Is ABS-CBN 137% correct but 100% wrong?

Emeterio Sd. Perez

Emeterio Sd. Perez

OWNERSHIP PROFILE. Here is how the Lopez-controlled ABS-CBN Corp. computed the company’s public ownership, which, as a rule, should not be less than 10 percent of outstanding shares.

In a public ownership filing posted on the website of the Philippine Stock Exchange, ABS-CBN listed two significant stockholders:

Lopez Inc., which is the holding company of the Lopezes, owns 446.223 million shares, or 57.24 percent, making it the majority stockholder. ABS-CBN Holdings Corp. and ABS-CBN Foundation Inc. hold 325.809 million shares, or 33.97 percent, and 780,995 shares, or 0.09 percent, respectively.

In computing how many shares the public owns, ABS-CBN divided the ownership between non-public—774.147 million shares, and public—423.785 million shares, or 48.59 percent. Ironically, it presented only the percentage equivalent of publicly owned but forgot that of the non-public shares.

BAFFLING NUMBERS. Where did ABS-CBN get those numbers to make it appear that it is compliant with the 10-percent-minimum public ownership rule that governs listed companies?

In the first place, the ownership report as of June 30, 2014 even had the holdings of Lopez Inc. and ABS-CBN Holdings Corp. added up, resulting in a sum of 772.040 million shares, which, the filing showed were equivalent to 91.21 percent “of total outstanding shares.”

If you are among the public who trade ABS-CBN shares, you would do your own computation by dividing 772.040 million, which in Mathematics is the dividend, by 850.999 million, which is the divisor and which the filing showed as “outstanding shares” and you would come up with 90.722 percent.

WRONG COMPUTATION? If you would be more curious as to ABS-CBN’s divisor, then you would divide 772.040 million by 91.21 percent (772.040 divided by 0.9121) and your answer, or quotient would be 846.442 million, which did not merit even a tiny space in the filing.

Reread the public ownership report filed by ABS-CBN and try to decipher and interpret what it meant by 774.147 million shares as non-public and 423.785 million as “owned by the public.” Then add the numbers and your sum would be 1.198 billion shares, topping its 850.999 million issued shares by 346.933 million shares, or by 40.768 percent.

Perhaps, ABS-CBN people can justify the numbers that they had used in presenting the percentage of public ownership of the company’s outstanding common shares. Only they can explain their computation or series of computations that made it appear that close to 50 percent, or 48.59 percent, of outstanding common shares are held by the public.

WRONG AGAIN. ABS-CBN Corp. filed on Aug. 20 an amended public ownership report, which was even worse than the one it posted on the PSE website on July 15.

In what should have been a corrected version, ABS-CBN said Lopez Inc. and ABS-CBN Holdings Corp. owned a total of 806.743 million shares, or 92.51 percent, with the remaining 44.257 million shares, or 7.49 percent, owned by the public.

Again, ABS-CBN was wrong because its addition resulted in the two major stockholders owning a total of 806.743 million shares, which was correct, but the sum did not represent 92.51 percent of 850.999 million outstanding shares but more.

The percentage equivalent when recomputed should have been 94.799 percent or 94.8 percent, which would have left the public with 44.256 million shares, or 5.2 percent.

BIGGER ERROR. In summarizing its public ownership report, ABS-CBN either knowingly omitted or failed to include its outstanding shares. Instead, as it did in the earlier filing, it posted the following: number of listed common shares, 872,122,352; total number of non-public shares, 808,932,780; total number of shares owned by the public, 388,999,662.

From the number of shares owned by the public, it concluded that ABS-CBN’s “public ownership percentage” was 44.60 percent, which resulted from 388,999,662 over 872,122,352 equals 44.603 percent. This is good enough for the public to appreciate because the division was correct.

But here is a big ‘why?’ Why didn’t ABS-CBN disclose to the public the percentage equivalent of 808,932,780 non-public shares? Probably, its people were afraid that 92.754 percent would be questionable: A total of 1,197,932,442 non-public and public shares would exceed the number of listed shares by 325,810,090 shares.

Why not add 92.754 percent and 44.60 percent? When has the whole been 137.354 percent? Should it not always be 100 percent?

By the way, ABS-CBN had 1.30 billion authorized common shares as of Dec. 31, 2013. As of Sept. 24, it had already issued 872.124 million, leaving the company with 427.876 million available for sale or for declaration as stock dividend.


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  1. their report seems really confusing. at first glance it seems total public ownership is really less than 10%, or total shares issues is more than what is allowed. isnt this a violation of PSE rules?
    if you check further through their top100 stockholders report, it seems out of the declared public ownership of 44.6%(or 46.624% based on june30 report), 30.725% was owned by ABS CBN holdings which they considered as part of public ownership.They only considered the shares owned by Lopez Inc. as private.
    I do not understand why they did it like this but basing on this report total shares would be correct at 872,123,642
    checking back with the public ownership report they listed lopez inc and abs-cbn holdings corp as “substantial sotckholders” not private stockholders. maybe its this wording that makes the report confusing when they say public ownership is 44.60%

  2. Anima A. Agrava on

    Thanks for your corporate filing assessments and analyses, Mr. Perez. You do the Filipinos investing in the stockmarket a great service. Which means you do a great service to our country.

  3. I am not an Accountant or fin ace guy – so my question to the data presented is simple. What does it all mean – is there corruption through tax avoidance and dividend payment cheating to the poor 10% share owners?