Category: News

As the National Ayala Young Leaders Congress (AYLC) enters its 13th year, 81 of the country’s most promising youth leaders will attend the four-day congress to further enhance their leadership skills and build bonds with like-minded peers from all over the country.

With the theme, “Leadership: Serving, Transforming, Sustaining,” the 13th AYLC will be held on February 8 to 11 at the San Miguel Corporation Management Training Center in Alfonso, Cavite. Sec. Jose Rene D. Almendras of the Department of Energy, and former president of Manila Water Company, will keynote the congress.

This year’s theme underscores the need to bring about lasting transformation in the country. “We recognize that nation building is a continuous journey and that responsibility for it does not rest solely on the shoulders of our leaders but on each and every one of us,” explains AYLC program director John Philip Orbeta.

Delegates to the Ayala group’s annual youth leadership program come from a broad range of disciplines and are chosen not only for academic excellence but also for their involvement in school or community development. A total of 722 nominees from colleges and state universities all over the Philippines sent in their applications for AYLC 2011. Paper screening and panel interviews with Ayala group executives yielded 81 delegates from 44 higher education institutions, which include the Philippine Military Academy, the Philippine National Police Academy, the Pamulaan Center for Indigenous Peoples Education, and the Immaculate Conception Major Seminary.

“Leadership is needed in many sectors of society,” says AYLC 2011 congress director Simon Mossesgeld. “By linking up with diverse academic institutions, we ensure a good mix of leadership experiences, advocacies, and backgrounds from which our young participants can learn from and broaden their own perspectives.”

AYLC 2011 delegates will participate in lectures, panel discussions, workshops and outdoor activities designed to hone their leadership potential and inspire them to lead lives of integrity and to work for the good of their community and country. They will be joined by notable figures from government, business, and the socio-civic and arts sectors, which include: Dr. Chelsea Calcado, a rural health physician of the Integrated Provincial Health Office of Negros Oriental who is noted for her work in bringing healthcare services to far flung and conflict areas; Chris Tiu, TV personality and athlete, who is also a businessman and barangay official in Makati City; and Marites Vitug, co-founder and board member of the Philippine Center for Investigative Journalism, whose critically acclaimed book Shadow of Doubt provides insights into the Philippine justice system.

To inspire this year’s crop of young leaders, past participants of the AYLC will also share their continuing passion for service and leadership. Arnel Genzola (AYLC 2002), faculty member of Jilin University-Lambton College in China; Patricia Gallardo (AYLC 2000), director for corporate social responsibility and sustainability of Shangri-La International Hotel Management; and Hon. Emmeline Y. Aglipay (AYLC 2001), Party-List Representative of the Democratic Independent Workers Association, will discuss how they are making a difference in their own spheres of influence, be it in the academe, private sector, or public service.

The AYLC is the flagship program for youth development launched in 1999 by the Ayala group of companies as a concrete expression of its commitment to national development. Now on its 13th year, AYLC continues to fuel the dream of nurturing a corps of servant leaders who will use their leadership to help uplift the lives of Filipinos.

“We have great hope that many young Filipinos today will commit wholeheartedly to the challenging task of sustaining the changes initiated by our nation’s leaders and build on these gains to benefit even more people,” says Ayala Corporation chairman and CEO Jaime Augusto Zobel de Ayala. “With AYLC, we believe that effective leadership does not only bring about positive change, but, more importantly, inspires change in others so that more people work together for the greater good.”

Ayala Corporation reported first nine months’ net income of P6.8 billion, 17% higher than earnings in the same period last year. Its property, banking and water businesses fuelled growth, offsetting the weakness in its telco unit. Nearly all businesses posted double-digit growth in earnings which resulted in a 26% increase in equity earnings to P8.6 billion.

Ayala Corporation president and COO Fernando Zobel de Ayala noted, “We are encouraged by the strong growth trajectory of our core businesses. The favorable economic environment, robust domestic consumption, and low interest rate environment set the condition for rapid growth and expansion. The initiatives we have taken the past few years have clearly positioned our businesses to benefit from this renewed growth cycle.”

Ayala Land’s net income rose by 35% to a nine-month record high of P3.9 billion on strong revenue growth across all business lines. Residential revenues grew by 19% with take-up of projects doubling versus last year. Shopping center revenues also rose by 6% with the expansion of occupied gross leasable area (GLA) and steady occupancy rate across its shopping malls. Office building revenues rose by 12% as occupied GLA and leased-out rate in its BPO portfolio improved significantly while average lease rates remained steady. Higher revenues and better cost control translated to a substantial improvement in overall margins. Ayala Land continues to expand aggressively. This year it has launched 9 retail projects, 8 BPO buildings and around 8,400 residential units with a deep pipeline of project launches secured.

Bank of the Philippine Islands’ net income grew by 24% year-on-year putting nine-month profit at P9.1 billion. The bank’s push to broaden customer base resulted in strong loan and deposit growth. Net loans grew by 14% mainly from middle market/SMEs and consumer loans, while its deposit base increased by 19% year-on-year. Total revenues reached P29 billion, 13% higher than same period last year driven by higher net interest income and non-interest income which rose by 8% and 22%, respectively. Net interest income grew on an 11% increase in average asset base while non-interest income rose due to significant gains from securities trading, fee-based income, and foreign exchange transactions. BPI’s asset quality is among the top. Its non-performing loan ratio declined further to 2.6%. BPI continues to pursue its growth strategy centered on more aggressive customer acquisition, prudent lending, and deeper cross selling penetration.

In its telco business, Globe Telecom’s broadband business sustained its growth momentum in the first nine months of the year as broadband revenues grew by 84%, while its mobile postpaid business registered a 7% revenue growth. These effectively cushioned the impact of lower mobile prepaid revenues and combined put Globe’s consolidated service revenues for the nine-month period at P45.8 billion, 2% lower than the same period last year. While Globe’s mobile subscriber base continued to expand with mobile SIM base at 25.4 million and its SMS and voice traffic on the rise, intense price competition due to unlimited and bulk offers capped growth in the mobile prepaid segment. Its broadband subscribers, however, surpassed the 1 million mark. Globe maintains a healthy financial position with strong cash flows giving it room to sustain dividend flows and pursue initiatives that will sustain the growth momentum in broadband while recovering mobile revenue market share.

Ayala’s water business posted strong revenue and net income growth. Revenues in the first nine months grew by 19% to P8.3 billion driven by a 4% increase in billed volume and a 9% increase in household connections from its expansion areas within in the concession zone. Its water concessions in Laguna and Boracay also improved revenue contribution. This was further boosted by favorable depreciation levels and regulatory costs brought about by the full implementation of the renewal of its concession agreement. Despite increased operating costs, net income jumped by 31% to P2.9 billion in the first nine months of the year. Continued investments in its network resulted in efficiency improvements. Non-revenue water or system losses were reduced further to 12.2% as of September from 15.4%. Its efficiency standards helped sustain service levels to customers, particularly during the height of the El Nino period early this year. While water supply has improved, the company continues to put in place mitigating measures to stem water supply challenges in the future. Manila Water is pursuing development of other water supply sources to augment and diversify its water source. It is also progressing on new business development outside of its concession zone.

Electronics unit Integrated Microelectronics, Inc. (IMI) posted US$293 million in consolidated revenues for the first nine months of the year, a 4% increase due to the sustained strong performance of its China operations. China and Singapore operations posted US$185 million in revenues, 22% higher year-on-year and accounted for 63% of IMI’s total revenues. This compensated for the 17% decline in revenues from its Philippine operations. IMI’s net income reached US$5 million during the period, 36% higher than same period last year. IMI’s diversification strategy has mitigated the impact of isolated business downturns. IMI continues to be in a robust financial position with cash of US$40M and low gearing levels that provide flexibility to support its expansion program. It recently completed the purchase of a 56% stake in PSi Technologies, Inc.

Ayala’s automotive dealerships registered a 10% growth in revenues to P9 billion on account of higher unit sales, benefitting from the robust industry car sales. Ayala is the leading dealer of the Honda and Isuzu network in the Philippines with a 51% share of Honda network sales and 30% of Isuzu sales nationwide. Ayala Auto posted a 47% growth in net income to P245 million in the first nine months.

Ayala’s BPO businesses under LiveIt delivered a net profit of P1.5 billion for the first 9 months of 2010, versus last year’s loss. The positive result was primarily due to the revaluation gain of P2.3 billion recognized in the second quarter as result of a third party investment in Integreon. This gain more than offset the operating net loss of P513 million and net interest expense of P303 million during the period. On a quarter-on-quarter basis, LiveIt’s net loss was lower at P178 million in 3Q10 versus P199 million in 3Q09. The combined revenue of the BPO businesses in the first 9 months was US$656 million, of which LiveIt’s share was US$200 million, reflecting 32% growth over the same period last year. Combined EBITDA was US$45 million, of which LiveIt’s share was US$11 million, reflecting 6% growth over the same period last year. LiveIt’s share of EBITDA in 3Q2010 was $4.7 million, up 122% over 2Q2010.

The strong performance of these business units negated the impact of the P1.8 billion net loss of Ayala’s international real estate unit, AG Holdings, which took impairment provisions in the first half of the year for certain real estate assets in North America. The company’s Asian portfolio, however, yielded positive earnings in the first nine months as projects in Macau, Thailand, India, and China remain on track and continue to receive favorable market response.

Ayala ended the period with P30 billion in cash and net debt of P13 billion, keeping net debt to equity low at 12%. Ayala is exploring opportunities in the infrastructure space, recently announcing an agreement with long-time strategic partner Mitsubishi Corporation to develop and test the technical and commercial feasibility of solar power generation in the Philippines.

The above statement pertains to the disclosure made to the PSE and SEC today, November 15, 2010, by Ayala chief finance officer Delfin C. Gonzalez, Jr.

In a disclosure to the Securities and Exchange Commission, the Philippine Stock Exchange and the Philippine Dealing and Exchange Corporation made by chief finance officer Delfin Gonzalez, Jr., Ayala announced that its Executive Committee has approved the expansion of its share buyback program from P5.0 billion to P10 billion and, for this purpose, the allocation of an additional P5.0 billion for hte program.

As previously disclosed, the amount P2.5 billion was budgeted for the program when it began in September 2007 and another P2.5 billion was appropriated in May 2010. As of yesterday, the company has bought back 14.2 million of its common shares at an average price of P322.81 per share for a total cost of P4.65 billion.

In a disclosure to the Securities and Exchange Commission, the Philippine Stock Exchange and the Philippine Dealing and Exchange Corporation made by general counsel and compliance officer Solomon Hermosura, Ayala announced that its Board of Directors has accepted the resignation of Ms. Mercedita S. Nolledo as director and elected Mr. Antonio Jose U. Periquet as independent director for the remainder of the term of Ms. Nolledo. The Board also elected Mr. Periquet and Mr. John Eric T. Francia, our Group Head of Corporate Strategy, as members of the Finance Committee.

Ms. Nolledo served as director of our Company for a total of nine (9) years, from 1999 to 2002, and from 2004 until today. She will remain as Corporate Secretary, Senior Counsel and Chair of the Proxy Validation Committee. The Board thanked Ms. Nolledo for her exemplary and dedicated leadership and service as director, and also for her passion and commitment to good and effective corporate governance.

Mr. Periquet, 49, is an accomplished fund manager. The Fund Managers Association of the Philippines recognized him as the Best Strategist for seven consecutive years, from 2003 to 2010, and Best Analyst in 2009 and 2010. He was also adjudged the Best Analyst in 2004 by Asiamoney. He was the Chairman of Deutsche Regis Partners from 1999 to August 2010. He is also presently the Chairman of Pacific Main Holdings Inc., an independent director of BPI Capital Corporation, DMCI Holdings Inc. and Philippine Seven Corporation, and a director of Capstone Technologies Inc., The Straits Wine Company Inc. and Development Bank of the Philippines. He obtained his AB Economics degree from Ateneo de Manila University in 1982, MSc Development Economics degree from Oxford University in 1988 and MBA degree from the University of Virginia in 1990.

Ayala Corporation’s net income grew by 21% to P2.3 billion in the second quarter of 2010 versus the same period last year. This was driven by the robust performance of its real estate and banking units Ayala Land and Bank of the Philippine Islands (BPI) as well as Manila Water, Integrated Micro-Electronics, the automotive and business process outsourcing (BPO) units. Altogether this resulted in a 24% growth year-on-year in equity earnings during the quarter.

This pushed Ayala’s consolidated net income in the first half of the year to P4.4 billion, 9% higher year-on-year. Equity earnings in the first semester rose by 15% to P5.7 billion with equity earnings from Ayala Land and BPI up by 31% and 14%, respectively. This cushioned the impact of a 29% decline in equity earnings from Globe Telecom. Equity earnings from AC Capital units also improved significantly reaching P915 million from P77 million in the same period last year fuelled by a significant rise in earnings of Manila Water, IMI, Ayala Auto, and LiveIt. LiveIt realized a revaluation gain of P2.3 billion during the period which helped offset the impact of the P1.7 billion impairment provisions undertaken by AG Holdings for its real estate assets in North America.

Ayala president and COO Fernando Zobel de Ayala noted that “the results in the second quarter reflect a strong rebound from the lows of the recent economic slowdown. Domestic consumption has been robust and benefitted our real estate, banking, and auto businesses. Meanwhile, our water distribution business continues to expand and improve efficiencies, while our telecom business faces significant competitive challenges. The fundamental drivers of the local economy remain in place which we believe will continue to fuel the growth of our key businesses. The improved global economic conditions also favorably impacted our electronics manufacturing and business process outsourcing services.”

REAL ESTATE
Ayala Land’s net income in the second quarter reached a record high and put first half net income at P2.5 billion, 34% higher than the same period last year. Revenue growth was at 28% in the first half of the year to P18.4 billion driven by residential development revenues which rose by 27% on the back of strong growth in bookings from residential brands Ayala Land Premiere, Alveo and Avida. Demand for Ayala Land’s residential projects remained strong leading the company to increase the number of residential launches this year by 25% from its earlier planned launches at the start of this year. Ayala Land’s leasing business meanwhile grew by 7% year-on-year with shopping center, office leasing and hotel operations all contributing to overall revenue growth. Occupancy rates at Ayala Malls remained high while its office occupancy rate continued to improve with the increased absorption of BPO offices in step with the resurgence in the growth of the BPO sector.

BANKING
BPI’s net income in the second quarter grew by 17%, an improvement from the 5% year-on-year decline in the first quarter of this year. This put profits in the first semester to P5.6 billion, 5% higher than the same period last year. The bank’s core businesses remained strong with double-digit growth in loans and deposits. The bank’s total revenues rose by 4% in the first half with net interest income up by the same rate, mainly as a result of a 12% increase in its average asset base. Non-interest income increased marginally on account of lower securities trading gains compared to last year. Loan growth was strong across all segments indicative of the renewed business and consumer confidence. Net loans grew by 13% with large corporates posting a 13% growth, SMEs growing by 14%, and consumer loans up by 16%. The bank recently announced it is offering stock rights to existing eligible shareholders. The offer covers around 307 million common shares which will raise P10 billion. This will further strengthen the bank’s Tier 1 capital position and also enable it to support its growth strategy towards more aggressive customer acquisition, prudent lending, and deeper cross selling penetration.

TELECOM
Globe’s consolidated revenues were down 3% year-on-year in the first semester mainly due to lower mobile revenues. Mobile revenues declined by 9% in the first half consistent with the trends in the over-all industry and reflecting the impact of pricing pressures from an intense competitive environment. Broadband revenues, however, continued to grow with revenues up 89% year-on-year and is gaining market share. Fixed line data and fixed line voice revenues rose by 18% and 8% year-on-year, respectively. This resulted in reported net income of P5.1 billion in the first half of 2010, 30% lower year-on-year. Excluding all forex and mark-to-market charges, as well as one-off gains from last year’s equipment exchange transaction, Globe’s core net income was down 25% to P5.2 billion. Globe ended the period with a SIM base of 24.6 million, 3% higher versus last quarter and a total of 930,000 broadband subscribers, 145% higher than subscriber levels in the same period last year.

WATER DISTRIBUTION
Manila Water’s net income grew by 34% to nearly P2 billion in the first half of the year. The 14% decline in depreciation costs as a result of the renewal of the Concession Agreement partly drove the increase in net income. Revenues in the same period grew to P5.5 billion, 18% higher than the same period last year due to a 5% increase in billed volume, tariff adjustments and improved revenue contribution from the Laguna and Boracay concessions. Operating expenses increased at a much slower rate than revenues, which helped improve operating margins. Operating efficiencies remain high with non-revenue water continuing to decline to 13.5% and increasing the number of household water connections by 8% year-on-year.

ELECTRONICS MANUFACTURING
The electronics industry continues to improve along with the gradual recovery of the global economy. This led to an 11% growth in IMI’s revenues in the first half of the year as larger orders from its major customers in the storage device, telecom, automotive, and consumer electronics picked up driven by a rise in demand for their products. IMI’s net income in the first half of the year amounted to US$4.7 million inclusive of a one-time gain. Excluding gains this year and last year, IMI’s net income for the first semester was at US$2.8 million compared to a US$1.3 million loss in the same period last year.

AUTOMOTIVE
Ayala Automotive continued to benefit from the strong growth of the auto industry in the first half of the year. Ayala Auto’s revenues rose by 15% to P6.2 billion driven by an increase in the share of Ayala dealership network and the improved performance of its collateral business. This resulted in a net income growth of 80% to P172 million as of the end of the first half.

BUSINESS PROCESS OUTSOURCING
Liveit, Ayala’s holding company for its BPO investments delivered a net profit of P1.6B in the first half versus last year’s loss of P449M. This was due to the revaluation gain of P2.3B recognized in the second quarter, following the $50M investment in Integreon by Actis, a UK based leading emerging markets private equity firm, which diluted LiveIt’s ownership from 86% to 56%. The gain more than offset the first half operating net loss of P363M and net interest expense of P183M and validated LiveIt’s potential for value creation. With the proceeds of Actis’s investment, Integreon plans to grow its range of services and technologies, seek strategic acquisitions and launch new delivery centers, including a second site in the Philippines.

INTERNATIONAL REAL ESTATE
AG Holdings, the company’s vehicle for international investments, reported a loss of P1.8 billion due mainly to impairment provisions for certain real estate assets in North America given the sluggish state of real estate recovery in the U.S. This allows AG Holdings to focus more on its Asian portfolio which grew by 3% in terms of net asset value during the period.

Ayala chairman and CEO Jaime Augusto Zobel de Ayala said, “The development trends we see in various areas in the Philippines present opportunities for expansion and growth for each of our businesses. We consider our businesses well placed not only to capture these but also to expand their participation in the broader infrastructure space as we seek to contribute as a group to the country’s development agenda.”

The above statement pertains to the disclosure made to the PSE and SEC today, August 13, 2010, by Ayala chief finance officer Delfin C. Gonzalez, Jr.

Ayala companies earned seven of the 11 highest rankings of the Institute of Corporate Directors (ICD)’s Corporate Governance Scorecard Project for 2009.

Ranked in the Gold category were Ayala Corporation and its companies Ayala Land, Inc. (ALI), Bank of the Philippine Islands, Globe Telecom, Manila Water Company and ALI’s listed subsidiaries Cebu Holdings, Inc., and Cebu Property Ventures and Development Corporation, all of which scored 95% or above in the governance scorecard. ICD recognized companies that led its scorecard project on May 27 at Manila Peninsula.

A non-stock, non-profit organization, ICD works closely with the Organisation for Economic Co-Operation and Development (OECD), the Global Corporate Governance Forum, and the International Corporate Governance Network on improving actual boardroom practices in the Philippines. ICD is a founding member and permanent secretariat of the Institute of Directors in East Asia Network composed of representatives from Thailand, Indonesia, Singapore, China, Hong Kong, Philippines, South Korea, Taiwan, and Malaysia.

For the last five years, ICD’s corporate governance scorecard has been used by publicly listed companies as a tool to rate and benchmark their corporate governance practices relative to global and regional standards. The project is jointly administered with the Securities and Exchange Commission, the Philippine Stock Exchange, the Institute of Internal Auditors of the Philippines, the Ateneo Law School, and the Center for International Private Enterprise. In 2009, it developed separate scorecards for banks, government-owned and controlled corporations, government financial institutions, and insurance companies.

Led by the parent company, Ayala group companies assessed their own governance practices using ICD’s scorecard to evaluate their practices in the areas of shareholder rights, equitable treatment of shareholders, role of stakeholders in governance, disclosure and transparency, and board responsibilities—key governance principles used as basis for corporate governance practices globally.

In addition to the Ayala group, other companies cited in the Gold category were Energy Development Corporation, First Gen Corporation, First Philippines Holdings Corporation, and PLDT. Nineteen companies were cited in the Silver category for scoring 90 to 94% in the ICD scorecard, including Aboitiz companies, ABS-CBN Broadcasting, Alaska Milk, Benpres Holdings, Centro Escolar University, Chinabank, GMA Network, Highlands Prime, Panasonic Manufacturing Philippines, Petron, PSBank, Security Bank, Semirara Mining, SM companies, and Unionbank.

“We are very happy with the results as they show continued improvement in compliance and corporate governance practices among our listed companies,” said ICD chairman Dr. Jesus Estanislao. “The challenge is to step up to the plate, go beyond mere compliance and into governance that delivers performance and breakthrough results.” Estanislao said that the ICD is now working with select top-ranked companies on a corporate governance improvement pathway to help cultivate a governance culture in organizations through a performance governance system.

Ayala Corporation chairman and CEO Jaime Augusto Zobel de Ayala received the conglomerate’s Grand Chamber Award of Distinction from the Cebu Chamber of Commerce and Industry (CCCI) for its “exemplary and conscientious adoption of the principles of sustainable development in all its strategies, practices, and activities, as exemplified by its distinction as the first ever group of companies in the Philippines to issue a Global Reporting Initiative-compliant sustainability report in 2009.”

“I share this honor and recognition with the entire Ayala management team who altogether oversee the operations of each of our key businesses,” said Zobel in his acceptance speech. “They have all worked vigorously to realize our commitment to sustainability initiatives while ensuring that we remain competitive and relevant as an enterprise to our stockholders.”

Ayala was among the businesses that were recognized for business excellence at the 15th Grand Chamber Awards Night held on June 25 at Waterfront Cebu City Hotel. Other honorees were Benito Sy Gaisano (Entrepreneur of the Year), Edgar Sia II of Mang Inasal, Rey Calooy of RNC Marketing, Joy Martinez Onazawa of Environment Design, Peter and Susan Holaysan of Sta. Fe Resort, Wesley Chiongbian of Mynimo.com, USC Kapamilya Negosyo Na!, and Rey Merida of Amicha Toledo Multi-Purpose Cooperative.

The event was the highlight of the CCCI’s Visayas Area Business Conference. Cebu Governor Gwendolyn Garcia, PCCI chairman emeritus Miguel Varela, CCCI chairman Consul Samuel Chionson, and conference chairman and Cebu Holdings president Francis Monera led the representatives from the public and private sector in attendance.

In keeping with the theme of the Cebu Business Month 2010, “Get Inspired! Go Green,” Zobel’s remarks focused on the role of business in sustainable development. He enjoined colleagues in the private sector to “take on a broader responsibility to tackle environmental and social development issues with the same discipline and thinking we approach traditional business opportunities and be one in this sustainability journey.”

Ayala Corporation’s consolidated net income in 1Q10 reached P2.1 billion, at par with the P2.2 billion net earnings in the same period in 2009. Equity earnings from its business units rose by 6%, driven by higher equity earnings from its real estate unit Ayala Land, Inc. and a significant turnaround in equity earnings from AC Capital.

Equity earnings from Ayala Land rose by 31% year-on-year driven by the sustained recovery in the real estate sector. Ayala Land attained record-high quarterly net income of P1.2 billion in the first quarter, 32% higher than 1Q09 as it achieved record sales and bookings from its residential project launches. Its leasing portfolio likewise performed steadily with occupancy rate in its malls rising to 94% and occupied business process outsourcing office leasable area expanding by 20% from 4Q09 and by 59% from 1Q09.

All companies under Ayala’s AC Capital unit contributed to the turnaround. Manila Water, IMI, and Ayala Automotive posted substantial growth year-on-year, while AG Holdings and LiveIt recorded lower losses during the period. Combined equity earnings from AC Capital companies improved to P228 million in the first quarter, a turnaround from a P132 million loss in 1Q09.

Equity earnings from Manila Water grew by 78% as its net income rose by 35% to P839 million. Manila Water continued to grow within its concession area as well as in other areas in the Philippines. Revenues rose by 18% to P2.5 billion as a result of higher water sales volume and new service connections in the East Zone. Operating efficiency improved further with better supply and water pressure management and network enhancements. This reduced non-revenue water to 13.7% and kept the company’s service levels unaffected by the El Nino dry spell. The substantial growth in equity earnings was also due to Ayala’s increased ownership stake in the company following its purchase of United Utilities’ 11.6% interest. Manila Water continues to make headway in other parts of the country with operations running in Laguna and Boracay.

A recovery in the global electronics exports sector sustained IMI’s positive momentum. IMI posted earnings of US$3.2 million in 1Q10, reversing the loss in the same period last year. Sales grew by 11% driven by its Philippine and China operations. China operations contributed substantially, making up 58% of revenues. IMI continues to increase its presence in China as it becomes increasingly in the center of the global manufacturing industry. It opened its 6th manufacturing facility in Chengdu last April.

Ayala’s automotive dealerships delivered a 9% growth in unit sales, reflecting the country’s vibrant domestic consumption. This pushed Ayala’s dealership income up by 124% year-on-year as a result of higher vehicle sales, better service income, and improved income from collateral businesses.

Its business process outsourcing investment company, LiveIt, grew its share of investee company revenues to US$67 million in the first quarter, which represents 48% growth over last year, primarily as a result of the eTelecare-Stream merger and Integreon’s acquisitions of Onsite and Grail Research. Revenue growth and enhanced operating efficiencies resulted in a 23% increase in LiveIt’s share of investee company EBITDA to US$3.7 million. LiveIt’s consolidated net loss improved from last year’s Php306 million to this year’s P279 million, which includes acquisition related expenses of P131 million.

Ayala’s other core business units, Globe Telecom and Bank of the Philippine (BPI) Islands reported lower net earnings year-on-year. Globe’s reported net income declined by 26% in 1Q10 vs 1Q09 to P2.9 billion mainly due to the soft performance of the mobile business. Mobile revenues fell by 10% year-on-year and by 3% quarter-on-quarter as the mobile market was weighed down by intense competition and price pressures. Despite this, Globe sustained positive net additions in 1Q10, an improvement from the net reductions last year when the company deliberately recalibrated acquisition efforts. As a result, cumulative mobile subscribers increased by 3% year-to-date to 23.9 million. Recent programs that focused on acquiring new subscribers, stimulating usage, and rewarding loyal Globe customers helped stem the decline in the mobile business. Globe’s broadband business and corporate data business, however, grew at double-digit rate. Its broadband subscriber base nearly tripled from last year’s level driven by wireless broadband, which contributed over 80% of the net adds during the quarter.

Its banking unit, BPI, posted 1Q10 net income of P2.7 billion, 5% lower than same period last year, but remains substantially higher than earnings in the past three successive quarters. The bank’s revenues were steady at P9 billion despite the 54 basis point decline in net interest spreads and weaker trading profits. Compensating for the drop in spreads was an 11% improvement in the bank’s average asset base. Loan growth improved by 8% over the previous year with strong growth registered in the consumer and middle market. Middle market loans were up by 20%, credit card receivables up by 18%, and SME loans were up by 15%. Retail mortgages and auto loans grew by 13%. The bank’s total asset base increased by 8% versus last year with deposits growing by 8% to P558 billion.

Ayala chairman and CEO Jaime Augusto Zobel de Ayala commented, “We are pleased with the trend in earnings performance of the business units, particularly in comparison to the past three quarters. The continued and steady improvement reflects the sustained recovery in the domestic market. We remain confident this trend will continue to improve moving forward in step with the economy and the improving pace of domestic consumption.”

This press statement refers to the disclosure submitted today, May 14, 2010, to the Securities and Exchange Commission and the Philippine Stock Exchange.

FinanceAsia’s 10th annual poll of Asia’s top companies cited Ayala Corporation as the best managed company in the Philippines and Jaime Augusto Zobel de Ayala and Ernest Cu as the country’s best chief executive officers.

In addition to the outstanding overall performance in this year’s survey, Ayala led Philippine companies for “Best Corporate Governance” and “Best Corporate Social Responsibility.” It placed second for “Best Investor Relations” and third in the category “Most Committed to a Strong Dividend Policy.”

Ayala subsidiaries Globe Telecom, Manila Water, and Ayala Land ranked in second, third, and eighth place, respectively, among the Philippines’ best managed companies. Together with Bank of the Philippine Islands, these companies also figured prominently in the four categories. Moreover, Manila Water received the nod for best mid-capitalization company and Cebu Property Ventures and Development Corporation was best small-cap company.

Albert de Larrazabal of Globe and Chito Oreta of Manila Water were named best chief finance officers in the Philippines.

The FinanceAsia poll was conducted among more than 300 investors and analysts across the region. Other companies that made it to the list of best managed companies in the Philippines were PLDT, San Miguel, Aboitiz Power, SM Prime Holdings, SM Investments Corp, Jollibee Foods, and Aboitiz Equity Ventures. Results of the poll were published online on April 29, 2010, at www.financeasia.com.

In a disclosure to the Philippine Stock Exchange, Securities and Exchange Commission, and the Philippine Trading and Exchange Commission (PDex), Ayala Corporation treasurer Ramon G. Opulencia said that Ayala’s application to list its P10 Billion Fixed Rate Putable Bonds (7.20%) Due 2017 for trading on the PDex has been approved effective April 30, 2010.

“The listing of the bonds shall widen the reach of price discovery and transparency for the Ayala issue and enables participation across all markets on PDex. The trading and settlement of the bonds shall be in accordance with the PDex rules,” explained Opulencia.