SBMA cites robust Subic Freeport growth

The Subic Bay Metropolitan Authority (SBMA) has successfully turned the country’s first free-port zone into a productive engine of growth, overperforming in the last four years in terms of revenue generation and remittances to the national treasury.

Figures released by the agency last week showed SBMA managed to reverse its dismal financial performance starting in 2012, when it posted a net income of P800 million, from a P1.1-billion loss the previous year and a negative record of P2.54 billion—the agency’s biggest beating—in 2008.

This was consistent with a gross income that started out at P200 million in 1993 a year after the establishment of the free port, then rising to P800 million in 1996; P1.54 billion in 2002; P1.57 billion in 2008; P1.63 billion in 2012; P2.44 billion in 2014; and P2.75 billion in 2015.

In terms of operating income, SBMA was “awash with cash” last year when it posted a P1.41-billion operating income, a far cry from the P329 million it worked with in 2011 following heavy losses in previous years.

SBMA was also able to reduce its total debt by 36 percent in the last five years, or from P10.39 billion in 2011 to P6.64 billion 2015.

SBMA Chairman Roberto Garcia, who presided over the agency’s financial turnaround in the last five years, said SBMA’s positive cash position has allowed it to undertake various infrastructure projects last year, including repairs of major roads here to the tune of P60 million.

“These are signs that SBMA is very healthy,” Garcia said in a recent news briefing. Meanwhile, the Subic agency further increased its contributions to the national economy by intensifying remittances in customs duties, taxes, dividends and shares to the national and local government units (LGUs).

Last year SBMA said it contributed a total of P19.3 billion to the national economy, broken down as P16.4 billion in collections by the Bureau of Customs (BOC); P1.73 billion in tax collections by the Bureau of Internal Revenue (BIR); P373 million in shares to the national government; P248 million in shares to neighboring LGUs; and P527 million in dividends to the national government.

This, as BIR collections here increased from P1.1 billion in 2011 to P1.73 billion in 2015, accounting for a 57.3-percent growth; while the BOC collections grew from P6.05 billion in 2011 to P16.4 billion in 2015 for a record-breaking 171-percent increase.

All in all, SBMA posted a 157-percent increase in various contributions to the national economy by increasing them from a total of P7.51 billion in 2011 to P19.32 billion in 2015, SBMA figures indicated.

With the unprecedented growth created in the last five years, the Subic Bay Freeport is now poised for more business and better income, Garcia said. He said Subic’s robust performance, current fiscal health and positive business outlook could be traced to the agency’s efforts in promoting transparency and good governance, aggressive marketing, as well as policies that fostered the protection of Subic’s natural environment.

“The only way for SBMA to go is up, and we can only expect better times,” Garcia confidently said in a statement.

“The Subic Bay Freeport is not only the first and largest free port in the country today; it is also the most progressive and the most successful,” Garcia said. (Henry Empeño, BusinessMirror)

PHOTO:
SBMA Chairman and Administrator Roberto V. Garcia in his recent the State of the Freeport Address (AMD/MPD-SBMA)

http://www.businessmirror.com.ph/sbma-cites-robust-subic-freeport-growth/

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SBMA: 2015 4th successive record year

The Subic Bay Metropolitan Authority (SBMA) has recorded another chart-busting performance in 2015, as the Subic agency continued with its unparalleled growth since 2012.

SBMA Chairman Roberto Garcia, in his 4th State of the Freeport Address (SOFA) here on Wednesday, said the authority managing the country’s premier free port had successfully implemented new revenue initiatives last year, resulting in the biggest revenue and operating income since 1992.

The growth in various key areas, Garcia said, helped the SBMA shatter its own financial charts last year with the gross revenue of P2.75 billion and operating income of P1.48 billion the highest in the 23-year history of SBMA. Adjusted for unrealized foreign exchange losses, net income of the Agency increased by 26 percent.

The impressive financial performance by the SBMA included a 21 percent increase in revenue by the authority’s maritime and logistics business unit, which pulled out a P1.58-billion income last year; a 23-percent increase in committed investments, which grew to P22.8 billion in 2015; and a steady growth in exports, which reached $2.5 billion last year.

Garcia said that some of the major business developments in Subic last year were the launching of a $30-million mill project by the Singapore-based Interflour Group; the start-up of the 150-megawatt solar and wind energy project by Jobin Inc.; and the approval of a $10-million project by Datian Subic Shoes, Inc. for the manufacture of footwear, among others.

Meanwhile, employers in the Subic Bay Freeport generated 4,693 new jobs in 2015, increasing the local workforce to a total of 101,651 at the end of the year. SBMA’s contribution to the National government consisting of BOC, BIR collections and dividends of P19.3 grew by 8 percent over 2014.

Tourism also continued to grow, posting a 14 percent growth in 2015 and registering a total of 7.7 million in visitor arrivals.

With these developments, Garcia said the SBMA will aim this year to create new industrial parks, establish linkages with other global ports to further boost port utilization, increase revenue collections and capital expenditure program, and continue with its good governance initiatives.

“We must leave a legacy, and continue to take advantage of the present favorable economic environment,” Garcia told SBMA employees and members of the Subic Bay Freeport Chamber of Commerce, which sponsored the forum.

“The Philippines is projected to become one of the world’s 16 largest economies within the next 35 years — it is now at Number 39 — so the time for the Philippines is now; the opportunity for Subic is now,” Garcia also said. (HEE/MPD-SBMA)

PHOTO:
SBMA Chairman and Administrator Roberto V. Garcia reaffirms the commitment of the Subic Bay Metropolitan Authority to pursue the sustainable development of the Subic Bay Freeport Zone during his 2015 State of the Freeport Address (SOFA) on March 16 at the Subic Bay Exhibition and Convention Center. The SOFA is an annual event organized by the Subic Bay Freeport Chamber of Commerce. (AMD/MPD-SBMA)

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SBMA reports P202-M revenue in trade facilitation

The Subic Bay Metropolitan Authority (SBMA) announced that it posted a total of P202 million in revenue from trade facilitation and compliance fees collected last year from importers, brokers, processors, and other stakeholders in this free port.

SBMA Chairman Roberto Garcia said that based on the annual report submitted by SBMA's Trade and Facilitation and Compliance Department (TFCD), the department’s revenue for 2015 represented an increase of P51 million, or 34 percent, compared to the P151 million recorded in 2014.

Garcia said the increase in earnings is the direct result of the implementation of key objectives and strategies in all SBMA departments to deliver the best services to clients and to sustain the agency’s positive performance in the last three years.

The measures include promotion of good governance, where SBMA has institutionalized the integrity pledge (IP) among employees in support of the agency’s crusade against graft and corruption; transparency in communicating with importers, brokers, processors, and other stakeholders through consultative meetings; and fiscal responsibility by implementing stricter collection procedures and monitoring of the same.

“The satisfaction of our locators and investors with regards to the services they received from SBMA is to some measure reflected on the upward movement in our statistics,” Garcia explained.

“It’s good to know that the figures are all positive,” he added.

TFCD officer-in-charge Anna Joy Quito meanwhile said that better service to customers had, indeed, resulted in better earnings for the department.

She said that export value freight on board (FOB) reached a total of US$2.52 billion in 2015, which is 11 percent higher than the US$2.26 billion in 2014.

Quito explained that under SBMA’s good governance initiatives, the department has succeeded in providing services in a much shorter period of time than the minimum requirement.

She cited as example that while the target time for issuing an admission permit from time of application is 16 hours, the department has lately managed to shorten this to an average of 7.9 hours, or a decrease in processing time of 51 percent.

Another area where the TFCD successfully introduced faster processing time is in Export Declaration clearance, where actual processing time is now 30 minutes, or down by 94 percent from the target time of eight hours.

Quito added that the department will conduct benchmarking with other ports and ecozones in the country to establish and adopt best practices in trade facilitation to increase further the efficiency of the Subic port.

The TFCD facilitates admission of goods into the Subic Bay Freeport through efficient delivery of frontline services, such as processing of permits on imports and exports, and keeping locators or investors in step with all procedural guidelines implemented by the SBMA. (RAV/MPD-SBMA)

PHOTO:
SBMA Chairman and Administrator Roberto V. Garcia (AMD/MPD-SBMA)

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SBMA earnings increased by 12% to P1.7B in 2015

The Subic Bay Metropolitan Authority (SBMA) has posted a total of P1.7 billion in earnings before interest, tax, depreciation and amortization (EBITDA) in the previous year, thereby allowing the Subic agency not only to sustain its operations but also to fund more development projects in the Subic Bay Freeport.

SBMA Chairman Roberto Garcia, comparing the agency’s EBITDA in the last two years, said that the P1.7 billion earnings last year represented an increase of 11.89 per cent over the P1.5 billion record in 2014.

“This positive inflow permitted us to undertake several infrastructure projects that were designed to improve the attractiveness of the Freeport to investors,” Garcia said.

“The more we improve the Freeport, the more we earn; and the more we earn, the more we can afford further developments,” he added.

Garcia said that the 2015 earnings of P1.7 billion was derived from a total of P2.75 billion in operating revenue, less the P1.05 billion total in operating expenses.

He attributed the increase to the 12.8 per cent increase in operating revenues despite the 14.4 per cent increase in total expenditures in the same period.

According to a year-end report from the SBMA Finance Group, the SBMA posted operating revenues of P1.34 billion derived from leases; P933 million from port services; P12.6 million from tourism services; and P466.2 million from other operating incomes.

Meanwhile, the agency incurred operating expenses of P266.4 million in manpower; and P784.3 million in maintenance and other operating expenses.

As of December 31, 2015, the agency’s net income after depreciation and FOREX stood at P1.6 billion. However, a 109 per cent loss on foreign exchange pulled the income before tax down to P1.1 billion, Garcia explained.

In 2013, the SBMA under Garcia shattered its all-time record by 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 continues to equal, if not surpass, its previous financial condition by attracting more investments into the Freeport. (RFD/MPD-SBMA)

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SBMA posted 12-percent revenue increase last year

The Subic Bay Metropolitan Authority (SBMA) has again broken its own record of sterling performance in the past three years with a bigger growth upsurge in 2015, which rode on the swell of opportunities in the transshipment and maritime logistics sector.

SBMA Chairman Roberto V. Garcia said in a media briefing on Monday that the Subic agency had coaxed a broad-based revenue growth across all strategic business units (SBUs) in 2015, posting a 12-percent revenue growth and achieving an 8-percent increase in operating profit for the same period.

Previously, SBMA’s gross revenue stood at P2.44 billion in 2014, the highest for the agency since it began operations in 1992, while its operating profit or earnings before interest, taxes, depreciation and amortization last year was at P1.39 billion, also the highest since 1992.

“The seaport/airport sector is now the leading SBU in Subic, with a 28- percent growth last year,” Garcia said during the news briefing.

He added that the growing transshipment and logistics revenue was bolstered by a 56-percent increase in the volume of containerized cargo processed in Subic, which rose from 77,000 twenty-foot equivalent units (TEUs) in 2014 to 120,000 TEUs in 2015.

Garcia said that, apparently, Subic has begun attracting legitimate shippers last year after being categorized as an extension for the Port of Manila in 2014.

“According to Secretary [Jose Rene] Almendras, there was no port congestion in Manila last year. However, Subic’s container volume still increased, so this can only mean that we have already attracted the legitimate shippers,” Garcia said.

Because of this, Garcia said SBMA is looking forward to bigger container volume in 2016. A 150,000-TEU target, he added, “would be easy [to achieve] this year.”

Aside from the growing transshipment and logistics revenue, Subic’s tourism sector also performed better in 2015, as it posted a 12-percent increase in tourist arrivals, bringing the year’s cumulative total to more than 6 million.

Nature theme parks, like Ocean Adventure and Zoobic Safari, contributed about 2.2 million to the 6 million arrivals for Subic in 2015, Garcia said.

Subic also posted in 2015 the highest hotel-occupancy rate in Central Luzon at 66 percent, as the meeting, incentive, conference and exhibition, and sports tourism niches gained more visitors.

“This is why more new hotels are being built here, and existing ones are expanding because there is a demand,” Garcia said.

He said that after several hotels and restaurants opened along Subic’s waterfront area in mid-2015, the Best Western Hotel was inaugurated late last year while the newest addition, The Reef Hotel, began construction.

Meanwhile, because of better financial performance in the last four years, SBMA was able to increase its capital expenditures from P30 million in 2014 to P40 million in 2015, as well as implement a 10-percent retroactive salary increase for all its personnel.

Garcia also said that, with better financial standing in 2015, SBMA contributed an estimated P630 million in dividends to the national government, an increase of 11 percent over its P570-million contribution in 2014.

SBMA’s outstanding performance in 2015, Garcia added, was capped by Subic’s recognition by fDi Magazine, a publication of The Financial Times of London, as “Global Free Zone of the Year” for Asia.

Subic also received two special awards from fDi last year: one for infrastructure development and another for reinvestment. (Henry Empeño, Business Mirror)

http://www.businessmirror.com.ph/sbma-posted-12-percent-revenue-increase-last-year/

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Subic Freeport, overall winner in Asia of Global Free Zones of the Year 2015 award

The Subic Bay Metropolitan Authority (SBMA) adds another feather to its cap of achievements in the management and administration of the country’s first free port.

After the agency’s record highs for three (3) consecutive years, SBMA chairman and administrator Roberto Garcia announced today that the Freeport garnered two (2) major awards in the recently concluded survey for the Global Free Zones of the Year 2015 awards: overall winner in Asia and overall winner in the sub-region of South and Southeast Asia.

The Subic Freeport also received commendations in the form of bespoke awards for infrastructure developments and reinvestment. “Some locations, which were particularly outstanding, were acknowledged with honorable mentions and bespoke awards,” Garcia explained.

According to Garcia, the publication received a total of 76 entries from all over the world, which were individually studied by a panel of judges who then nominated their winning and runner-up locations in each region.

“Emerging as overall winner in Asia, as well as in South and Southeast Asia, is a significant indicator of Subic Freeport’s level of competitiveness among other zones in the region,” Garcia said.

Garcia added that the awards also underscore the Freeport’s attractiveness and potential as an investment site and validates the strategies that the Subic agency has been undertaken to spur the zone toward further growth.

The survey was conducted by the fDi Magazine, an 11-year old bi-monthly publication of The Financial Times, Ltd. of London, to acknowledge the most promising free zones across the world. Invited to join were free zones, government entities, and investment promotion bodies, which were asked to complete a short survey, detailing their zone’s attractiveness, facilities, and incentives offered to investors.

Survey questions included growth performance measures for 2013 and 2014; what multinational companies have chosen to locate in the zone and why; which tenants have chosen to undertake recent expansion of their presence in the zone; and what initiatives have been implemented to offered in the last 12 months to increase tenant numbers, including any special incentives, programmes, or facilities catering specifically to small medium enterprises or start-ups.

Also asked were infrastructure developments or facilities upgrades in the last 12 months, as well as major development plans to facilitate future expansion.

Wrapping up, the SBMA chairman pointed out, “These awards also mean that we’re on the right track and doing the right thing, and exerting our best effort as a team”. (KMF/CorComm-SBMA)

PHOTO:

SBMA Chairman Roberto Garcia announces the “Global Free Zone of the Year” Award received by the Subic Bay Freeport Zone from fDi Magazine, a publication of the Financial Times of London. (AMD/MPD-SBMA)

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Container volume doubles at Port of Subic

Container shipments at the Port of Subic doubled as of August this year as Manila continues to experience massive port congestion.

Subic Bay Metropolitan Authority (SBMA) Chairman Roberto V. Garcia, in a press briefing, told reporters that as of August this year, container volume at the Port of Subic has already reached 83,000 twenty-foot equivalent units (TEUs) compared to 43,000 TEUs for the same period last year.

This indicated a 93 percent increase, Garcia pointed out.

The SBMA official said efforts by the agency and partner locators to ensure ease in cargo processing at the Port of Subic, as well as other marketing initiatives, contributed to the rise in container volume here.

“We are the only port in Luzon that has a one-stop shop, and this gives us the competitive edge,” Garcia also explained. “They come to our container port, go to our one-stop shop where offices of the SBMA, Customs, and the Landbank are there all in one place, and in just a matter of 30 minutes, their papers are already processed.”

“The one-stop shop and our marketing programs such as the two recent maritime summits and the formation of a Maritime Technical Group, are all coming into play right now,“ Garcia added.

At the rate the Port of Subic is performing, Garcia said he expect shipping volume this year to double last year’s yearend record of 77,000 TEUs.

The SBMA chair also concurred with Senator Ferdinand Marcos Jr. who said in a recent forum here that Subic is the answer to the current traffic congestion in Manila.

“Senator Marcos hasn’t been here for some time, but he was really impressed with Subic. We are really pushing very hard to increase the volume here to help decongest Manila,” Garcia said.

Subic Bay is the only port in the western seaboard of the Philippines that still has enough capacity to handle additional container volume.

Garcia said that unlike the Port of Batangas, which has now reached its full capacity, shippers can come to Subic any time.

Seven major shipping lines are now calling on the port of Subic on a regular basis. These include Maersk, APL, NYK, and SITC, among others. (RBB/MPD-SBMA)

PHOTO:
Container ships unloads cargo at the New Container Terminal in the Subic Bay Freeport. (AMD/MPD-SBMA)

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SBMA net income doubles in 1st sem

After hitting record highs in financial performance for three consecutive years, the Subic Bay Metropolitan Authority (SBMA) recently reported another substantial increase of 104 per cent in its net income for the first half of the current year.

According to SBMA Chairman Roberto Garcia, unaudited figures from the agency’s Finance group placed the agency’s January-to-June net income at P687 million, showing a significant improvement from P337 million for the same period last year.

“Revenues for the first semester were pretty good as well,” Chairman Garcia said, referring to a 15 per cent revenue increase from last year’s level.

Sharing the agency’s operating revenue pie were port services and regulatory fees, which increased by 29 per cent and 24 percent, respectively over the same period last year.

Also contributing substantially to the agency’s financial health, according to Chairman Garcia, were a 33 per cent buildup in current assets, including a 38 per cent increase in cash assets, and a 56 per cent increase in miscellaneous assets such as prepaid expenses, guaranty deposits, mobilization funds given in advance to contractors, and others. Tight control was also implemented as far as operating expenses were concerned.

“Meanwhile, SBMA’s earnings before interest, taxes, depreciation, and
amortization (EBITDA) increased by 18 per cent. This means that the agency is not only pursuing effective strategic initiatives, but is implementing them efficiently as well," Garcia added.

The top SBMA executive also noted that the first semester saw a much improved business climate in the Freeport, which led to better bottom lines for the Subic agency and its locators, as well as the start-up operations of many new ones and a much bigger workforce that would soon breach the 100,000-mark.

With this profit increase, Garcia said the SBMA is “looking forward to a more positive outcome to further strengthen and sustain the agency’s financial turnaround over the past three years record performances.

“We need to provide funds for our strategic plans, including the implementation of the long-overdue salary increases for SBMA employees and the procurement of badly needed equipment for security, maintenance and infrastructure development work,” the SBMA chairman said. (AMF/CorComm-SBMA)

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Subic Freeport workforce to breach 100,000-mark this year

The number of workers in this premier free port is expected to reach the 100,000 mark this year, as the Subic Bay Metropolitan Authority (SBMA) continues to attract investors in the tourism and manufacturing industries here.

According to Subic Bay Metropolitan Authority (SBMA) Chairman Roberto Garcia, the Subic Bay Freeport is now home to a total of 99,463 employees working in various companies here, with shipbuilding giant Hanjin Heavy Industries and Construction-Philippines (HHIC-Phil) having almost 30,000 workers.

Garcia said that with the current investment and employment generation outlook, as well as the need to allocate some area for the planned Philippine military bases inside Subic, the SBMA is looking around for more suitable spaces for new investors since most of the available land in the Freeport have already been taken.

As of now, Garcia said that the service industry in Subic Freeport hires the most number of workers at a total of 45,661, which is equivalent to 45.91% of the total number of employees here. The workers in this sector include waiters, busboys, bellhops, kitchen staff, and others employed by tourism-related companies.

The manufacturing industry comes in next with 14.79% of the total Subic workforce. Workers in this field are mostly employed at the two industrial parks here, the Japanese-owned Subic Techno Park (STEP) and the Taiwanese-controlled Subic Bay Gateway Park.

He added that with new economic developments in the Asia-Pacific region, more Japanese companies are now looking into the possibility of investing in Subic Bay Freeport.

Meanwhile, the recent construction boom in the Freeport zone has brought more workers to Subic. Garcia said that as more hotels and restaurants are put up inside the Freeport, construction workers has swelled to 2.81% of the workforce here.

Another growing area in the employment scene here is the category for domestic helpers and caretakers. Garcia pointed out that aside from tourists, retirees are also moving into the Subic Freeport for its tranquil atmosphere and access to health and wellness facilities.

Among the companies registered in the Subic Bay Freeport, Hanjin is the single biggest employer with workers at its Redondo shipbuilding facility making up 36% of the total Subic workforce.

Garcia said that Hanjin expects its workers to breach the 30,000 mark this year, as the company had signed more shipbuilding contracts for this year.

According to Hanjin President Jeong Sup Shim, the company would require more skilled workers to complete new orders such as the three ultra-large container ships (ULCS) for the French shipping conglomerate CMA CGM.

Shim added that aside from CMA CGM, the company has also bagged contracts for six 11,000-TEU vessels with leading shipping companies across Europe and Asia.

Shim also said that because of the growing business at Hanjin’s Subic shipyard, the Philippines is currently ranked by the authoritative and Europe-based Clarksons Research as the 4th largest shipbuilding nation in the world in terms of order book by builder country.

He added that at the same time, Clarksons has reported that Hanjin Subic shipyard is the 10th largest shipyard in the world in terms of order book and now contributes 1.7-million compensated gross tonnage (CGT), which is equivalent to 74% of the Philippines’ CGT for new vessels. (JRR/MPD-SBMA)

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