Abacus Consolidated eyes P500-million net profit for this year

MANILA, Philippines - Publicly-listed Abacus Consolidated Resources & Holdings Inc. is looking to end the year with a net profit of P500 million, up 7.5 percent from 2009.

In a disclosure to the Philippine Stock Exchange, ACRHI said the projected net income is equivalent to a basic earnings per share of P0.23, a slight increase from last year’s P0.21.

ACRHI said P40 million will consist of current income principally from share in net earnings and dividend income from Pacific Online Systems Corp. and gain on sale of Pacific Online shares and P460 million from gain on revaluation of real properties, net of deferred tax.

As of September this year, the company holds an 18.83 percent interest in Pacific Online, the exclusive online lottery systems provider in Visayas and Mindanao.

In the same meeting, the board authorized the execution of a second amended deed of exchange covering the issuance by ACRHI of 654.53 million new shares in favor of Blue Stock Development Holdings Inc. in exchange for the acquisition of two of BSDHI’s fully-owned subsidiaries Kapuluan Properties Inc. and Vantage Realty Corp.

In the second amendment to the deed of exchange, an updated valuation of KPI and VRC shares will be used in order to comply with the Securities and Exchange Commission’s valuation standards.

ACRHI is considering filing a request for reconsideration on the rejection by the Philippine National Oil Co. (PNOC) of its unsolicited proposal to develop the 100-kilometer natural gas pipeline project from Batangas to Manila.

It is also considering participating in the bidding for the project in case it comes earlier.

ACRHI said there have been discussions with PNOC on its unsolicited proposal for the joint venture with foreign entities. It explained that by May 2010, the company was of the view that it was not the opportune time to complete the discussions as well as the submissions that were being requested, in view of the national elections and the imminent changes in incumbent government officials.

Aside from this, ACRHI has submitted a P60-billion unsolicited proposal to develop the Laiban Dam as an alternative source of water for Metro Manila’s households. The joint venture proposal, which was offered to Metropolitan Waterworks and Sewerage System, involves the construction of the Laiban Dam in Tanay, Rizal to supply Metro Manila around 1.9 billion liters of water per day and supply the irrigation requirements of the agricultural sector of neighboring areas.

ACRHI also plans to build a 30-megawatt hydropower plant to alleviate the projected water supply shortage for the Luzon grid, which is expected to incur a supply deficit of 3,000 megawatts by 2013.          

The proposed project also involves low-cost housing for families to be displaced by the construction of the dam, which will be completed within 60 months from start of construction.

ACRHI, which is owned by a group of businessmen led by Hermilando Mandanas, has tapped Sinohydro Corp. Ltd. of China as its partner for the Laiban Dam project, a pro-government initiative that seeks to prepare for the inevitable deterioration of the only water source for Metro Manila - the Angat Dam.

Sinohydro is a company registered in the People’s Repubic of China mainly engaged in water conservation and hydropower industries, building, civil infrastructure, mechanical and electrical plant manufacturing and installation. It has been the backbone of China’s efforts to harness and develop rivers accounting for 70 percent of China’s water conservation canal and irrigation water treatment and water supply projects.