First Holdings scores P738-M paper gain

Emeterio Sd. Perez

Emeterio Sd. Perez

ON Jan 21, 2015, First Philippine Holdings Corp. (FPHC) bought 196.751 million additional FGen shares at P25.25 each. The acquisition, which included treasury shares, increased FPHC’s stake in the subsidiary to 2.425 billion shares, or 66.24 percent.

FGen had unloaded 279.407 million treasury shares, of which 179.128 million went to FPHC and 100.279 million to other investors. In addition, it also issued FPHC 17.623 million new FGen shares.

As of Monday’s trade, FGen shares were up P3.75 apiece for a total paper gain of P737.816 million.

The sale of treasury shares raised the number of FGen’s outstanding shares to 3.643 billion.

As of Sept 30, 2014, FGen had 331.031 million treasury valued at $72.239 million, or $0.218 per share. At P44 to a dollar, this translates to P9.602 per share, which would mean a buyback cost of P3.179 billion against current market value of P9.60 billion at P29 per share.

Executive compensation
Holcim Philippines Inc. played it safe in making an estimate of the pays and perks of its “chief executive officer and four most highly compensated executive officers” this year by adopting the amounts it paid them in 2014.

As disclosed, Holcim said last year it paid the group P69.852 million divided into P52.136 million in salaries; P16.111 million in bonuses; and P1.605 million in benefits.

Holcim paid the group P94.162 million in 2013 by giving them much bigger benefits totaling P24.50 million. It also said it raised their salaries to P57.40 million, which more than compensated for the decline in the group’s bonus to P12.261 million.

The company paid “other officers and directors as a group P57.029 million in salaries, P10.553 million in bonuses and P15.078 million in benefits in 2013; the following year, it paid P45.025 million in salaries, P10.199 million in bonuses and P23.915 million in benefits, the same amounts it said it would pay the executives this year.

Generous company
IF the five highest paid executives of First Gen Corp. received salaries of P133.245 million and bonuses of P40.686 million each (for an aggregate bonus of P203.431 million) in 2013, the public should have long been guessing how much in perks the group got in 2014 pending the filing of the company’s annual report.

As it estimated, FGen placed the bonus of its five top executives at P116.565 million, or P23.313 million each last year, for a huge “loss” of P17.373 million for the group, or P3.475 million each compared with what they got in 2013.

In 2012, FGen paid Federico Lopez, chairman and chief executive officer, and four others a group salary of P97.291 million and a bonus of P107.063 million.

In the same compensation filing, FGen said it paid all “other officers and directors as a group unnamed” a salary of P192.527 million and a bonus of P212.933 million in 2012; and a salary of P273.846 million and a bonus of P320.949 million in 2013. It estimated the group’s salary in 2014 at P310.928 million and its bonus at P258.495 million.

Ayala charter change
As provided for in Section 1, Article VII of the by-laws of Ayala Corp. (AC), the allocation for management bonuses taken from net income before taxes should be recommended by the board of directors and submitted for approval “at the next General Meeting of the stockholders of the Corporation.”

This provision has changed. AC’s board has amended its bylaws so that it now provides that “net taxes shall be distributed as follows: a. An amount for management bonus to be recommended by the compensation committee of the board of directors and approved by the board of directors.”

As the amendment shows, AC has shortened the approving process of the management bonus by omitting the approval of the stockholders at the general meeting.


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