PSE Points to Ponder

ABS-CBN Corporation ( ABS ) has finally submitted its first half 2020 (1H 2020) results. The results showed that it has the financial strength to continue its operations. It has cash, cash equivalents, and short-term investments of 18 Billion Pesos as of end of 1H 2020 while debts due in the next 12 months is only 0.5 Billion Pesos. In the 1H 2020 it was able to generate cash from operations of 1.7 Billion Pesos which has been more than enough to service it debts. The losses of 3.2 Billion for the period 1H 2020 can be attributed to the inefficiency of a bigger organization (the administrative and general expenses/GAEX) with a smaller revenue stream. But this inefficiency is now being addressed. ABS has adopted and continues to implement cost control measures, reducing general and administrative expenses (GAEX) or overhead, rationalizing capital expenditures, and streamlining its manpower requirements. Given the reduced operations, ABS is reviewing its current business models, struc...

Megawide Construction Corporation ( MWIDE ) has tapped RCBC Capital Corporation and PNB Capital as joint lead underwriters for the primary offer of series 2 non-voting perpetual preferred shares to raise 5 Billion Pesos. The dividend rate has yet to be set for the series 2 non-voting perpetual preferred shares. MWDE has outstanding preferred shares in the market trading under the symbol MWP . MWP has a dividend yield of 6.96%. The series 2 preferred shares may have the same dividend rate with that of the first series but we will have to wait for the final prospectus to confirm the final dividend rate. The COVID-19 pandemic restrictions affected the businesses of MWIDE resulting to a net loss of 617 Million Pesos in the first half of 2020. But cash flow from operations of MWIDE for 1H 2020 has more that doubled compared to that of 1H 2019. MWIDE has generated cash from its operation of 2.4 Billion Pesos during 1H 2020. This shows the resiliency of MWIDE’s businesses as ca...