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Ayala Corporation posted a net income of P7.3 billion for the first half of the year, 20 percent higher than its year-ago level. The robust performance of Ayala’s property and banking units, boosted by its increased stake in the latter, primarily drove its strong earnings momentum. Higher earnings of its water unit and improved performance of its business process outsourcing business likewise contributed to Ayala’s profits during the period.

Netting out the impact of the accelerated depreciation as a result of the network modernization of Globe Telecom, Ayala’s core net income grew even higher to P8.9 billion, a 42-percent improvement year on year.

The conglomerate’s strong performance was driven by robust equity earnings which reached P9.5 billion, a 24-percent jump year on year. Ayala’s consolidated revenues likewise increased 21 percent to P74.6 billion.

“The first half broadly turned out as expected as we sustained growth momentum across our key businesses. Our core businesses made great strides in growth and expansion while our international businesses continued to improve. We are confident this strong performance will carry on this year. The encouraging macroeconomic conditions continue to present opportunities for further investment and we will continue to take advantage of these moving forward,” Ayala President and Chief Operating Officer Fernando Zobel de Ayala noted.

REAL ESTATE

Ayala Land, Inc.’s (ALI) net income during the first semester expanded 30 percent to P5.6 billion from a year ago as it sustained its revenue growth across all business segments and achieved stable margins during the period. Its total revenues climbed 36 percent to P36.6 billion driven by the 38-percent jump in real estate revenues. This was primarily a result of higher bookings of residential projects, the sale of office units and commercial lot sales mainly from the Food Terminal, Inc. property which ALI acquired last year.

Revenues from its commercial leasing portfolio rose 17 percent to P8.5 billion in the first half of 2013. Shopping center revenues increased by 10 percent with the addition of gross leasable area (GLA) in ALI’s new malls. Office leasing posted a 13-percent increase, as a result of higher occupied GLA and the escalation of lease rates in its existing facilities. Meanwhile, hotel revenues grew 46 percent and contributed 22 percent of total commercial leasing revenues as the number of rooms doubled and average room rates increased across the board.
 
BANKING

Bank of the Philippine Islands (BPI) continued to perform strongly in the first half of the year, posting a net income of P12 billion, a 27-percent growth from its year-ago level. This was driven by the 14-percent improvement in the bank’s total revenues coupled with a modest 6-percent increase in operating expenses. The growth in revenues was boosted by higher net interest income, which went up 6 percent and non-interest income, which soared 23 percent from a year ago. Gains across fee-based income, foreign exchange, securities trading and insurance income drove up the non-interest income during the period.

The bank’s loan growth remained strong across all segments, with net loans expanding 17 percent to P564 billion. Lending to corporates went up 18 percent, while consumer loans rose 15 percent. BPI’s asset quality remains strong, with non-performing loan ratio flat at 2.2 percent.

TELECOM

Globe Telecom’s consolidated service revenues for the first half of 2013 rose by 9 percent year-on-year to P44.5 billion, driven by its mobile business, which accounted for 80 percent of revenues. Revenues from the broadband and fixed line data segments also contributed to the growth, collectively making up for 17 percent of revenues.

Globe’s robust revenue growth offset the higher operating expenses, resulting in a 7-percent year-on-year improvement in its earnings before interest taxes depreciation and amortization (EBITDA) to P18.9 billion in the first half.

The impact of the accelerated depreciation charges arising from the ongoing network modernization, however, resulted in a 72-percent decline year on year in reported net income to P1.4 billion. Excluding that, Globe’s core net income actually grew by 13 percent to P6.4 billion.

WATER INFRASTRUCTURE

Manila Water Company, Inc. (MWC) posted a net income of P2.9 billion, 11 percent higher year-on-year on higher billed volume and expanded service connections. Businesses outside the East Zone also continued to contribute during the period. Revenues rose 6 percent to P7.6 billion with contribution from Laguna Water Company surging 52 percent, Boracay Island Water, 21 percent and Clark Water, 5 percent.

Manila Water continues to invest in improving its service to East Zone customers to ensure 24/7 water availability and expand its water and wastewater coverage.

INTERNATIONAL

Integrated Micro-Electronics, Inc. (IMI) registered an 8-percent improvement in revenues to US$350.5 million. This was a result of the robust performance of its operations in Europe, Mexico, and the Philippines, which offset the slowdown in China. Operations in Europe and Mexico grew 37 percent year-on-year, while Philippine operations also posted a healthy 11-percent growth. However, revenues from its China and Singapore operations declined by 9 percent year on year. Lower capacity utilization resulted in a 33 percent decline in net income during the period.

Ayala’s BPO unit, LiveIt, achieved continued growth in revenues and profitability in the first half of 2013. share of revenues reached US$190 million, up 15 percent year-on-year, while share of EBITDA reached US$16.3 million, up 21 percent due primarily to higher revenues and improved profitability at Stream and Affinity Express. Stream reported a 26-percent increase in revenues and a 52-percent increase in EBITDA for the second quarter, due to an 11-percent organic growth and the acquisition of UK-based LBM Holdings Limited, a premier demand and lead generation solutions provider. LiveIt exited the second quarter with share of EBITDA of US$8M, representing the tenth straight quarter of year-on-year growth in share of EBITDA. Further improvement is expected in the second half of 2013 due to organic growth, seasonality and Stream’s acquisition of LBM.

POWER AND INFRASTRUCTURE

With its strong balance sheet and cash position, Ayala remains on track with its investment plan to scale up its power assets and participate in the government’s transport infrastructure-related public private partnership projects.

Its energy unit, AC Energy Holdings, Inc., continued to expand its portfolio. It recently announced its joint venture agreement with UPC Philippines Wind Holdco B.B. and the Philippine Investment Alliance for Infrastructure (PINAI) Fund to develop a wind farm in Ilocos Norte with a capacity of about 81 megawatts. The unit also recently partnered with Power Partners Ltd. for the construction and operation of a 405-megawatt thermal power plant in Kauswagan, Lanao del Norte.

Ayala’s transport infrastructure unit, AC Infrastructure Holdings Corporation, continues to work with various partners to bid for significant size infrastructure projects. It has prequalified to bid for the Light Rail Transit 1 extension and the adjacent automatic fare collection system projects, as well as the Mactan Cebu International Airport.

BALANCE SHEET

Ayala’s balance sheet remained healthy. At the parent level, cash at the end of June amounted to nearly P36 billion, with the debt at close to P70 billion. The conglomerate maintained a comfortable gearing level with net debt to equity ratio of 0.25 to 1. On a consolidated basis, net debt to equity ratio likewise remained comfortable at 0.67 to 1.

This year, Ayala declared a cash dividend of P2.40 per share, 20 percent higher than the regular P2.00 per share payable on August 12, 2013.

The above press statement pertains to the disclosure submitted to the SEC, PSE, and PDEx by Ayala Chief Finance Officer Delfin Gonzalez, Jr.

AC Energy Holdings, Inc. (ACEHI), a wholly owned subsidiary of Ayala Corporation, signed an Investment Framework Agreement and Shareholders’ Agreement with UPC Philippines Wind Holdco I B.V., a wholly owned company of UPC Renewables Partners (UPC) and the Philippine Investment Alliance for Infrastructure (PINAI) fund, comprised of the Government Service Insurance System, APG and Macquarie Infrastructure Holdings (Philippines) Pte. Limited, to develop wind power projects in Ilocos Norte through Northern Luzon UPC Asia Corporation (NLUPC) as their joint venture company. An initial equity investment has been agreed for the first 81MW project with an investment value of approximately US$220 million with ACEHI funding 64% of equity, PINAI 32% and UPC 4%.

The 81MW project received a declaration of commerciality on June 17, 2013 from the Department of Energy. Accordingly, NLUPC has signed the Turbine Supply, Installation and Service Availability Agreements with Siemens Wind Power A/S and Siemens Inc. and has issued the Notice to Proceed. The project’s initial phase is expected to be connected to the grid by June 2014. The joint venture company has a portfolio of additional wind energy projects of over 200MW under development.

The project will grow ACEHI’s wind farm portfolio in the Philippines, building on its current 50% ownership of NorthWind Power Development Corporation which already operates a 33 MW wind farm in Bangui, Ilocos Norte. Over the past two years, ACEHI has established a robust pipeline of power assets and has committed over US$300 million of equity in conventional and renewable energy technologies.

UPC has nearly 20 years of experience in developing, financing, constructing, owning and operating wind farms in Europe, USA and Asia with gross generating capacities of approximately 2,000MW. UPC continues to have a significant wind project development pipeline globally.

PINAI is a Php26 billion fund dedicated to equity investment in Philippine infrastructure assets. PINAI is managed by Macquarie Infrastructure and Real Assets (MIRA), part of Macquarie Group. MIRA manages more than US$100 billion worth of infrastructure assets globally, including more than 16.7GW of power generation assets. PINAI’s investors include the Government Service Insurance System, Dutch pension fund asset manager APG, the Asian Development Bank and Macquarie Group.

Siemens is a leading supplier of wind power solutions for onshore, offshore and coastal sites and has installed over 12,700 wind turbines globally which equals to over 21,100MW installed capacity as of July 2013. Wind Power is part of Siemens’ Environmental Portfolio. In fiscal 2012, revenue from the Environmental Portfolio totaled about €33 billion, making Siemens one of the world’s largest suppliers of eco-friendly technologies. Siemens Wind Power Asia Pacific Region is headquartered in Shanghai, China.

This press statement pertains to the disclosure submitted to the SEC, PSE, and PDex on July 12, 2013, by Ayala CFO Delfin C. Gonzalez Jr.

German auto giant Volkswagen formally signed the appointment of Automobile Central Enterprise, Inc. (ACEI), a wholly owned subsidiary of Ayala Corporation, as its Philippine distributor.

In a simple ceremony held on May 27 at Ritz Carlton Hotel in Hong Kong, Weiming Soh, president for commercial operations in Greater China/ASEAN, affixed his signature on the Importeur Agreement with Fernando Zobel de Ayala, president and COO of Ayala, and John Philip Orbeta, president and CEO of ACEI.

“The dominant position of Volkswagen in the global automotive market will boost Ayala’s strong presence in the growing Philippine automotive industry,” said FZA. “We are excited to bring Volkswagen’s innovation and technology to the Philippine market complemented by an outstanding customer experience.”

Said Soh: “In line with our ASEAN growth strategy and the vision to be the world’s most successful automobile manufacturer in ecological and economical terms by 2018, we found in Ayala Auto a dedicated, resourceful, and experienced partner in the Philippines that will strengthen the Volkswagen brand.”

The Volkswagen Group is Europe’s biggest and the world’s third largest with global sales of 9.3 million units in 2012 up 11% from the previous year. As of 2012, its global market share for passenger cars accounted for 12.8%. The group operates 100 production plants in 27 countries and employs more than 550,000 people worldwide. The Volkswagen Group sells its vehicles in 153 countries.

Ayala Auto has been a key player in the local automotive industry for over 20 years operating dealerships of Honda and Isuzu in Metro Manila and the Visayas region. It has minority interest in the distributor companies of both brands.

Said Orbeta: “Ayala is now making a comprehensive program to successfully bring back Volkswagen to the Philippines. We are finalizing plans to roll out several models in multiple showrooms at the earliest time. We would like to contribute to the growth of the auto industry with the appointment of new dealership partners in the coming months.”

Ayala Corporation’s earnings in the first quarter of the year reached P4.5 billion, 29% higher than net income in the first quarter of last year. Core net income, which excludes the impact of Globe Telecom’s accelerated depreciation, grew even higher to P5.2 billion, a 49% increase year on year. The strong earnings momentum was driven largely by its banking unit, Bank of the Philippine Islands (BPI), which delivered a record net income for the quarter combined with Ayala’s increased equity stake in the bank. Its property unit, Ayala Land, Inc. (Ayala Land), likewise posted robust earnings growth during the period in review. Both units accounted for 88% of equity earnings during the quarter.

BPI posted a net income of P8.4 billion for the first quarter, 43% higher than last year’s P5.8 billion. The bank’s total revenues grew by 21% driven largely by significant trading gains. Net interest income increased slightly as the bank’s average asset base expanded by 15%. Net loans grew by 19% year-on-year to P514 billion at the end of the quarter with growth noted across all market segments. Notwithstanding the strong lending activity, the bank’s NPL ratio continued to decline to 2.1% from 2.5%.

Property unit Ayala Land’s net income grew by 30% to P2.8 billion on the back of sustained revenue growth. Ayala Land’s total revenues for the first quarter reached P18.5 billion driven by the steady completion and higher bookings of its residential projects. Revenues were likewise boosted by the sale of commercial lots from the recently acquired FTI property. Its commercial leasing businesses also contributed significantly with revenues from both shopping and office leasing up 7% and 13%, respectively as a result of higher occupied gross leasable area and lease rates. The opening of new hotels and resorts also pushed hotel revenues up 86% year-on-year. Ayala Land continues to pursue a robust pipeline of development projects. A total of P10.3 billion in capital expenditure was spent during the quarter for project completion and land acquisition. Recently, Ayala Land sealed several joint venture agreements to develop significant size properties in prime areas in Cebu and Davao.

Its telecom unit, Globe Telecom, maintained its revenue momentum in the first quarter. Consolidated service revenues grew by 6% to P21.4 billion driven by the steady growth of its mobile, broadband and fixed line data businesses. Mobile revenues rose by 3% as Globe continued to expand its subscriber base which now totals 35.1 million, up 13% year on year. Broadband revenues also increased by 23% year on year with subscriber base likewise expanding by 17% to 1.7 million. Globe remains on target with its network and IT modernization program with the first phase, which included the change-out of various cell sites nationwide, completed. The network modernization, however, resulted in higher depreciation charges during the period which brought reported net income down 76% year-on-year to P656 million. Excluding the impact of the accelerated depreciation, Globe’s core net income rose by 13% to P3.1 billion.

Manila Water posted revenues of P3.6 billion, 6% higher year on year. Cost of services and operating expenses, however, increased at a much faster rate of 11% due to water and wastewater expansion. Combined with higher depreciation and interest expense, which rose by 20% and 17%, respectively, net income for the quarter remained steady year on year at P1.3 billion. New concessions outside the East Zone continued to post significant earnings gains with Boracay Water up 26%, Clark Water up 24%, and Laguna Water up 98% year on year.

In the meantime, Ayala’s international businesses saw continued growth despite the sluggish global economic conditions.
Integrated Micro-Electronics, Inc. (IMI) saw consolidated revenues grow by 9% year on year despite slower demand for electronic products in the Eurozone, the US, Japan, and China. However, net income declined to US$253 thousand from US$854 thousand due to lower capacity utilization, particularly of its facilities in China.
Its international business process outsourcing operations under LiveIt achieved continued growth and margin improvement. LiveIt’s share of revenues from its investee companies reached US$ 93.2M, up 13% versus last year, while share of EBITDA grew to US$ 8.3M, up 8% due mainly to higher revenues and improved profitability at Stream and Affinity Express. This resulted in a reduction in LiveIt’s net loss by US$1.5M. Performance of its major investee companies is expected to further improve in the second half of 2013.

Ayala President and Chief Operating Officer Fernando Zobel de Ayala said, “We are pleased to see the sustained strong performance of our key business units. The positive macroeconomic conditions continue to present opportunities for further investment and expansion in each of our businesses. We continue to take advantage of these and have set group-wide capital expenditure of P136 billion this year to pursue our growth objectives.”

Ayala Corporation maintains a very solid financial position with consolidated cash of P88 billion and debt of P173 billion as of the end of the quarter. Cash at the parent company alone stood at nearly P38 billion at the end of the quarter with parent debt at P70 billion. Gearing ratios remain highly comfortable with consolidated debt to equity ratio at 1.3 to 1 and parent net debt to equity of 0.25 to 1. The company’s market capitalization has risen by 28% year-to-date to P392 billion, making it the second largest among listed Philippine conglomerates.

The above press statement pertains to the disclosure submitted to the Securities and Exchange Commission, Philippine Stock Exchange, and Philippine Dealing and Exchange Corporation by Ayala Chief Finance Officer Delfin Gonzalez, Jr.

LiveIt, Ayala’s BPO investment arm, announced that its investee, Stream Global Services, Inc., recently completed the acquisition of all the outstanding share capital of UK based LBM Holdings Limited, and also posted strong financial results for the quarter and year ending December 31, 2012.

Stream is a leading Customer Relationship Management BPO company with over 39,000 employees supporting 35 languages across 56 service centersin 23 countries. LBM is a premier demand and lead generation solutions provider that employs approximately 2,500 people across six locations in the UK and generates approximately £60 million in annual revenues. LBM will enable Stream to better penetrate the UK, the world’s second largest English language market, as well as strengthen its ability to help customers grow their sales through LBM’s revenue generation service offerings. LBM’s clients are in the telecommunications, financial services, utilities, automotive and retail industries.

“This transaction is about delivering greater value to our clients and long-term growth for our company,” said Stream Chairman and CEO Kathy Marinello. “LBM has proven experience in creating highly precise target lists of people who will be more inclined to buy products and services, which will further enhance our StreamSELLER offering. StreamSELLER focuses on everything involved with the sales process, from recruiting, hiring and training the right people to the consistent use of proven sales behaviors that close more sales with greater predictability. LBM’s people, expertise and capabilities, combined with Stream’s financial strength, global presence, and sales and service offerings, will establish a broader portfolio of high-value service offerings for our clients.”

As previously announced, Stream also achieved revenues of $860 million in 2012, and 14% growth in Adjusted EBITDA to $101 million. In the fourth quarter, revenue was $236 million, up 7% versus the fourth quarter of 2011, and Adjusted EBITDA was $34 million, up 10%, representing the eighth straight quarter of year over year growth in Adjusted EBITDA. Net income for the fourth quarter of 2012 was $4 million.

Stream has also achieved strong momentum in the Philippines where over the last 3 years it has grown its headcount to more than 14,000, and in recent months it has opened 3 new sites in Pasay, Makati and Cebu.Stream pioneered the call center industry in the country when it took the first calls from the US market in mid 2000.

Stream also won the prestigious “IT-BPO Employer of the Year” award during the recent seventh annual International ICT Awards. Stream’s selection was based on its company-wide focus on employee engagement, satisfaction, and career opportunities. The award recognizes Stream for its leadership, strategic approach to HR with a focus on employee retention, and commitment to continuous improvement.

Stream’s company culture, embodied in its global brand promise of “Caring People…Building Businesses. Building Careers” is the foundation for growth and opportunity for those who want to build careers at Stream. By creating a caring environment, Stream has steadily improved employee satisfaction and engagement. This ultimately has led to higher employee retention and skill level, which has enabled Stream employees to deliver exceptional customer experiences on behalf of the clients they serve.

“This award is a testament to the work we have done to create a unique and powerful company culture that really focuses on our most valuable asset – our people,” said Jared Morrison, Stream’s VP and Philippine Country Manager. “We put a lot of energy into making sure our employees are prepared for success. This starts with the way we recruit for exceptional talent all the way through training, development, and ongoing professional growth opportunities that we offer our people. We also create a fun, vibrant work environment so people get more personal satisfaction out of their choice to build a career with Stream.”

Stream is also a past winner of the prestigious “Employer of the Year” award by the People Management Association of the Philippines (PMAP), the country’s leading association of human resource management and development practitioners from various industries.

Fred Ayala, LiveIt’s CEO and Stream’s Vice Chairman, added, “We are very pleased with Stream’s entry into the UK market, its strong financial results globally, its continued growth in the Philippines, and its recognition by the industry as an employer of choice.”

About Stream Global Services
Stream Global Services is a global business process outsourcing (BPO) service provider specializing in customer relationship management services including sales, customer care and technical support for Fortune 1000 companies. Stream is a trusted partner to some of the world’s leading technology, computing, telecommunications, retail, entertainment/media, and financial services companies. Stream’s service programs are delivered through a set of standardized best practices and sophisticated technologies by a highly skilled multilingual workforce of over 39,000 employees capable of supporting over 35 languages across 56 service centers in 23 countries. Stream strives to expand its global presence and service offerings to increase revenue, improve operational efficiencies and drive brand loyalty for its clients. To learn more about the company and its complete service offering, please visit www.stream.com.

New four-year deal with US-based business intelligence services market leader further expands Integreon’s strong presence in the Philippines

Integreon, a leading global provider of integrated legal, research and business solutions, recently announced a multi-year extension to its existing landmark deal with SNL Financial (SNL). SNL is a premier provider of business intelligence and news for the banking, financial services, insurance, real estate, energy, metals/mining, and media/communications industries. Integreon has been providing business services to SNL since May 2012, and the recent expansion of the relationship extends the contract through January 2017.

The partnership will grow SNL’s existing relationship with Integreon in Manila and will further extend Integreon’s position as a market leading provider of business services to demanding professionals. Integreon already employs 400 people in Manila, providing a range of business services, legal services and document services to clients. Integreon’s largest investor, LiveIt Investments, is the BPO investment division of Philippine-based Ayala Corporation and has played a significant role in Integreon’s success in growing its global business, including its Philippine delivery capabilities.

Under the extended agreement, Integreon will help SNL build a team of approximately 300 or more financial research and business support professionals that will be located in dedicated delivery centers in Manila.

Tom Corbitt, Chief Administrative Officer at SNL Financial, said “Integreon has a good understanding of SNL’s client base since they’ve historically provided business critical services to many of the same customers. They’ve proven they can leverage their local knowledge and employer brand in the Manila market to quickly deliver the high caliber talent and physical infrastructure SNL needs to support our growing global client base, particularly as we expand into Asian markets.”

Robert Gogel, Chief Executive Officer, Integreon, said, “SNL is an impressive company with exciting growth plans. We are delighted that our ability to attract talent for them in Manila has led them to choose us for further expansion plans. We look forward to supporting SNL in their growth and delivery of high quality information services over the coming years.”

About Integreon
Integreon is a trusted provider of integrated legal, research and business support solutions to discerning professionals, including law firms and corporate law departments, leading corporations, financial services organisations and professional services firms. Integreon’s 2,000+ associates work globally to support its clients in areas such as market and competitive intelligence, discovery, legal process outsourcing (LPO), operating model transformation and back office redesign. Integreon also excels in business support services such as IT, document processing, finance, and HR. With unrivalled outsourcing experience and its industry-leading onshore and offshore capabilities, clients increasingly rely on Integreon to meet their needs in a demanding business environment. Integreon provides its services to its global client base with delivery capabilities from the US, UK, India, Philippines, South Africa and China. For more information about Integreon’s extensive range of services, please visit http://www.integreon.com.

Integreon is a privately held company and is majority owned by LiveIt Investments Ltd. and Actis. LiveIt Investments is the holding company for Ayala Corporation’s investments in Business Process Outsourcing and Knowledge Process Outsourcing. Founded in 1834, Ayala Corporation is the oldest business house and one of the largest conglomerates in the Philippines. Actis is a leading private equity investor in emerging markets with a growing portfolio of investments in Asia, Africa and Latin America. It currently has US$5 billion in funds under management which is managed by more than 100 investment professionals in 10 offices worldwide.

About SNL
SNL Financial is the premier provider of breaking news, financial data and expert analysis on business sectors critical to the global economy: Banking, Insurance, Financial Services, Real Estate, Energy and Media & Communications. SNL’s business intelligence service provides investment professionals, from leading Wall Street institutions to top corporate management, with access to an in-depth electronic database, available online and updated 24/7. For more information about SNL’s extensive offerings, please visit http://www.snl.com.

For additional information, please contact:

Ariella Steinreich
Burson-Marsteller
+1-212-614-4262
press@integreon.com

Ayala Corporation announced that it assisted its real estate unit, Ayala Land, Inc. in raising funds through a placement of 399,528,229 common shares at a price of P30.50 per share. The placement was conducted via an overnight bookbuilt offering structured as a top-up placement with all the proceeds to be received by Ayala Land.

The equity placement is expected to raise an aggregate of P12.2 billion in proceeds which Ayala Land intends to use for its next phase of expansion. Ayala Land has set aside P66 billion in planned capital expenditure this year for its various projects.

Ayala Corporation Chairman and CEO Jaime Augusto Zobel de Ayala said: “This second round of equity placement will further provide Ayala Land the flexibility to pursue its growth plans as it continues to build a robust development pipeline moving forward. We are delighted to assist Ayala Land in this transaction and once again encouraged by the support of the investing community.”

As a result of this transaction, Ayala Corporation’s holdings in ALI common shares will be reduced to 49.0% from 50.4% but it will retain voting control at over 70% ownership of the voting shares.

Ayala Corporation’s share price last closed at P586 per share reflecting a 13% increase year-to-date. Ayala Land’s share price has likewise increased by 24% year-to-date, closing at P32.85 per share yesterday.

The above statement is based on the disclosure made on March 6, 2013, to the Philippine Stock Exchange and Securities and Exchange Commission by Ayala Corporation CFO Delfin Gonzalez, Jr.

This announcement is not an offer for sale of securities in the United States. The securities referred to herein (the “Securities”) have not been registered under the U.S. Securities Act of 1933, as amended (the “Securities Act”), and may not be sold in the United States absent registration or an exemption from registration under the Securities Act. The issuer of the Securities does not intend to register any part of the placement in the United States or to conduct a public offering of the Securities in the United States.

Ayala Young Leaders Congress (AYLC), the Ayala group’s flagship program for youth development, convened on its 15th year from February 5 to 8 in Alfonso, Cavite. Eighty-one student leaders from colleges and universities across the country attended the 15th AYLC to exchange views on the theme, “Leadership Imperative: Confronting and Adapting to Changing Realities.”

As keynote speaker, Hon. Mario Victor Leonen, Associate Justice of the Supreme Court of the Philippines, shared his experiences in the academe and government including challenges he faced in his former role as Chief Negotiator of the Peace Talks in Mindanao.

Annually, AYLC chooses eighty of the country’s most promising student leaders to participate in a four-day leadership summit that features in-depth workshops and consultation sessions, rigorous experiential learning activities, and inspiring talks and panel discussions from distinguished leaders of society.

This year, delegates had the chance to listen to and interact with Ayala group executives led by Ayala chairman emeritus Jaime Zobel de Ayala, chairman and CEO Jaime Augusto Zobel de Ayala, president and COO Fernando Zobel de Ayala, and Bank of the Philippine Islands (BPI) president Aurelio Montinola III. Officers from Ayala Land, BPI, Globe Telecom, Manila Water Company, Integrated Micro-Electronics, Ayala Automotive Holdings, and Ayala Foundation also helped facilitate some sessions.

In what alumni describe as a life-changing experience, AYLC is a holistic and intensive leadership program framed on the principles of “servant leadership.”

AYLC carefully selects individuals from various disciplines to provide concrete examples of servant leadership in action. This year’s panelists included Expo Mejia, coach of the Philippine Volcanoes, Maribel Garcia of The Mind Museum, and Rappler.com’s Glenda Gloria; Phinma’s Ramon del Rosario, Jr., former COMELEC chairman Christian Monsod, and Sister Eva Maano of the Foundation of Our Lady of Peace Mission; and AYLC alumni Bonar Laureto, executive director of Philippine Business for the Environment, Dr. Bryan Albert Lim, and Khal Mambuay-Campong, secretary-general of the Autonomous Region of Muslim Mindanao. Emily Abrera, Cheche Lazaro, and Gang Badoy-Capati moderated the panel sessions.

The congress was immediately followed by the AYLC community’s 3rd Alumni Grand Reunion held on February 9 at The Circuit in Makati City.

One highlight of the gathering was Starfish Fair 2013, a showcase of 10 development projects that AYLC alumni have initiated over the years. The fair serves as a venue to share best practices in organizing community projects and provides an opportunity to replicate and support the various initiatives.

Says John Philip S. Orbeta, managing director of Ayala Corporation and AYLC program director: “These are exciting times for all of us as our alumni community has formed the Ayala Young Leaders Alumni Association, Inc., and is set to explore more projects that serve communities.”

With 1,043 alumni involved in various sectors here and abroad, AYLC forms a strong network of young leaders who are values oriented and have a sense of stewardship for their respective communities. Individually and collectively, they have been active in relief operations, leadership camps, educational and livelihood programs, medical missions, and other development work.

“We are celebrating more than just 15 years of a leadership congress,” says Orbeta. “We are celebrating 15 years of young Filipinos making a difference in the communities they serve. It is also a promise to do more for the country in the years to come.”

Palm Concepcion Power Corporation (PCPC) has begun the construction of the first phase of the 2 x 135-megawatt power plant project in Northern Iloilo.

PCPC is a joint venture of AC Energy Holdings, Inc., Palm Thermal Consolidated Holdings Corporation, a subsidiary of A. Brown Company, Inc., and Jin Navitas Resource, Inc. (JNRI).

Located in a 30-hectare property in Sitio Puntales, Bry. Nipa, Concepcion, Iloilo, the facility is expected to be operational by 2015.

The new clean coal power plant will help address the increasing power requirements of Iloilo, Aklan, Antique and Capiz in the island of Panay as well as neighboring provinces of Negros and Guimaras, considering the fast economic growth in the region.

“Visayas is in development mode and more investments are expected in the next 3 to 5 years. This will mean significant power requirements, especially in Western Visayas where power supply is limited,” said AC Energy president Eric Francia.

He added: “Palm Concepcion thermal power plant anticipates such need and is a project that is ready to be constructed. AC Energy was invited by project proponent A. Brown to partner with them and Jin Navitas to make this project a reality.”

The project, with an estimated cost of P12.5 billion, will use Circulating Fluidized Bed Combustion (CFBC) technology in generating thermal energy from coal. In this technology, limestone is used in the fluidized bed to minimize production of harmful chemicals to acceptable limits. It is also the only coal-fired power plant in Panay to use a reheat technology that requires less fuel to produce thermal power.

Local officials led by Iloilo Gov. Arthur Defensor, Sr., House of Representatives deputy speaker and member of the Joint Power Commission Cong. Erin Tañada, and Concepcion Mayor Millard Villanueva participated in the groundbreaking ceremony held on January 15.

Gov. Defensor in his message welcomed the construction of the new Concepcion plant and emphasized its importance in the anticipated growth and development in key areas of the province. Deputy Speaker Tañada mentioned the benefits to the people of Visayas who will experience not only a more stable power supply but also a more environment friendly source of power.

Ayala Corporation announced today that it entered into a sale and purchase agreement to acquire 100% of the interests held by an affiliate of a fund advised by Denham Capital in GNPower Mariveles Coal Plant Ltd. Co. (GMCP). GMCP is the owner of the 2 x 300-MW coal-fired power generating plant in Mariveles, Bataan province.

Pursuant to such agreement and subject to lenders’ consent and other customary closing conditions, Ayala has agreed to acquire ownership interests of approximately 17.1% in GMCP and its Mariveles Power Plant for a total purchase price of approximately US$155.0 million. The Mariveles Power Plant is currently undergoing commissioning. The other sponsors of the Mariveles Power Plant are power project developer Power Partners, Ltd. Co. and Sithe Global Power LLC, a company owned by investors of The Blackstone Group. Ayala intends to hold its investment in GMCP through its wholly owned energy subsidiary, AC Energy Holdings, Inc.

According to John Eric T. Francia, Ayala managing director and AC Energy president, “The Mariveles Power Plant is a major capacity addition that is critical to alleviating potential power shortages in the Luzon grid. It is utilizing pulverized coal technology designed to meet global standards and contributes to Ayala’s goal of providing low-cost electricity to the country.”

Ayala president and COO Fernando Zobel de Ayala, for his part, said, “We are pleased with the addition of the Mariveles Power Plant to Ayala’s growing portfolio of energy projects. We are delighted to be working with Sithe Global Power and Power Partners in this endeavor. Our investment reflects the Ayala group’s support for the energy and infrastructure needs of our country and our confidence in its bright growth prospects.”

J. P. Morgan served as financial advisor to Ayala on this transaction.