PSE Points to Ponder

Someone has said that in deal making, if you are a buyer pretend to be a seller and if you are a seller pretend to be a buyer. After  Business World has reported  that the Philippine Competition Commission (PCC) green-lit DMC Urban Property Developers, Inc.’s acquisition of Smart Towers, the Makati-based office building assets of PLDT Inc. ( TEL ), another news outfit the Philippine Star/PhilStar Global has r eported that MVP Group’s PLDT is vying for Lopez owned Sky Cable . Business World and the Philippine Star are units of Hastings Holdings, Inc. and according to the disclosure in the Business World report, Hastings Holdings, Inc. – a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc. — maintains interest in BusinessWorld through the Philippine Star Group, which it controls. Hastings is a wholly-owned subsidiary of MediaQuest and holds all the print-related investments of MediaQuest, including equity interests in the three leading newspapers: The Philip...

Someone has said that in deal making, if you are a buyer pretend to be a seller and if you are a seller pretend to be a buyer. After Business World has reported that the Philippine Competition Commission (PCC) green-lit DMC Urban Property Developers, Inc.’s acquisition of Smart Towers, the Makati-based office building assets of PLDT Inc. ( TEL ), another news outfit the Philippine Star/PhilStar Global has r eported that MVP Group’s PLDT is vying for Lopez owned Sky Cable . Business World and the Philippine Star are units of Hastings Holdings, Inc. and according to the disclosure in the Business World report, Hastings Holdings, Inc. – a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc. — maintains interest in BusinessWorld through the Philippine Star Group, which it controls. Hastings is a wholly-owned subsidiary of MediaQuest and holds all the print-related investments of MediaQuest, including equity interests in the three leading newspapers: The Philippine S...

Eusebio H. Tanco is the principal controlling stockholder of STI Education Systems Holdings, Inc. ( STI ). He directly owns around 12.7% of STI’s outstanding common shares as of June 30, 2020. STI has a fiscal year ending on March 31 of every year. For the fiscal year 2019 to 2020 STI has not yet been able to file its 17-A report or the annual report. According to STI the preparation of the Financial Statements (“FS”), and timely completion of the statutory audit of the Company’s Consolidated and Parent Company FS have been greatly affected by the travel and quarantine restrictions imposed by the IATF. The STI network of schools are located nationwide and most of these locations are placed under quarantine, suspension of business operations, and other safety and quarantine protocols imposed by both local and national government authorities and the Company in response to COVID 19 pandemic . Prior to the implementation of the quarantines, STI was able to file its 3Q results for the fis...

As of the end of first half of 2020, Filinvest Land, Inc. ( FLI ) has debts becoming due in the current period of 9.3 Billion Pesos while cash is only at 3.9 Billion Pesos. As with everyone else, FLI ‘s revenue is down for the first half of 2020. FLI’s revenue from real estate sales went down by 46% but rental revenues held up. Mall rentals may have been significantly affected by COVID-19 pandemi c restrictions but office leasing remained strong. FLI earned around 3 Billion Pesos in the first half of 2020 from office rentals. The office rentals is expected to be the main cash generator for FLI in these times. In the first half of 2020 FLI generated cash from operations of 0.9 Billion Pesos only. Although FLI has an inventory of real estate units for sale of around 65.8 Billion Pesos of 1H 2020, we can not expect for sales of real estate units to be buoyant during these times. Judging of the first half results of FLI, real estate sales have come to a standstill. Thus, ...

PLDT Inc. ( TEL ) is under heavy pressure to (1.) invest in fiber broadband and 5G wireless networks and (2.) still reduce leverage and (3.) distributes dividend to shareholders, the “ triple threat position. “ No less that the President of the Philippines on its State of the Nation Address had called on TEL and Globe Telecom, Inc. ( GLO ) to improve their services. The President was telling the telcos that it is just a matter of capital infusion and that the telcos have to look for it to fund service improvements. As of June 30, 2020 TEL’s debt had increased 22% to 235.3 Billion Pesos from the end of December 31, 2019 of 192.6 Billion Pesos. The already elevated debt level gives TEL less flexibility to raise capital through debts. Judging by the results of the 1H 2020, cash generations from operations will just be enough to fund capital expenditures of 70 Billion Pesos if TEL will stick to its plan of spending around 70 Billion Pesos for capital expenditures on n...

We have earlier commented that the COVID-19 pandemic had a significant adverse impact on the operations and finances of DMCI Holdings, Inc. ( DMC ) during the first half of 2020 (1H 2020) which resulted to a weaker financial footing for DMC as of end of 1H 2020 . The weakness in the results of DMC sent it shares plummeting to a low of 3.40 a share almost revisiting the 3.10 a share low at the height of the sell down in March 2020. The Consunji’s took advantage of the weakness in the share price of DMC, accumulating DMC shares along the way. We have commented earlier that the Consunji’s private holding company, DFC Holdings, Inc., had accumulated a total of 55,425,100 DMC shares as of the end of August 2020 . It appears now that DFC Holdings is not yet done accumulating DMC shares. For the first two weeks of September 2020, DFC Holdings bought 3,892,000 DMC shares. The Consunji’s accumulation of DMC shares signals that they have the operational and financial expertis...

First Gen Corporation ( FGEN ) is currently investigating the condition of the generator of its 414MW San Gabriel Combined Cycle Power Plant following a trip. The initial investigation, which is being carried out by specialists from Siemens Power Operations Inc., indicates that there is an electrical fault in the generator, and pending completion of the inspection, the plant has been declared as unavailable for dispatch. First NatGas Power Corp. (FNPC) is the project company and operator of the 420 MW San Gabriel natural gas-fired power flex plant. FNPC is a wholly owned subsidiary of AlliedGen Power Corp. (AGPC) which is in turn a wholly-owned subsidiary of FGEN. As of end of 1H 2020, San Gabriel Combined Cycle Power Plant contributes US$97.3 Million to the revenues of FGEN. In March 2018, FNPC was awarded a six-year Power Supply Agreement (PSA) by Meralco for 414 MW of San Gabriel’s baseload capacity after undergoing a Competitive Selection Process (CSP). The sale of electricity t...