Chairman's Letter

DEAR FELLOW SHAREHOLDERS

The global economy in 2022 was marked by the lingering of the pandemic, the global fight against inflation, and the consequences of the war in Ukraine. These latter two factors are expected to continue to weigh on the global economy with the International Monetary Fund forecasting global growth to slow to 2.9% in 2023 from 3.4% a year earlier.

As the effects of the pandemic diminish, the markets in which our companies operate face headwinds from global financial tightening and an expected slowdown in external demand. Overall growth in Asia-Pacific is expected to be 4.3% in 2023, well below its historical average of 5.5%.

Nevertheless, the government of the Philippines saw 7.2% growth in gross domestic product in 2022 and expects similarly strong numbers in 2023. Indonesia, a much larger economy, saw growth of 5.3% last year, much of that driven by household consumption, with further strong growth expected in 2023.

Against this backdrop, the companies of the First Pacific Group recorded their fourth year in a row of higher contribution to First Pacific, allowing our Company to deliver record high recurring profit and a strong 16% increase in distribution to shareholders – a matter of importance to all of us.

The First Pacific Group is not resting on its laurels. Our companies will continue to improve efficiencies and productivity with judicious capital expenditure and well targeted training of staff. We continue to be optimistic about the Group’s prospects over the medium term not least because steady investment in digital services, particularly by Indofood and PLDT, has strengthened our understanding of our markets and made us nimble in the face of changing consumer preferences and sentiment.

Yours sincerely
Anthoni Salim

Chairman
30 March 2023