Biz Buzz: Beer love
We still love our beer, apparently.
The Inquirer has learned from sources that San Miguel Brewery Inc.’s domestic volumes for the first five months of the year has grown by about 4 percent to around 72 million cases.
Revenues were reported to have reached an estimated P28 billion, up from P25.1 billion in the same period last year. Net income, on the other hand, reportedly improved 22 percent to an estimated P6 billion.
Last year, the firm’s performance was hampered by the imposition of higher excise taxes.
Despite the continued imposition of excise taxes (albeit more “moderate” this year), this recovery proves that Filipinos continue to love beer, specifically, San Miguel beers.
And if the sales of San Miguel beers can indeed be used as a gauge as to how the economy is doing, then what this also tells us is that our economy continues to grow and apparently more money is going into people’s pockets— hence, even more reason to celebrate and raise a toast.
With the election season coming up, the volumes bump that it usually brings can only push SMB’s growth further. Miguel R. Camus
DBP director complains
Development Bank of the Philippines (DBP) director Reynaldo Geronimo wrote the Inquirer recently to complain about the series of articles that came out about the P717 million in losses incurred by the government bank in the process of executing “wash sales”—defined by regulations as the prohibited act of buying and selling securities which results in no real change in beneficial ownership.
In his letter, Geronimo said that the articles published recently were “unbalanced, distorted and malicious.” He said that this writer did not seek the side of DBP “which is contrary to the spirit of fair play.” He also said that the writer’s sources were “tainted,” appearing to be “another attempt to discredit DBP’s senior management.”
In particular, Geronimo zeroed in on the DBP employees’ union and the Association of DBP Career Officers (Adco), which, he said, had filed “harassment suits” in various government regulatory agencies stemming from “policies and reforms initiated by the current DBP management to reform the institution.”
Among the management’s reforms supposedly being opposed by the employees were (a) the enforcement of an eight-hour work day and putting an end to the decade-long practice of DBP employees leaving their workstations by 4:30 p.m.; (b) withdrawal of the “guaranteed bonus” and institutionalization of performance-based bonuses, in accordance with the policy approved by the Governance Commission for GOCCs, and (c) enforcement of the no-gift policy to curtail the practice of accepting gifts by DBP employees, including unauthorized foreign trips sponsored by DBP counterparties.
Geronimo also claimed that the bank’s risk oversight committee approved a “general strategy” to address the increasing unrealized losses of DBP’s available-for-sale portfolio “in order to avert a P10-billion loss for the bank.” He said that, contrary to the “misleading and defamatory statements” published in the Inquirer, the risk oversight committee never approved any “wash sales.”
“Indeed the term ‘wash sales’ was never mentioned in the Commission on Audit report, but was used by the DBP union and Adco,” he added.
According to Geronimo, “this loss was due to the impairment in the value of the government securities caused by economic and financial conditions within and outside the Philippines, which beset the banking industry and which were certainly not created by and were beyond the control of DBP. In fact, despite the P712-million trading losses on these transactions, the bank ended the year with net trading gains of over P420 million, which contributed to the bank’s net income of P4.6 billion in 2014.”
In any case, Geronimo’s letter was too long to be covered in the limited space we have today, but we will continue where we left off in the next edition of Biz Buzz.
But for the sake of our readers who are wondering about Geronimo’s credentials, here are some highlights: He is a lawyer and a partner in the Romulo law office (previously known as the Romulo Mabanta Buenaventura Sayoc and delos Angeles law firm). He writes a column called “The Trust Guru” for some print publications, several of which took the side of the new DBP management in its 2011 drive to nail down businessman Roberto Ongpin on a supposed behest loan (the case was dismissed). After this, he was appointed director of DBP. Stay tuned for the rest of his letter.
The Inquirer’s reports were based on DBP and Commission on Audit documents which detailed both sides of the issue. We also met with a top DBP official, reached out to Atty. Geronimo, and sought the reaction of the bank’s spokesperson—from whom we received no reply. Daxim L. Lucas
Ad interim coming up?
Energy stakeholders are buzzing with speculation about a possible interim head at the Department of Energy (DOE) as Secretary Carlos Jericho L. Petilla’s appointment lapsed last week.
Petilla remained unconfirmed by the Commission on Appointments as its legislator-members went on a break from June 12 to July 26, 2015.
Many stakeholders said they believed Petilla might not be reappointed since he had already tendered his resignation last summer and had only been staying on in the absence of a “suitable replacement.”
Previously, we said in this column that there were four candidates for the interim position. The latest buzz in rumorville was that one of the women candidates might secure the interim appointment. That is, unless the President reinstates Petilla.
If a new person is named during Congress’ break, the “ad interim” appointee can immediately perform the functions and powers of the position.
Some said it might be high time for Malacañang to settle with having an officer-in-charge at the DOE since it will just be for about a year.
But an ad interim appointee could do just as well, they said. Riza T. Olchondra
PR nightmare
The daily four- to five-hour power outages in the tiny island-province of Romblon is proving to be a major public relations and community relations nightmare for the Energy Regulatory Commission (ERC) and construction/power conglomerate DMCI.
Last week, several town mayors and Rep. Eleandro Madrona (who represents Romblon’s lone district) blew their collective tops due to ERC’s alleged protracted delays in finally setting power rates for the island’s new electricity provider.
But apart from assailing the “snail paced” deliberations, Romblon officials also laid the blame on DMCI’s doorstep. The local executives scored DMCI for allegedly being a “sore loser” and for allegedly throwing the proverbial monkey wrench on a pending rate petition that prevented a rival power supplier from running its generator sets that have been on stand by since early this year.
Caught in the crossfire of this intense power play are more than 200,000 Romblon residents who have been suffering from rotating power outages since 2012.
Ironically, the object of bitter rivalry is the supply of only 5 megawatts of electricity for the entire island province. This, according to energy experts, is simply a fraction of a Manila mall’s daily power requirement.
With no resolution in sight, expect the PR war to further intensify. In fact, Representative Madrona is reportedly sharpening his knives by calling for a congressional probe to dig deep into DMCI’s other power issues in Palawan, the Torre de Manila “photo bomber” issue in Luneta and the curious case of DMCI’s managing director Victor Limlingan, whose joint bank account with brother Gerry Limlingan was recently frozen by the Anti-Money Laundering Council due to supposedly suspicious transactions. Daxim L. Lucas
D-Day deferred
We’re all going to have to wait a bit longer before knowing if the Philippines or China will host the Fiba World Cup in 2019.
In an unusual move, the board of Fiba, or the International Basketball Federation, decided to defer the date for the final pitches of both countries to Aug. 7 this year from June 18, the multititled former PBA and Gilas Pilipinas head coach Vincent “Chot” Reyes told Biz Buzz.
Reyes, who’s involved in the final 20-minute presentation, will join other Filipino delegates to make a final pitch in Tokyo, Japan, instead of Geneva, Switzerland, as originally planned.
Businessman Manuel V. Pangilinan is also expected to join, although more to lend our countrymen support as he’s on the Fiba board.
Reyes said that officially, the postponement was because of a Fiba scheduling issue, but talk within the industry was rife that the deferral had more to do with the fallout from the bribery scandal that has rocked football’s ruling body, Fifa.
Yes, it’s a different sport but we hear Fiba would rather avoid handing out big decisions with another major international sports organization coming under extreme scrutiny.
In any case, the deferral should give us more time to prepare and fine-tune what we expect would be an elaborate presentation effectively showcasing the Philippines as the best choice in four years. Miguel R. Camus
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