Subic-Clark’s 11% GDP contribution cited

The Subic Bay Freeport and the Clark Freeport Zone in Pampanga remain to be major contributors to the country’s economic development, as their combined export values last year provided about 11 percent of the country’s gross domestic product (GDP).

In a report to Subic Bay Metropolitan Authority (SBMA) Chairman Roberto Garcia, SBMA acting deputy administrator for business group Ronnie Yambao said that the contribution of the two neighboring special economic zones to the Philippine GDP was between 10 and 11 percent.

“Clark's and Subic’s combined export value last year of US$6 Billion is very significant to the gross regional domestic product (GRDP), which contributed 11 percent to our GDP,” said Yambao.

Yambao added that according to a report from the International Monetary Fund (IMF), the Philippine GDP’s growth rate remained at 6.1 percent as of 2014.

Referring to the updated World Economic Outlook, Yambao also said that the IMF sees the Philippines to still become the fastest-growing economy in Southeast Asia this year after it was able to maintain its 6.1 percent GDP, outpacing Vietnam and Indonesia.

For Subic, Yambao said that among the major growth contributors is the South Korean shipbuilder Hanjin Heavy Industries Corporation (HHIC), which now has 29,000 direct workers.

“For this year, Hanjin is projecting to complete at least 17 ships worth over US$1.6 billion. This would mean hiring additional workers,” Yambao said.

Meanwhile, Yambao also named five new investment projects that the SBMA Board of Directors has approved this year. These include Harbor Star Subic Corp., which proposed a US$4.5-million investment for marine-related ancillary service operation, such as harbor assist, towage, oil spill, and underwater services.

Another project, Nanofixit Ventures Inc., will open a $5.32-million rebottling and packaging company for water-based liquid screen protector, while Subic Superfood Inc. will infuse $920,000 for a food processing plant that will use local pili nuts from the Bicol Region and Himalayan salt for the manufacture of so-called “super foods.” (RAV/MPD-SBMA)

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SBMA commended for its financial and investment gains

The Regional Development Council of Region 3 (RDC 3) recently cited the Subic Bay Metropolitan Authority (SBMA) for the financial and investment strides it had achieved in the past three years.

In a resolution passed by the RDC 3 last January, the council commended the SBMA for “the financial viability of the authority, improving the collection of customs duties and other taxes, as well as increasing investment commitments within the Freeport and Special Economic Zone, and for optimizing container traffic at Subic Port”.

According to the same resolution, “SBMA was able to restore the financial viability of the authority by posting annual net incomes ranging from Php0.8 billion to Php1.3 billion from 2012 to 2014, a complete turnaround from the negative income streams ranging from Php0.2 billion for six (6) consecutive years starting 2006 to 2011”.

SBMA chairman and administrator Roberto V. Garcia recently reported that SBMA hit new record highs in its 2014 financial performance, as it scored a net income of P1.6 billion vs. its 2013 income of P1.1 billion for a substantial increase of 40 per cent.

The RDC 3, which serves as the counterpart of the National Economic and Development Authority (NEDA) Board at the sub-national level in Region 3, likewise noted in its resolution that the SBMA’s implementation of various trade facilitation measures and innovations in systems and procedures had boosted the collection of customs duties and other taxes.

Through these actions by SBMA, “...the collection of customs duties and other taxes in within SBF-SEZ increased dramatically from Php7.2 billion in 2011 to Php16.8 billion that corresponds to 233 percent growth”, the RDC 3 said.

The NEDA regional office likewise cited the Subic agency for maximizing container port traffic in the Subic port and for initiating ”business process improvements and promotion activities that boosted investment commitments fromPhp3.6 billion in 2-13 to Php9.7 billion in 2014”.

Due to the renewed business and manufacturing climate in the Freeport, the RDC 3 said that the gross revenue share of affected local government units correspondingly increased by 40 percent, from PhP145 milllion in 2011 to PhP203 million in 2014.

Garcia welcomed the RDC 3’s commendation and assurance of full support to SBMA’s development efforts geared toward making Central Luzon a leading regional transhipment and global gateway.

“The Agency’s sterling three-year record performance could be attributed to good governance, the implementation of its strategic initiatives, and the hard work of the Agency’s management and employees,” Garcia said. (AMF/CorComm/MPD-SBMA)

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SBMA 2014 record income up 40%

For the third consecutive year, the Subic Bay Metropolitan Authority (SBMA) hit new record highs in its 2014 financial performance, as it scored a net income of P1.556 billion vs the 2013 income ofP1.11 billion, a substantial increase of 40%.

“Revenues from port operations, tourism and industrial commercial leases rose to P2.442 billion or 21% vs 2013 figures, while EBITDA or operating profit hit P1.391 billion or 51% over the previous year,” SBMA Chairman and Administrator Roberto V. Garcia announced recently.

With the port congestion in Manila, many importers shifted to Subic, causing port revenues to hit P909 million or an increase of 45%. Significantly, containerized volumes jumped to 77,000 TEUs or an increase of 105%. Locator export volumes likewise increased to U$2.3 billion or a 59% increase from the previous year.

Tourism likewise registered substantial revenue gains with a substantial 61% jump driven by a 12% hike in tourist traffic. MICE events (Meetings, Incentives, Conventions and Exhibitions) chalked up an increase of 150% while sports events rose 75% to make Subic Bay the number one tourist destination in Central Luzon according to DOT records.

Industrial and commercial leases likewise hit P1.050 billion, up 13% from previous years, as more businesses flocked to the Freeport. These and other expansion projects of existing locators caused jobs to increase from 89,584 in 2013 to 96,958 in 2014, providing 7,374 new jobs or an increase of 8%.

Reflecting the Agency’s robust growth on all fronts are the cash collections of the Bureau of Internal Revenue’s P1.8 billion and the Bureau of Customs’ P15.290 billion, which improved by 27% and 36% respectively in 2014.

Lastly, the 5% tax collected from locators in the Freeport rose to P497 million, or a 35% increase over 2013. SBMA remitted this amount with P199 million going to the eight local government units surrounding the Freeport, while P298 million was remitted to the National Government Treasury. The total contribution of SBMA to the national economy therefore amounted to P17.638 billion.

According to Garcia, the agency’s sterling three-year record performance could be attributed to good governance, the implementation of its strategic initiatives, and the hard work of the agency’s management and employees. (KMF/CorCom-SBMA)

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Bright outlook for Subic all the way to 2016

The stability of the SBMA (Subic Bay Metropolitan Authority) and its unyielding performance, coupled with the current business in-flow in the Freeport will definitely create a strong economic surge in the Freeport Zone in 2015 and in 2016.

This was the prediction of Subic Bay Freeport Chamber of Commerce (SBFCC) President Rose Baldeo during the Subic Bay Outlook Towards 2016 Economic Employment Summit held at the Olongapo City Convention Center last week.


The prediction Baldeo made was based on SBMA’s accomplishment of besting 2012’s net profit record of P824 million with last year’s P1.2-billion net profit, highest in the entire 21 years of existence.

SBMA Chairman Roberto Garcia also stated that the agency’s gross revenue last year of P2.09 billion and the Earnings Before Interest Taxes Depreciation Amortization (EBITDA) of P992 million are the highest levels in the history of the SBMA.

Garcia also pointed out the increase in port traffic as this Subic Freeport became the alternative port for Manila, thanks to Executive Order 172. Garcia said that Subic’s cargo volume is expected to hit more than 70,000 TEUs this year from 38,000 TEUs last year.

Nippon Yusen Kaisha (NYK) Line made its first direct call at the Subic Port to help solve the current concerns in Manila. According to NYK Manager Mary Grace Golez, the Subic call is marked by many firsts, opening more opportunities for Philippine shipping.

“This will be the first service in the Philippines to make a direct call from Japan to Subic, in addition to the regular Taiwan-Subic call. It will also be the first service to call from Subic to Singapore, a major transshipment port providing numerous connections to East Asia, the Middle East, South Asia, Europe, Africa, North America, Australia and New Zealand ports,” she said.

Baldeo said, “Outlook-wise, we as locators and investors are beginning to feel the change of the business climate in the Subic Bay Freeport. Slowly and steadily, the SBMA has begun to adjust to the needs of its investors businesses.”

“But these positive outlooks require a great cooperation; we the locators see the need for an improved working relationship or partnership with the local governments, the educational institutions, the SBMA, and other concerned government agencies including the local businesses in the city and in the nearby provinces,” she said.

To help entice more shipping lines to use Subic, the SBMA cut its port fees starting October 1, even if this would result in losses of about $10 million to $15 million for the state agency. (Jonas Reyes, Manila Bulletin)

PHOTO:
SUBIC SHIPPING SHAPES UP — A truck hauls off a cargo container from the ‘M/V Jakarta Tower,’ a cargo vessel chartered by the Nippon Yusen Kaisha (NYK) Line, after docking at the NCT-1 of Subic Bay Freeport. The NYK Line made its first direct call at the Subic Port to help solve the current concerns in Manila.

http://www.mb.com.ph/bright-outlook-for-subic-all-the-way-to-2016/

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SBMA net operating income up by 66%

The Subic Bay Metropolitan Authority (SBMA) is confident of breaking its record operating profit established last year, as the agency’s net operating income increased by 66 percent as of last August.

SBMA chairman Roberto Garcia announced this during the flag ceremony early this week, adding that the agency’s earnings before interest, tax, depreciation and amortization (EBITDA) or net operating income this year would likely surpass last year’s level.

“The performance of the agency continues to be very strong. As of August, our revenues are up by 22 per cent from the same period last year and expenses are down by 16 per cent,” Garcia announced.

“The good news is that our operating revenue, which is really the measure of the efficiency and effectiveness of the strategic initiative that we have launched, has gone up, raising our net operating income by 66 percent,” he added.

Garcia explained that the 66 per cent increase in net operating income was derived from the P385 million increase this year on top of last year’s P580 million.

He further said that as of August last year, operating revenue was at P1.3 billion, and less operating expenses worth P720 million resulted in a P580-million net operating income.

“Meanwhile, this year’s operating revenue increased by 21 per cent to P1.57 billion, and minus the operating expenses worth P607 million, or a 16 per cent decrease, would result to a P965-million net operating income, or 66 percent more spending power and fiscal flexibility in our financial management efforts,” Garcia said.

In 2013, the SBMA shattered its all-time record after posting P1.2 billion in net profit, along with the highest gross revenue of P2.1 billion and the highest EBITDA of P992 million in the 21-year history of the Subic agency.

Garcia said the SBMA is now further improving its financial condition to develop facilities here and attract more investments in the Subic Bay Freeport Zone, as well as improving employment security of the agency’s workers. (RFD/MPD-SBMA)

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SBMA projects P1.17 billion in net earnings for 2014

The Subic Bay Metropolitan Authority (SBMA) projects net earnings of P1.017 billion by year end, having reached the level of P737.89 million in June 2014 compared to the P992 million total in 2013.

This, as SBMA has again notched impressive financial performance in the first semester of 2014, surpassing even its record-breaking first half performance last year when it turned in a net profit of P1.2 billion, the agency’s highest in its entire 21-year history.

According to the SBMA’s midyear accomplishment report, the state-owned corporation obtained positive results in the first six months of 2014 in all the key results areas like investment generation, customs duties and tax collections, export production, as well as job creation.

In terms of committed investments, the SBMA amassed $267 million in the first six months of 2014, a 400 percent improvement over the $53 million record in the same period the previous year.

Meanwhile, freight-on-board exports rose by 173 percent, with $185,088 million in the first semester 2014 compared to $67,476 million last year; while employment generation managed a 1 percent growth, from 89,436 in 2013 to 90,425 in 2014.

Likewise, cash collections by the Bureau of Customs (BoC) here grew by 44 percent, from P4.945 billion in the first half of 2013 to P7.099 billion in 2014; while taxes collected by the Bureau of Internal Revenue (BIR) rose by 25 percent, from P737 million in the first half of 2013 to P919 million in the same period this year.

SBMA officials said the continuing improvement in the agency’s financial performance stemmed from prudent fiscal management over the past few years under the helm of Chairman Roberto Garcia, which successfully implemented various measures to balance the budget and promote a healthier financial condition for the organization.

Records from the SBMA Finance Group indicated that, in particular, port revenues showed an increase of 52 percent in the first half of 2014 to cement a positive financial performance for the Subic Bay Freeport. The port revenues totalled P457.29 million, compared to P300.94 million in the same period last year.

Tourism revenues also grew by 20 percent, from P6.9 million last year to P8.29 million this year, resulting to a 27 percent increase in the SBMA’s total operating revenues that increased from P946.01 million in first half 2013 to 1.198 billion this year.

The agency also posted a 62 percent increase in earnings before interest, taxes, depreciation and amortization (EBITDA), from P454.10 million to P737.89 million. The increased earnings, officials said, would allow the agency to recoup by the yearend despite a midyear slowdown in net income before tax from P767.27 million in January-June 2013 to P337.26 million this year.

In view of SBMA’s improved fiscal performance, the agency was able to remit P243 million in dividends this year to the National Treasury, the first time it did in more than a decade.

It also released P93.7 million in revenue shares early this month to local government units contiguous to the Subic Bay Freeport, and P14.8 million in rental fees to the Ayta Ambala tribe for the use of parts of their ancestral domain in the Subic Bay Freeport. (HEE/MPD-SBMA)

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SBMA H1 earnings increased by 62% to P738M

The Subic Bay Metropolitan Authority (SBMA) has recorded an increase of 62 per cent in earnings before interest, tax, depreciation and amortization (EBITDA) during the first semester this year.

This was announced by SBMA Chairman Roberto Garcia, who also cited the added flexibility in the agency’s financial program as a result of its efforts to increase its earnings.

“Our EBITDA increased by 62 per cent - from P454 million in the first semester last year to P738 million in the same period this year,” Garcia said in a recent press briefing.

“This gives SBMA the desired spending power and fiscal flexibility to manage its various financial obligations,” he added.

Garcia explained that this year’s first semester earnings of P738 million was derived from a total of P1.2-billion in operating revenue, less the P461-million total in operating expenses.

He added that the increase in EBITDA can be attributed to a 27 per cent increase in total operating revenues and a 6 per cent decrease in total operating expenses.

According to a report from the SBMA Finance Group, the Subic authority posted operating revenues of P627,319,504.39 from leases; P380,800,701.72 from port services; P8,277,995.15 from tourism services; and P182,220,722.83 from other operating incomes.

On the other hand, the agency incurred operating expenses of P194,216,593.46 in manpower; P80,823,616.77 in bad debts; P43,504,924.73 in power; P17,459,000.74 in supplies, materials and fuel; P3,584,204.33 in water; and P121,145,435.64 in other operating expenses.

Records from the SBMA Accounting Department also revealed that the agency’s net income after tax to-date amounted to P322 million.

In 2013, the SBMA shattered its all-time record after posting P1.2 billion in net profit, along with the highest gross revenue of P2.1 billion and the highest EBITDA of P992 million in the 21-year history of the Subic institution.

The present SBMA administration headed by Garcia has been largely credited for turning around the agency’s financial standing from several years of non-profitability to attaining record earnings starting 2012.

Garcia said the SBMA is now committed to further improving its financial condition to develop facilities here and attract more investments in the Subic Bay Freeport Zone. (RFD/MPD-SBMA)

PHOTO: SBMA Administration Building 229

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Subic Bay tops freeports and eco-zones with P185-million dividends remittance

The Subic Bay Metropolitan Authority (SBMA) emerged as the highest dividends contributor among agencies of special economic zones in the country during the recent Dividends Day in Malacañang, an annual event recognizing government-owned and controlled corporations (GOCCs) with the highest remittances.

According to SBMA Chairman Roberto Garcia, the SBMA remitted a total of P185 million to the National Treasury this year, the first time for the Subic agency after more than a decade.

“Overall, SBMA placed number 10 among the 50 GOCCs that remitted dividends out of the total 114 GOCCs in the country today,” Garcia said.

“Meanwhile, we ranked number one and surpassed eight other free ports and special economic zones, including Clark which remitted P110 million,” Garcia added.

Under RA 7656, GOCCs are required to declare and remit half or 50 per cent of their net income to the National Treasury as dividends. The remittances are used mainly by the government for its social services programs.

According to Department of Finance reports, this year’s top contributors were the Philippine Amusement and Gaming Corporation (PAGCOR) which had the highest total remittances at P9.791 billion, and Land Bank of the Philippines (LBP) which had the highest dividends remitted at P6.298 billion.

Other GOCC contributors were Development Bank of the Philippines (DBP), with P3.616 billion; Power Sector Assets and Liabilities Management Corp. (PSALM), P2.5 billion; Bases Conversion Development Authority (BCDA), P2.107 billion; Manila International Airport Authority (MIAA), P1.577 billion; Philippine National Oil Company-Exploration Corporation (PNOC-EC), P1.5 billion; Philippine Ports Authority (PPA), P1.422 billion; and Philippine Deposit Insurance Corporation (PDIC), P1.05 billion.

Meanwhile, next to the SBMA in the free port/special ecozone category were Clark Development Corporation (CDC), with P110 million; Cagayan Economic Zone Authority (CEZA), P100 million; and Authority of the Freeport Area of Bataan (AFAB), P4.56 million.

In his Independence Day message, President Benigno Aquino III said that GOCCs have remitted a total of P95.38 billion in just the three and a half years of his administration, compared to the P81.54 million that the corporations remitted in eight years of the Arroyo government from 2002 to 2010.

Garcia explained that since 2004 until 2013, the SBMA failed to remit dividends after the agency suffered financial losses. However, with major financial and operational restructuring in the last three years, the SBMA has managed to recover and turn financial statistics upward.

Records indicated that the SBMA first complied with the dividends requirement by remitting P5.23 million from its net earnings in 1993. Then in 2003, the SBMA remitted P75.6 million from its net earnings from 2000 to 2003 as a result of the adjustment of the required dividends from 50 percent to only 10 percent for GOCCs with very low net earnings.

The GOCC Dividends Day started in 2011 as an annual ceremony spearheaded by the Department of Finance and later on by the Governance Commission for GOCCs (GCG), to recognize complying GOCCs and to raise support for the government’s “unprogrammed fund.”

A total of P32.3 billion was raised by the national government during the GOCC Dividends Day recently.

Garcia said that while the SBMA could use the amount it had just remitted as dividends for its various capital expenditure projects, the Subic agency is happy to comply with the law.

“For one thing, we are able to help the President with his developmental programs. That’s one significant contribution by Subic to national development,” Garcia said. (RFD/RAV/MPD-SBMA)

PHOTO:
SBMA Chairman Roberto Garcia hands over to President Benigno Aquino III a check worth P185 million, representing the Subic authority’s dividend remittance to the national government, during the GOCC Dividends Day at Malacañang Palace. Looking on are Vice President Jejomar Binay (left) and SBMA Director Joven Reyes.

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