BIZ BUZZ: Gold dividend play

As the initial public offering (IPO) of OceanaGold (Philippines) Inc. (OGP) ends today, underwriters of the P6-billion equity deal have been able to fully cover the books despite coming to market during a challenging period.

Eduardo Francisco, president of underwriter BDO Capital & Investment Corp., told Biz Buzz he was encouraged to see improving institutional, retail and even trading participant demand for the IPO amid uncertain market conditions.

“But where is it better to invest than in gold and copper?” Francisco asked. “Gold is the classic safe haven asset, while copper is a key decarbonization metal. With OGP being a dollar earner, dividend payments would also be protected from peso depreciation.”

Investors have the Philippine government to thank for requiring OGP to list (which will happen on May 13), and considering where market is, at a big discount to how much the parent company has valued it, he said.

With around 1.7 million ounces of gold in resources, OGP is going for less than $350 per ounce. With OGP all-in sustaining margin of more than $1,000 per ounce of gold in 2023, a pretty good upside is expected as global gold prices hover above $2,100 per ounce.

Investors may not have to wait long, as OGP might declare its dividends as early as the third quarter of this year. Depending on where gold prices are, dividend yield is estimated to be within the mid-teens range, on an annualized basis.

As a policy, OGP has committed 90 percent of its free cash flow of each past year as annual dividend payment.

“This stock is really a dividend play and we want investors to hold on to their investments and receive the double-digit dividend yields,” Francisco said

AIA PH, Ayala join hands for art

May is Heritage Month in the Philippines and Filipinos can mark it this year by going to the free exhibition at the Ayala Museum featuring 11 works of Filipino visual art masters from the vast collection of AIA Philippines (formerly PhilAm Life).

The exhibit entitled “Unraveling the AIA Philippines Art Collection” is quite special as it is the first time that these works of art by artists ranging from national artists Ang Kiukok and Victorio Edades to national hero Jose Rizal will be shown to the public.

These works initially graced the halls, walls and offices at the former PhilAm Life Building on UN Avenue in Manila and AIA Philippines decided to share them with the public so that they can be appreciated by more people.

“Our partnership with Ayala Museum is part of our arts and culture advocacy as a means to promote social and community wellness. We believe that art, when made accessible, can bring people together and build community. That’s why we’ve taken pieces from our AIA Philippines art collection and shared them with the best local museums where more people can appreciate them,” said Melissa Henson, Chief Marketing Officer of AIA Philippines. “The pieces that we shared with Ayala Museum include works from the country’s best visual artists, celebrating the talent of the Filipino.”

Mariles Gustilo, Senior Director of Ayala Museum, said the museum was heartened by the special opportunity for the public to see for the first time the works of some of the best Filipino visual artists for free.

“These masters have made such important contributions to the development of Filipino visual art, and we’re very thankful to AIA Philippines for choosing Ayala Museum as the venue to showcase their art collection,” she added

The free exhibit will run until May 26 this year. –– Tina Arceo-Dumlao