the Outsider - PSE Points to Ponder

  ABS-CBN Corp.’s long-running turnaround effort suffered another blow in the first quarter of 2026, as weaker advertising, a shrinking cable business, and compressed gross margins pushed the former broadcasting giant into negative equity. The Lopez-led media company reported a ₱813 million net loss for the three months ended March 31, 2026, wider than the ₱500 million loss a year earlier, as consolidated revenue fell 21% to ₱3.33 billion . Gross profit dropped to ₱527 million from ₱1.02 billion , driving the gross profit ratio down to about 15.8% from roughly 24.0% in Q1 2025. The weak quarter erased what remained of ABS-CBN’s equity cushion. Total equity swung to a ₱66 million deficit from ₱747 million positive equity at end-2025, while the company’s accumulated deficit widened to ₱6.65 billion from ₱5.97 billion . The results underscore how difficult it has been for the Lopezes to rebuild ABS-CBN’s earnings base after the loss of its broadcast franchise. Management has s...

The Lopez family’s listed holding company has, over little more than a decade, transformed ABS-CBN from a fully consolidated operating subsidiary into an associate carried at zero on a consolidated equity-accounting basis — a shift that says as much about accounting architecture as it does about the fall of one of the Philippines’ best-known media groups.   There was a time when ABS-CBN sat squarely inside Lopez Holdings’ numbers. In its 2025 annual report, Lopez Holdings explicitly recalls that ABS-CBN had been treated as a subsidiary in 2012 and prior years , meaning its revenues, costs, debt, and losses flowed line by line through the parent’s consolidated accounts. That changed after the adoption of PFRS 10 , when Lopez Holdings said it reassessed control and concluded that it did not control ABS-CBN but did control First Philippine Holdings. From   January 1, 2013 , the group deconsolidated ABS-CBN and began accounting for it under the equity method .  That accounti...

The most revealing number in Philippine media is not ratings, subscriber counts, or YouTube views. It is the share of each peso of revenue that survives the direct cost of making and delivering content. By that measure, the country’s two most storied television brands now inhabit very different worlds. In 2025,  GMA7 posted a gross profit margin of 50.97% , down only slightly from 52.37% in 2024. ABS-CBN managed 16.52% , a touch above 16.18% a year earlier. In plain terms, GMA kept a little over 50 centavos of gross profit from every peso of revenue, while ABS kept only about 16.5 centavos .  That gulf is not a quirk of accounting. It is a map of two business models. GMA remains the Philippines’ dominant free-to-air broadcaster, still benefiting from the old but lucrative economics of mass television: national reach, ratings leadership, and an advertising machine that continues to throw off high-margin revenue. Its 2025 consolidated revenue rose to about ₱18.12bn , while gr...

  In corporate finance, there is a simple rule: when a firm’s overheads exceed its gross profit, survival depends not on operations but on patience. By 2025, ABS‑CBN had crossed that line. The company reported a gross profit margin of 16.52% , producing gross profit of roughly ₱2.6 billion on consolidated revenues of ₱15.85 billion , even as revenues declined 9% year‑on‑year . Against this, administrative, corporate, and support costs remained structurally larger—helping drive a net loss of ₱4.72 billion and a net income margin of –29.76% for the year . In a normal business, that arithmetic ends the discussion. Yet ABS‑CBN continues to operate, raising a different question: for how long will its financiers—among them institutions associated with the Aboitizes and the Ayalas—continue to forbear? A Cost Base Built for a Bigger Company ABS‑CBN’s overhead problem is not subtle. The firm remains profitable at the gross level, but general and administrative expenses, together with per...

The feud now spilling across LPZ, ABS, ROCK and FGEN is not merely a family quarrel; it is a corporate-governance issue at the top of listed companies. The Lopez family’s dispute has ceased to look like a private quarrel and begun to resemble a public-markets problem. ABS-CBN itself has said that this is “a family dispute and should remain so” and that it should not be fought in public. Yet it is being fought in public — through statements, counter-statements and litigation that now spill across companies connected to the group.  That matters because these are not merely family assets. Lopez Holdings, First Philippine Holdings, First Gen, Rockwell Land and ABS-CBN are all publicly listed companies , each with minority shareholders who did not sign up to become spectators in a dynastic power struggle. Public reporting shows that the conflict is no longer confined to the private holding company. It has extended into ABS-CBN, where the company confirmed that one director proposed a sh...

In the Lopez empire, the better balance-sheet story still comes with a warning label In Philippine capitalism, families do not merely own companies; they curate ecosystems. That makes the latest lesson from the Lopez orbit unusually instructive. On one side sits Rockwell Land , the group’s polished property arm, which delivered rising earnings in 2025 and expanded its commercial footprint with the ₱21.6 billion acquisition of 74.8% of Alabang Commercial Corporation (ACC) . On the other sits ABS-CBN , another Lopez-controlled company, still haggling with lenders over waivers, maturities and covenant relief after years of losses and a balance sheet weakened by the loss of its broadcast franchise. Together, the two suggest a truth financiers know well: within a conglomerate, trouble rarely spreads legally—but it often spreads psychologically.  Rockwell’s 2025 results looked, at first glance, reassuringly robust. Net income rose 29% to ₱5.3 billion , revenues increased 4% to ₱20.9 bill...

  Technically defaulted loans, a ₱50‑billion gas windfall elsewhere in the group, and the quiet limits of relationship banking. In the Philippines’ compact world of family capitalism, debts are rarely just financial. They are social, reputational, and, at times, inter‑dynastic. That is why the technically defaulted bank loans of ABS‑CBN—once the country’s most powerful broadcaster—are being watched not merely by credit committees, but by the inner circles of three of the nation’s most prominent business families. On one side stand the Lopezes , controllers of ABS‑CBN and First Gen Corp. On the other sit their creditors: UnionBank , controlled by the Aboitiz family , and the Bank of the Philippine Islands (BPI) , long dominated by the Ayala family . The sums at stake—roughly ₱12–13 billion in consolidated bank loans—are manageable for institutions of their size, but the issues they raise are not purely about recoverability. They go to the heart of how elite Philippine conglomerates ...

  On the screen, ABS-CBN still looks like a going concern with options. Its shares last traded at ₱3.39 , even as the company’s September 30th, 2025 consolidated book value worked out to only about ₱1.77 per share , implying a price-to-book multiple of roughly 1.92 times . In markets, that is the sort of rating ordinarily reserved for firms with a comfortable balance-sheet cushion, or at least a credible story about earnings power just around the corner. ABS-CBN has neither in abundance.  The balance sheet is the awkward part. ABS-CBN reported ₱38.54bn of total assets as of September 30th, 2025, against ₱36.95bn of total liabilities, leaving just ₱1.59bn of total equity. Put differently, roughly 96% of the asset base already belongs, in one form or another, to somebody else. Equity is not the substance of the enterprise so much as the thin residue left after everyone else has been heard from. Start with the people who keep the machine running. ABS-CBN had ₱13.07bn  i...

  The long rise, stumble, and reinvention of Lopez Holdings In the Philippines, conglomerates often resemble republics: sprawling, dynastic, and convinced that history is on their side. Few have embodied that truth as vividly as Lopez Holdings , the listed flagship of one of the country’s most storied business families. Born in 1993 as Benpres Holdings Corporation, it was meant to be the Lopez clan’s public wager on a democratic Philippines finally ready to modernize—through television, phones, toll roads, water pipes, and power plants. For a time, it looked like a masterstroke. Then it became a cautionary tale. And then, by a mixture of stubbornness, asset quality, and financial surgery, it turned into something rarer: a survivor. At birth, Benpres had the swagger of the age. The early 1990s were years when investors, local and foreign, believed that the Philippines—newly emerged from dictatorship and eager for liberalisation—was finally ready to catch up with its more indust...