Is JFC more public than others?


Emeterio Sd. Perez

JOLLIBEE Foods Corp. (JFC) said so in a public ownership report (POR) as of Dec. 31, 2016, which showed its public stockholders holding 459.423 million common shares, equivalent to 42.73 percent of 1.075 billion outstanding common shares.

By a simple process of subtraction—1,075,083,542 outstanding common shares minus 459,422,793—JFC’s principal stockholders and related companies held the remaining 615,660,749 common shares, or 57.27 percent of the outstanding shares.

The division of ownership between insiders, who are the principal stockholders and their affiliates, and the public investors could have been justifiable had Jollibee based the composition of its nine-person board on ownership.

Jollibee did not. Instead, as the majority stockholders, businessman Tony Tan Caktiong and his family elect every year all seven regular directors and appoint two independent directors.

Foreign funds

Oppenheimer Funds Inc. (OFI) of 225 Liberty Street, New York, NY is among JFC’s public stockholders. As of March 6, it owned 53.777 million common shares, or 4.99 percent of 1.077 billion outstanding common shares of Jollibee Foods Corp.

In a letter dated March 8 to JFC, with a copy furnished each of the Securities and Exchange Commission and the Philippine Stock Exchange, OFI said as “an investment adviser registered under the US Investment Advisers Act of 1940, it provides investment advice to various mutual funds and other accounts (OFI clients).”

“The shares of the company are held by OFI on behalf of various OFI clients only for investment purposes,” OFI said.

The letter was posted as a “report by owner of more than five percent” on March 9 on the PSE website, when the percent equivalent of OFI-held JFC common shares was only 4.99.

OFI also assured JFC it was investing in the food company’s common shares for investment purposes only and not “to exercise control over the company.”

At JFC’s last traded price of P182.10 on Monday, OFI had paper wealth of P9.793 million. It last received a dividend of P1 per share on Dec. 12, 2016.

A and B shares

Cebu Property Ventures and Development Corp., which belongs to the group of companies owned by the Zobels, (CPVDC) is one listed company that still divides its capital stock into A and B shares.

In an audited financial report, CPVDC reported authorized capital stock of 940.35 million shares, of which 564.210 million are Class A common shares and 376.14 million Class B common shares. Both classes of shares have par value of P1 each.

All 940.35 million Class A and Class B shares are outstanding, according to a CBVDC filing.

An ownership posting listed Cebu Holdings Inc. as CPVDC’s biggest stockholder, with 717.064 million shares, or 76.26 percent—439.388 million Class A shares and 277.676 million Class B shares. It credited the province of Cebu with 77.865 million shares, or 8.28 percent—65.281 million Class A shares and 12.585 million Class B shares. Ayala Land Inc., a subsidiary of Ayala Corp., holds 73.342 million shares, or 7.80 percent—9.99999 million Class A shares and 63.342 million Class B shares.

The classification of capital stock of listed companies into A and B shares was intended to strictly monitor compliance with the 60-40-percent ownership provision of the Constitution in favor of Filipinos. This was abolished by the SEC, then under the chairmanship of lawyer Perfecto R. Yasay Jr.

Pays and perks

Phoenix Semiconductor Philippines Corp. is a subsidiary of SFA Semicon Co. Ltd. of Korea, which owns 1.840 billion Phoenix common shares, or 85 percent. Other foreigners hold 23.786 million shares, or 1.1 percent.

This year, Phoenix said it may increase from P37.414 million (salaries, P29,219,224; bonuses; P8,197,849) in 2016 the compensation of its top five executives this year to P56,125,610 (salaries, P43,828,836; and bonus and other salaries, P12,296,774.)

Apparently, Phoenix adjusted the group’s estimated compensation to make up for last year’s drastic reduction by P14,217,649, or 27.535 percent, from P51,634,722 (salaries, P41,549,704; bonuses, P10,085,019 in 2015.)
In the same compensation filing, Phoenix projected the compensation of “all other officers and directors as a group unnamed” at P44,725,651 in 2017, up from P42,595,858 in 2016 but down from P52,480,339 in 2015.
Isn’t it ironic that while Phoenix uses the US dollar as functional currency in its financial filings, it pays its executives in peso?


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