligations and that ULC will undertake the committed real-estate development as programmed in the proponent’s business plan.

The agreement also provided that the government will pay $108 million every year to ULC as capacity fee payment for 20 years. The government has also committed to fare adjustments and will get a 30-percent revenue share on net passenger fares, 20 percent on advertising and commercial development fees, and 20 percent on income derived from real-estate development.

ULC will get 70 percent of the net passenger revenue after the operation and maintenance expenses, and 80 percent sharing in advertising and commercial development over the stations and real-estate development income.

The consortium is composed of Siemens AG of Germany, Alstom Corp. of France, China National Technical Import and Export Corp., EL International Holdings of Hong Kong, Earth Tech of Tyco International USA, Premier Gold of Japan, Redford Assets Ltd. of the SM Group, EEI Corp. of the Yuchengco Group, Penta Capital Management Corp., Merlin Pacific Capital Inc., TCGI Engineers and private investors such as George Go and former finance secretary Roberto de Ocampo.

Airport upgrading in Sulu, Tawi-Tawi under way

BusinessWorld
http://www.bworldonline.com/BW052209/content.php?id=057

ZAMBOANGA CITY — Airport runway upgrading ongoing in Sulu and Tawi-Tawi are expected to improve these islands’ air linkages with the rest of the country and help boost the economy of the Sulu Archipelago.

THE SANGA-SANGA (Bongao) airport improvement project in Tawi-Tawi is extending the runway from 1,611 meters to 1,930 meters, and widening it to 30 meters.

Both runway improvement projects are currently more than 50% complete and are expected to be completed by the end of August next year, a statement of the Mindanao Economic Development Council read.

The Jolo airport project in Sulu includes replacing and widening the existing asphalt runway, and extending it from 1,200 meters to 1,845 meters.

The Sanga-Sanga (Bongao) airport runway in Tawi-Tawi is being extended from 1,611 meters to 1,930 meters, and widened to 30 meters.

These main airports in both provinces are being improved and extended through partnerships between the Department of Transportation and Communications, the Civil Aviation Authority, the provincial governments, and the United States Agency for International Development-funded Growth with Equity in Mindanao (GEM) Program.

"These improvements will ensure safer airport operations and higher-capacity air linkages as well as open up more trade, tourism and investment opportunities in the region," the statement quoted MEDCo Chairman Virgilio L. Leyretana, Sr. as saying.

Following the improvements, larger aircrafts used by major domestic carriers, such as A320s and B737s, will be able to land at these airports.

The airport upgrade in Tawi-Tawi is complemented by a bridge-road project which will directly link Sanga-Sanga Island, where the airport is, and the provincial capitol to the largest island of Tawi-Tawi. The project consists of a 8.4-km road connecting the bridges from Sanga-Sanga to the Tawi-Tawi Island highway network, and a 9.3-km road in Sanga-Sanga itself.

Metro Cebu car dealers enjoy brisk sales, run out of vehicles to sell

Wilfredo Rodolfo III
Business Mirror
http://www.businessmirror.com.ph/home/economy/10685-metro-cebu-car-dealers-enjoy-brisk-sales-run-out-of-vehicles-to-sell-.html

CAR dealers in Metro Cebu said they are running out of inventory of vehicles as they continue to exceed sales estimates for the year despite the slowing economy and the competition from rampant smuggling in southern Philippines.

Jose Manual Cuenco, president of the Car Dealers Association of Cebu (Cadac), said some dealers are forced to turn down customers as there are no more stocks of the vehicles they prefer.

Dealers, however, continue to market themselves aggressively with all key players joining the Cebu Auto Show at the Cebu International Convention Center (CICC) which opened on Thursday.

“The biggest problem for us is the pessimism. If we had been a little optimistic, we could have sold more,” Cuenco said. Most car dealers have been projected to grow by zero percent in 2009, thus stocks were limited and production schedules slowed—but the results were the opposite.

He said dealers in Cebu are experien-cing 5- to 10-percent growth in volume and value for the first several months of the year, despite the limited number of stocks and despite the slow economy. Cuenco said traditional markets for commercial vehicles, passenger cars and even company vehicles still lead the pack.

Dealers, however, said there is an increasing number of middle-income car buyers in Cebu, an indication that despite the economic reports, things are doing well for Central Philippines. Toyota Cebu, Bohol and Leyte sell out some 200 cars a month this year, Cuenco said.

He also identified an increasing preference for more fuel-efficient cars, adding buyers who used to buy wider, bigger engine cars are now opting for smaller yet efficient models.

He said shows like the Cebu Auto Show, which is held side-by-side the Philippine World Building and Construction Expo and Cebu Foods and Beverages are a chance for the car dealers to show that they are still alive and business is actually good.Cebu City Acting Mayor Michael Rama said the three shows are an example that despite the crisis, the private sector is doing its share to keep business going.

Philippine Business Sentiment Improves for Q2 2009 and Turns Positive for Q3 2009

Turns positive for the first time since first survey in Q2
http://www.bsp.gov.ph/publications/media.asp?id=2078
CLICK HERE FOR FULL REPORT

Business sentiment improved in Q2 2009 as the overall confidence index (CI) rose by 21.3 index points to -2.6 percent from -23.9 percent last quarter. It continued to improve going into Q3, with the CI reverting to positive territory at 13.7 percent, 20.2 index points higher quarter-on-quarter as respondents expected an economic turnaround to commence in Q3 2009. This means that optimists outnumbered the pessimists on the next quarter outlook. However, the Q3 index was down by 2.9 index points year-on-year.

This optimism was driven by improving confidence in the US and global financial markets— an upshot of the fiscal stimulus package committed by G20 nations. The announcement by the Philippine government of its Economic Resiliency Plan, the series of policy rate cuts and the decelerating inflation also helped lift business sentiment. Seasonal factors such as expected pick-up in demand during the summer season and school opening in June as well as new and improved management strategies also contributed to this development.

The business outlook in both the NCR (National Capital Region) and AONCR (Areas Outside NCR) tracked the national trend, with their CIs at lower negative in Q2 2009 but turning positive for Q3 2009. However, mixed trends were noted within the AONCR. Firms from Regions I, III and XI were optimistic in both the current and next quarters as their indices for Q2 and Q3 2009 were both positive. Business sentiments in Region VII were becoming less pessimistic for both the current and next quarter. Meanwhile, responses of firms located in Regions IV and XII moved in the same direction as the national sentiment.

The outlook of all types of business (i.e., importers, exporters and those engaged in dual activities) in Q2 2009, although remaining negative, improved significantly as their indices increased, quarter-on-quarter. All types of businesses expected more favorable global trade conditions for Q3 2009 as their indices turned positive.

By employment size, medium and large firms showed a turnaround from negative to positive outlook in Q2 2009. By contrast, small firms remained pessimistic, though at a lesser degree, in the current quarter. A further analysis of the small firms surveyed showed that most industry firms, particularly from the manufacturing sub-sector, perceived themselves to be most vulnerable to the slack in demand from global and domestic markets. However, looking ahead to Q3 2009, small firms turned out to be the most optimistic. Medium and large firms were likewise more positive on the next quarter’s economic condition.

A positive outlook is evident across all sectors


Improvement in outlook was noted across all sectors in Q2 2009. The indices went up significantly compared to levels recorded a quarter ago. The construction sector was the most upbeat in Q2 2009 with a CI at 3.0 percent.

The services sector was also optimistic in Q2 2009 with a CI at 1.0 percent as it expected a boost in consumer spending due to seasonality. The hotels and restaurants, as well as community and services sub-sectors, both expected brisker business during the summer season. Notably, the financial intermediation subsector recorded the highest quarter-on-quarter and year-on-year increases in indices among subsectors.

The CIs of the wholesale and retail trade as well as industry sectors for Q2 2009 at -3.1 percent and -7.6 percent, respectively, were both higher quarter-on-quarter. This may be partly due to the expected pick-up in demand with the opening of classes in June.

Going forward, all sectors anticipated an economic turnaround in Q3 2009, as all industries posted positive indices. The construction sector was most optimistic with a CI at 20.0 percent as it expected to benefit from government infrastructure projects that form part of the 2009 stimulus package. Meanwhile, the wholesale and retail trade sector, although the least optimistic with a CI at 10.3 percent, was more upbeat for Q3 2009 than the previous quarter and the year-ago comparable period.

More firms see improvement in their business operations


Firms in the services sector expected their business operations to get better in Q2 2009. In the trade and industry sectors, more firms expected improvement in their business operations compared to a quarter ago. However, the pessimists still outnumbered the optimists.

Despite the expected improvement in business operations, the average capacity utilization at 69.2 percent was lower than the corresponding levels quarter-on-quarter and year-on-year.

Expectations of better credit access and financial conditions improve


The credit access index improved in Q2 2009 by 5.6 index points quarter-on-quarter, after three quarters of decline. The index, although negative at 7.2 percent, indicated that fewer firms expected tighter access to credit in the current quarter compared to the previous quarter.

The financial condition index, which is an indicator of internal liquidity, likewise edged up by 6.1 index points compared to its level in the last quarter’s survey. This implied that a fewer number of respondents expected liquidity problems in Q2 2009 compared to the previous quarter.

Employment outlook turns less negative but the number of industrial firms with expansion plans still quite limited


The employment outlook index for Q3 2009 turned less negative at 6.4 percent compared to the previous quarter due largely to the increase in the employment indices of the trade and industry sectors. However, given the current excess capacity in the industry sector, only 16.0 percent of respondents (from 17.8 percent in the last quarter survey), expressed expansion plans for Q3 2009.

Competition remains a major risk to business


Competition, weak demand, and financial problems were considered by the respondents as the key risks to business activity in Q2 2009.

Expectations on key economic indicators likewise improve


Generally, fewer firms anticipated that the peso would weaken, inflation would go up, and interest rates would increase in Q2 and Q3 2009. The outlook on the weakening peso was shared by fewer respondents compared to those in the previous quarter. Specifically, for Q2 2009, the peso-dollar exchange rate index at -10.2 percent increased by almost 2 index points compared to -12.0 percent in the previous quarter. Likewise, the number of respondents that indicated that interest rate would go up in the current quarter decreased relative to the previous quarter. On the other hand, the inflation rate index was steady at 14.1 percent. The same trend was observed for Q3 2009.

Survey response rate continues to pick up


The Q2 2009 BES was conducted during the period 1 April to 6 May 2009. There were 1,410 firms surveyed nationwide. Respondents were drawn from the Securities and Exchange Commission 2008 Top 7,000 Corporations as follows: 515 companies in NCR (36.5 percent) and 895 firms in AONCR (63.5 percent), covering all 17 regions nationwide. The survey response rate for this quarter was 77.6 percent, higher than last quarter’s 75.3 percent. For NCR, the response rate was 80.4 percent (73.2 percent last quarter); and for AONCR, the response rate was 76.0 percent (from 76.5 percent). A breakdown of responses received by type of business showed that 10.9 percent were importers, 7.5 percent were exporters, and 16.3 percent were both importers and exporters. About sixty-five percent of the respondents were neither importers nor exporters or did not specify their firm type.

Holcim Philippines sales revenue surges 28% to P5.5B

As Philippine cement demand grows 6% in Q1

Honey Madrilejos-Reyes
Business Mirror
http://www.businessmirror.com.ph/home/companies/10673-holcim-sales-revenue-surges-to-p55b.html

AS demand for cement grew 6 percent from January to March this year, sales revenues of leading cement manufacturer Holcim Philippines Inc. surged 27.907 percent to P5.5 billion in the first quarter from P4.3 billion in the same period in 2008.

With this sales’ performance, Ian Thackwray, Holcim chief operating officer, said the company’s net profit in the three-month period soared 71 percent to P793 million.

Holcim, meanwhile, said its board approved in a meeting before Thursday’s annual stockholders’ meeting held at Mandarin Oriental Hotel the distribution to stockholders of P0.20 per share.

In a filing, Holcim said it will distribute the dividend to all stockholders holding 6.452 billion shares as of June 5, 2009 not later than June 29, 2009. The amount, equivalent to P1.29 billion will be taken from P1.4-billion retained earnings as of December 31, 2008.

Thackwray demand for cement rose during the period because of the increased infrastructure projects and sustained commercial and residential construction activities.

“This certainly exceeds our expectations. We’re seeing higher than anticipated growth in the market, including regions outside the national capital region,” said Thackwray.

However, he said the first quarter financial results should not be regarded as indicative of what will happen this entire year.

“We are encouraged by the strong financial results, but there are several factors that will come to play, most important of which will be the ability to sustain infrastructure investment,” he said.

Even as input costs have begun to stabilize, Holcim continues to feel the effects of the steep price hikes of coal last year as it has yet to deplete coal stocks bought in 2008. The company was chose to buy coal locally, enabling it to protect itself it from further price increases and supply uncertainty.

In opting to continue tapping local coal suppliers, Thackwray said the company is negotiating with Seminar Mining Corp. for a potential long-term coal-supply agreement.

Meanwhile, he said the company is unlikely to increase its prices this year mainly because import cost in under control. “Also the competitive market would not allow us to do so.” Holcim has the control over one-third of the market.

Holcim, whose shares are traded on the Philippine Stock Exchange, has set a capital spending of P700 million for this year to fund the maintenance and improvement of facilities.

“While we are in a tough year, we still maintain higher-cape level,” said Thackwray.

As it focused on reducing coal and spare-parts inventories this year, Holcim has already succeeded in improving net-working capital and generated P1.5-billion free-cash flow from its operating activities, after capital investment.

A member of the Holcim Group, Holcim is engaged in the manufacture, sale and distribution of cement to local and export markets. It operates four cement plants located in La Union, Bulacan, Misamis Oriental and Davao.

In 2008, it produced 4.6 million tons of cement.

Poll automation machines set for demonstration

By LESLIE ANN G. AQUINO
Manila Bulletin
http://www.mb.com.ph/node/201632

Smartmatic/Technology Information Management Corp., the consortium that remains in the running for the highly contested P11.3-billion poll automation project, may start demonstrating its machines Friday before the Commission on Elections’ Special Bids and Awards Committee (Comelec-SBAC).

This will push through if the SBAC denies the motion of Gilat/F.F. Cruz and Company, Inc. and refuses to accept the motion for reconsideration made by Indra Sistemas/Strategic Alliance Holdings Inc/Hart Intercivic group.

The SBAC, led by its chairman Atty. Ferdinand Rafanan, is expected to rule on the appeal of Gilat/F.F. Cruz, which earlier asked the panel to reconsider their technical bid.

On Thursday, Indra also filed an appeal requesting the SBAC to accept their financial documents.

The SBAC earlier disqualified the Spain-based Indra after their bid showed that they could only supply 50,000 voting and counting machines, much lower than the Comelec’s requirement of 82,200.

Jojie Villa, spokesperson of the Smartmatic, meantime, expressed readiness in demonstrating their machines.

"Upon their go signal, we will demo to the Comelec. We are ready. We will demo our Precinct Counting Optical Scan (PCOS) machines, including the transmission, canvassing based on Comelec’s criteria," Villa told reporters.

"We are confident that the full end-to-end demonstration will be smooth," he added.

Smartmatic’s offer of P7.2 billion for the project remains the lowest.

The SBAC had already disqualified for failing in the eligibility requirements Avante International/Canon Marketing Phils/Netnode Technologies/DB Vizards/Creative Point, AMA Group of Companies/Election System and Software, Syrex Incorporation/Amalgamated Metro Philippines/Anishin Inc, and Sequoia Voting Systems/Universal Storefront Services.

Meanwhile, Rafanan said Gilat beat last Tuesday’s 5 p.m. deadline for the filing of a motion for reconsideration.

Rafanan said SBAC has seven days to resolve Gilat’s motion but hinted that it will not take that long for the committee to resolve the motion.

The last of the bidders whose motion for partial reconsideration and clarification filed by the consortium of Seuoia Voting System of the United States and Universal Store Front Services Corporation of the Philippines, was denied by SBAC based on its admission that USSC/Sequoia Voting Solutions, Inc. was incorporated only on April 16, 2009.

"It was an unsolicited admission straight from the movant. Thus, being one month old only, it could not submit the required financial eligibility document which would assure the Comelec and the election stakeholders that Comelec will contract only with qualified bidders," SBAC Resolution No. 09-003 said.

Rafanan hinted that filing another motion for reconsideration is part of due process but pointed out that the Comelec Rules of Procedure considers the filing of a second motion for reconsideration a prohibitive pleading. (with a report by E. T. Suarez)

Election preparations on track – Sarmiento

The Commission on Elections (Comelec), now in deep preparations for the May 10, 2010 elections, is not affected by the moves to effect Charter Change (Cha-Cha) by convening Congress into a Constituent Assembly or passing the amendments by three-fourths vote in each of the Senate and the House of Representatives, Commissioner Rene V. Sarmiento said in a speech at the General Membership Meeting of the Philippine Constitution Association (Philconsa) held at the historic landmark Manila Hotel.

Sarmiento said Comelec is conversant with House Resolution No. 1109, which seeks to turn Congress into a constituent assembly and effect Charter Change by a joint vote of the House and the Senate, as well House Resolution 737 authored by Speaker Prospero Nograles, which calls for amendments by a three-fourths vote in each of the two chambers, instead of a simple majority as required in passing bills.

However, Sarmiento stressed that the poll body cannot be distracted in its efforts to ensure that next year’s polls will strengthen rather than weaken democracy.

The youngest commissioner of the seven-man poll body, Sarmiento made the assurance of Comelec’s thorough preparations for next year’s polls because of recurring public perception that Charter change is being pushed through to extend the terms of incumbent officials, effect a shift from presidential to parliamentary system of government, and deny the people the right to elect their public officials by cancelling next year’s political exercise. (ETS)

Thursday, 21 May 2009

Update video: Philippines' Laguindingan airport project

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Displaced Filipino workers return to Taiwan

Ben Arnold O. de Vera
Manila Standard
http://www.manilatimes.net/national/2009/may/21/yehey/top_stories/20090521top3.html

The Manila Economic and Cultural Office (MECO) on Wednesday said many displaced Filipino workers have returned to work in Taiwan, as its electronics industry began to recall workers.

According to the office, Taipei-based Labor Attaché Rodolfo Sabulao recently reported to Labor Secretary Marianito Roque and to the office’s Resident Representative Antonio Basilio that MECO facilitated the entry of 4,406 workers from January to April 2009, compared with 1,509 workers displaced in the same period.

Sabulao said the number of Filipino workers hired during the first four months of this year has outnumbered those displaced in the fourth quarter of last year. Job orders have been rising by about 15 percent every month, while the number of displaced workers has been declining, he said.

Basilio added that jobs registered with Taiwan’s online Job Bank in early May went up to 203,000, which is the highest in six months.

Basilio explained that these developments indicate that Taiwan’s employment market was regaining momentum, and this is benefiting Filipino workers.

“Several Taiwanese manufacturers value the significant contribution of their talented and skilled Filipino workforce to their enterprises’ future growth and competitiveness,” Basilio added.

The global economic slowdown has badly hit many Taiwanese electronics exporters, resulting in some factory closures and layoffs.

During the last quarter of last year, 3,563 Filipino workers were laid off in Taiwan, compared with 3,434 workers who were hired in the same period the previous year, Sabulao said.

The office reported that this “job gains and job losses” data were based on job orders processed and verified by MECO’s labor posts in Kaohsiung, Taichung and Taipei, and employers’ records on the number of workers they retrenched, from October 2008 to April 2009.

Nokia wants to make Philippines the e-mail capital of the world

Lawrence Agcaoili
Manila Standard
http://www.manilastandardtoday.com/?page=business5_may20_2009

Mobile phone giant Nokia Philippines has launched three new mobile phones as part of efforts to transform the Philippines into the leading mobile phone e-mail capital of the world.

Nokia Philippines general manager William Hamilton Whyte said the company introduced the Nokia 2323, Nokia 2700 classic and 2730 classic to bring Internet closer to mobile phone users.

Whyte said the Finland-based mobile phone maker planned to make the Philippines the leading mobile phone e-mail capital of the world on top of being the texting center of the world over the next three years.

He said the mobile phone penetration rate in the Philippines was at a high of 80 percent. About 95 percent of the total mobile phone subscribers in the Philippines are pre-paid subscribers and only 5 percent are post-paid users.

He said Internet access would be accessible and affordable to most Filipinos with the new Internet-ready mobile phones costing an average of P5,000 a unit.

Only 15 million of the 80 million Filipinos had access to Internet right now, with most of them through personal computers.

“I think it [Internet penetration rate] is going to move very fast and within the next three years, we will make sure that the Philippines will be the leading mobile phone e-mail capital of the Philippines,” Whyte said.

Nokia vice president for entry category marketing Paula Laine said there was enormous potential in the Philippines as about 60 million Filipinos had access to mobile phones while only 15 million were linked to the Internet.

“That leaves about 45 million Filipinos who could access the Internet through their mobile phones. Nokia makes the Internet available and affordable to everyone,” Laine said.

According to an extensive Nokia consumer research, nearly half of the emerging market customers said they would rather connect to the Internet over a mobile phone than a personal computer.

Nokia has developed locally relevant solutions that consist of affordable mobile phones and applications, designed and built from the ground up to meet the specific needs of customers in the developing world.

Nokia has launched a campaign to encourage mobile phone users to set up e-mail accounts with ovi.com in order to gain access to their mail through 35 Nokia mobile phone models.

Road link to Albay, Sorsogon

Michael Caber
Manila Standard
http://www.manilastandardtoday.com/?page=news9_may20_2009

A ROAD network linking Albay to Donsol, Sorsogon, will be built soon after it was named one of six road projects assured of financing from a grant from the US government, an official said yesterday.

The P815-million Guinobatan-Jovellar-Donsol road, which will link to the Maharlika Highway, would serve as the main road to Donsol, the town famous for its whale sharks, Albay Gov. Joey Salceda said.

The road would also boost tourism in Bicol because almost 80 percent of the tourists visiting the region were there to see the whale sharks, Salceda said.

The project will consist of 26.90 kilometers of concrete road and five bridges. It is expected to complement the proposed Southern Luzon International Airport in Alobo, Daraga, in Albay.

Cebu Pacific hiring more flight crew

Airline set to hire 250 attendants
Roderick T. dela Cruz
Manila Standard
http://www.manilastandardtoday.com/?page=news7_may20_2009
FOR CAREER AND EMPLOYMENT ENQUIRIES, PLEASE GO TO http://impact-ph.jobstreet.com/jobs/jobs.asp?eid=29087747&fil=1&did=903&ddt=1

CEBU Pacific is expanding and hiring 250 more female flight attendants despite the global economic downturn, which has cut international tourist arrivals by 8 percent in the first two months.

“Our continued domestic and international expansion and rapidly growing passenger base require us to hire and train more cabin attendants,” vice president for marketing Candice Iyog said.

“They have to exemplify Cebu Pacific’s fun, reliable, and high-quality service.”

Iyog said applicants must be at least five-foot-three and between 18 and 25 with good eyesight and a pleasing personality. They may apply at the Cebu Pacific Training and Development Center on Domestic Road, Pasay City.

Cebu Pacific has a fleet of 10 A319 and 11 A320 Airbus aircraft and eight turbo-prop ATR 72s. It expects to take delivery of two more ATR aircraft this year, allowing it to open more inter-island routes.

Meanwhile, the Tourism Department says there has been no cancellations of tour packages to the Philippines, which remains free from the swine flu that has killed 79 people and infected almost 10,000 others in over 40 countries.

“There has been no reported case of influenza A (H1N1) in the Philippines, and is thus declared as an H1N1-free destination,” the department said.

The government is screening all inbound travelers with thermal scanners to detect their body temperatures. Special isolation areas have also been put up to quarantine travelers exhibiting flu symptoms.

Tighter security has also been implemented in seaports and other airports serving chartered flights.

The World Tourism Organization has confirmed that H1N1 is starting to affect the tourism sector.

The organization expects international tourism to decline by between 2 percent and 3 percent in 2009.

US, Filipino troops build water system in Patikul, Sulu

Bong Garcia Jr.
Business Mirror
http://www.businessmirror.com.ph/home/53-agri-commodities/10496-us-filipino-troops-build-water-system-in-patikul.html

ZAMBOANGA CITY—US and Philippine soldiers have turned over a water-distribution system project worth $30,000 to the Sulu provincial government, a US military official here said.

Lt. Lara Bollinger, Joint Special Operations Task Force-Philippines (JSOTF-P) deputy public-affairs officer, said the project was inaugurated and turned over to Sulu Gov. Abdusakur Tan after its completion.

Bollinger said the construction of the project in barangay Bon-Bon in Patikul town started on March 21 and was completed early this month.

The new water-distribution system will supply potable water not only to the residents of barangay Bon-Bon but also residents of four other nearby barangays, Bollinger explained.

It consists of two 6,000-liter water tanks with approximately 2 kilometers of distribution hose line.

“The water distribution system project is an example of dedication and commitment between AFP [Armed Forces of the Philippines] and US Forces in helping the community,” JSOTF-P chief Col. William Coultrup said.

Governor Tan said he was grateful to the AFP and US soldiers for building the Bon-Bon water system and the other civic construction programs they have accomplished together, like roads and schools.

With the water system in place, residents in the area will have a good source of potable water at their doorsteps for the first time ever, Tan said. He advised residents to put to good use the water- system project.

Sitel Philippines opens Pasig facility; Baguio is next

Johanna Roldan
Business Mirror
http://www.businessmirror.com.ph/index.php?option=com_content&view=article&id=10619:sitel-opens-pasig-facility-baguio-is-next&catid=23:topnews&Itemid=58

SITEL Philippines announced on Wednesday it will open in July its third contact-center facility in Baguio City, which will play a key role in the company’s goal to sustain its 30-percent average annual growth even in the midst of a crisis this year.

Steven Paul Barker, Sitel Asia-Pacific chief operating officer, said the new Baguio site, situated right across Sitel’s second location in Loakan, Baguio, will have a capacity of 500 workstations.

Barker said the moment the new facility opens, 700 jobs will be available.

“We believe that this will play a part in the sustainability of the 30-percent growth,” Barker said at a press conference for the official launch of Sitel’s 2,000-seat facility at One Julia Vargas in Ortigas, Pasig.

Sitel already has six sites in Metro Manila and Baguio with a total of 11,000 employees.

Sitel has a diverse range of support processes for inbound and outbound (sales support and lead generation), such as customer service, technical helpdesk, B2B consumer support, and back-office processing services.

Barker said Sitel Philippines is currently operating at a 95-percent capacity and their focus is to fill up the empty seats and the new Baguio City site before looking at other areas for expansion.

However, should there be new job orders, Barker said their next candidate location is San Fernando, La Union, where the company already maintains its training center for prospective employees.

Sitel Philippines currently handles 58,000 customer interactions every day, and Barker said they are delivering the quality of jobs they promised to their customers.

Sitel Philippines was cited as the BPO Company of the Year in the International ICT Awards-Philippines 2008, and given the Outstanding Employer Award 2008 by the Philippine Economic Zone Authority.

What do we do if?

Outside the Box
John Mangun
Business Mirror
http://www.businessmirror.com.ph/home/opinion/10610-what-do-we-do-if.html

You probably ignored a story in yesterday’s BusinessMirror, “New US law may hamper Philippine food exports to American market.” The conclusion of the article quoting Robert Levy, a US Food and Drug Administration (FDA) and Asia Trade Matters consultant, was that the Philippines needed to move quickly to meet new food-testing standards and procedures.

His last comment was the most interesting; “The Philippines will gain a bigger share in the American food market, especially once the American media have started reporting that Philippine food exports comply with the US FDA standards.”

The new attitude toward imports into the USA has changed for nations like the Philippines, who gain from access to the US market. “In the last six months, 65 shipments from the Philippines were detained, and Levy said the number is expected to reach 165 for this year, or an increase of 47 percent from 2008.”

The reason I point out this article is that it illustrates what I have been ranting and raving about for some time. The global economic game has gone through a complete upheaval in the last year; what worked before is not going to work anymore, and the Philippines must adapt and take advantage of those changes.

The traditional behavior of countries like the Philippines about trade with the American giant has been to go begging to Washington, D.C., asking for more favorable trade policies to boost exports to the world’s largest economy. And, no doubt, when the government finally realizes the significance of this new US food-importation law and the negative results to our exports, that is probably what will happen again. Hey, begging worked in the past, why wouldn’t it work now?

But as I have said before, the rules of the game have changed. What Mr. Levy is proposing is something that politicians and policymakers are not very good at: being proactive. He is strongly suggesting that the Philippines get ahead of the curve and do everything necessary to comply before our trading competitors to meet the new standards and, therefore, keep our food-exporting business running smoothly.

Creative thinking and being proactive, looking ahead to and planning for possible scenarios are not something that politicians do well.

World War II was a game-changer. The most significant after-effect of the war was that 500 years of colonial rule came to an end almost overnight. The Philippines, Malaysia, India, Indonesia, a large portion of Africa, all had sought and fought for self-rule for decades, if not longer. Yet none of the political leaders of these nations had accurately anticipated that the war would lead to their final independence, and few, if any, were remotely prepared. India disintegrated with terrible violence into two nations. Britain’s abrupt pullout left Malaysia completely unstable. After Japan no longer ruled China, civil war erupted. Many African nations have never recovered the economic standard they had under colonial rule.

Events blew over these nations’ leaders as they desperately tried to react to changing times. None seemed to have a plan in place for what to do when they finally achieved the independence they had so long sought. And the results were, in many places, catastrophic.

Government policymakers are good at saying “What do we do now?” when conditions change instead of thinking “What do we do if?” before the game changes.

Assume for a moment that I am correct and Obama’s financial policies do not work and, instead, the USA prolongs its recession and all the dollar-printing creates very high inflation. The most visible result will be the impact on millions of older and retired Americans living on pensions and other fixed income that will see their purchasing power greatly reduced. This, of course, includes thousands and thousands of older Fil-Ams.

We have given lip service for a decade to making the Philippines the retirement capital of the world, and it could be a reality. There may soon be an incredible need for a country to position itself to serve the needs of retirees from First-World countries. Yet little, if anything, has been done to prepare for that scenario.

Of course, it is not the government’s job to do the heavy lifting. All it can really do is assist private enterprise and capital. And our private sector is behind the curve also. There, too, is the mentality of often waiting to see what will happen instead of being proactive.

There is a reason disaster-planning is usually left in the hands of the military or headed by former military people. A successful general leading a successful army spends most of the time thinking in the “What if” frame of mind.

What if economic recovery is years away in the West? What if inflation becomes a serious problem for the First World? What if global trade continues to deteriorate? The “what if” list is lengthy.

The last year should have taught us one lesson: Things happen and situations can change very dramatically very quickly. And I do not think we are planning to take of advantage of the inevitable changes that will come next. The changes will come and our leaders will again be saying, “What do we do now?”

****

PSE stock-market information and technical analysis tools provided by CitisecOnline.com Inc. E-mail comments to mangun@email.com.

Wednesday, 20 May 2009

Asia rice prices keep falling

Due to thin demand, ample supply
By Apornrath Phoonphongphiphat
Agence France-Presse
http://business.inquirer.net/money/breakingnews/view/20090520-206112/Asia-rice-prices-keep-falling

Filed Under: Food, International (Foreign)Trade, Economy and Business and Finance, Agriculture
BANGKOK--Asian rice prices extended recent falls this week due to a lack of fresh demand plus sales from the Thai government's stocks, traders said.

The benchmark 100 percent B grade white rice fell to $525 per ton on Wednesday from last week's $530, exporters said.

Prices were expected to fall further over coming weeks as supply is rising with the release of rice from the Thai stockpiles and demand remains thin.

"The market is reacting to the government stock sale and I expect prices to fall further as buyers are still on the sidelines as they realize there is plenty of rice on the market," one exporter said.

Last week, the Thai Commerce Minister signed contracts to sell 2 million tons of rice to exporters.

That fell short of the 3.76 million tons it had aimed to sell earlier due to low bids, but the government is estimated to hold another 3 million tons of rice that will come onto the market eventually.

It is buying from farmers under an intervention scheme running until the end of July.

With unattractive prices compared to Vietnam and an absence of buyers, Thai rice exports have dropped significantly, according to Commerce Ministry data.

From January to April, Thailand exported 2.6 million tons, down 33 percent from the 3.9 million it shipped in the same period last year, when a global panic over food security caused demand to soar.

In Vietnam, the world's second-biggest rice exporter, prices also fell due to thin demand, traders said.

The 5 percent broken rice dropped to $395 a ton, free on board, from $400-$410 a ton last week and $430 early this month.

The 25 percent broken rice fell to $330-$340 a ton from $370-$380 a week ago and $400 on May 6.

"There aren't many buyers asking for rice now, while stocks are plentiful, so prices keep falling," a trader in the Mekong Delta said.

Rice loading, which had helped keep prices steady last month, was also subdued this month.

This week eight vessels were loading 105,400 tons of rice at Saigon Port for Cuba and the Philippines, after 13 vessels left last week with nearly 133,000 tons for Africa and the Philippines.

So far this year Vietnam has exported 2.58 million tons, a jump of 56 percent from the 1.65 million tons, in the same period last year, Vietnam Food Association reports showed.

Philippines' PSALM bond offer oversubscribed

Agence France-Presse
http://business.inquirer.net/money/topstories/view/20090520-206109/PSALMs-bond-offer-oversubscribed

MANILA, Philippines--A billion-dollar bond offering by Power Sector Assets and Liabilities Management Corp. (PSALM) was nearly six times subscribed, the government and reports said Wednesday.

The offering attracted some $5.7 billion in demand, Dow Jones Newswires said.

About 55 percent of the bonds were allocated to Asia, while 17.5 percent went to Europe. Twenty-seven percent were booked in the United States, the agency said.

It said 208 foreign investors participated in the transaction, it said.

The bond was the first from a power company out of Asia this year.

"The strong response to our debut offering signifies the confidence of investors globally in PSALM and (in) our ability to deliver on our privatization and liability management mandate," PSALM president and chief executive Jose Ibazeta said in a statement.

Finance Secretary Margarito Teves said the enthusiastic response to the bond offering reflected investor confidence "in the overall economic prospects of the country.

Proceeds from the bond, which are unconditionally guaranteed by Manila, will go to funding requirements as well as servicing of debts owed to independent power producers.

PSALM was established in 2001 to run and manage the assets and liabilities of the debt-ridden National Power Corp.

Power from the ocean: Philippines' next frontier

http://www.gov.ph/index.php?option=com_content&task=view&id=2000584&Itemid=2

MANILA, May 19 (PNA) -- Ocean energy development could be the country’s next frontier. With resources estimated at 170,000 megawatts (MW), ocean energy potential is the most robust among the country’s renewable resources. It remains untapped because technologies are still in development stage worldwide.

But the reward for early adoption of such untested technology is immense, according to Martin Burger, founding CEO and chairman of Vancouver-based Blue Energy Canada Inc.

“The economic development prize for whoever becomes the seat for tidal power technology, the right technology, in the Pacific Rim is bigger than any other economic prize in history,” he told PNA. “By hosting early projects there, you (the Philippines) become the default seat for the region and that is the biggest prize of them all.”

Blue Energy studied the country’s ocean energy resources in the late ‘90s and submitted a build-own-operate-transfer proposal to the Ramos administration. Phase 1 of the proposed Dalupiri Ocean Power Project, was designed to generate 2,200 MW within six years.

The next three phases of the project would have extended the tidal fence to connect Luzon and Samar, and thus bring power generation to 25,000 MW that could serve as a backbone for an Asian grid. The proposal had a term of 25 years.

It would have been the largest renewable energy project in the world. But having been submitted at the tailend of the Ramos administration, the project was locked down due to a constitutional ban on large contract undertakings during transition periods, according to Burger.

“I think, the promise of the resource and the technologies today have come so much farther that it would be much easier to see something positive occur there.”

Positive Developments

That ray of light could come from a project being undertaken by the government with the United Nations Industrial Development Organization (Unido).

In a separate interview, Mario Marasigan, assistant secretary of the Department of Energy (DOE), said preliminary studies of marine current in the San Bernardino Strait have been done with the support of Unido-Italy.

The DOE is working with the Department of Science and Technology and the Philippine National Oil Co. on the UN-funded project, which also involves China and Indonesia.

“We hope successful demonstrations of the Italy-based technology soon,” he said.

Based on Unido-Italy documents, the project aims to test marine current power generation in the Far East by deploying Kobold turbine prototypes in the Philippines, China and Indonesia.

So far, potential marine current sites in the three countries have been evaluated based on GIS-mapping, and best sites identified.

The studies show that the northwestern part of Allen municipality in Naga is the most suitable site in the Philippines for marine current energy exploitation.

Marasigan, director of the DOE’s Energy Utilization Management Bureau who is now setting up a separate unit to handle renewable energy management in line with the law passed last December, said the agency is also evaluating several proposals of a foreign company to explore ocean thermal energy conversion (OTEC) in different parts of the country.

“On the local initiatives, we have demonstration projects involving micro-scale tidal energy generation but very limited at 2-5 kilowatts. If proven feasible, we can possibly apply the technology in rural electrification. Although optimistic, I believe we will (need) more time to prove the same,” Marasigan said.

He noted that most ocean technologies for power generation remain in research and development, exploring potentials for generating marine power through OTEC, tidal current, marine/turbidity current, and wave energy.

A Near-Term Option

Taking baby steps is not bad at all, according to Houston, Texas-based Christopher Olson, who is field testing prototypes of a wave energy device he invented.

“We must start with small projects and get people trained and experienced in the ocean energy field so they can handle larger and larger devices as time goes by. The local economy must be involved and new jobs will be added everyday, paid for by selling the electricity made from the ocean energy device,” he said in an email.

Olson started marketing his wave energy device, called Lever Operating Pivoting Float (LOPF), last year. He acquired a US patent for the device in 2007 and has filed an international application, with patents pending in several countries.

Prototypes have been deployed in El Salvador, Indonesia and South Korea under licensing agreements with Swell Fuel, a company he formed in 2005.

The LOPFs are small ocean wave energy converters that, linked together, could generate up to 100 KW, according to Olson.

“We have tested them in very small and very large waves. The frequency is more important than the size. Small waves that are close together are as good as big waves that are spread out really far from each other,” he said.

The LOPF is an option for off-grid resorts, small coastal towns and oil rigs, Swell Fuel said in a statement. It could also be used for coral reef restoration projects that require low-voltage electricity, the company added.

Olson explained the LOPFs are designed to be lightweight to keep the initial cost down and to make for easy installation and servicing. It costs about $ 8,000 for a 1-KW unit.

Tidal Power

But in the long run, tidal power is the low-cost predictable clean energy option that would harness the country’s vast potential, according to Blue Energy’s Martin Burger.

“This is indeed going to be a significant power option in the Pacific Rim and other places in the world, and the earlier they get in the game, then they participate in the economic development spin-offs for the whole region rather than just their own resources,” he said.

While Blue Energy is currently focused on a project in Scotland, Burger said the company would be happy to return to the Philippines once the regulatory framework is established for the sector.

He said that if the country were to invest about $ 200,000 to do resource mapping and install tidal gauges that could be done in three months, the country would be in a better position to jump-start its ocean energy development.

“For every revolution of the water and any cubic meter of tide that goes through there, you know what that means in revenue so that now, that’s a tight business case,” he noted.

Once the basics are set in place, Burger said Blue Energy could embark on a $ 750-million scale project with available financing for the deployment of its technology.

“There’s a great basis for us being active over there at a certain point in time,” Burger said.

“We’re prioritizing our work right now in Scotland and the incentives that they’ve provided and the maturity of the regulatory framework, the awareness and the willing to take risks in early action in the emergence of the marine power sector, give us a much better environment to work in for the present. But if we could see a concerted effort and the commitment over there as is presently the case in Scotland, we would return in a minute,” he added. (PNA)

Only one bidder hurdles Comelec's tough tests

By Bernice Camille V. Bauzon
Manila Times
http://www.manilatimes.net/national/2009/may/20/yehey/top_stories/20090520top2.html

Only one automation firm from an original list of seven prospective bidders for the P11.3-billion poll automation project of the Commission on Elections (Comelec) hurdled on Tuesday the pass-fail criteria set by the Special Bids and Awards Committee of the poll body.

The consortium of Smartmatic and Total Information Management (TIM) seemed to have become the frontrunner among the four that remained on the list after it passed the Comelec’s test for eligibility and technical and financial capabilities.

Of the remaining three other prospective bidders, two—Universal Storefront Services Corp. and Sequioa Systems and the joint venture of Gilat Satellite Network and F.F. Cruz and Co. Inc.—were still in the running, pending the Comelec’s decision on the motions for reconsideration that they had filed after being earlier disqualified from the prospective bidding.

The motion for reconsideration by AMA Group Holdings Corp. was denied by the bids committee for failure to meet requirements of the committee.

The bids committee on Monday night invited all the prospective bidders to bring their election machines to the bidding conference and prepare for a machine demonstration, a part of the qualifying requirements of the committee.

Of the four bidders, only Smartmatic passed the inspection made by the committee’s technical working group on Tuesday.

Bids committee Chairman Ferdinand Rafanan said that if the motions of reconsideration of Universal and Gilat were granted, they would also be asked to prepare for a machine demonstration.

Smartmatic bid on the automation project was P7.19 billion.

The system provider for the 2007 elections in the Autonomous Region in Muslim Mindanao (ARMM), it said that if it won the bidding, its automation machines would be manufactured in Taiwan.

Next year’s polls had been expected to be the first fully automated elections in the Philippines. The vote will pick President Gloria Arroyo’s successor.

Mindanao’s pineapple export sales rise 42%

RSS
BusinessWorld
http://www.bworldonline.com/BW052009/content.php?id=054

KORONADAL CITY — Mindanao’s pineapple industry posted robust growth last year despite the global economic downturn, generating export sales of $352.3 million, official data showed.

Pineapple export sales last year were 42.17% more than the previous year’s $247.8 million, the Bureau of Agricultural Statistics said in a report released recently.

The United States and Japan, two of the countries affected by the global financial turmoil, bought at least 60% of the country’s pineapple exports in 2008. Japan took the bulk of fresh pineapple, while the US bought canned products.

The volume of exports reached 809,315 metric tons (MT) in 2008, up 37.36% from the previous year’s 589,206 MT.

Mindanao produces nearly 90% of the country’s pineapples, a large part of which comes from Northern Mindanao (Region 10) and Central Mindanao (Region 12 or Soccsksargen), specifically in the form of canned products.

Northern Mindanao is home to the pineapple farms of Del Monte Philippines, Inc., while Region 12 hosts Dole Philippines, Inc. (Dolefil).

The Davao Region also exports mostly fresh pineapple to Japan.

Pineapple production in 2008 rose by 9.6% to 2.2 million MT from 2 million MT the previous year. "The gain was attributed to area expansion in Northern Mindanao and Soccsksargen. Producers were encouraged by the increasing market demand," the report explained.

Area planted to pineapple rose to 58,000 hectares from 54,000 hectares in 2007. — RSS

‘Polls will be automated, no matter what’

Sara Fabunan
Business Mirror
http://www.businessmirror.com.ph/home/economy/10517-polls-will-be-automated-no-matter-what.html

THE Commission on Elections (Comelec) said on Tuesday it has set in place contingency plans if the ongoing bidding for the P11.3-billion poll automation project fails.

The Comelec’s Special Bids and Awards Committee chairman, lawyer Ferdinand Rafanan, said they have in fact prepared and discussed contingency measures from “Plan B” to “Plan D,” but declined to bare details of the plans, except to assure the public that the 2010 electiona will be “fully automated” no matter what happens.

“We will have full automation. We assure the public that the Comelec is prepared for any eventuality. There are plans in place and the plans are up to plan D,” he said.

Last Monday evening, SBAC disqualified the consortium Indra Sistemas with their partners SAHI and Hart Intercivic for “noncompliance” with Comelec documentary requirements or for filing a partial bid.

As a result, Smartmatic and its partner Total Information Management (TIM) remained the only consortium qualified to bid for the poll automation, although the SBAC is still reviewing motions for reconsideration filed by other bidders.

The SBAC then ordered Smartmatic to prepare their machines for a “possible” demonstration in case none of the MRs filed by other disqualified bidders is granted.

The Consortia AMA Group Holdings and Sequoia Voting Systems and Universal Storefront Services had earlier been disqualified by the SBAC and filed their respective motions for reconsideration.

On Tuesday afternoon, while the SBAC was deliberating the appeal from other disqualified bidders, Jimenez conducted a short side interview with the remaining possible bidder (Smartmatic) regarding the accuracy of its machines.

“Earlier today, the SBAC gave instructions to one of the bidders to prepare for a possible product demonstration this afternoon,” he said.

However, after the interview with Smartmatic spokesman Juan Villa, AMA project director Johnny Ramos called the attention of Jimenez, accusing him of being unfair.

“Director James Jimenez is creating a perception that Smartmatic already won. That’s not good for us bidders here. We have been sitting here for five days waiting for SBAC to rule on the MR [motion for reconsideration]. We are very offended by that statement. Smartmatic will do their demonstration on what basis? The SBAC group said that they are not allowed to demonstrate unless our MR has been cancelled. He is not SBAC,” Ramos said, his body shaking with anger.

Jimenez clarified his remarks and reiterated his statement that there has been “no declaration” yet as to who is the lowest calculated bidder.

He said the Comelec wanted to make sure that everything flows as seamlessly as possible and that includes making sure that everyone who will have the opportunity to demonstrate their machines will be able to do so with “minimum delay.”

“The preparations that Smartmatic is undertaking are really just to make sure that they are ready in case it turns out that way [none of the MR of disqualified bidders was granted]. The Comelec is not creating an impression; it’s just that we have very little time left,” Jimenez explained.

Remittances boost peso

We've only just begun
Erik de la Cruz
Business Mirror
http://www.businessmirror.com.ph/home/top-news/10551-remittances-boost-peso.html

THE peso rose for the third-straight session on Tuesday, buoyed by the surge in dollar inflows ahead of the school opening next month, dealers said.

Market participants also sold down their dollar holdings as investors’ appetite for risks held up following strong gains in US and European equities markets on Monday, they said.

“Remittances and a weak dollar across the board pushed the peso higher,” said Jonathan Ravelas, chief market strategist at Banco de Oro Unibank.

Remittances are expected to remain strong in the coming days as Filipinos abroad send more money for school expenses of their beneficiaries.

The peso closed at 47.28 to a dollar, near the intraday high of 47.26, which was a centavo away from a three-month high reached just last week. The local unit advanced by 0.5 percent from Monday’s close of 47.53.

Traders at Metropolitan Bank & Trust Co., in a note, said the peso’s gains were likely to be tempered by lingering concerns about economic growth prospects and the government’s fiscal health.

Tuesday, 19 May 2009

First quarter earnings show strong Philippine economy

VIRTUAL REALITY
Tony Lopez
Manila Times
http://www.manilatimes.net/national/2009/may/19/yehey/opinion/20090519opi4.html

Those who still doubt that nothing is really wrong with the Philippine economy should look at the first quarter results of leading listed companies. They show an upbeat economy even as two-thirds of the world is in the midst of a recession.

The Philippines’ largest non-oil company, San Miguel Corp., reported robust revenue and profit increases. Core income increased 25 percent to P2.83 billion despite slowing consumer demand. Revenues rose 8 percent to P41.9 billion in the quarter ending March 31.

SMC President Ramon S. Ang said its solid start for the year was sustained by the performance of its beer and liquor businesses, packaging and food group’s recovery, along with tight group-wide financial management actions in 2008.

The largest retailing and banking conglomerate, SM Investments Corp. (SMIC) of Henry Sy Sr., increased revenues by 10.9 percent to P35.1 billion and profits by 13.1 percent to P4.2 billion. Spectacular is its 91.1-percent increase in real estate sales. Even cinema sales rose, by 11 percent to P633.8 million. Ordinarily, in a down market, demand for capital-intensive purchases like property and expenditures for entertainment should decline. They did not.

Jollibee, the largest fast-food operator founded by Tony Tan Caktiong, showed a hefty 13.5 percent in total revenues to P11.3 billion for the first quarter of 2009. Consolidated net income jumped 17.2 percent to P562 million. Net income margin also increased by 20 basis points to 5.0 percent.

Jollibee said “the growth in consolidated system-wide sales resulted from the upward price adjustments, acquisition of a new business and—organic growth.” Imagine, in a slowing economy, the fast food giant even had to increase prices, instead of lowering them to stimulate demand.

The largest telco, Philippine Long Distance Telephone Co. (PLDT), reported a 9-percent increase in first-quarter core income to P10.2 billion on the back of a 4-percent increase in service revenues to P36.2 billion. This gives Chair Manuel V. Pangilinan confidence to project a P40-billion net profit for the whole of 2009, a record.

Other companies reported the same uptrend:

• Aboitiz Equity Ventures, the Cebu-based power, transport, food and banking conglomerate, increased net income by 20 percent to P1.4 billion.

• SM Prime Holdings, the mall developer and operator, reported a 7-percent increase in consolidated net income to P1.7 billion for January to March 2009 from P1.6 billion last year, on the bank of an 18 increase in revenues to P4.7 billion.

• Sister company SM Development Corp.’s net income for the first quarter jumped 30-fold to P419 million from just P14 million last year, driven by robust real estate sales.

• China Bank posted a 23.9-percent increase in net profit to P884 million for the first quarter, driven by a 36.21-percent surge in net interest income to P1.93 billion.

• The Ayala group’s Bank of the Philippine Islands chalked up an 86-percent jump in first-quarter net income to P2.9 billion as all income sources recorded significant gains.

• Globe Telecom, Ayala Corp.’s telecom business, reported a 3-percent increase in service revenues to P16 billion, driving core net income 5 percent higher to P3.7 billion from P3.5 billion a year ago.

“From a business perspective, it doesn’t look likely that growth will be zero this year,” according to Manuel V. Pangilinan, chairman of PLDT.

Based on its first-quarter results, PLDT is expected to surpass its P40-billion core net profit target for 2009. “The actual figure will fall north of guidance, a bit more than P40 billion,” Pangilinan predicts.

“Our economy has some resiliency; it is not overly dependent on exogenous factors like exports or investments,” the PLDT chair exults. “Domestic consumption and OFW remittances are both strong and are the key drivers.”

Perhaps, remarkable for bucking the increases in revenues and profits by large companies is the giant real estate, banking and telco conglomerate Ayala Corp. Its net income declined a big 18 percent to P2.2 billion. Still, Ayala Corp. President and COO Fernando Zobel de Ayala was happy. “We see some degree of resiliency in domestic demand despite the slowdown in the global economy,” he gushed.

Still, industry has yet to recover. Production is down as indicated by Meralco electricity sales to industry which declined 10.2 percent in the first quarter. But then industry has a very small share of the economy, 28 percent (versus 66 percent share of consumption).

Philippines' Filinvest Land grows 10%

Jenniffer B. Austria
Manila Standard
http://www.manilastandardtoday.com/?page=business4_may18_2009

HIGHER real estate sales and rentals pushed up the net profit of the Gotianun family’s Filinvest Land Inc. to P475 million from P430 million in the first three months of the year, or an increase of 10 percent.

Filinvest Land said in a disclosure to the stock exchange its total revenues amounted to P1.42 billion, 7 percent more than the P1.33 billion generated during the first three months of 2008.

Real estate sales accounted for P948 million, or 66 percent, of total revenues while rental income contributed P311 million, 16 percent more than the P269 million generated last year.

Total residential sales reservations for the first three months of the year reached P1.87 billion, 14 percent more than the P1.64 billion generated in the first quarter of 2008 as demand for the company’s residential housing for the socialized, affordable and middle income markets remained steady.

Filinvest Land’s newest product line, medium-rise buildings, also continued to generate interest from residential buyers.

Medium-rise projects are inner city projects with several five-story buildings clustered around the project’s central amenity area and offer a much-better living environment due to its low-density development compared to high-rise condominium buildings.

Philippines' Metrobank posts 10% hike in profit

Eileen A. Mencias
Manila Standard
http://www.manilastandardtoday.com/?page=business3_may18_2009

METROPOLITAN Bank and Trust Co., the country’s second- largest bank, reported a 10-percent increase in its consolidated net income for the first quarter of the year to P2.09 billion from P1.99 billion a year ago.

On an annualized basis, the Metrobank group’s net income translates to a return on equity of 11.53 percent, higher than the 10.19 percent reported a year ago.

“We are encouraged by the strong performance of our core banking operations amidst the global financial crisis. Volumes grew steadily in tandem with our thrust to preserve credit quality, while margins expanded as a result of better credit spreads and improved deposit mix,” the bank’s president Arthur Ty said over the weekend.

Metrobank’s consolidated net interest income amounted to P7.03 billion for the first quarter, a 41.5-percent jump from a year ago, while trading and foreign exchange gains soared by 68.5 percent to P1.44 billion.

“Although it seems conditions may be improving globally, until the outlook is more certain we will continue to take a cautious stance in our provisioning policy as reflected in the P1.46 billion provisions set aside for the quarter,” Ty said.

Metrobank reported a 29.22 percent growth in interest income to P12.07 billion in the first quarter from P9.34 billion a year ago but its interest expenses increased by 15.25 percent to P5.04 billion.

The bank’s corporate banking sector contributed most to the bank’s profits, accounting for P2.015 billion, followed by its treasury group at P938.7 million. Consumer banking accounted for P725.47 million of profits.

Metrobank’s consolidated assets stood at P764 billion at the end of March, some 13 percent higher than the P678 billion reported a year ago, with loans and receivables expanding by some 6 percent to P331.7 billion from P313.8 billion a year ago. Its deposits, meanwhile, increased by 12.3 percent to P554.39 billion from P493.63 billion a year ago.

Philippine poll body says poll machines must be ‘99.9995% accurate’

Emilia Narni J. David
BusinessWorld
http://www.bworldonline.com/BW051909/content.php?id=071

MACHINES TO be used in the 2010 national elections will need to pass strict technical qualifications according to the Commission on Elections (Comelec).

In an interview with reporters, Ferdinand T. Rafanan, chairman of the special bids and awards committee said the machines must not make more than one mistake.

"The machines need to be 99.9995% accurate. Meaning, for 200 marks only one or less than one will be the error for 600 ballots," said Mr. Rafanan.

He added that the machines would be tested by the technical working group of the Comelec and other experts from the Department of Science and Technology.

The Comelec is hoping to test machines by Wednesday and hopefully begin the post-qualification requirements for the lowest bidders.

Over the weekend, the special bids and awards committee opened the financial bids of Indra Elections Consortium and Total Information Management (TIM)/ Smartmatic. The bids were P11.2 billion and P7 billion, respectively.

However, the Comelec will not reveal the lowest calculated bid until all motions for reconsideration has been resolved.

"We will defer the lowest calculated bid until after all the motions for reconsideration and clarifications have been decided on," said Mr. Rafanan.

He added that Gilat/ F.F. Cruz and Co., Inc. is expected to file its motion for reconsideration today.

Representatives of F.F. Cruz and Gilat earlier said in a statement that there was no lack of documentation in the materials it presented to the Comelec.

"The lawyer representing our consortium was a new one. Since he was not too familiar with the documents, [he] failed to find the ballot management plan," said the company in its statement released yesterday.

AMA Group of Companies/ Election System and Software already filed for a motion for reconsideration. Both companies were originally allowed to proceed with the bidding but were disqualified once more after failing to provide documents required by the Comelec.

In a late development, Indra Elections Consortium was disqualified by the Comelec special bids and awards committee because it will be unable to provide 82,000 machines for the precincts, among other financial matters.

Comelec spokesperson James Arthur B. Jimenez, however, said "the company may still file for a motion for reconsideration."

Mr. Rafanan said the poll body is already investigating the list of incorporators of each company bidding.

The companies must declare that "there is no controlling stockholder, officer or incorporator that is related to an elected incumbent politician" Mr. Rafanan said.

Protecting the Philippines

Outside the Box
John Mangun
Business Mirror
http://www.businessmirror.com.ph/home/opinion/10480-protecting-the-philippines.html

It seems to me that both local policymakers and pundits are living in a fantasy world about what is happening all around us.

Take the A (H1N1) or swine flu, for example. Japan has just confirmed 93 cases. That fact, by definition, raises the World Health Organization pandemic alert to Level 6, the highest possible stage.

In the USA during a bad flu season, 10,000 to 15,000 more-than-normal deaths are expected. At this point, even given the low mortality rate of this current pandemic, 50,000 more US deaths are anticipated because this virus is much more contagious than normal. The economic effect, if the disease stays at the current death rate, is thought to take 0.25 percent off the US economy.

Of course, there is nothing to get hysterical about. As usual, the Philippines will probably be spared any significant effects as there is sometimes an advantage to being stuck on 7,000 islands in the middle of the ocean. And government has shown some foresight in dealing with the problem. But that is not the point. The real issue is the realization that 2009 is not a year of “business as usual” on many fronts.

I am sure you are as bored as I am, reading my constant comments about the fundamental changes taking place in the US economic/government structure. But what is happening in the USA is so dramatic and essential as to change the way the world does business. And ultimately, the effects and results will reach down to the very core of the Philippine economy.

Imagine reading tomorrow headlines in BusinessMirror and finding these bits of news. “Arroyo administration to decide corporate executive salaries” or “President Arroyo’s advisor to determine San Miguel’s advertising budget.” What would the reaction be to “President Arroyo doubles taxes on Filipino firms doing business abroad”?

Not only would there be outrage at such government intervention in local business, but also these policies would be seen as potentially disastrous to the economy. Yet this is exactly what is happening in the largest economy on the planet.

The result is that nations like the Philippines are going to have to carefully look at ways to avoid being overwhelmed by what is happening in the West. I know, I have said that many times before. But before 2009 comes to an end, this nation is going to have to accelerate its ability to adapt and adjust in a way that had not been necessary before.

Following the same policies and models as in the past is not going to work in this brave new world. As the West turns its economic polices inward, the Philippines must do the same. For a nation that has embraced Western economic ideas, where do we turn? Perhaps we need to look to the past, the very distant past.

In the 1500s, an economic philosophy derisively called “mercantilism” arose. Because this theory required government intervention on a scale never seen before. There were abuses of the theory, leading to what many believe was the age of colonial conquest and the creation of business monopolies that were thought to be more efficient. A basic flaw of mercantilism was that an economy was a zero-sum game; wealth was finite and one could only become wealthier at the expense of another. Mercantilism is a supposedly discredited theory in this “modern” time. Yet the premise of a famous, intensely nationalistic work by Austrian Philipp von Hörnigk called “Austria over all, if she only will” has some interesting implications for the Philippines in 2009.

Von Hörnigk lays down nine principles:

1. All of a country should be utilized for agriculture, mining or industry. A nation must maximize the resources it has, using these resources for its own benefit, and should not import the resources it needs.

2. A nation’s raw materials should not be sold but should be processed domestically into manufactured goods, since finished goods have more value.

3. A large working population is important. Two ideas come from this: deemphasizing such things as abortion and the welfare mentality, and a culture of hard work and production.

4. All exports of raw gold and silver are prohibited.

5. Foreign imports are discouraged. Foreign imports have the tendency of causing a nation to rely on a foreign power, damaging a nation’s own industries.

6. Indispensable imports should be paid for in exchange for manufactured goods if at all possible. This way, the nation sells off its excess production of high-value finished goods, without devaluing its own currency and economic stability.

7. Imports should be confined to raw materials. Again, it is better to buy the raw material and produce the finished.

8. Surplus manufactured goods should be sold to foreigners for cash, not for more imported goods.

9. There should be no imports of foods that can be manufactured at home. The worst thing any nation can do is put its food supply into the hands of a foreign power. This is the epitome of stupidity or betrayal.

Mercantilism served the purposes of the colonial powers until the 19th and 20th centuries when “free trade” became the mantra, which also served their interests. Now the West is swinging back toward a mercantile mentality.

For nations like the Philippines to prosper, perhaps even survive, we must move even more quickly to protect our economy or, as they did during the last two centuries, the West will once again bury and consume smaller nations like the Philippines.



PSE stock-market information and technical-analysis tools were provided by CitisecOnline.com Inc. E-mail comments to mangun@email.com.

Monday, 18 May 2009

Why the Philippine economy should hold up in 2009 -- Central Bank newsletter

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Philippine April BOP surplus $466M--BSP

Reuters
http://business.inquirer.net/money/topstories/view/20090518-205672/April-BOP-surplus-466M--BSP

MANILA, Philippines --The country recorded a balance of payments surplus of $466 million in April after a deficit of $472 million in March, the central bank said on Monday.

The cumulative surplus in the first three months of the year has reached $2.198 billion.

The central bank has predicted a BOP surplus of $700 million this year.

The overall BOP surplus in 2008 fell to a four-year low of $89 million after a record $8.58 billion in 2007.

Philippine energy corporaton Q1 net income rises 52.8% to P1.48B

Paul A. Isla
Business Mirror
http://www.businessmirror.com.ph/home/companies/10366-edcs-q1-net-income-rises-528-to-p148b.html

SIGNIFICANT foreign-exchange gains have pushed geothermal giant Energy Development Corp.’s (EDC’s) net income by 53 percent to P2.27 billion in the first quarter of the year from P1.48 billion during the same period a year ago.

In a statement, EDC attributed the increase in net income to the recognition of P1.28-billion foreign- exchange gains from the translation to pesos of the yen- and dollar-denominated loans using the March 31, 2009 closing rates.

EDC said the total revenues also increased by P750 million, broken down as follows: P514.5 million from an increase in average electricity and steam prices; P168.9 million in construction revenues from the combined recognition of intangible assets for the buffer zone in Northern Negros and Tanawon project in Albay; and the P66.7-million increase in revenues from drilling services in Lihir Island, Papua New Guinea.

“EDC’s impressive financial performance is a result of our good fiscal management policies aimed at fostering prudent liability management,” said Fenina Rodriguez, EDC chief financial officer.

She added that EDC continuously looks for appropriate structure to hedge its yen exposure, specifically the Miyazawa 1 and 2 loans, since “currency risk on foreign debt is what affects EDC’s share performance the most.”

EDC has P30.64 billion in long-term foreign loans as of end-March, 78.8 percent of which is yen-denominated.

EDC added that it has already hedged the JY12- billion Miyazawa 1 loan and is now soliciting bank proposals for the hedging of the JY22-billion Miyazawa 2 loan.

Philippines' Metrobank net up by 10%

Gerard S. dela Peña
BusinessWorld
http://www.bworldonline.com/BW051809/content.php?id=021

METROPOLITAN BANK and Trust Co. (Metrobank), the country’s second largest lender, booked a 10.2% growth in its earnings in the first quarter after gains from treasury operations recovered.

The Ty-led bank’s consolidated net income reached P1.94 billion in the first three months of the year from P1.76 billion in the same period last year.

This was the first time in four quarters that the bank recorded a quarterly profit that was higher than in the same period the year before.

Profits in the first to third quarters of last year had slumped in relation to comparable periods in 2007. For the whole of 2008, net income was 37.5% lower at P4.4 billion.

The bank attributed this year’s first quarter profit growth to the rebound in its securities trading and foreign exchange gains, which registered a 68.5% year-on-year growth to P1.44 billion.

Last year, Metrobank recorded a 58.76% year-on-year drop in its treasury operations to P853.46 million due to rising interest rates that pummeled bond prices.

Boosting the bank’s earnings during the period was a 41.5% growth in net interest income to P7.03 billion. This was backed by a 5.7% increase in net loans and receivables to P331.75 billion as well as a 12.3% expansion in deposits to P554.39 billion.

The bank’s bad loan ratio was unchanged from 4.92% in the same period last year.

"Volumes grew steadily in tandem with our thrust to preserve credit quality, while margins expanded as a result of better credit spreads and improved deposit mix," Arthur V. Ty, Metrobank president, said in a statement.

The bank’s operating expenses rose by 1.6% to P6.37 billion, even if the bank shored up its defenses by allocating more provisions for loan losses amounting to P1.46 billion from P1.16 billion last year.

Metrobank ranked as the second largest bank in the country during the period with consolidated assets amounting to P755.65 billion.

Philippine Operator of 7-Eleven chain reports 160% profit surge

K.J.R. Liu
BusinessWorld
http://www.bworldonline.com/BW051809/content.php?id=042

LISTED CONVENIENCE store operator Philippine Seven Corp. more than doubled its profits last quarter on the back of better sales from newly opened 24-hour outlets.

The operator of the 7-Eleven chain of stores said net income grew by 160% to P13 million or P0.05 per share, up from P0.02 in the same period last year.

Revenues climbed to P1.47 billion from January to March compared with P1.35 billion in sales posted in the first quarter of 2008.

Philippine Seven said this was due to the "continuous expansion of its store network."

System-wide sales, or overall retail sales to customers of company and franchised stores, reached P1.63 billion last quarter, compared with P1.45 billion in the first quarter of 2008, Philippine Seven President and Chief Executive Officer Jose Victor P. Paterno told the stock exchange.

Mr. Paterno said his company plans to optimize earnings of its convenience stores by improving the variety of merchandise and ensuring the availability of stocks.

As of March, the company had 371 7-Eleven outlets, a 17% hike compared to the previous year’s level. Mr. Paterno said new stores helped increase the company’s profitability last quarter amid the global economic slowdown.

"Despite the growing competition in the convenience store business, Philippine Seven maintains its leadership in the industry [by] operating the largest convenience store network in the country," Mr. Paterno said.

Mr. Paterno’s group acquired from 7-Eleven, Inc. of Dallas, Texas the license to operate 7-Eleven stores in the Philippines in 1982.

Philippine Seven has allotted P240 million for store expansion this year. The company plans to close the year with 450 7-Eleven outlets in Luzon, and is considering opening branches in Visayas and Mindanao next year to further expand its foothold in the industry.

Shares of the company remained at P2 apiece on Friday.