Shell boosts earnings 28% to P5 B in H1

 Economy
Sep 202016
 
Shell boosts earnings 28% to P5 B in H1

MANILA, Philippines – Pilipinas Shell Petroleum Corp. reported a net income of P5.07 billion in the first half of the year, up 28 percent from the same period in 2015. However, sales fell to P71.7 billion from P88.37 billion largely due to lower product prices, documents submitted to the Securities and Exchange Commission showed. Last year, Shell posted a net income of P3.6 billion, a marked turnaround from two consecutive years of losses (P8.5 billion in 2014 and P912 million in 2013) due to  improvement in refining margins and lower inventory losses. Sales also declined to P168.8 billion. Aside from improving finances, Shell said its gearing ratio – a measure of a company’s financial leverage – has also improved to 32 percent as of the end of the first quarter. “With a recently completed rights issue in 2015, the company believes it has low gearing and a well capitalized balance sheet that positions it for growth opportunities,” Shell said. Last year, Shell raised P17.9 billion from a rights offering, effectively boosting its capital, which is necessary for its planned initial public offering. Business ( Article MRec ), pagematch: 1, sectionmatch: 1 After almost 18 years, Shell is pursuing its long-delayed IPO, seeking to raise about P29.7 billion from the sale of of 330 million shares. The offering includes an over allotment of up to 30 million shares, which will be sold for a maximum P90 per share. Industry sources said Shell is hoping to do the IPO before its country Read More …

S&P tags downside risks to Philippine growth

 Economy
Sep 202016
 
S&P tags downside risks to Philippine growth

The Duterte administration has adopted a 10-point agenda to address the high poverty rate in the country. It also raised the budget deficit ceiling to three percent of GDP instead of two percent of GDP as it intends to ramp up infrastructure spending.  External factors, political issues MANILA, Philippines – S&P Global Ratings said external factors as well as local and regional political issues pose downside risks to the strong economic performance of the Philippines. In its latest Asia Pacific Economic Snapshots, S&P said external factors include the continued economic slowdown in China as well as the volatile global market brought about by the impending interest rate increase by the US Federal Reserve. “The main downside risks to the Philippine economy continue to come from external factors, such as a sharper-than-expected downturn in China or repeated bouts of market turbulence. Recently, tail risks from local and regional political issues have appeared as well,” S&P said. The economy grew seven percent in the second quarter from 6.8 percent in the first quarter. This brought the average GDP growth to 6.9 percent in the first half from 5.5 percent in the same period last year. “Economic and demographic fundamentals continue to drive a strong domestic demand story, as indicated by nearly seven percent growth in the first half of the year,” S&P said. Business ( Article MRec ), pagematch: 1, sectionmatch: 1 The Duterte administration has adopted a 10-point agenda to address the high poverty rate in the country. It also raised Read More …

Index strengthens above 7,600

 Economy
Sep 202016
 
Index strengthens above 7,600

The PSEi gained 95.88 points or 1.27 percent to finish at 7,671.72, while the broader All Shares index gained 21.58 points or 0.47 percent to finish at 4,563.55. MANILA, Philippines – The benchmark Philippine Stock Exchange index (PSEi) continued to firm up yesterday, ahead of the scheduled meeting today of the US Federal Reserve. The PSEi gained 95.88 points or 1.27 percent to finish at 7,671.72, while the broader All Shares index gained 21.58 points or 0.47 percent to finish at 4,563.55. Except for the industrial index all sub-indices gained led by the services and mining index. Jonathan Ravelas, chief market strategist at Banco de Oro said all eyes are on the US Fed meting. Analysts said investors’ concerns on rate hike have ease as the latest US macroeconomic figures indicate a postponement of a September rate hike to possibly in December. A consolidation above the 7,500 level could lead to continued bounce following five weeks of decline. Business ( Article MRec ), pagematch: 1, sectionmatch: 1 Thus, the market may recover to 7,700 after today’s consolidation. The mining and oil index gained 256.39 points or 2.46 percent after the Department of Environment and Natural Resources (DENR) cleared some mining companies after a technical audit. Semirara Mining and Power Corp. gained 4.77 percent to close at P114.20 per share after the DENR found its expansion project to be “technically sound,” and “complaint” with regulations. The company underwent an audit last July after the DENR sought to put an end to Read More …

A ray of hope

 Economy
Sep 202016
 
A ray of hope

Despite what they say about the Duterte administration, there is one thing the present government was able to do that the previous leaderships failed to do – fast track approval for important and critical infrastructure projects. Metro Pacific Investment Corp. subsidiary Metro Pacific Tollways Development Corp. (MPTDC) has just received the notice of award from the Department of Public Works and Highways (DPWH) for the North Luzon Expressway-South Luzon Expressway (NLEX-SLEX) connector road project. According to news reports, the contract for the project was awarded to MPTDC, the original proponent, as no comparative proposals were submitted to the DPWH during the Swiss challenge held last July. Being an unsolicited proposal by MPTDC submitted sometime April 2010, the law requires that a Swiss challenge be conducted wherein the government accepts comparative proposals from interested parties, after which the original proponent is given the right to match the best offer given. The connector road project started out as an unsolicited project by MPTDC in 2010. It was approved by the National Economic and Development Authority (NEDA) board in 2013 under the public-private partnership (PPP) program. However, it suffered several delays because the government at the start said the proposal should undergo a Swiss challenge, and then it changed its mind and the DOTC proposed that the private proponent should instead enter into a joint venture with the state’s Philippine National Construction Corp. Sometime middle of 2014, the Department of Justice opined the JV is illegal, so government went back to the Swiss Read More …

Conspiracy theorists

 Economy
Sep 202016
 
Conspiracy theorists

Much of what is making the current political situation seemingly volatile can be described as self inflicted. We love scaring ourselves like children telling each other ghost stories and finding it difficult to sleep alone afterwards. I am sure most of us have heard one conspiracy story or another. Even some friends who should know better seem to believe there is more to it than mere product of the overworked imagination of some people who profit from it. There is a plot to kill the president, one story goes. And the PNP chief says it isn’t just the president whose life is in danger but his as well. But isn’t such danger inherent to the jobs they both agreed to take? Plots against presidents are par for the course. That’s why we have the PSG and the Secret Service among others. As for the plot against the PNP chief, isn’t he leading the war against drugs? Of course he should assume the drug lords will try to neutralize him. It is his job to neutralize them first. It doesn’t fit his image to sound like a cry baby. The Liberals are plotting to oust Duterte, another story goes.  Well… the Liberals lost so badly in the last election there isn’t much of a Liberal Party left. Didn’t a throng of Liberals renounce party membership to join Duterte’s super majority in the House of Representatives? That makes Duterte impeachment proof. As for the conspiracy story the Liberals will try to unseat Read More …

PCCI, MAP skeptical on tax reform plan

 Economy
Sep 202016
 
PCCI, MAP skeptical on tax reform plan

MANILA, Philippines – Despite widespread public support, the Philippine Chamber of Commerce and Industry (PCCI) and the Management Association of the Philippines (MAP) yesterday expressed some reservations on the Duterte administration’s tax reform plan. “It is a non-issue that we need to do a (tax) re-bracketing, but aside from addressing equity and progressivity, tax laws should also be simple, equitable and efficient,” MAP governor Benedicta Du-Balalad said. “I don’t see that yet,” she told the House ways and means committee hearing tax bills. Du-Balalad cited difficult taxing mechanisms on fringe benefit taxes on corporations as well as those on micro, small- and medium-enterprises (MSMEs), which she said could be “lumped all as compensation.” Under the National Internal Revenue Code, fringe benefits such as housing, vacation expenses, life and health insurance are charged a separate 32 percent on their gross monetary value. Concerns were also expressed on “discrepancies” on data used to gauge the number of those employed by MSMEs. Business ( Article MRec ), pagematch: 1, sectionmatch: 1 The Bureau of Internal Revenue and the Department of Labor and Employment have different figures. Du-Balalad, also speaking for the PCCI, also said tax evasion is a possibility once a higher 35-percent tax rate is imposed on “ultra rich” individuals. The plan, which will be part of the first of the four package of reforms, will be slapped on those earning more than P5 million annually. Currently, the highest rate of 32 percent is charged against those getting above P500,000. “The profile Read More …

BIR chief goes on leave

 Economy
Sep 202016
 
BIR chief goes on leave

The Bureau of Internal Revenue is the government’s main revenue agency. Philstar.com/File photo MANILA, Philippines – Only about two months in office, Bureau of Internal Revenue (BIR) Commissioner Caesar Dulay has gone on leave for medical reasons. This was bared during House ways and means committee heating on pending tax reform bills on Tuesday. “May I ask where is the commissioner?” said Nueva Ecija Rep. Estrelita Suansing. To which, BIR Deputy Commissioner Nestor Valeroso replied: “He is currently on medical leave but we understand he will return by the end of the month.” “He underwent an operation but he is already recuperating,” he added. Suansing called the committee’s attention on Dulay’s apparent persistent absence on congressional hearings. Dulay was also absent on last week’s organization meeting of the committee. Suansing then went on to ask what the operation was for, to which Valeroso responded that it might be “personal” in nature. After prodding, the BIR official then said that Dulay had a hip operation. Aside from Valeroso, Dulay was represented by deputy commissioners Jesus Clint Aranas, Celia King and Lanee David on Tuesday’s hearing. BIR, which accounts for about 80 percent of tax revenues, is the government’s main revenue agency. It collected P117.4 billion in July, the first month of the Duterte administration, down one percent year-on-year. It marked the first time in seven months that collections dipped, data showed. For the first seven months however, BIR already raised P900.9 billion, up nine percent from last year.

Share Acquisition in 2016: Antitrust and Tax Compliance

 Economy
Sep 192016
 

The legal landscape for mergers and acquisitions in the Philippines has been developing at an unprecedented pace over the last few years. In July 2015, Congress passed RA 10667 or the Philippine Competition Act, and in June 2016, the Philippine Competition Commission promulgated the Implementing Rules and Regulations of the said law. While it is inaccurate to say that antitrust laws never existed in the Philippines prior to 2015, RA 10667 is the first comprehensive competition legislation in the country. It is also the first time the Philippines created a specialized antitrust body to enforce antitrust laws and prevent anti-competitive agreements.

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