Category: News

May 19, 2019, Laguna, Philippines. Bilang sagot sa kakulangan ng ventilator na kailangan ng dumaraming COVID-19 patients ng bansa, nagkaisa ang Integrated Micro-electronics, Inc. (IMI) at ang UK-based subsidiary nitong Surface Technology International Limited (STI, Ltd.) upang sumangguni sa mga eksperto, health practitioners, at mga sangay ng gobiyerno hinggil sa pagbuo ng isang lisensyadong Ventura Continuous Positive Airway Pressure (CPAP) device solution.

Ang Ventura CPAP ay isang uri ng ventilator na may kakayahang mag-apply ng patuloy na mild air pressure sa mga pasiyenteng nahihirapang huminga. Ang device na ito ay isang non-profit initiative na hango sa isang off-patent CPAP system na may kakayanang mag-optimize ng oxygen consumption. 

Aprubado ng Medicines and Healthcare Products Regulatory Agency (MHRA) ang paggamit ng Ventura CPAP sa UK. Ang disenyo nito ay lisensyado rin ng University College London Hospital (UCLH) and Mercedes-AMG High Performance Powertrains para magamit sa special conditions tulad ng COVID-19. Mayroon nang basbas ang IMI mula sa UK proponents ng device upang simulant ang manufacturing nito sa Pilipinas. 

Ayon sa UCLH, ang paggamit ng Ventura CPAP ay nagbunga ng 60%-70% success rate sa mga COVID-19 patient na kailangang i-intubate at kinalaunan ding gumaling. Kasalukuyan nang nakikipagtulungan ang IMI sa Institute of Biomedical Engineering and Health Technologies (IBEHT) ng De La Salle University upang i-localize ang produksiyon ng Venture CPAP. 

Ang IMI ay isang global technology and manufacturing solutions expert na may headquarters sa Philippines. Ito ang unang nagdaos ng series of multi-industry consultative sessions dito sa bansa. Kabilang sa na nakikipag-ugnayan sa consultative sessions ay si Nick Davey, ang chief technology officer ng IMI. Si Davey ang nag-set up ng research and development team ng STI Ltd. noong 2011. Siya rin ay key member ng UK Ventilator Challenge Consortium na nakikipagtulungan sa UK cabinet officials.

Ang IMI, STI, Ltd., at AC Health ay patuloy sa paghahanap ng iba’t ibang alternatibong ventilator para sa COVID-19 patients.

May 19, 2019, Laguna, Philippines. In support of the Philippine government’s call for the local sourcing and manufacturing of low-cost ventilators and other breathing aid solutions in caring for COVID-19 patients all over the country, Integrated Micro-electronics, Inc. (IMI), along with its UK subsidiary Surface Technology International Limited (STI, Ltd) is organizing a series of virtual consultative and information-sharing sessions with medical experts, health practitioners, and concerned government agencies to explore non-invasive alternative ventilatory strategies using the device solution. CPAP is a form of ventilator that applies mild air pressure continuously and effectively supports patients with breathing difficulties. The proposed solution is a non-profit initiative based on an existing off-patent CPAP system that has been further modified to optimize oxygen consumption. 

The Ventura CPAP system is approved by the Medicines and Healthcare Products Regulatory Agency (MHRA) for use in the UK.  Its design is licensed from the University College London Hospital (UCLH) and Mercedes-AMG High Performance Powertrains under special conditions particularly for use in COVID-19 cases.  The proponents in the UK have granted a license to IMI in the manufacturing of the product in the Philippines.

UCLH reported that the use of the Ventura CPAP system has resulted in 60-70% success of sustaining COVID-19 patients needing intubation.  The patients eventually went on to full recovery. IMI is working with the Institute of Biomedical Engineering and Health Technologies (IBEHT) of DLSU University in localizing the manufacturing of the system. 

In today’s webinar, one of the resource speakers is Nick Davey, IMI’s chief technology officer. Davey set up the Research and Development team in the IMI’s UK subsidiary Surface Technology International Limited (STI Ltd.) in 2011 and is a key member of the UK Ventilator Challenge Consortium, working closely with the UK cabinet officials.

IMI, a global technology and manufacturing solutions expert with its headquarters based in Philippines, is the first to organize this series of multi-industry consultative sessions here in the country. The company along with its UK-based subsidiary STI, Ltd. and local affiliate AC Health, continue to explore various possible ventilator alternative solutions.

Makati City, Philippines – May 18, 2020 Companies within the Ayala group settled taxes of about P9.86-B before the extended June 14, 2020 deadline to help boost the government’s coffers and allotment to COVID-19 response, as the country gears up for the “new normal.”  

The core value drivers of the Ayala group—Ayala Corporation, Ayala Land, Inc., Bank of the Philippine Islands, Globe Telecommunications, Inc., AC Energy, and Manila Water Corporation—paid a total of P9,858,293,348 of taxes. 

In a joint statement made last week, brothers Jaime Augusto Zobel de Ayala and Fernando Zobel de Ayala, who serve as the group’s chairman and president, respectively, expressed their gratitude to President Rodrigo Duterte for recognizing Ayala’s support to the government’s initiatives. 

“We are committed to help the President tackle the many challenges he has to deal with and are confident that by working together, our country can overcome each challenge, save lives, and gradually put the country back on a path of growth,” the joint statement reads. 

The brothers also emphasized the importance of public–private cooperation as the country deals with the vast impact of the pandemic.

Group-wide Bayanihan 

To date, the Ayala group has contributed about P5.6 billion in anti-COVID-19 initiatives aimed to protect its employees, support its partners and clients, and provide for the communities it serves.

Related story: Letter to the Ayala Community
Link: https://ayala.com.ph/letter-ayala-community

The Ayala group also took the lead in the conversion of the World Trade Center into a 500-bed quarantine facility that features safe and controlled isolation cubicles as well as examination rooms and quarters for medical personnel. The conversion of this 9, 700 square meters of space took only seven days and was effectively turned over to the Armed Forces of the Philippines. 

Related story: Ayala Group takes part in conversion of World Trade Center into a COVID-19 facility called WTC: We Heal As One Center
Link: https://www.ayala.com.ph/press-room/press-releases/ayala-group-takes-part-conversion-world-trade-center-covid-19-facility

Ayala also donated all the testing booths for four Mega Swabbing Centers at the Palacio de Maynila Tent along Roxas Boulevard, the Mall of Asia Arena in Pasay City, Enderun Colleges in Taguig City and the Philippine Arena in Bulacan. These Mega Swabbing Centers aim to swab 55,000 individuals in the Greater Manila Area over the next three weeks.  

Related story: Ayala Supports Government’s TASK FORCE T3​
Link: https://www.ayala.com.ph/press-room/press-releases/ayala-supports-government’s-task-force-t3 

Through Go Negosyo’s Project ARK, the Ayala group also joined other business groups in donating RT-PCR machines to ramp up the testing capacities of six government hospitals at 7,000 swab tests per day. 

The group also collaborated with other members of the private sector for Project Ugnayan, a multi-sectoral initiative with various distribution channels, to give immediate and much needed relief to the poor communities in Greater Metro Manila. 

As of April 27, Project Ugnayan—through its Caritas Manila’s Project Damayan, ABS-CBN’s Pantawid ng Pag-ibig, Asian Development Bank’s and the Government’s Bayan, Bayanihan, and Jollibee’s FoodAID program—has reached about 2.4 million families or 12 million individuals. 

Related story: Project Ugnayan beneficiaries reach over 7.6 million people in Greater Metro Manila​
Link: https://www.ayala.com.ph/press-room/press-releases/project-ugnayan-beneficiaries-reach-over-76-million-people-greater-metro 

Amid the crisis brought by the pandemic, the Ayala group remains true to its commitment to serve its employees, partners, clients, and the communities around it.  

Makati City, Philippines – May 18, 2020 Hindi na hinintay ng mga kompanya ng Ayala group ang extended deadline sa pagbabayad ng buwis sa hangaring matulungan ang gobiyerno sa pagpapalawig ng COVID-19 response ng bansa at paghahanda sa “new normal.”   

Ang mga pangunahing negosyo ng Ayala group—ang Ayala Corporation, Ayala Land, Inc., Bank of the Philippine Islands, Globe Telecommunications, Inc., AC Energy, at Manila Water Corporation—ay nagbayad ng P9,858,293,348 kabuuang buwis bago pa man ang June 14, 2020 deadline. 

Sa isang joint statement noong nakaraang lingo, nagpasalamat sina Jaime Augusto Zobel de Ayala and Fernando Zobel de Ayala—ang chairman at president ng Ayala group—sa Pangulong Rodrigo Duterte sa pagkilala sa suportang ibinibigay ng Ayala group habang nilalabanan ng bansa ang COVID-19.  

“We are committed to help the President tackle the many challenges he has to deal with and are confident that by working together, our country can overcome each challenge, save lives, and gradually put the country back on a path of growth,” saad ng joint statement.  

Iniriin din ng magkapatid na Ayala ang kahalagahan ng kooperasiyon sa pagitan ng pribado at pampublikong sector habang hinarap ng bansa ang epekto ng pandemya.  

Group-wide Bayanihan 

Sa kasalukuyan, naglabas ang Ayala group P5.6 bilyong response package na naglalayong protektahan ang bawat empleyado ng grupo, ipagpatuloy ang galaw ng mga negosyo, suportahan ang partners at kliyente, at bigyang tulong ang mga komunidad na pinagsisilbihan nito.   

Pinangunahan din ng Ayala group ang pag-convert sa World Trade Center sa isang 500-bed quarantine facility na mayroong ligtas at kontroladong isolation cubicles pati na rin examination rooms at quarters para sa medical personnel. Sa loob ng pitong araw, ang 9,700 square meters na pasilidad ay na-turnover sa Armed Forces of the Philippines at agad na nagamit.

Ayala rin ang nagpatayo sa lahat ng testing booths sa apat sa Mega Swabbing Centers sa Palacio de Maynila Tent sa Roxas Boulevard, Mall of Asia Arena sa Pasay City, Enderun Colleges sa Taguig City, at sa Philippine Arena sa Bulacan. Layunin ng Mega Swabbing Centers na ma-swab ang 55,000 indibiduwal sa Kalakhang Maynila sa loob ng tatlong linggo.  

Sa pamamagitan ng Project ARK ng Go Negosyo, nakipagtulungan ang Ayala sa ilang business groups para sa karagdagang RT-PCR machines upang mapabilis at mapalawig ang testing capacity ng anim na hospital ng gobiyerno. Ang machines na ito ay makakapagproseso ng 7,000 swab tests sa loob isang araw.

Nanguna rin ang Ayala group sa pakikipagtulungan sa ibang miyembro ng pribadong sector sa pagbuo ng Project Ugnayan, isang multi-sectoral na inisiyatibong nakapagbigay ng mabilis at kinakailangang tulong sa mga pinakamahihirap na komunidad ng Kalakhang Maynila. 

Sa datos na inilabas ng Philippine Disaster Resilience Foundation, as of April 27, humigit kumulang 2.4 milyong pamilya at 12 milyong katao ang natulungan ng Project Ugnayan at ng iba’t ibang distribution channels nito kasama ang Project Damayan ng Caritas Manila, Pantawid ng Pag-ibig ng ABS-CBN, Bayan, Bayanihan ng Asian Development Bank at gobiyerno, at FoodAID program ng Jollibee. 

Sa gitna ng krisis na dala ng pandemya, patuloy ang serbisyong tapat ng Ayala group sa mga empleyado, partner, kliente, at komunidad sa paligid nito.  

Makati City, Philippines – May 14, 2020 The United Nations Global Compact recognizes the tremendous impact of the COVID-19 pandemic on the socio-economic progress countries have achieved over the last couple of years.

But despite the major setbacks brought by the pandemic, regional business leaders see a silver lining from the renewed unity between the private and the public sectors in these unprecedented times.

In Global Compact Academy’s webinar “#UnitingBusiness to Respond to COVID-19” held Tuesday, Ayala Corporation’s Chairman and CEO Jaime Augusto Zobel de Ayala said the partnership between the private sector and the government has been instrumental in effectively addressing the immediate needs of the Philippines, as the country’s main island Luzon enters the 57th day of enhanced community quarantine.

“We’ve been working hand in hand with the government to see what kind of economic stimulus would be necessary,” Zobel said. “Not a day goes in the Philippines where the private sector and the public sector are not having dialogues, exchanging notes, and seeing where we can help each other at all different levels.”

Quick, multi-sectoral response

Immediately after the implementation of the enhanced community quarantine, the Ayala group unveiled a P5.5 billion COVID-19 response package that aimed to protect its employees, support the tenants of its malls and commercial properties, and provide relief to the communities it serves. According to Zobel, this response package enabled the group’s more than 72,000 direct-hire employees as well as 75,000 day laborers in its construction business to have financial security in a time of uncertainty.

The group also acknowledges the importance of supporting micro, small and medium enterprises (MSMEs), which cover 60% of total annual revenues of Philippine businesses, contribute about 35% of the total gross domestic product, and employ 63% of Filipino workforce. As such, Ayala commits to supporting its network of 200,000 SMEs and over 1 million micro enterprises under three key aspects, namely, health, business continuity through digitalization, and financial assistance. For instance, AC Health opened a 24/7 medical hotline. Meanwhile, Globe offered digital packages for work-from-home arrangement and data storage requirement, while BPI currently works on a product that will help MSMEs recover.

In partnership with the government, the Ayala group took the lead in the conversion of the World Trade Center to a 500-bed quarantine facility, which was effectively turned over to the Armed Forces of the Philippines in less than two weeks. The group also donated all the testing booths for four Mega Swabbing Centers, which aim to swab 55,000 individuals in the Greater Manila Area over the next three weeks. Moreover, through Go Negosyo’s Project ARK, Ayala and other big business groups donated RT-PCR machines to ramp up the testing capacities of six government hospitals at 7,000 swab tests per day.

“Out of a difficult and painful situation, we can all come out of this in a way that we’ve created a new sense of purpose in unity— in our constituency, in our communities— then I think there’s a lot that we can build on in the future,” Zobel emphasized.

The Ayala group has also been instrumental in collaborating with other members of the private sector for Project Ugnayan, a multi-sectoral initiative that reached 5,445,255 urban poor families, equivalent to over 7.6 million Filipinos, through different distribution channels led by Caritas Manila’s Project Damayan.

Higher resilience through sustainability

But these are just short-term solutions to the bigger issues, Zobel said. According to him, the pandemic has exposed how vulnerable we all are, and this presents an opportunity to realign business strategies to make us all resilient in the future.

“If ever there’s a time to basically reflect on the way we’ve all been doing things and on the kind of world we want to create, it is now,” Zobel said. “In the end, we can emerge as more unified, more resilient.”

Zobel’s statement was backed by Kokosai Kogyo Chairperson and CEO Sandra Wu, who said the crisis has actually strengthened her company’s sustainability agenda. Meanwhile, UN ESCAP Undersecretary General Armida Salsiah Alisjahbana said companies should begin investing in “soft infrastructure,” which includes a change of mindset and behavior for all its stakeholders.

As a founding member of the United Nations Global Compact Network Philippines, Ayala Corporation believes that sustainability is key to a better future. It supports Global Compact’s 10 Principles and aligns its business objectives with the United Nations Sustainable Development Goals.

To further the group’s contribution to a sustainable future, it launched its own Ayala Sustainability Blueprint that features specific sustainable development goals (SDGs) with particular business units as champions. At Ayala, each business unit sets a target to help bring the Filipino to Ayala’s vision of 2030.

These targets were further strengthened during the Annual Stockholders’ Meetings, as the leaders across the Ayala group disclosed their respective sustainability initiatives in relation to their commitment to the SDGs. Visit this link to learn more about the sustainability performance of the Ayala group: https://www.ayala.com.ph/investors/annual-reports

Makati City, Philippines — May 8, 2020 Buo ang suporta ng Ayala Corporation sa TASK FORCE T3 (Test, Trace, Treat), ang ugnayan ng gobiyerno at pribadong sektor upang pabilisin at pataasin ang kapasidad ng ating healthcare system na iwaksi ang COVID-19.

Itinayo ng Ayala ang lahat ng testing booths sa apat na Mega Swabbing Centers na binibuksan ngayong linggo. Kasama dito ang Palacio de Maynila Tent sa Roxas Boulevard, Mall of Asia Arena sa Pasay City, Enderun Colleges sa Taguig City, at Philippine Arena sa Bulacan.

Layunin ng Mega Swabbing Centers na ma-swab ang 55,000 katao sa kalakhang Maynila sa susunod na tatlong linggo. Samantala, 125,000 katao ang na-swab sa buong bansa sa nakaraang tatlong buwan. Priority ng malaking swabbing operation na ito ang 25,000 repatriated overseas Filipino workers (OFWs) na kasalukuyang naka-quarantine sa hotels at iba pang pasilidad. Target din nitong ma-swab ang halos 30,000 katao na COVID-19 suspects pati health workers na madalas ay exposed sa virus.

“We are fully committed to helping the Government in its drive to beat COVID-19. We completely agree with its whole of nation approach, where Government, the private sector and our citizenry unite to overcome this extraordinary crisis,“ saad ni Ayala Corporation Chairman at CEO Jaime Augusto Zobel de Ayala. “In particular, we support the IATF’s focus on rapidly ramping up testing and the country’s healthcare capacity, as we believe these are key to saving both lives and livelihoods during this pandemic.”

Patuloy naman ang suporta ng Ayala Group of Companies sa iba’t ibang proyekto ng gobiyerno sa iba pang lugar. Noong Abril, ilan sa Ayala companies (Ayala Land, Globe, Manila Water, IMI and AC Energy) ang nagkaisa upang tulungan ang ICCP, Manila Exhibition Center, the Bases Conversion Development Authority (“BCDA”), at gobiyerno sa pag-convert ng World Trade Center sa isang 500-bed quarantine facility na may ligtas, malinis, at kontroladong isolation cubicles.

“We are grateful to the Ayala group for partnering with us in this time of major crisis. We call on everyone to support TASK FORCE T3, because rapid and massive Testing, Tracing and Treating are the keys to defeating COVID-19. With our Bayanihan spirit, where the Government, the private sector and our people are united, we are confident that we can Heal as One,“ ani Vince Dizon, ang Deputy Chief Implementer ng COVID-19 response ng gobiyerno, at kasalukuyan ding CEO ng BCDA. Siya rin ay katulong ni Chief Implementer Carlito Galvez, Jr. sa pag-implement ng guidelines at protocols na inilabas ng IATF (Inter-Agency Task Force for the Management of Emerging Infectious Diseases).

Makati City, Philippines – May 8, 2020 Ayala Corporation is supporting TASK FORCE T3 (for Test, Trace, Treat), the Government’s partnership with the private sector to rapidly ramp up the national health care system’s capacity to beat COVID-19.

Ayala has donated all the testing booths for the four Mega Swabbing Centers that are being launched this week at the Palacio de Maynila Tent along Roxas Boulevard, the Mall of Asia Arena in Pasay City, Enderun Colleges in Taguig City and the Philippine Arena in Bulacan.

The goal of the Mega Swabbing Centers is to swab 55,000 individuals in the Greater Manila Area over the next 3 weeks. To date, a total of 125,000 have been swabbed nation-wide over the past 3 months. The massive swabbing operation will prioritize 25,000 repatriated Overseas Filipino Workers (OFWs) who are currently quarantined in hotels and quarantine facilities, plus 30,000 individuals who are suspects, probables and healthcare workers who are constantly exposed to the virus.

“We are fully committed to helping the Government in its drive to beat COVID-19. We completely agree with its whole of nation approach, where Government, the private sector and our citizenry unite to overcome this extraordinary crisis,” said Ayala Corporation Chairman & CEO Jaime Augusto Zobel de Ayala. “In particular, we support the IATF’s focus on rapidly ramping up testing and the country’s healthcare capacity, as we believe these are key to saving both lives and livelihoods during this pandemic.”

The Ayala Group of Companies is supporting the Government’s efforts in other areas as well. Last month, several Ayala companies (Ayala Land, Globe, Manila Water, IMI and AC Energy) partnered with ICCP, Manila Exhibition Center, the Bases Conversion Development Authority (“BCDA”) and the Government to convert the World Trade Center into a 500 bed quarantine facility with safe, clean and controlled isolation cubicles.

“We are grateful to the Ayala group for partnering with us in this time of major crisis. We call on everyone to support TASK FORCE T3, because rapid and massive Testing, Tracing and Treating are the keys to defeating COVID-19. With our Bayanihan spirit, where the Government, the private sector and our people are united, we are confident that we can Heal as One,” said Vince Dizon, the Deputy Chief Implementer of the Government’s COVID-19 response. Dizon is concurrently CEO of BCDA and has been asked to help Chief Implementer Carlito Galvez, Jr. to implement the guidelines and protocols issued by the IATF (Inter-Agency Task Force for the Management of Emerging Infectious Diseases).

Makati, Philippines — 1 May 2020 Ayala Corporation (Ayala) won the Silver in the Best Sustainable Development Goal (SDG) Reporting category at the 5th Asia Sustainability Reporting Awards (ASRA), which was held online on April 29, 2020. Ayala was also a finalist for Best Integrated Report at ASRA, Southeast Asia’s most prestigious recognition for corporate sustainability reporting.

As one of the country’s leaders in corporate sustainability, Ayala pioneered Integrated Reporting in 2016 in the Philippines, and in 2018 began integrating risk management and sustainability in its business stragategies. This integration allows Ayala to better make long-lasting and meaningful contributions to the communities that it serves, as it aims to address persistent societal gaps that have excluded many Filipinos for years.

In April 2019, Ayala furthered this integration by launching the Ayala Sustainability Blueprint, a framework that allows each of its business units to champion specific United Nations Sustainable Development Goals (UN SDGs), and be deliberate in monitoring and evaluating sustainability targets. Ayala, a founding member of the GCNP in 2017, first formally aligned its businesses with the UN SDGs in 2015.

“The path towards a sustainable future beckons us all and so, we in Ayala took on the challenge of pioneering a sustainability blueprint that is anchored on the SDGs. It has proven to be valuable especially in this turbulent times wherein it is evidently clear, that the only way for us to have a future is if we start taking sustainable, innovative, and collaborative actions,” said Jose Teodoro K. Limcaoco, Ayala Corporation Chief Risk Officer and Chief Sustainability Officer, Senior Managing Director, and Chief Finance Officer.

Ayala Corporation’s award-winning report demonstrates the organisation’s leadership in sustainability reporting and its commitment to creating long-term value for stakeholders.

In a live broadcast from Singapore, more than 200 senior business leaders and sustainability professionals from 15 countries attended the exclusive awards ceremony hosted virtually due to the COVID-19 pandemic. Attendees also included dignitaries from embassies and high-ranking officials from academia,  trade associations, and advocacy organisations.

The winners were selected from 461 entries received from 16 countries in Asia. The 2019 ASRA saw 80 shortlisted companies from 13 countries competing in the finals across 19 awards categories.

AYALA CORPORATION ASM SPEECH
2020 ANNUAL STOCKHOLDERS’ MEETING
MESSAGE OF THE PRESIDENT & COO FERNANDO ZOBEL DE AYALA
APRIL 24, 2020

Good morning to everyone.

Let me begin by thanking all of you for your continued support and confidence in Ayala. The past year was a trying time for our group as we confronted an unprecedented situation in Manila Water and our Metro Manila concession area. The water supply shortage that emerged in March 2019 impaired the high standards of service Manila Water has maintained over the past 23 years.  Several factors led to this unfortunate incident. While the situation was compounded by low dam levels brought about by the prolonged dry season last year, the main reason for the shortage was the delay in new water source development under the government’s Water Supply Master Plan.

In order to prevent this from happening again, Manila Water is working closely with MWSS and this administration on the timely execution of the Water Supply Master Plan. Several medium-term water supply projects are now in various stages of development. These projects will provide additional water supply for the growing water demand of our East Zone customers in the coming years.

These initiatives, along with the continued network management and optimization program, has enabled water availability for customers to be maintained within regulatory levels despite a lower raw water supply.

Although we faced significant challenges in both our water and global manufacturing businesses in 2019, our real estate, banking, telco, and power units continued to serve as engines of growth. This validates the strength of a diversified portfolio and the expansion strategy we put in place a decade ago.

We are happy to report that in 2019, Ayala recorded ₱35.3 billion in net earnings, an 11 percent increase from 2018. This was lifted by gains from the partial divestment of AC Energy’s thermal assets as it moved towards the creation of a larger portfolio of renewable energy assets and the merger of our education arm with iPeople.

Our results, however, were weighed down by the recognition of a remeasurement loss of ₱18.1 billion arising from a likely reduced stake in Manila Water, whose shareholders are being asked to approve an increased number of shares to open up opportunities for a strategic investor.  We believe a partnership with a strategic investor will accelerate Manila Water’s long-term strategic direction, including its regional aspirations. Over the past decade, Manila Water has established itself as a major water infrastructure player in Southeast Asia with investments in various platforms across Vietnam, Thailand, and Indonesia and today continues to be on the lookout for opportunities in the region.

Let me now touch on the performance of our business units in greater detail.

Ayala Land continued to reap the benefits of its diversification strategy to achieve a better balance between its development and recurring income portfolio as well as in its geographic concentration. Its net profits rose 13 percent to ₱33.2 billion, supported by office and commercial and industrial lot sales as well as a growing leasing operation.

Ayala Land’s geographic diversification continued, with new estates contributing 58 percent to its bottomline as the development of these new areas accelerates. With over 12,000 hectares of landbank, 29 estates, and a presence in 57 growth centers across the country, Ayala Land offers a balanced and complementary mix of residential developments, shopping centers, offices, hotels and resorts. These estates contribute to progress and growth in the many communities they serve through various livelihood and entrepreneurial opportunities and increased economic activity.

Bank of the Philippine Islands continued to work towards its goal of improving its earnings capacity and shareholder returns by focusing on its core lending business and increasing efficiencies through technology. In 2019, the bank’s net earnings reached ₱28.8 billion, jumping 25 percent from 2018 on strong core banking business revenues and a steadily growing fee-based segment, supported by higher securities trading gains.

Consistent with the Ayala group’s thrust to support the growth of MSMEs in the country, BPI aims to reach a greater number of our retail, micro, and SME lending segments, which continues to be underserved today.  MSMEs form an integral part of the Philippine economy, making up 99 and a half percent of businesses, 60 percent of which are microentrepreneurs. In addition, they employ 63 percent of the Filipino workforce and contribute to 35 percent of the country’s GDP.

In 2019, BPI continued to ramp up its microfinance arm BPI Direct BanKo, with 300 branches, servicing more self-employed microentrepreneurs nationwide. Only three years since its relaunch, BanKo is now the second largest microfinance bank in the country having doubled its loan portfolio to ₱4.3 billion. 

BPI’s SME group, the two-year old Business Bank, is likewise gaining traction, particularly in the mass market or loans below ₱15 million. This segment expanded more than fourfold in approved loan applications, reflecting the bank’s dedicated coverage of this customer group.

Globe continued to benefit from high demand for data-related products and services. The 20 percent expansion in its net income to ₱22.3 billion was bolstered by data-driven customers across its mobile and broadband segments. It is worth noting that data-related services accounted for over 70 percent of Globe’s service revenues, which grew 12 percent to ₱149 billion during the year.

Globe continues to harness an increasingly digitally enabled economy to promote financial inclusion through its mobile wallet GCash. As our Chairman mentioned, GCash is the number one mobile wallet in the Philippines today with 20 million registered users and over 75,000 QR merchants and partner billers. To enable access to more financial services to the unbanked population, GCash introduced GSave, which allows first time depositors to participate in the formal banking system. GSave offers a competitive interest rate with no minimum initial deposit or maintaining balance requirement.

AC Energy registered net profits of ₱24.6 billion in 2019, lifted by contributions from its solar projects in Vietnam and gains from the partial divestment of its thermal assets. AC Energy increased its attributable energy output in 2019 by 25 percent to 3,500 gigawatt hours, of which 50 percent came from renewable sources. Given the increasing contribution of AC Energy to Ayala’s equity earnings over the past three years, we have started to classify AC Energy as one of our core business pillars together with Ayala Land, BPI, and Globe.

As it moves away from thermal energy, AC Energy continues to aggressively build up its renewable portfolio. It ended 2019 with an attributable capacity of over 1,800 MW, with 50 percent of total energy output coming from renewable sources. In addition, it has 1,200 MW of various solar and wind projects in the pipeline, bringing it on track to achieve 5,000 MW of renewable capacity by 2025. To support these aggressive targets, AC Energy tapped the capital market through the issuance of two Green Bonds, raising US$810 million in combined proceeds.

Moving to Manila Water, as mentioned earlier, the challenges in the East Zone concession weighed on Manila Water’s performance in 2019. The water crisis took a toll on Manila Water’s profitability, which declined 16 percent to ₱5.5 billion. Business performance was dampened by the impact of the MWSS penalty and a voluntary one-time bill waiver program to assist severely affected customers. This was further affected when raw water allocation from Angat Dam hit its lowest in July. To mitigate this, Manila Water implemented network efficiency measures to maintain service availability and be able to serve more than 7 million people in the East Zone.

Manila Water likewise continued to work towards its goal of providing 32 percent wastewater coverage of the East Zone by 2021. Wastewater coverage currently stands at over 30 percent or equivalent to two million people served through nearly 400 kilometers of laid sewer network. This was only at three percent before Manila Water took over operations from MWSS in 1997.

AC Industrials faced a challenging year due to the difficulties in global manufacturing and the automotive industries. These challenges also included the impact of geopolitical tensions, such as the US-China trade conflict and the prolonged uncertainty on Brexit. These macro headwinds together with the disruptive changes currently affecting many key industries have created a challenging environment for worldwide manufacturing and trade.

In the electronics space, intensifying competition posed operational challenges for companies like AC Industrials, particularly its anchor manufacturing arm, IMI, and new platforms, Merlin Solar and MT Technologies. These challenges resulted in longer fulfillment times and higher material costs. Meanwhile, automotive sales likewise experienced weakness and the industry’s megatrends of connectivity, autonomy, sharing, and electrification continued to disrupt the industry. In this difficult environment, AC Industrials recorded a net loss of ₱2.4 billion in 2019.

During these trying times, we take comfort in the fact that AC Industrials retains specialized technical resources such as advance manufacturing engineering as well as proprietary technologies, including power electronics, camera and vision, smart energy, and connectivity, which all serve as the foundation for future growth.

Finally, we continue to support our long-term investments in infrastructure, healthcare, and education. AC Infra is building up its logistics and fulfillment arm, Entrego, which posted a compounded monthly growth of 14 percent in volume throughout the year. This growth was underpinned by the rising demands of the e-commerce and retail sectors for B-to-B and B-to-C logistics services. Entrego also launched an automated sorting center to drive operational efficiencies and processes.

AC Health acquired a 100 percent stake in Healthway, one of the leading clinic networks in the country. The addition of Healthway’s 7 mall-based multi-specialty clinics and 40 corporate clinics expands AC Health’s clinic portfolio, which today includes 74 FamilyDOC primary care clinics and 10 corporate clinics. It also expanded its pharma portfolio with new investments in IE Medica, one of the major importers of pharmaceutical products in the country, and MedEthix, its affiliated distribution company.

AC Education’s merger with iPeople in 2019 has significantly broadened our education footprint. Our student population has grown from 38,500 before the merger to approximately 60,000 students. The merger has resulted in several synergies, including leveraging the various schools’ complementary strengths to improve the student learning experience and producing greater operational efficiency.

As the Ayala group continued to be optimistic about the domestic macroeconomic environment, our combined capital expenditure reached ₱215 billion in 2019. At the parent level, our balance sheet remained strong with enough capacity to support our future investments and cover dividend and debt obligations. In 2019, we paid ₱8.30 per share in cash dividends, 20 percent higher than its 2018 level. We likewise took advantage of favorable market conditions to raise capital. These included the US$400 million in fixed-for-life senior perpetual notes with an annual coupon of 4.85 percent for life with no step-up, and the ₱15 billion in preferred shares.

In closing, at Ayala, we constantly strive to deliver a more holistic engagement with the communities we serve and we make sure that we create a meaningful, lasting impact in conjunction with our economic aspirations. This desire to help bridge societal gaps has been embedded in our corporate culture and will continue to define our direction in the coming years. We are fortunate to have so many individuals in our institution who share this thinking and enable its execution across our many companies in the Ayala group.

This kind of engagement from our Ayala citizens is evident as our group, along with individuals and institutions collectively do their part in responding to the COVID-19 pandemic.

In these unprecedented times, it is the Ayala group’s foremost priority to ensure the safety of its employees while at the same time securing their financial health. With this in mind, the group has allocated ₱2.4 billion in a relief package to assist our employees, including the daily wage earners or no-work-no pay personnel.

Furthermore, to help mitigate the impact of the Luzon-wide enhanced community quarantine on the urban poor, together with 36 other private institutions, we launched Project Ugnayan to support those who are most in need of help at this time. Through this effort, the consortium has raised over ₱1.7 billion for food vouchers for more than one and a half million urban poor families or approximately 7.5 million of our most vulnerable countrymen in Greater Metro Manila. We worked closely with Caritas Manila and the over 600 parishes of the Catholic Church for the distribution of 1000 peso supermarket vouchers.

These efforts are similarly present across our business units. Ayala Land employees have so far raised ₱71.4 million to help COVID hospitals and Project Ugnayan. In support of the Department of Public Works and Highways’ initiative and through its construction arm, Makati Development Corporation, Ayala Land is in the final stages of the renovation of the World Trade Center in Pasay into a 500-bed quarantine facility.

To aid in the shortfall of personal protective equipment, Ayala, Ayala Land, BPI, and Globe donated to the Philippine Red Cross who facilitated the distribution of over 200,000 face masks to several hospitals in Metro Manila and other front liners in the government, as well as 104 PRC chapters nationwide. Furthermore, Ayala and Ayala Foundation have set aside over ₱15 million to procure additional masks and vitamins for donation to various hospitals and local government units throughout the country, which will be done through AC Health.

Meanwhile, Manila Water, recognizing the importance of sanitation in these times, has donated 1,800 hygiene kits and deployed much needed drinking water to six Quezon City hospitals.

Globe, mindful that efficient communication lines are necessary in battling this crisis, has donated 500 cellphone units to public hospitals and now provides free internet connection to 68 hospitals nationwide with free calls to emergency and government hotlines available to all users.  Globe has also raised ₱43 million from its employees and customers through various donation drives to help hospitals.

AC Health has more than 1,500 employees in its clinic network who are reporting daily, continuing to operate as extended frontliners, and are able to help in the triage efforts of the government and private hospitals. Generika continues to operate and offer medicines at very reasonable prices.

In addition, to help our healthcare system with the growing number of COVID-19 cases, AC Health is leading the Ayala group’s efforts to convert Qualimed Sta. Rosa into a COVID-19 dedicated hospital. This initiative will cost ₱150 million.

Finally, AC Health will work in partnership with other external stakeholders to build a COVID-19 testing facility that will give more Filipinos access to testing.

Apart from bolstering our support to the healthcare system and our economically vulnerable countrymen, we also continue to ensure that the essential services we manage such as water, banking, and telecommunications continue to operate. Select BPI branches remain open with all OTC branch fees and transfer fees to other banks waived during this period. BPI has also offered a grace period and relief options for affected clients with financial obligations to BPI.

Manila Water, while operating with a reduced workforce, has been able to continue providing basic services during this time. Likewise, AC Energy’s plants are sufficiently manned to operate at full capacity and provide vital electricity to our grids. Meanwhile, Globe is doubling down in its efforts to ensure that its network stays reliable and consistent.

Through all these efforts, we hope to instill faith and confidence in the Filipino people. The Ayala Group is ready to carry on and support the country in our battle against COVID-19.

In closing, Ayala owes its success to the commitment of our shared vision across the whole group’s management team and staff, the guidance and leadership of our Board of Directors, and the trust and confidence of our many stakeholders.  We thank you all for your continued commitment and support.

Thank you.

AYALA CORPORATION ASM SPEECH
2020 ANNUAL STOCKHOLDERS’ MEETING
MESSAGE OF THE CHAIRMAN & CEO JAIME AUGUSTO ZOBEL DE AYALA
APRIL 24, 2020

Fellow shareholders,

The events of the past year have challenged the corporate momentum we have built over the last decade. However, history has shown Ayala’s resilience across multiple business cycles over the 186 years that we have been in operation. This ability to deal with adversity has been built on our fundamental strengths of adhering to the highest standards of corporate governance, always looking to develop value over the long term, remaining flexible to adjust to changing circumstances, and constantly aligning our business objectives with the broader development needs of the country.

These fundamental values have stood us in good stead through the years, defined Ayala as a successful multi-business group, and ensured our continuity and relevance throughout the years.

While the challenges of the past year have resulted in one of the most difficult periods in our corporate history, it is also during trying times that the strength of our diversification initiatives and massive expansion program are put to the test.

Recall that in 2011, the Ayala group set in motion a strategic agenda that led to the expansion of our established franchises in real estate, banking, and telecommunications to capitalize on the strong momentum we saw taking place in the domestic environment.

In parallel, we invested in energy generation as a new growth platform from which we would derive future sources of earnings and value creation. These initiatives have cemented our competitive advantage, maintained our relevance in our markets, and established the foundation for long-term growth and value regardless of the prevailing macroeconomic or competitive environment.

In particular, we have seen how the strong performance of our core business pillars–Ayala Land, Bank of the Philippine Islands, Globe Telecom, and AC Energy–sustained Ayala’s trajectory in 2019. Their results cushioned the impact of the setbacks faced by Manila Water in connection with the water supply shortage in the metropolis. Further, these core businesses helped mitigate the slowdown AC Industrials confronted which arose from headwinds in global manufacturing and the domestic automotive industries. I am pleased to report that despite a challenging period, our profitability improved 11 percent to ₱35.3 billion in 2019.

Let me provide a background of the macroeconomic environment we faced during the period to put this yearend review into perspective.

Global economic growth in 2019 was at its slowest since the Global Financial Crisis, but developing countries in Asia still recorded strong growth even as trade tensions dampened outlook for the region.

Here at home, while the Philippine economic growth of 5.9 percent in 2019 fell below the above-6 percent growth that we witnessed over the past seven consecutive years, it continued to be bolstered by solid domestic consumption, driven by stable inflation, higher remittances, and record-low unemployment. This continued to benefit Ayala Land, BPI, and Globe, which remained as the top contributors to Ayala’s performance during the year, along with AC Energy, which has been a consistent significant source of growth over the past three years. AC Energy’s announced pivot towards renewable energy and the sale of some of its conventional power assets allowed it to recycle capital, recognize gains, pointing us towards an exciting new future.  

We envision these four business pillars to remain as Ayala’s core value drivers in the medium term.

We have always actively managed our portfolio and believe in constantly rebalancing our businesses interests to either realize value as opportunities arise or to launch a new business-building cycle in a specific industry. In particular, we have always been proud of what Manila Water has achieved, turning around the East Zone concession and laying an efficient water supply and distribution system for the metropolis despite the absence of new water sources. However, we also need to be flexible, quick and open-minded to how industries, economic environments, and regulatory agencies evolve.  Thus, in February 2020, we invited the Razon group as a strategic partner in Manila Water.  I look forward to this partnership with a group that shares a deep commitment to contributing to the country’s water infrastructure development.

In AC Industrials, the company experienced a number of geopolitical headwinds including the US-China trade war and Brexit that contributed to the world economy’s slowest year-on-year expansion since the financial crisis a decade ago. We recognize the acceleration of disruptive changes, driven by intensifying competition and evolving customer demands, which has created a challenging environment for worldwide manufacturing and trade. These have posed operational challenges for the various platforms under AC Industrials. To address this, we are in the process of reassessing AC Industrials’ portfolio to identify the pain points, develop solutions, and rationalize the long-term strategic direction of the business.

Meanwhile, our social infrastructure portfolio continues to gain traction. AC Health continues to ramp up its clinic footprint with the acquisition of a 100 percent stake in Healthway Philippines, which operates a network of mall-based multispecialty and corporate clinics. This complements FamilyDoc, the largest network of primary care clinics in the country. In education, with the merger of AC Education and iPeople, we have established a group of seven educational institutions with a combined student population of approximately 60,000 across 28 campuses in Metro Manila and the Calabarzon, Bicol, and Mindanao regions.

During the year, the Ayala group also made great strides in our digital transformation journey. Our digital portfolio includes Zalora, the country’s largest fashion e-commerce site with 10 million visits per month and carrying 20,000 fashion brands, as well as its adjacent company Entrego, a technology-driven logistics company that has gained foothold servicing the major e-commerce players in the country.  In financial services, we are happy to see the many touchpoints that both BPI and Globe have been able to harness to address financial inclusion and facilitate higher engagement from the unserved and underserved segments of the population, including MSMEs and the low-income consumer segment.

Between the BPI mobile app and Globe’s Gcash, the group has been able to reach over 1.9 million banking clients, 20 million registered users, and over 75,000 merchants and partners.

Today, the BPI app ranks 5^th in mobile banking on the App Store and 17^th on Google Play. Moreover, I am delighted to share that our efforts to grow the fintech landscape in the country has gained significant traction as GCash is currently the number one finance app in the Philippines on both the App Store and Google Play.

While we intend to remain as a Philippine-centric business group, we are open to overseas investments on an opportunistic basis, particularly in markets and sectors where we can bring our strengths and expertise. In November 2019, we acquired a 20 percent stake in the Yoma group, Myanmar’s leading conglomerate with interests in sectors that are overlapping with Ayala, including real estate, power, and financial services.

Myanmar is an underpenetrated frontier market with a promising economic growth story, supported by its government’s broad liberalization initiatives. We envision our investment in the Yoma group to serve as Ayala’s main platform for strategic investments in Myanmar.

As a final word, the unfortunate episodes that transpired in our country and the rest of the world at the beginning of 2020 have resulted in an existential moment of radical business transformation. The COVID-19 pandemic is adversely impacting many economies, markets, and businesses, and the national and global scale which has not spared the Ayala group. Our President and COO will give more color on how the Ayala group is responding to help alleviate some of the challenges our nation is facing from the COVID-19 pandemic.

In the Philippines, even before the onset of this global pandemic, the eruption of the Taal Volcano in January had already affected certain industries domestically, including real estate and retail within the volcano’s vicinity.

While the outlook for the business environment has radically changed as a result of these unfortunate events, we take comfort in the fact that we have built a healthy balance sheet at the holding company and across the group that gives us a buffer to absorb external shocks such as the current global health crisis. We consider this to be one of our strongest attributes, having survived and thrived under multiple crises.

It is within this context that I thank our board of directors for their engagement and foresight across a variety of working committees, our management team for ensuring a culture of professional commitment, our many business partners for their willingness to collaborate with us, and our fellow shareholders for their continued support, trust, and confidence in Ayala. We look forward to a lasting partnership as we weather these uncertain times, supporting our employees and our many stakeholders as we continue to contribute to society through our institutions, our products, and our services.

Thank you.