• Sy Sr. is family’s ‘poorest billionaire’

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    EMETERIO SD. PEREZ

    EMETERIO SD. PEREZ

    “AS of December 31, 2015,” SM Investments Corp. (SMIC) said in a filing, “the group had about 94,516 direct employees.” Of the total workforce, it said in the same posting, “the parent company had 355 regular employees as of the same period.” Then it followed this with a revelation that its 355 employees “are not subject to any Collective Bargaining Agreements (CBA).”

    SM Investments did not say anything about the regularization of the rest of the group’s workers or if it hired them by groups last year with each group good only for five month.

    Perhaps, among the group’s 94,516 direct employees are SMIC’s five highest paid executives, namely, Harley T. Sy, president; Jose T. Sio, EVP and CFO; Elizabeth Anne C. Uychaco, SVP-corporate services; Franklin C. Gomez, SVP-finance; and Frederic C. Dybuncio, EVP-investment portfolio.

    As a group, they received P69-million salary, P12-million bonus, and P4 million other compensation in 2014. In 2015, they were paid P77 million, P13 million and P3 million. This year, SMIC estimated their salary at P85 million, bonus at P14 million, and other pays and perks at P4 million.

    Capital profile

    SM Investments held its annual stockholders’ meeting on April 26. It has nine items listed under the heading “agenda” but none of them has anything to do with workers’ pay increases. Instead, it took up the payment of stock dividend, which the board approved on March 2.

    As in the past, the agenda included the “ratification of the acts of the board of directors”
    which approved the declaration of a 50-percent stock dividend and an increase in authorized capital to P28 billion from P12 billion.

    The capital expansion is intended to accommodate the 50-percent stock dividend which will increase SMIC’s outstanding common shares to 8.705 billion.

    As the listed holding company of businessman Henry Sy Sr. and his family, SMIC has 803,055,405 outstanding common shares, which are owned by 1,243 stockholders, or an average of 646,062.27 shares each. At SMIC’s last traded price of P927.50, each stockholder had paper wealth P599.223 million.

    Based on a public ownership report as of April 13, SMIC’s stockholders outside Sy group are even much richer. As holders of 370.748 million shares, they control 46.17 percent of the company, a significant ownership that is not reflected by their membership in the board.

    Unluckily for SMIC’s Filipino stockholders, 269.537 million, or 33.56 percent of the publicly held shares belong to foreigners, leaving them with 101.211 million, or 12.603 percent. (Note: The resulting percentage does not tally because of the rounding off of numbers.)

    Billion-peso paper wealth

    While businessman Henry Sy Sr. is the family patriarch and SMIC founder, he is no longer the biggest stockholder of the company. In the listing, he is credited only with 3.18 million SMIC shares, an ownership that does not qualify him for inclusion in the list of stockholders with 5 percent or more holdings.

    The children, who own 352.727 million shares, or 43.923 percent, have replaced the father. They are Teresita, with 57.085 million SMIC shares, or 7.11 percent; Harley, 58.528 million shares, or 7.29 percent; Henry Jr., 58.46 million shares, or 7.28 percent; Hans, 65.97 million shares, or 8.21 percent; Herbert, 65.96 million shares, or 8.21 percent; and Elizabeth, 46.723 million shares, or 5.82 percent.

    Computed at P927.50, the paper wealth of Sy’s six children totaled P327.154 billion. Individually, Teresita has a paper wealth of P52.947 billion; Harley, P54.285 billion; Henry Jr., P54.222 billion; Hans, P61.187 billion; Herbert, P61.178 billion; and Elizabeth, P43.336 billion.

    Henry the father is also a billionaire going by his holdings of 3.18 million SMIC shares. At P927.50 each, he is still very rich with his paper wealth of P2.949 billion but which makes him the poorest in the family.

    Dividend

    On May 28, SMIC will pay its stockholders P10.63 per share dividend, for a total of P8.536 billion of which P3.749 billion will go to the Sy children due to their 352.727 million shares equivalent to 43.923 percent of outstanding.

    The dividend will be sourced from SMIC’s retained earnings, which, as of Dec. 31, 2015, totaled P188.005 billion of which P36 billion is classified under “appropriated.” The “appropriated” amount, according to the company filing, will be used for debt servicing as follows: P18.8 billion in 2017, and P8.2 billion in 2018, and new investments of P9 billion from 2016 to 2020.

    In its 2015 consolidated annual report, SMIC reported three-year net profits of P117.462 billion – P40.333 billion in 2015, P38.891 billion in 2014, and P38.239 billion in 2013.

    SMIC’s three-year net profits resulted from P826.073 billion revenues – P295.978 billion in 2015, P276.615 billion in 2014, and P253.58 billion in 2013.

    In 2015, SMIC distributed a P10.61 per share dividend which it paid on June 9, 2015. The dividend totaled P8.52 billion of which 43.923 percent, or P352.726 billion went to the Sy children.

    esdperez@gmail.com.

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