2016 Half Year Goals


  • Goal: Reduce significantly First Pacific’s Head Office net debt level
    Achievement: Partly achieved and ongoing On 27 May 2016, Metro Pacific Holdings, Inc. (“MPHI”), a Philippine affiliate of First Pacific, sold 4.1% of diluted interest of MPIC to GT Capital Holdings, Inc. (“GT Capital”) for a net consideration of US$168.6 million. The proceeds will be used for debt reduction.
  • Goal: Continue to seek new investment opportunities when appropriate
    Achievement: Achieved and ongoing First Pacific Group, through MPIC, expanded its infrastructure portfolio by investing in: Global Business Power Corporation (“GBPC”) for electricity generation; Cebu- Cordova Bridge Project for toll roads; Metro Iloilo Water District for the supply of bulk treated water; Eco-System Technologies International, Inc. (“ESTII”) for wastewater and sewage treatment and Sacred Heart Hospital of Malolos Inc. (“SHHMI”) for hospital services.
  • Goal: Guide PLDT through its digital transformation
    Achievement: Ongoing The acquisition of further telecommunications spectrum during the period will strengthen PLDT’s service offerings for advanced mobile phone 4G technology. To this end, PLDT’s capital expenditure budget for 2016 has been increased to accommodate the new planned spending.
  • Goal: Execute turnaround in Australia and support Goodman Fielder’s export initiatives and expansion in Asia
    Achievement: Ongoing Management is executing a business turnaround in Australia to improve profit performance, driven by cost savings, operational efficiencies and new product launches. The China strategy is being implemented with an initial focus on dairy products such as UHT milk, whipping cream, yoghurts and cheese, while in ASEAN markets Goodman Fielder is building its distribution capabilities for the sale of high- quality Australian and New Zealand products.
  • Goal: Assist Philex to complete the definitive feasibility study for the Silangan project
    Achievement: Ongoing The project has secured all major permits including environmental compliance certification for surface mining and approval by the Department of Environment and Natural Resources of the amended Declaration of Mining Project Feasibility for surface mining. The project’s feasibility study is under peer review and further optimization by third-party consultants with completion targeted for early 2017.
  • Goal: Work with management of PLP to achieve profitability
    Achievement: Ongoing The electricity generation industry in Singapore is going through evolutionary changes influenced by the market participants themselves. PLP is fully engaged in working to change and adapt to market conditions to achieve profitability.
  • Goal: Work with management of RHI and First Coconut Manufacturing Inc. (“FCMI”) with the aim of developing these companies as major players in the Philippines’ sugar and coconut industries, respectively
    Achievement: Ongoing Both companies are focusing on securing reliable supplies of raw materials as an important part of laying down the foundation for their long-term growth.

  • Goal: Grow consolidated service revenues, excluding international long distance (“ILD”)/national long distance (“NLD”), by increasing wireless service revenues and sustaining double digit gains in the data and broadband businesses
    Achievement: Mostly achieved and ongoing Consolidated service revenues (excluding ILD and NLD) rose 2% to Pesos 72.1 billion (US$1.5 billion) as data, broadband and digital platform service revenues rose 23% to Pesos 29.5 billion (US$627.7 million) and accounted for 36% of consolidated service revenues. On a segment basis, fixed line service revenues (excluding ILD and NLD) rose 9% period-on-period, while wireless service revenues (excluding ILD and NLD) declined by 3% compared to the first half of 2015.
  • Goal: Meet core income guidance of Pesos 28 billion
    Achievement: Ongoing Core income declined 6% to Pesos 17.7 billion (US$376.6 million) in the first half of 2016. With net gain from the sale of 25% interest in Beacon Electric offset by lower equity in earnings in Beacon Electric and taking into consideration lower EBITDA and higher financing costs due to higher capital expenditure, core income guidance was revised upward to Pesos 30 billion for the year as a whole.
  • Goal:  Further establish the PLDT group’s fixed and wireless networks’ dominance and reliability to support the data and broadband businesses, with 2016 capital expenditure budget of Pesos 43 billion
    Achievement: Ongoing During the period, data and broadband revenues rose 25% to Pesos 29.3 billion (US$623.4 million), accounting for 41% of consolidated service revenues (excluding ILD and NLD). 2016 capital expenditure was revised upward to Pesos 48 billion (US$1.0 billion), with the increase to finance utilization of newly acquired spectrum including the 700 MHz band from San Miguel Corporation (“SMC”).
  • Goal: Expand the PLDT group’s suite of offers in digital services, particularly via digital platforms and mobile financial services
    Achievement: Achieved and ongoing  PLDT’s digital mobile and commerce arm Voyager Innovations, Inc. offers various consumer lending platforms; a mobile payments platform, PayMaya, as a prepaid wallet for e-commerce payments and remittances; and digital commerce solutions for B2B2C including TackThis! and Takatack, while freenet enables enterprises to reach digital consumers.

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  • Goal: Continue to accelerate growth, both organically and inorganically
    Achievement: Achieved and ongoing Consolidated net sales rose 4.4% to Rupiah 34.1 trillion (US$2.5 billion) mainly driven by higher sales contributions from Consumer Branded Products (“CBP”). CBP group’s total sales value grew 9.4%, driven by existing and new products. In the first half of 2016, this group launched more than 30 new products including new concepts such as Indomie Real Meat and Indomie Bite Mie.
  • Goal: Maintain a healthy balance sheet
    Achievement:  Ongoing  Gross debt to equity ratio and net debt to equity ratio as of 30 June 2016 stood at 0.66 times and 0.39 times respectively, similar to the figures at the end of 2015.


  • Goal: Continue the development of major projects in light rail and roads which were won in 2015 bidding
    Achievement: Achieved and ongoing To date, 14 light rail vehicles (“LRV”) were restored which increased the total number of LRVs in operation to 91, while projects for rail replacement, central station unification and facilities improvement are underway. The integration of toll collection systems for Subic Clark Tarlac Expressway (“SCTEX”) and North Luzon Expressway (“NLEX”) was completed in March 2016, while preparation and construction of other road projects are continuing as scheduled.
  • Goal: Bid on further public-private partnership (“PPP”) projects in the Philippines, expand MPIC’s regional presence and pursue opportunities in non- or less-regulated infrastructure businesses
    Achievement: Ongoing MPIC is working on the resubmission of proposals for the Metro Rail Transit 3 (“MRT3”) rail line as requested by the new Administration of the Philippine Government. MPIC through MetroPac Water Investments Corporation (“MWIC”) invested in an unregulated business Eco-System Technologies International, Inc. (“ESTII”) which is involved in the wastewater management business.
  • Goal: Resolve tariff claims in the domestic toll road and water businesses as well as other disputes in light rail and electricity distribution
    Achievement: Ongoing  Delay in tariff adjustments at Meralco, Maynilad, NLEX and Manila-Cavite Toll Expressway (“CAVITEX”) are expected to make progress in the second half of 2016 with the instalment of a new Administration. The final hearing for arbitration filed by Maynilad is expected to take place in December 2016.
  • Goal: Establish specialty hospitals in the Philippines to improve patient outcomes while reducing costs to patients
    Achievement: Ongoing Three joint ventures signed for specialty/non-hospital healthcare formats, further expand the scope of health service offerings from the Hospitals group.


  • Goal: Increase sales and profitability in South East Asia and China
    Achievement: Ongoing Sales in Fiji and China rose 15% and 5%, respectively. In South East Asia, Goodman Fielder is increasing its sales and distribution capabilities, including recent commencement of distributor partnerships in Vietnam and the Philippines. As a result, higher export volumes and sales are expected from the second half of this year, led by the sales of products in dairy, grocery and baking-related categories. Sales of UHT and flavored milk products continue to develop and the business will expand into higher margin dairy products such as dairy creams, yogurts and cheeses.
  • Goal: Improve sustainability and growth of profits for the bread business in Australia
    Achievement: Ongoing Volume shortfalls across all categories were partly offset by stronger results in Home Baking. Cost-out and logistics improvements will also help to offset the shortfalls. Discussions continue with retailers on reducing wastage of unsold bread loaves. Material and logistics costs improved in the period, and related cost-out programs will continue to drive operational efficiencies and improve profitability of the baking division.
  • Goal: Refinance debt due in 2016 at a significantly lower net cost
    Achievement: Ongoing Discussion of refinancing of approximately A$200 million (US$149 million) is underway and is expected to be finalized in the fourth quarter of this year.

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  • Goal: Complete the definitive feasibility study of the Silangan project
    Achievement: Ongoing The project has secured all major permits including environmental compliance certification for surface mining and approval by the Department of Environment and Natural Resources of the amended Declaration of Mining Project Feasibility for surface mining. The project’s feasibility study is under peer review and further optimization by third-party consultants with targeted completion by early 2017.
  • Goal: Continuously improve productivity amidst weak metal prices
    Achievement: Achieved and ongoing Tonnage milled rose 5% to 4.7 million tonnes and the operating cost per tonne of ore milled declined 11% to Pesos 741 (US$15.8) period-on-period.
  • Goal: Explore tenements around Padcal mine to extend the mine life
    Achievement: Ongoing Drilling activities in Bumolo resulted in the estimation of a maiden inferred resource of 21.7 million tonnes at 0.2% copper and 0.3 gram/tonne gold at 0.274% copper equivalent cut-off. Additional drilling programs are ongoing to further identify the quality and quantity of the initial findings.
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  • Goal: Diversify its gas portfolio
    Achievement: Ongoing  PLP continues to search for means of reducing its fuel costs by diversifying its gas portfolio. It has successfully done so for the near term through securing better terms in its gas supply agreement and is looking for additional opportunities for the medium and long term.
  • Goal: Leverage its efficiency advantage and operational flexibility to increase its retail portfolio
    Achievement: Achieved and ongoing The proportion of total sales volume devoted to the retail market through PacificLight Energy Pte. Ltd. rose to 68% of total volume of electricity sold compared to 55% period-on-period.
  • Goal:  Achieve a total contract level of 85-90% for its generation
    Achievement: Achieved and ongoing Total contract sales accounted for 98% of total volume of electricity sold and 68% of overall generating capacity.

FP Natural Resources/

  • Goal: Increase reliability of cane supply
    Achievement: Ongoing Shortage in supply of sugar cane in the Philippines worsened in the period due to the impact of El Niño. RHI improved its competitiveness by implementing a new cane purchase program and offering incentives to sugar cane planters. It was able to secure 1.8 million tonnes of sugar cane compared with 1.7 million tonnes in the first half of 2015.
  • Goal: Lift core net earnings
    Achievement: Ongoing Core net income in the period was adversely impacted by higher cost of sugar cane due to cane supply competition, extended facility upgrade of ethanol plants and higher interest expense. RHI is in discussions with sugar cane planters for securing additional supply of sugar cane, the completion of ethanol facilities expansion this year can also enhance production efficiency.
  • Goal: Increase ethanol production
    Achievement: Achieved and ongoing  Sales volume of ethanol rose 32% to 39.0 million liters from 29.5 million liters in the first half of 2015 reflecting inclusion of San Carlo Bioenergy, Inc.’s (“SCBI”) six months of sales compared with two months in the first half of 2015.
  • Goal: Complete rights issue
    Achievement: Achieved RHI completed its rights issue in May 2016, raised Pesos 1.1 billion (US$23.4 million) by issuing 266.8 million new common shares at Pesos 4.19 (US$0.089) per share. The fund raised will be primarily used for loan repayment and capital expenditure.