Category: News

AYALA LAND ASM SPEECH
2020 ANNUAL STOCKHOLDERS’ MEETING
MESSAGE OF THE PRESIDENT BERNARD VINCENT O. DY
APRIL 22, 2020

Members of the Board, fellow shareholders, ladies and gentlemen, Good Morning!

Our commitment to advance the country’s development goals is best demonstrated in our investments across the various business lines. With these investments, we build sustainable communities and create products and services that enable more Filipinos to partake in the benefits of economic growth and social progress.

In 2019, we continued to live up to this commitment as our investments translated into further expansion of our core businesses. We achieved revenues of PHP168.8 billion, 2% higher than a year-ago. Back-ended residential product launches and nearly completed projects sold out in previous years accounted for the significantly slower revenue growth.

However, strong leasing revenues and commercial lot sales coupled with tight cost management fueled our net income to PHP33.2 billion, 13% higher than a year ago.  The strong leasing growth is a result of our strategy rolled out six years ago to invest heavily in commercial assets and we saw many of these completions now bearing fruit.

All these resulted in a return on equity (ROE) of 16.7%, the highest in the Philippine property sector.

Since the rollout of our 2020-40 plan in 2014, I am pleased with how our organization has responded to the challenge and delivered significant growth over this period.

From a net income of PHP11.7 billion in 2013, we have been able to increase our bottom line at a compounded annual growth rate (CAGR) of 19% by the end of 2019.

The net income from property development increased at a CAGR of 17%, lifted by consistent demand for our residential products as reservation sales grew at an annual average of 8%.

Meanwhile, net income from commercial leasing advanced at a CAGR of 25% as our malls’ gross leasable area (GLA) increased by 68% to 2.12 million sq. meters, offices’ GLA doubled to 1.17 million sq. meters, and the number of hotel and resorts rooms increased by 85% to 3,705 rooms.

This consistent strong growth has allowed us to disburse PHP7.7 billion in dividends in 2019, 3% higher than previous year.

Notwithstanding our achievements and strong cash flows, we ensured the stability of our balance sheet through prudent cash management and optimal capital deployment. With this, we ended 2019 with a net debt-to-equity ratio of 0.78:1, affirming our Triple-A credit rating.

These results were made possible as the Philippine economy paved the way for steady progress. The country benefitted from lower inflation and interest rates, a strong peso, robust household consumption, and a growing middle class. These macroeconomic factors have provided for an environment that is supportive of growth, enabling us to sustain our momentum and fulfill our vision of “enhancing land, enriching lives for more people.”

We best demonstrate this through our investments in estate development, residential projects, commercial leasing, and other property-related businesses. In 2019, we spent a total of PHP108.7 billion in capital expenditures. 

We introduced three new mixed-use estates, further venturing into more locations—the 120-hectare ALVEO Broadfield in Biñan, Laguna; the 11-hectare The Junction Place in Quezon City; and the 290-hectare Cresendo in Tarlac City.

Broadfield is a mixed-use commercial development located close to Laguna Technopark and adjacent to De La Salle University Canlubang. It is poised to benefit from the completion of the Cavite-Laguna Expressway (CALAX) and the planned Cavite-Tagaytay-Batangas Expressway.

Meanwhile, The Junction Place is a pocket urban development located on Quirino Highway near Tandang Sora Avenue which will host an Amaia neighborhood. We see this strengthening our footprint in Quezon City, following the success of Vertis North and Cloverleaf.

Lastly, Cresendo is our first estate in Tarlac province and will feature a 30-hectare downtown area, a 32-hectare industrial park, a school by Don Bosco Technical Institute, and an Avida community.

We are investing a total of PHP35 billion for the buildup of these estates over the next few years to spur commercial activity, promote job generation, and foster community development.

With these three planned mixed-use projects, Ayala Land will have 29 estates nationwide, cementing its place as the largest mixed-use developer in the Philippines.

To ensure adequate inventory across all market segments we serve and to continue the buildup in our various communities, we launched PHP158.9-billion worth of projects for sale during the year.  Eighty-five percent (85%) of the launches were accounted for by residential products, with the balance composed of office units, commercial lots, and industrial land for sale. I am also pleased with our progress in addressing the broader housing market served by Avida, Amaia, and BellaVita. In total, they delivered 11,476 units in 2019, a compounded annual growth rate of 28% over the last five years.

In commercial leasing, we opened new malls and retail spaces, capitalizing on strong local consumption. These are Ayala North Exchange Retail in Makati City, Ayala Malls Central Bloc in Cebu, and our biggest mall to date, Ayala Malls Manila Bay in Parañaque. Altogether, these account for 213,000 sq. meters of GLA.

To meet the demand requirements from various office locators, we completed Ayala North Exchange BPO, Manila Bay BPO, and Central Bloc Corporate Center 1 in Cebu, offering 70,000 sq. meters in total GLA.

In addition, we opened 774 new rooms in our various hotels and resorts such as Seda Residences Makati; Seda BGC expansion; Seda Lio in Palawan, Huni in Lio, Palawan and Sicogon, Iloilo; and Circuit Corporate Residences in Makati.

In other leasing formats, Clock In, our co-working space provider catering to entrepreneurs, startups, freelancers, and flexible-space users, tripled its capacity to 1,404 seats by opening five new branches—in Vertis North, The 30th, Ayala North Exchange, Alabang Town Center, and Lio. Meanwhile, The Flats, our co-living space offering, opened a new branch in BGC. Together with its first branch in Amorsolo, Makati, The Flats now has 2,044 beds to serve young office professionals who require accessible and affordable housing within the CBDs. We also expanded our standard factory buildings and warehouses, now totaling 175,000 sq. meters of GLA. This is managed and operated by our listed subsidiary, AyalaLand Logistics Holdings, Corp. (ALLHC), accommodating demand for light manufacturing facilities and storage requirements from various industries.

Our ability to execute on these investments would not have been possible without our construction arm, Makati Development Corporation (MDC). I am proud to share that MDC celebrated its 45th anniversary in 2019. MDC managed 193 ongoing projects and completed 44 projects as it continued to improve its safety, quality, and timely delivery performance. It has also significantly increased its design-and-build engagements and has started to gear up for prefabricated, prefinished volumetric construction. With its nine local training facilities accredited by the Technical Education and Skills Development Authority (TESDA), MDC produced 5,139 graduates in 2019, bringing its total to 29,845 graduates since the inception of the program in 2015.

Complementing MDC is Ayala Property Management Corporation (APMC). APMC conducted 13,260 emergency response team drills and 192 night drills, and rolled out a centralized fire detection alarm monitoring system to ensure the safety of residents and tenants. Through these efforts, APMC achieved a “zero major fire incident” record across its 256 managed properties. APMC received an overall satisfaction rating of 89.1% in 2019 from a survey of 5,786 respondents. Both MDC and APMC ensure that we are able to fulfill our customer commitments and maintain the quality of our completed projects over time.

I am also glad to report on the performance of our strategic investments—ALLHC, Ortigas Land, and MCT Bhd. Through ALLHC, we were able to build further on our position as the largest industrial estate developer in the country. In 2019, it launched the 105-hectare Laguindingan Technopark in Misamis Oriental. This brought our total number of industrial estates to five, adding to our portfolio of 29 mixed-use estates. Ortigas Land, on the other hand, launched new projects such as The Galleon in Ortigas Center and Empress in Capitol Commons and opened a new wing in its Estancia Mall. Meanwhile, MCT Bhd is preparing the launch of new projects in Petaling Jaya and Subang Jaya after the strong sellout of its projects in 2019.

2019 was a year of significant investments and business activity for our company.  As we continue to build projects and communities, we remain steadfast in our commitment to integrate sustainability in our day-to-day operations. Three years ago, we embarked on our ambitious plan to offset the carbon footprint of all our commercial assets by the year 2022.  I am pleased to report that as of end-2019 we have already offset 72% of our carbon emissions through a deliberate shift of 16 properties to renewable energy and allocating 586 hectares of our landbank to become protected forests.

We also rolled out new programs for waste management with the launch of our first eco hub in Arca South to drive segregation and improve waste reduction. In 2019, the facility was able to collect 32,000 kgs of plastic and converted the sub particles into construction materials to be used in our developments.  A second hub in Lio, Palawan was also introduced in the last quarter of the year.   

Indeed, we realized significant achievements and progress across multiple fronts in 2019.  But as I speak to you today, the world is going through the biggest crisis of our generation, a global pandemic brought about by COVID-19. An overwhelming majority of business activity stopped overnight and the entire Luzon region was placed under an enhanced community quarantine, with major cities in Visayas and Mindanao also under quarantine. Filipinos’ movements were restricted to help control the spread of the virus and our operations were brought to a standstill, with the exception of our BPO offices and hotels that continue to operate on a limited basis to accommodate current business needs.

Today, we cannot ascertain the effect this crisis would have on our business. We do know, however, that this will have a major impact on the short term and our performance for the year 2020, with high likelihood of a spillover into 2021.  We are now in the process of adjusting our plans to ensure that we adapt quickly to this new reality and remain resilient throughout this crisis. 

In the midst of this situation, what gives me comfort is knowing that our balance sheet remains robust and I am confident that this strength would enable us to weather this storm.

As I look back over the last decade, it gives me tremendous pride knowing that our company has undergone an unprecedented period of growth, expanding our product lines and services to benefit more Filipinos, enhance their quality of life, and help bring economic activity to various growth centers in our country.

As we enter this new decade and a new chapter, we will start by creating a plan to adapt to the unprecedented disruption resulting from the COVID-19 crisis.

As I close this report, let me take this opportunity to thank all my colleagues at Ayala Land.  All our company’s achievements would not have been possible without your hard work, dedication, and commitment. For this I am truly grateful. I am also confident that this same team will allow us to overcome the challenges brought about by the pandemic and that we will bounce back stronger and more united as a company, “one despite the distance.”

To our Board of Directors, I would like to express my gratitude for your continued engagement, providing the guidance and wisdom that has allowed our company to achieve market leadership and thrive all these years.

Finally, to you, our shareholders and stakeholders, your unwavering support and belief in Ayala Land is what inspires us to be of service to the Filipino people. Thank you for standing by us as we continue our journey to enhance land and enrich lives for more Filipinos.

At this point, I would like to invite everyone to watch our corporate video.

Once again, thank you and good morning.

Despite the dampened economic growth in the global and domestic front last year, Globe Telecom recorded a robust performance driven by its integrated approach to value creation, sustainability, and risk management.

“For us, the true value we create lies in the impact we have on the lives of people — our customers, employees, business associates, suppliers, vendors and Filipinos at large.  Our employees are at the forefront of helping us achieve our goals and vision and are key to furthering our sustainability agenda,” said Ernest Cu, Globe President and CEO.

Globe achieved an important milestone when it launched the Globe At Home Air Fiber 5G postpaid plans which made the Philippines the first Southeast Asian country to experience the fifth generation fixed wireless broadband.

The company, in total, spent Php 51 billion in capital investments which represents 34% of gross service revenues and 67% of full year earnings before interest, taxes, depreciation, and amortization (EBITDA).  It also forged more partnerships to anchor infrastructure development at a larger scale, resulting in 139% more cell sites and 28% more 3G and 4G base stations compared to 2018.

Through innovative customer-centric solutioning, Globe ended 2019 with over 94 million mobile customers and over 2 million home broadband customers, representing a year-on-year increase of 27% and 25%, respectively.

“We have made strong strides aligned with our vision of redefining customer experience, enabling last mile connectivity and revitalizing the country’s digital economy. Our performance in 2019 is a testament of our integrated approach to value creation by focusing on customer experience, driving sustainability and adopting a holistic approach to risk management,” Cu said.

Together with its digitalization efforts, Globe embarked on various sustainability programs as it aims to be a market disruptor in terms of innovative technology and sustainability initiatives.

Globe became a signatory to the United Nations Global Compact, committing to implement universal sustainability principles and contribute to the UN Sustainable Development Goals focusing on education, environmental conservation, digital inclusion and development.

As natural resources play an indispensable role in the well-being of society, Globe strives to conduct its operations with minimum impact on the environment by rolling out almost 7,000 green network solutions in 2019, avoiding Single-Use Plastic in all its offices, advocating for e-waste management, participating in reforestation efforts, shifting to paperless billing which translates to over 650 tons of paper saved, and automating and migrating to a paperless process and saving over 20 tons of paper, among other initiatives.

Globe also undertook a marine protection program aimed towards biodiversity conservation, and devised a dedicated climate strategy focusing on building the resilience of its value chain to extreme weather events and ensuring protection of the network in times of disaster.

Likewise, the company expanded the reach of the Digital Thumbprint Program which teaches responsible online behavior to young adults.  DTP was adopted by the Department of Education for incorporation in the values education subject for K-12 students. Globe also encouraged social innovators to use technology to address social issues through its Future Makers Program.

Meanwhile, Globe installed a dedicated Board Risk Oversight Committee in April last year which allowed the company to balance risk governance and define risk-taking responsibility and authority.  This step plays a crucial role in enhancing the robustness of the company by proactively managing risks, and thereby, ensuring continuous stakeholder value generation.

Moving forward, Globe has committed P63 billion for its capital expenditures in 2020 which the company intends to fulfill despite the global health crisis.

“We recognize the critical risks that a disruption from an emerging infectious disease can bring to our operations.  And from the onset, as part of our Business Continuity Management Plan, we already prepared for workforce health and safety, supply chain disruption and the need to provide seamless connectivity, among other things,” Cu said.

However, he said the magnitude of COVID-19’s impact on the company’s overall business operations and the whole economy will have to be assessed further.

See more.

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For more information, please contact:

Yoly C. Crisanto
SVP, Corporate Communications
Globe Telecom, Inc.
Email Address: gtcorpcomm@globe.com.ph
Globe Press Room: globe.com.ph/about-us/newsroom 
Twitter: @talk2GLOBE │ Facebook: www.facebook.com/globeph

GLOBE TELECOM 2020 ANNUAL STOCKHOLDERS’ MEETING MESSAGE FROM THE PRESIDENT

Welcome/Introduction
Thank you, Mr. Chairman and a pleasant morning to all present in this meeting.

Fast Tracking Digital Transformation
2019 has been a year of remarkable growth, driven by innovative customer-centric solutions, paving the way to enabling the fast-tracked digital transformation of the economy. The year in focus has been special for all of us at Globe, as we launched 5G in June 2019, strengthening our service delivery of broadband via fixed wireless access technology. Having made a record investment of ₱51.0 billion, we have made strong strides towards our vision of redefining customer experience, enabling last mile connectivity and revitalizing the digital economy of the country. We were able to deliver strong financial performance, while making a substantial positive impact on our society and environment.

Our company emerged with strong performance despite market changes, and the domestic and global economic slowdown. We posted a service revenue of ₱149.0 billion, 12% higher compared to 2018. This growth was primarily fueled by the gains from data services – spanning mobile, broadband and corporate data. Total data revenues at the end of 2019
accounted for 71% of total service revenues, evidence that more Filipinos are embracing a digitally enabled lifestyle.

Commitment to Improving Customer Experience
I am delighted to report that today, we are the service provider of choice for over 96 million customers nationwide. This positions us as an important player in connecting minds and inspiring ideas across the Philippines through digitization. With an increasing customer base and emerging customer needs, we endeavored to make substantial investments towards building our network infrastructure. As of December 2019, we put up 139% more sites and 28% more 3G and 4G base stations compared to 2018. These investments have translated to more customers enjoying higher data speeds, specifically improved LTE download and upload speeds, and lower latency as confirmed by a third party network quality test provider.

We have also extended our partnerships with leading providers of content, mobile messaging, social media and other popular OTT applications in order to provide products and services that cater to shifting customer preferences. As our customers realize the potential of digitization, our service proposition will focus on “owning our customers” through superior service experience. We anticipate enhanced customer delight, given our improved service delivery capabilities, coupled with unique offerings encompassing personalized plans and attractive product/device bundles.

Creating Impact and Leading with Purpose
For us at Globe, the true value we create lies in the impact we have on the lives of people – our customers, employees, business associates, suppliers, vendors, and Filipinos at large. Our employees are at the forefront of helping us achieve our goals and vision of ensuring that we create value for all our stakeholders. They share our desire for sustainable practices, and are key to furthering our sustainability agenda. We make it known to our employees that the ideas and innovation they bring to the company are central to the success we achieve year on year. In recognition of our employee-centric organizational culture, we have achieved 91% Sustainable Engagement score in 2018 (net of retention score) and 88% on Organizational Health Index Score in 2018.

Globe aspires to be an industry leader with purpose, helping customers discover new ways to enjoy life. As a company driven by passion and purpose, we are proud to share the result of our Purpose Survey with 3 Purpose Index Indicators: (1.) Role and Work contribution to Globe Purpose: 91 in 2019 vs 87 in 2018; (2.) Personal Purpose contribution to Globe Purpose: 88 in 2019 vs 87 in 2018; (3.) Employer NPS is the likeliness to recommend Globe as an employer: 53.40 vs 43.38 in 2018. The Purpose Survey serves as a gauge to determine how our employees resonate with the Globe Purpose, and their insights on factors that contribute to how they can live out Purpose in Globe including culture, clarity and ways of working.

Solving Problems Beyond Telecom
Aside from our employees, our business partners, vendors and suppliers play a vital role in furthering our business in a sustainable manner. We have formed an ecosystem that creates a mutually inspiring atmosphere to achieve greater integration of sustainability in business.

This year we reinforced our position as a change agent, leading Filipinos to a digitally-enabled lifestyle by incubating, developing, and operating new non-telecom businesses. By leveraging on Globe’s strengths and assets, these startups are nurtured by Globe to maximize the value they generate. We launched a new subsidiary, 917Ventures which will hold all of Globe’s incubated startups that are beyond telecommunication. 917Ventures will also now house Globe Fintech Innovations (Mynt), the company that operates mobile wallet GCash; AdSpark Holdings, a digital advertising firm; and Konsulta MD, a telehealth firm. Globe’s push for new digital businesses is seen to play an important role in actualizing the company’s vision, while sealing its future growth trajectory. Through this initiative, we are confident that the Philippines can catch up with the rest of the region in terms of ICT adoption, especially in areas of great importance like advanced medicine, health and wellness, delivery of basic services, and education.

Commitment to Environmental Conservation
As natural resources play an indispensable role in the well-being of the society, we strive to conduct our expansion and capability building in a manner that exerts minimum impact on the environment. We strive to find innovative avenues to offset our environmental impact. We have focused on deploying green network solutions and have rolled out almost 7,000 solutions in 2019.

Indeed, we are now living in times where we are experiencing the impacts of climate change. We have worked towards instating a robust Business Continuity Management Plan to mitigate the risks arising from extreme weather events and climate linked risks. We are also actively contributing to climate change mitigation. For instance, we have been able to save over 650 tons of paper through customers shifting to paperless billing. In addition, by automating and migrating to a paperless process, we were able to save over 20 tons of paper, equivalent to saving 480 trees.

We also institutionalized the avoidance of Single-Use Plastics (SUP) in our office and engaged our concessionaires to look for SUP alternatives. Last September, we held the Plastic Exchange Program in seven barangays in Metro Manila in partnership with Ayala Land and Green Antz. Over 245,000 pieces of single-use plastic waste were collected and turned into 24,500 ecobricks by Green Antz Builders, Inc. The ecobricks will be used to build community gardens and benches, a waste segregation facility and a creek fence. It would also be used for rehabilitation for daycare centers.

In 2019, Globe became a signatory to the United Nations Global Compact, and we commit to implement universal sustainability principles and integrate these into the business.

Sustaining Momentum and Growth in 2020
For the global telecom sector, interesting and promising times lie ahead. To sustain the momentum we have gained, we will ramp up infrastructure to improve network experience with a committed spending of ₱63.0 billion in capital expenditures in 2020. Our acquisitions and partnerships in the area of electronic payments (EC Pay) and IT (Yondu) point toward how we intend to grow new businesses by leveraging our core assets.

For 0917 Lifestyle, we are excited for the next year, as we expand outside our Globe stores and online shop, to open our first flagship 0917 Store in Makati. Our flagship store will be carrying our exclusive Vanguard collection – infusing Fashion and Tech in our Apparel collection, as well as key collaborations to give life to our vision for 0917 to become a Fashion and Tech Brand that consumers will desire.

Closing Remarks
This concludes my report. It is my hope that this has enabled you to understand our shared value creation story and approach toward entrenching the culture of sustainability in our business endeavors.

Thank you.

GLOBE TELECOM ASM SPEECH
2020 ANNUAL STOCKHOLDERS’ MEETING
MESSAGE FROM THE CHAIRMAN JAIME AUGUSTO ZOBEL DE AYALA
APRIL 21, 2020

To our fellow shareholders, members of the Board of Directors, and friends: Good morning and welcome to Globe Telecom’s Annual Stockholders Meeting.

This year Globe achieved an important milestone as the Company launched the “Globe At Home Air Fiber 5G” postpaid plans. This made the Philippines the first Southeast Asian country to experience the fifth generation (5G) fixed wireless broadband.

Over the years our Company has been at the forefront of enabling digital inclusion and empowering Filipinos with the power of connectivity. Today we cater to over 94.2 million mobile customers.

We also serve over 2 million home broadband customers, a notable 25% increase compared to year 2018. At Globe, the belief is that we grow when our customers further enhance their digital lifestyle, the economy flourishes through digital transformation, and the natural ecosystem is nurtured in the process. With the ability to contribute towards a digitally enabled economy, our mission is to revitalize businesses and empower customers with enhanced digital capabilities.

Despite the country’s dampened economic growth in the global and domestic front, Globe had a record performance with a 12% growth in service revenues year-on-year. In line with past year trends, revenue growth has been predominantly data-driven. Total data revenues accounted for 71% of total service revenues compared to 61% reported last year. We have also been able to consistently increase our customer base; we witnessed a 27% rise in customer base this year compared to 2018.

Conscientious of our fiduciary duty to generate sustained value for our shareholders, we paid out ₱12.1 billion in common share dividends, which is similar to what we paid out in the previous year. This represents about 65% of 2018 core net income, in line with our new dividend policy of 60% to 75% of prior year’s core net income. This also translates to a 4.8% dividend yield, which is more competitive than other Philippine listed companies.

It is noteworthy that we have been able to showcase this performance with the looming entry of the third player. This reaffirms my belief that with the evolving market dynamic, strategic innovation is critical to reaffirm our reputation as a nimble service provider committed to bringing world class services to our customers.

In our quest to enhance customer experience and build the Philippine’s digital economy we made substantial capital investments this year. We spent ₱51.0 billion, which represents 34% of gross service revenues and 67% of full year EBITDA.

We also forged more partnerships to anchor infrastructure development at a larger scale.

In our endeavor to digitally transform businesses, we acquired a 77% equity interest in EC Pay, Inc., whose platform will enable small business owners to offer more products and services. This move will also future-proof Globe’s distribution network, bringing the company a step closer to its vision of a digitally-enabled Philippines. Additionally, our GCash partnership with CIMB Philippines reached a milestone of 1 million GSave accounts opened after only 8 months from launch. Moreover, together with other operators, we entered into a consortium and selected Syniverse as the Mobile Number Portability service provider.

We became a signatory to the United Nations Global Compact, committing to implement universal sustainability principles and contribute to the United Nations Sustainable Development Goals. Our focus areas in this vision include education, environmental conservation, digital inclusion and development.

We have rolled out various programs to realize our vision.

We also expanded the reach of DTP via the National Summit on Digital Citizenship and Responsibility (NSDCR) in partnership with the Department of Education last September. Over 400 curriculum experts on Values Education and ICT from DedEd were in attendance and help them become responsible online citizens. We also encourage social innovators, using ICT through the regional Future Makers program.

In line with Globe’s commitment to holistic value creation, we have made considerable progress in our environmental stewardship programs. This year we rolled out our Marine Protection Program for Boracay and Siargao Islands aimed towards biodiversity conservation. In recognition of the material risks and opportunities climate change presents, we have devised a dedicated climate strategy. Our strategy focuses on building the resilience of our value chain to extreme weather events and ensuring protection of the Globe network in times of disasters.

While focusing on climate adaptation, our strategy also contributes towards climate change mitigation through fostering an organizational culture of resource conservation and actively taking part in reforestation activities. Globe is also committed to resource usage optimization and waste minimization with a focus on effective E-waste management.

The strong performance we witnessed this year serves as a testament of our integrated approach to value creation and our commitment to adopting a holistic approach to risk management. Globe instated a dedicated Board Risk Oversight Committee (BROC) in April 2019. The BROC was established to assist the Board of Directors in fulfilling its oversight responsibilities in relation to risk governance to anchor clear definition of risk-taking responsibility and authority while ensuring effective functioning of the Enterprise Risk Management framework. This step will play a crucial role in enhancing the robustness of the company by proactively managing risks thereby ensuring continuous stakeholder value generation.

In closing, I would like to thank our Board of Directors, the management team, and all our employees for their untiring commitment and dedication to serving our customers. Our board members remained engaged across a variety of governance committees throughout the year and our employee and executive teams work tirelessly to improve our standards, to innovate, and to enhance our customers’ experience.  I would also like to thank our business partners for their support, our customers for their loyal patronage, and our fellow shareholders for their trust and confidence in our ability to build and create stakeholder value in the years ahead.

Thank you again for joining us here today. I now hand over the floor to our President and CEO, Mr. Ernest Cu, to deliver his report.

ACE ENEXOR ASM SPEECH
2020 ANNUAL STOCKHOLDERS’ MEETING
MESSAGE FROM THE CHAIRMAN JOHN ERIC T. FRANCIA
APRIL 20, 2020

Esteemed shareholders, my colleagues on the Board and management, ladies and gentlemen, good afternoon to all of you.

COVID-19

The impact of the COVID-19 pandemic continues to be felt globally, and the crisis is set to hit the most vulnerable the hardest.

Our various businesses within the Ayala group have been proactive in mobilizing resources to help overcome the challenges. 

We are fortunate that there are no known Covid cases among ACE Enexor and AC Energy Group employees. The Company is fully supportive of the government efforts to address the challenges by ensuring the health and safety of our employees and their families, providing support to immediate communities where we operate, and supporting broader efforts such as feeding programs, creation of additional health facilities, and the provision of medical supplies and PPEs. 

Headwinds encountered, but we remain on course

Amidst the current challenges we are making progress on the Company’s initiatives. Significant strides have been made on investments and towards exploratory drilling, yet we acknowledge that headwinds were encountered on the macro environment in which we operate.

The year was marked by oversupply, few reserves replacement, and modest annual increase in capital spending. From a high of $86 per barrel in 2018, Brent crude settled in the $60 level through most of 2019. Meanwhile the COVID-19 crisis reached pandemic levels in early 2020, severely affecting economic activity and oil demand, resulting in Crude prices declining to less than $30 per barrel. 

We anticipate that the same challenges we experienced will persist into 2020. The local upstream sector has been in dormancy in the last four years. 

Efforts to revitalize exploration have so far not achieved the desired results, despite the latest petroleum bid round that was formally launched in November 2018.

Outlook 

Your Company is well aware of the country’s dire need for replacement reserves.  Palawan55 Exploration & Production Corporation, ACE Enexor’s subsidiary, has responded proactively by bringing its primary asset, Service Contract 55, closer to exploratory drilling. 

A big positive of our efforts was Palawan55’s acquisition of the entire participating interest of its erstwhile foreign partner, thereby doubling its stake in SC 55 to 75%, highly encouraged by the results of its technical studies centered on a gas discovery made in the area in 2015.

Furthermore, just last week, the DOE confirmed SC 55’s entry into the Appraisal Period, with a commitment to drill one exploratory well within the first two years of the said time frame. Two candidate target sites are currently being evaluated using leading edge standards, and upon completion of the assessment, preparations for drilling will commence soon after.

Looking ahead to the future of oil and gas exploration

2019 has been a year of good progress for our Company. Our decisions and actions during this period positioned us well to work on our future growth and aid in the country’s future energy landscape.  

The business of oil and gas exploration continues to be challenging, uncertain and very complex. With your continued trust and support, we will constantly pursue business growth and value creation while we move towards playing a significant role in helping the country’s energy security in due course.

Thank you.

ACE ENEXOR ASM SPEECH
2020 ANNUAL STOCKHOLDERS’ MEETING
MESSAGE FROM THE COO RAYMUNDO A. REYES, JR.
APRIL 20, 2020

Thank you, Mr. Chairman.

Good afternoon, fellow shareholders and guests.

Since the middle of last year when AC Energy took over ACEX, our team has focused on validating the gas discovery made at the Hawkeye-1 well in 2015.  While the former Operator of SC 55 notified the Department of Energy of the gas find prior to its withdrawal, the company failed to submit a formal gas discovery report as required under said contract. Palawan55, ACEX subsidiary and current SC 55 Operator, remedied this deficiency by undertaking specialized technical studies that proved the existence of the gas resource, to the satisfaction of the DOE (Flash Slide 2)

Our team also confirmed the drill-ready status of the prospect that another former Operator almost tested in 2012, were it not for last-minute permitting problems.  Palawan55 also conducted advanced reprocessing and interpretation of seismic data that were originally acquired by the two former Operators, and this exercise yielded a number of new prospects and leads in the vicinity of the Hawkeye gas accumulation.  Drilling scenario planning indicated that the primary prospects are technically drillable.  

Encouraged by the promising results of technical studies, Palawan55 acquired the entire 37.5% participating interest of its Australian partner that opted to withdraw from the consortium due to financial constraints (Flash Slide 3).  Palawan55 thus doubled its stake in the block to 75% and remains as the Operator.

Moreover, Palawan55 notified the DOE of SC 55’s direct entry into the Appraisal Period with a commitment to drill one deep water well.  This exploration phase would allow the consortium to test other prospects in the block that could merit stand-alone or cluster field development.  As mentioned by our Chairman earlier, the DOE has confirmed SC 55’s entry into the Appraisal Period effective April 26, 2020 (Flash Slide 4).   The consortium will prepare for the DOE’s approval, a definitive work program that shall include the drilling of at least one well no later than April 2022.

Palawan55 is currently conducting follow-on evaluation of two candidate targets for drilling.  Upon completion of the comparative assessment, the consortium will choose the prospect to be drilled, then commence preparations for drilling immediately thereafter.  Rest assured that we will keep you posted of material developments through our regulatory disclosures.

Thank you.

AC ENERGY ASM SPEECH
2020 ANNUAL STOCKHOLDERS’ MEETING
MESSAGE FROM THE CHAIRMAN FERNANDO ZOBEL DE AYALA
APRIL 20, 2020

Fellow shareholders, colleagues in the Board and management, ladies and gentlemen, good morning to all of you.

As many of you know, our independent director Mr. Jesus “Chito” Francisco recently passed away. It is important that we honor his memory and the contributions he made to AC Energy Philippines.

We recognize the very difficult period our country is going through and at the Ayala group, our various businesses are working closely to help in any way we can. We have launched different initiatives across the group to mitigate the impact of the community quarantine, especially for the daily wage earners and the no-work-no-pay workforce, those who belong to the informal economy, as well as small and medium enterprises that have had to stop their operations. We have likewise made similar efforts to help our healthcare frontliners and have helped augment the capacity challenges in our hospitals. 

At the same time, we have ensured that the delivery of basic services within the group can continue such as healthcare, banking, telecommunications, water, and power.

We reinforce our strong commitment to invest in much needed energy investments in the Philippines as access to stable power is critical to supporting all the services needed to address this health crisis.

Through AC Energy, we have been able to do our part in ensuring uninterrupted power in medical facilities, production of essential goods, and in every home during this difficult period.

Let me now move on to our review of 2019. As you all know, AC Energy Philippines went through a major transformation in the past year as we acquired PHINMA Energy. We are happy to report the positive momentum that ACEPH has been able to achieve since we took over last October.

We are encouraged by the government’s push for more renewable energy generation and reduction in the dependence on traditional energy sources. From 416 MW, we have increased ACEPH’s portfolio to over 1,100 MW. To sustain this growth, we have transformed ACEPH as AC Energy’s growth platform in the Philippines. 

With this strong growth momentum, ACEPH accelerated the expansion of its power generation portfolio in the Philippines through greenfield projects and acquisitions. ACEPH continued to invest in strategic assets, consolidated key operating assets, and bolstered its renewable energy pipeline in line with this year’s goal to achieve an attributable capacity of 1,500 MW, half of which will come from renewable sources.

Together with the Ayala group, ACEPH is leveraging digital technology to enhance operational efficiency and energy solution services. Let me cite some of the initiatives that ACEPH has started to work on.

First, renewable plant performance will be monitored to predict intermittency, ensure efficiency in power generation, and help guide decisions on preventive maintenance to increase reliability.

Second, consumers will be provided with near real time energy data to offer them the opportunity to improve their operational consumption and environmental footprint.

Finally, prediction capabilities through weather forecasts, load forecasts, and tuned plant models will be used to respond to price signals in the market.

In addition, as part of the Ayala group’s overall sustainability agenda, ACEPH has aligned its business objectives with the UN Sustainable Development Goals. Integrating the UN SDGs into all aspects of the company’s processes allows AC Energy to expand its renewable energy capacity, support host communities, protect the environment, and contribute to sustainable development for the benefit of present and future generations.

To support this agenda, parent AC Energy has launched an Environment and Social Policy, anchored on three pillars where it believes it can have the greatest impact: excellence in environmental management, commitment to the community, and transitioning to a low carbon portfolio by 2030

ACEPH is committed to provide reliable, affordable and sustainable energy. We are making a commitment to transition to a lower carbon portfolio by rebalancing our generation portfolio to grow our renewable energy assets. 

In closing, AC Energy Philippine’s achievements have been made possible by the guidance of our Board of Directors, the commitment and dedication of our employees and the support of our business partners and host communities. We also thank our shareholders and many stakeholders for their continued trust and support as the company moves towards its aspiration of becoming a leader in sustainable energy in the Philippines.

Thank you.

We now invite you to watch our corporate video, which touches on our commitment to sustainable development. By continuing to build trust with communities and helping protect the environment, we are able to ensure the progressive development of the markets we serve.

As an example, AC Energy launched its flagship sustainability program in 2017, which involved a Conservation Estate in a community within one of its wind farms. It is a multi-year program with livelihood, environmental, and biodiversity protection. Following the successful completion of a pilot phase, we are now moving to a full implementation of the project.

We are very proud of this achievement and would like to share this with you through this video.

AC ENERGY ASM SPEECH
2020 ANNUAL STOCKHOLDERS’ MEETING
MESSAGE FROM THE PRESIDENT JOHN ERIC T. FRANCIA
APRIL 20, 2020

Fellow shareholders, colleagues from board and management, ladies and gentlemen. Good morning.

It has just been under a year since your new board and management assumed leadership roles in your Company, though we spared no time to transform the company with significant corporate decisions and swift outcomes in relation to development, commercial and operational matters. The rapid pace of progress strengthened the Company’s fundamentals, allowing us to be more resilient amidst the current global health and socio economic crisis that we are all confronted with.   

I am pleased to report that there are no known COVID cases among the Company’s 700 employees.

The Company is fully supportive of the government efforts to address the challenges by ensuring the health and safety of our employees and their families, providing support to immediate communities where we operate, and supporting broader efforts such as feeding programs via Project Ugnayan, creation of additional health facilities such as the WTC We Heal as One Center, and the provision of medical supplies and PPEs. While we have seen over 30% of drop in customer demand, all our power plants continue to operate as we maintain skeletal crew to keep the plants running. 

Notwithstanding the current challenges, the company continues to execute against our turnaround plan and establish a sustainable growth path.

I’m very pleased to share the significant progress we have made across three important areas:

• Strengthening the company’s balance sheet
• Expanding generation capacity 
• Increasing long term customer relationships

The company shored up its balance sheet through a series of actions. 

As part of its entry in June 2019, AC Energy infused 2.6 billion pesos of cash in the Company through a subscription of primary shares. 

Soon thereafter, AC Energy infused power generation assets valued at more than 14 billion pesos, through an asset for share swap. [The transaction is currently awaiting regulatory approval.]

The board of directors also approved the issuance of stock rights, where we are targeting to raise over 5 billion pesos in cash from the offering. 

Upon completion of all these initiatives, the company would have increased its balance sheet by well over 20 billion pesos. This represents a tripling of the company’s balance sheet. 

Expanding generation capacity 

With a bigger balance sheet, the company expanded its generation capacity from 416MW to well over 1100MW. 

Around 700MW of new capacity has been added to the company’s portfolio, of which 60% was from renewable sources. 

The 700MW of additional capacity came from a combination of:

(1) infusion of generation assets from AC Energy parent (176MW)

(2) acquisition of brownfield power generation assets (196MW), and 

(3) starting the construction of new power projects (330MW)

Increasing long term customer relationships  

With an expanded generation capacity and diversified portfolio, the company is able to provide compelling offers and build a strong customer base.  

Increasing long term customer relationships  

Last September, the Company won two Meralco contracts worth 310 MW through a competitive selection process, also known as CSP. The contracts were based on a five year and ten year tenor, providing steady and predictable cash flows to the company. 

The groundbreaking CSP required suppliers to offer fixed pricing and 100% guaranteed availability — making this a highly customer centric approach. 

The innovative structure was made possible by allowing generators to supply from multiple power plants and the electricity spot market. 

As a result, AC Energy Philippines was able to leverage its portfolio of power plants and deliver a compelling and winning proposition to the customer. 

2019 Results 

All the positive developments throughout 2019 resulted in an improvement of short term performance, and more importantly, a positive long term outlook. 

From a first half loss of [P550 mn], the company improved its performance in the second half, thereby reducing the full year loss to [P417 mn] by the end of 2019. 

We expect the turnaround initiative to prosper and are aiming for a positive bottom line by 2020. 

Given the positive developments and outlook, the company’s share price has more than doubled in 2019, delivering significant value to our shareholders.

Outlook

While we are facing significant challenges amidst the current crisis, the Company remains solid and steadfast in its commitment to a sustainable future. 

We will continue to expand and diversify our generation capacity and will target to exceed 1500MW of capacity by 2020 and significantly increase our renewables capacity.  

We will also enhance the operating efficiencies especially of our thermal power plants, where we aim to improve availability by over 20%  

We will also continue to add to and nurture our customer base, and develop long term relationships. 

Summary

On behalf of the company’s board and management, I would like to thank the entire AC Energy Philippines team for the full dedication, hard work, and significant results delivered in such a short span of time. 

Thank you to our shareholders and our board for the continuing trust and support. 

We are all highly committed to work towards our aspiration of becoming the leading renewables company in the country. Thank you.

MANILA WATER ASM SPEECH
2020 ANNUAL STOCKHOLDERS’ MEETING
MESSAGE FROM THE PRESIDENT JOSE RENE GREGORY D. ALMENDRAS
APRIL 17, 2020

Dear Shareholders,

To say that we are in the middle of unusual times may be an understatement. Addressing you in this manner is just one unmistakable proof of the situation. We have worked around all obstacles as it is paramount for us to make this report at this time of the year. It is, after all, our avowed commitment to be of Genuine Service to our customers, partners and stakeholders.  On a personal note I acknowledge the difference of 2007 to 2010, my first stint in Manila Water and what it is when I rejoined in September 2019.

Perhaps we can say that these extraordinary times begun in 2019. Thus, the 2019 Integrated Report of Manila Water is unlike any other we have produced in the past. On top of our compliance to the standard reportorial requirements as with previous years, we feature a Special Reports section which provides you, our shareholders, a direct and objective view into the significant events which transpired in. We have taken this new direction for the Integrated Report because clearly, 2019 was not a normal year, by any measure. Allow me to recount several of these significant events, the details of which will be extensively discussed in the pertinent sections of the Integrated Report, as distributed.

For our East Zone Concession, 2019 will be remembered as the year of the water supply shortage. There was drastic decline of water levels in the raw water dams, namely Angat  and La Mesa Dam.  This caused water service availability to drop drastically in the first half of 2019, thus underscoring the need to develop long-term water sources to ensure water supply sustainability.

Our response was immediate. We had to shift to new network operations regimen to adapt to a markedly reduced water supply allocation regime. We shifted operations protocols like we have never done before, all these aligned squarely towards customer requirements.

Pending new medium- to long-term water sources, we likewise ramped up our development of water supply augmentation projects for the East Zone. The production at our Cardona Plant reached 98 million liters per day (MLD) as of December 2019. Furthermore, our recommissioning and development of new deep wells continues, with a total capacity of 55 MLD as of year-end. These initiatives, along with our continued proactive network management and optimization programs, keep water availability within regulatory levels for our customers despite lower raw water supply allocation.

While we are able to manage our supply challenges, 2019 likewise required us to face considerable challenges on our commitment to provide and expand wastewater services in the East Zone. In September, the Supreme Court ordered each of the MWSS concessionaires, jointly and severally with MWSS, to pay more than Php921 million in fines for non-compliance with the Clean Water Act.  We affirmed that we would exercise all legal options in relation to this case, including the filing of a Motion for Reconsideration which we timely submitted to the Supreme Court on October 2, 2019. We firmly maintain our position that, as Concessionaires of MWSS, we have fully complied with our obligations under the Concession Agreement and the guidelines under the Clean Water Act.

Based on the original Concession Agreement, the wastewater coverage commitment for the East Zone was targeted at 55% by 2022. When the Philippine government approved the extension of the Concession Agreement in 2009,  one of the reasons for the extension is the increase of our obligation to 100% East Zone wastewater coverage by 2037. The extension of the Concession Agreement for an additional 15 years allows us to expand wastewater coverage to more communities but at the same time mitigating the price of services from spiking up too fast. This new coverage target and 2037 deadline was duly acknowledge by a Supreme Court Mandamus promulgated in 2008 for the clean- up and preservation of Manila Bay.

Consistent with our mandate as the MWSS concessionaire for the East Zone, we have invested close to Php43.56 billion in wastewater capital expenditures since the concession began in 1997, and plan to invest over Php38 billion more until 2022. Notably, we have spent more than what we have collected as sewer and environmental charges from the start of the concession until now.  When Manila Water started in 1997, only 45,000 people were connected to a sewer system, today we cover a population of 1.08 million.  At the end of last year we are happy to report 30% sewer coverage well on our way to the 32% target for 2022.

These challenges on water and wastewater provision have opened up queries and assailed the integrity of the current Concession Agreement to the point that such was allegedly laden with onerous provisions. It will be recalled that in 1997, it was government who invited the private sector to help address the looming water crisis in Metro Manila. Manila Water had nothing do with the drafting of the Concession Agreement as terms of the agreement had already been drafted and pre-determined. Manila Water was one of the 70 participants during the 1997 bid pre-qualification who had to accept the draft of the Concession Agreement on a “take-it or leave-it basis.

As the government continues the review of the Concession Agreement, we assure you that we are working closely with them to arrive at a solution that will be beneficial not only our customers but also balance the interest of our shareholders.

Even with these challenges, it is with the same firm resolve that we look forward to further strengthening our foothold on our non-East Zone ventures. While our domestic and regional businesses experienced its own set of obstacles, Manila Water remained resilient. Even in the face of operating and business development setbacks, our domestic subsidiaries under Manila Water Philippine Ventures significantly increased income contribution to the group, with the good performance of the core domestic operating subsidiaries providing a solid foundation. For our international operations under Manila Water Asia Pacific, the performance challenges in our Vietnam investments served to underscore the importance of managing our costs better, as well as in taking a more focused approach in business development.

Looking back at the year that was, the core which held us together and helped us weather the seemingly insurmountable challenges were our people. Manila Water’s strength lies in its unique mix of seasoned pioneers who provide experience and wisdom, coupled with young, dynamic leaders who inject energy, innovation and spirit. I commend the entire Team Manila Water for all their hard work and sacrifices that stem from a genuine desire to serve. Whether young or old, the common thread which runs through every Manila Water employee is our commitment to our service mission. This is what defines us – a heart for Genuine Service which takes precedence above all else.

The Manila Water brand of Genuine Service is not confined to within the company alone. This dedication to service extends outward – from our employees, flowing through to our customers, partners and to government as we support their thrust towards national development. Even with all the challenges we faced in 2019, we helped where ever disaster we were needed.  From Earthquakes and storms to the Taal Volcano eruption, Manila Water was there to help. I am always amazed by the overwhelming number of volunteers from our team members who are willing to help in disaster operations.  Only in working together with our stakeholders can we rise above the obstacles and find better ways to fulfill our service mission.

As Manila Water looks to the future, we draw strength from the challenges we have faced.  We do so because we know this is where we will find the solutions that will make us better equipped to meet the challenges to come. Equally, we draw inspiration from the confidence entrusted to us by our customers, partners and stakeholders. I thank our customers for their continued trust and support for the company. I thank our partners and stakeholders for their continued faith in the  organization, support for the projects and the initiatives that enable us to provide consistent, reliable service to our customers. Finally, I thank my fellow Manila Water employees for their resilience and unwavering dedication to our mission – to render Genuine Service, in all that we do.

Thank you and Good morning.

MANILA WATER ASM SPEECH
2020 ANNUAL STOCKHOLDERS’ MEETING
MESSAGE FROM THE CHAIRMAN FERNANDO ZOBEL DE AYALA
APRIL 17, 2020

Fellow Shareholders, good morning.

As you know, Manila Water experienced major challenges in 2019. The difficulties we experienced have drastically altered the way we view and operate our business.

The first set of challenges in 2019 were operational, but on a scale and magnitude never seen before in Manila Water’s history. In March last year, we experienced a severe water supply shortage in our East Zone Concession, with raw water volume in our main reservoirs reaching critically low levels. This caused prolonged service interruptions in several communities, significantly impairing the high standards of service which we have maintained for over 20 years. Furthermore, in August the Supreme Court rendered its decision to have Manila Water and MWSS pay more than Php921 million in fines for alleged non-compliance with the Clean Water Act.  Both Manila Water and the MWSS have appealed the decision, and we are hopeful that the Supreme Court will sustain our position that the Clean Water Act did not require MWSS and its concessionaires to provide a centralized sewerage system for the MWSS service area within five years from March 2004.

Towards the end of the year, we faced an unprecedented and even more fundamental set of challenges – the kind which put into question the foundation on which we have built our business and credibility. It began in November 2019, when we received the award rendered by the Arbitral Tribunal in the arbitration proceedings between Manila Water and the Philippine government constituted under the Permanent Court of Arbitration (PCA) in Singapore. The Tribunal ordered the government to indemnify Manila Water in the amount of Php7.39 billion representing the actual losses Manila Water suffered from June 1, 2015 until November 22, 2019 due to the government’s breach of its contractual obligation. The unfavorable reaction of several key government officials to this arbitral award unfortunately resulted in the questioning of key terms in the Concession Agreement. In order to address the mounting regulatory and government pressure, we resolved to no longer collect the arbitral award issued by the PCA. Additionally, we indicated that we would defer the implementation of our Approved Rate Adjustment for 2020, while we continue to work with MWSS on an arrangement as to how and when this deferral will be addressed in the future.

Despite the very difficult political environment, Manila Water continued to provide reliable service to our customers. This dedication and commitment are characteristics which are distinctly Manila Water – the same values and principles which we have maintained since our concession agreement began. 

Back in 1997, we established our commitment to national development by taking on the mandate of rehabilitating and expanding the MWSS water and wastewater system. At the time, systems losses in the East Zone were at a high of 63% and wastewater coverage was only 3%. In the face of great risk and difficulty, we accepted the challenge of improving water and wastewater service for the communities and households in the East Zone of Manila.

The results of that commitment speak for themselves. From 63% in 1997, we have successfully decreased system losses in the East Zone to a world class level of 10.37% at the end of 2019. The water we have recovered from the system enabled us to maintain water availability at near 100% in our Central Distribution System, with potable water flowing to our customers 24 hours a day and water pressure kept steady at regulatory levels.  To ensure the adequacy of raw water supply for East Zone customers, we continuously tried to work with government on its development of medium and long-term new water sources. Unfortunately, there were disagreements on supply projections which prevented us from planning properly for the needs of our concession area.  Last year’s water supply shortage has allowed us to fast track several new projects in collaboration with MWSS. Notably, the first phase of the Wawa-Calawis Bulk Water Supply Project is projected to supply 80 million liters per day to the East Zone by 2022 which can be expanded further to 518 million liters per day.

For wastewater, we now have over 30% wastewater coverage in the East Zone – equivalent to service for 2 million people coming from only 45,000 when we took over the system from MWSS. We continue to remain compliant with environmental standards as we execute our Service Improvement Plan approved by the government. Lastly, we remain open to discussions with the government on the Concession Agreement. The indication that government has engaged the Asian Development Bank for this purpose sends a positive signal that the discussions will be comprehensive and balanced.

The board has also decided to prepare for options to strengthen Manila Water’s balance sheet, which is why we are asking the shareholders to approve the increase of shares without pre-emptive rights to 900 million, so that the Company may issue shares as needed and open up opportunities for the entry of a strategic investor.  

In Manila Water, we have always seen our responsibility to our customers as more than a business to run.  When we committed ourselves to provide quality water and wastewater services to our customers more than 20 years ago, we knew then that it would not be an easy task. True enough, throughout Manila Water’s history we have persevered through many challenges – be it natural, economic or regulatory.  Our experiences in 2019 once again bring this reality front-and-center.

All these difficult challenges brought out the best in all of us. Each one made us stronger, more united and more committed to our service mission. As we weather these challenges, it inspires me to see that the strength and resilience which our company has built through the years, is very much alive in our people, our culture and in our work. What truly sets the Manila Water spirit apart is its heart for genuine service. In spite of the hardship and sacrifices, Manila Water has never hesitated to extend its hand to help and serve others – no matter when, or where it was needed. This commitment to genuine service is what will see us through the challenges we face today and the challenges that are still to come.

I hold on to the firm belief that Manila Water will always emerge stronger in the face of adversity. The company draws strength from its core – built upon resilience and strengthened by its commitment to genuinely serve its customers. I thank you for your continued trust and support, as we continue to champion our mission of providing access to water and sanitation services for the communities we serve.

I would like to thank our Board of Directors for their guidance and support, our management team and employees for their unwavering commitment, and finally our customers, partners and all our stakeholders who continue to inspire us as we fulfill our service mission.