Benpres loses P841M in 9 mos on lower earnings, forex losses

Benpres Holdings Corp., the investment holding firm of the Lopez family, incurred a net loss of P841 million in the first nine months of the year, largely due to foreign exchange losses and lower net earnings of subsidiaries.

In a financial report filed with the Philippine Stock Exchange, Benpres said the 14 percent increase in consolidated revenues was offset by the 89 percent drop in equity in net earnings of investees from P2.21 billion to P251 million. First Philippine Holdings Corp. incurred a P272 million net loss, a reversal of the P3.79-billion profit reported a year earlier.

The depreciation of the peso to 47.05 to a dollar in September 2008 from 41.28 in December last year resulted to a loss of P1.27 billion, Benpres said.

Provisions for losses fell seven percent to P104 million from P112 million due to lower debt related advances. Interest and other expenses-net declined eight percent due to lower interest rates.

Other income jumped 120 percent, mainly from the P178 million gain on the sale of its stake in Medical City in April 2008. In addition, there were gains during the period from the buyback of certain debt at 40 percent discount.

Media conglomerate ABS-CBN Broadcasting Corp., the crown jewel of the Lopez Group of Companies, reported a nine percent rise in net profit to P1.2 billion. Similarly, earnings before interest, taxes, depreciation, and amortization (EBITDA) went up 12 percent to P4.43 billion, for an EBITDA margin of 27 percent.

Consolidated revenues rose 15 percent to P16.54 billion largely driven by sale of services, which jumped 61 percent year-on-year due to the consolidation of SkyCable’s revenues in ABS-CBN as well as the continued subscriber growth of ABS-CBN Global.

Telecommunications unit Bayan Telecommunications Inc., on the other hand, incurred a net loss of P2.57 billion as against the P595 million income reported the same period a year ago. This is mainly due to the foreign exchange loss amounting to P2.482 million this year compared to recognized foreign exchange gains last year of P625 million. Benpres’ investment in Bayan have been fully written off. Thus, Benpres does not equitize income or loss from Bayan.

First Philippine Infrastructure, Inc. (FPII), meanwhile, posted a net income of P506 million, down 55 percent from P1.128 billion last year, mainly due to lower revenues and a foreign exchange loss this year after posting a foreign exchange gain last year. 

Revenues for the period were lower from the year ago level due to the four percent decrease in average daily traffic as fuel prices increased 32 percent. In addition, toll rates were reduced by an average of three percent beginning July 2008.

Property developer Rockwell Land Corp. continued to be strong with net earnings growing 26 percent to P477 million on the back of a nine percent gain in revenues from sales of One Rockwell residential condominium project.

Cash and cash equivalents jumped 49 percent to P4.42 billion from the end-2007 level due to the sale of Medical City in April 2008, as well as dividends received by Benpres during the first nine months of 2008. This primarily accounted for the 22 percent hike in total current assets and the 14 percent increase in total assets.

In November 2007, Benpres and parent firm Lopez Inc., purchased $43 million worth of debt held by Asian Infrastructure Fund, of which they are co-obligors. They also purchased debt from various bond holders holding a total face value of P385 million. The debt was purchased for P234 million or at 60 percent of the principal amount of debt including capitalized interest.