2011 Goals: Half-Year Review

FIRST PACIFIC
	Goal: Continue to explore investment opportunities in existing core businesses across the region Achievement: Ongoing. Exploration of potential investments in each of the four core businesses (telecommunications, infrastructure, foods/consumer, and natural resources) in the economies of emerging Asia continues.
	Goal: Fortify PLDT's position of market leadership in telecommunications Achievement: Achieved and ongoing. Leading market position retained as PLDT group broadband subscriber base improved by 10% from the end of 2010 to more than 2.2 million subscribers as at 30 June 2011. In the period, the fixed-line subscriber base grew 2% to about 1.9 million while combined SMART, TNT and Red Mobile subscriber base grew 5% to over 47.8 million subscribers.
	Goal: Invest in a new infrastructure project in the Philippines via MPIC Achievement: On track. MPIC has successfully raised Pesos 8.6 billion (US$201.5 million) in July 2011 to finance new projects and it continues to evaluate potential investments in infrastructure projects across the Philippines including participation in the Philippine Government's Public-Private Partnership initiatives. MPIC management is continuing to seek out infrastructure projects across the country.
	Goal: Grow MPIC's toll road network by building roads and/or by investment in other toll road assets Achievement: Ongoing. A Swiss Challenge to the Connector Road project is expected before year-end, fulfilling a necessary step before work can begin. Construction of Segment 9, part of the Harbour Link to central Manila, is expected to begin in early 2012 and evaluation of potential investment in other toll roads is underway.
	Goal: Continue moving into higher-margin products at Indofood Achievement: Achieved and ongoing. During the first half of 2011 the CBP group continued to market its growing range of food products utilizing fully its distribution network.
	Goal: Grow the plantation business so that Indofood become a net seller of crude palm oil ("CPO") Achievement: Ongoing. The Agribusiness expanded its oil palm plantations by 0.1% during the first half of 2011 although wet weather limited new plantings. Expansion of the oil palm plantations is expected to be stronger in the second half of the year.
	Goal: Expand sources of production at Philex from just one mine, Padcal, to others, through organic growth and/or via acquisition Achievement: Achieved and ongoing. Padcal mine life was extended for a further three years to December 2020 following reassessment of its reserves and resources earlier this year. Philex invested US$25 million in Kalayaan Project for a 5% stake rising to 60% with spending on the exploration phase of the planned mine, strategically located next to Philex's Silangan Project and potentially contributing to a significant increase in reserves at Silangan. Further investment of Pesos 1.4 billion (US$32.2 million) for 5% of Lepanto was also made. Evaluation continues of potential acquisitions of mines currently in operation. Exploration of Padcal environs and other license areas continues aggressively.

PLDT
	Goal: Achieve core net income for 2011 of around Pesos 40.5 billion Achievement: Ongoing. Core net income in the first half of 2011 reached Pesos 21.0 billion (US$483.5 million), down 1% from a year earlier but on track to achieving the full-year target.
	Goal: Achieve continued growth of the broadband business in terms of subscribers and revenues Achievement: Achieved and ongoing. PLDT group broadband subscriber base rose 10% from end-December 2010 to more than 2.2 million at end-June 2011. PLDT Group's total Digital Subscriber Line ("DSL"), wireless broadband and internet service revenues grew by 8% year-on-year to Pesos 9.0 billion (US$207.2 million) in the first half of 2011 and now account for 13% of total service revenues.
	Goal: Fortify PLDT's position of having undisputed market leadership in network quality and customer experience, and focus on margins and profitability Achievement: Ongoing. Capital expenditures for 2011 and 2012 is programmed to be higher than previous years with the bulk of capex intended for the upgrade and improvement of the network to achieve cost efficiencies, improve the broadband and cellular coverage and capacity, and continue delivery of quality service to customers.
	Goal: Upgrade the fixed and wireless networks within a capital expenditure budget of Pesos 34.4 billion for increased capacity and coverage Achievement: Ongoing. First half 2011 capital expenditure amounted to Pesos 6.3 billion (US$145.1 million), 35% lower than Pesos 9.7 billion (US$211.7 million) in the same period last year. In previous years, the bulk of the budgeted capital expenditure was registered in the second half of the year. In addition, there will be an opportunity to revisit the level of capital expenditures following the proposed acquisition of Digital Telecommunications Philippines, Inc. ("Digitel") to rationalize the network spend for both PLDT and Digitel.

MPIC
	Goal: Grow billed volume while cutting nonrevenue water to an average of 48% for the year. Fast-track expansion of the Putatan Water Treatment Plant and continue to explore alternative sources of water. Investigate opportunities to provide bulk water supply and distribution in other regions of the Philippines Achievement: Achieved and ongoing. Non-revenue water down to 48% at period-end from 53% a year earlier and declining. Putatan Water Treatment Plant formally inaugurated in July 2010 and work is ongoing to increase utilization following fourfold increase in capacity to 100 million liters per day ("MLD"). Maynilad continues to evaluate new bulk water and distribution concessions.
	Goal: For the electricity business, finalize plans to enter power generation and continue preparation for retail electricity sales Achievement: Achieved and ongoing. Meralco purchased a majority interest stake in the US$1.28 billion Redondo Peninsula Energy, Inc. (RP Energy), which is building a 600 MW coal-fired power plant in Subic Bay with the first 300 MW power plant coming online in 2014. Additional projects of close to 700 MW are under negotiation or evaluation. In preparation for retail electricity sales, a team has been organized to prepare a strategy for implementation of Open Access by 2013.
	Goal: Conclude evidentiary hearings for the Third Regulatory Period for Meralco beginning in July 2011 Achievement: Achieved. Third Regulatory Period commenced in July 2011 with a new four-year regulatory regime establishing a stable operating environment.
	Goal: Continue to expand the toll road portfolio at MPTC by targeting acquisitions and new builds in heavily trafficked areas Achievement: Ongoing. MPTC executives continue to evaluate potential investments for growth by acquisition and organic expansion. MPIC's fund-raising earlier this year is aimed in large part at financing MPTC's planned growth.
	Goal: Continue to grow the hospital network through the acquisition of hospitals across the country Achievement: Ongoing. The Hospital group continues to evaluate potential hospital acquisitions in all three main island groups of the Philippines.
	Goal: Participate in further development of the country's infrastructure, such as airports or Manila's Metro Rail Transit ("MRT") 3 light rail system Achievement: Ongoing. MPIC executives continue to explore potential infrastructure investment opportunities.

INDOFOOD
	Goal: Expand business/product categories Achievement: Ongoing. New categories have been introduced in traditional snacks, such as Qtele Tempe soybean chips and Bimbim, a biscuit for children.
	Goal: Increase market share in some categories Achievement: Ongoing. Higher sales volumes by certain divisions in the ICBP subsidiary – Dairy, Food Seasonings, Snack Foods and Nutrition & Special Foods – drove increases in market share in certain segments while price increases in the Noodles business sacrificed market share for an improvement in margins. Higher prices also drove sales increases.
	Goal: Optimize operational efficiencies Achievement: Ongoing. Increasing competition on price has put pressure on margins at all business units except Agribusiness, which benefitted from a 48% increase in the average price of crude palm oil ("CPO"). Margins have also been put under pressure by rising prices of ingredients, particularly for wheat and sugar.

Philex
	Goal: Extend Padcal's mine life beyond 2017 Achievement: Achieved. Philex announced the extension of Padcal's mine life to December 2020 based on reserves of 85.6 million tonnes of economically exploitable ore. Padcal's total resources are estimated at 147 million tonnes, indicating that 61.4 million tonnes of additional ore could be converted into reserves and extend Padcal's mine life even further if economic parameters permit.
	Goal: Move forward on Silangan development of the mine Achievement: Achieved and ongoing. Construction of the portal to the decline leading down to the Bayugo and Boyongan ore bodies was completed in August 2011 with tunnel construction to follow over the next 18 months to two years. The project is on target to deliver first commercial quantities of ore in late 2015 or 2016.
	Goal: Continue exploring opportunities to acquire new mining operations Achievement: Achieved and ongoing. Investment of US$25 million in Kalayaan Project for 5% stake rising to 60% with spending on pre-development phase of the planned mine. Further investment of US$33 million for 5% of Lepanto also made. Evaluation continues of potential acquisitions of mines currently in operation.
	Goal: Determine the feasibility and costeffectiveness of reopening the Bulawan Gold Mine Achievement: Ongoing. Philex engineers and geologists continue to evaluate the feasibility and cost-effectiveness of reopening the Bulawan Mine.
	Goal: Intensify exploration of areas with permits in the environs of the Padcal Mine, Bulawan Mine, Silangan Project and Sibutad Project for further mining opportunities Achievement: Ongoing. Exploration of Padcal environs and other license areas continues aggressively with go/no-go decisions on development seen likely in 2012 for several potential projects.
	Goal: Improve public perception of the benefits of mining to the Philippines Achievement: Ongoing. Working closely with the Bureau of Mines to improve the reputation of the mining industry.