The rich Filipinos

By Tony Lopez
MANILA – The top moneymakers of 2006 were also the top money makers in the first half of 2007. This proves the viability of the business model of these companies, all listed in the Philippine Stock Exchange, and the sustainability of the economic takeoff.
Also, the very richest Philippine families keep getting richer everyday because they are the owners of these immensely profitable companies.

As I keep saying in this column, only 160 families own the economy and the politics of this country. The Philippines has one of the worlds worst income inequality ratios, according to World Bank data.

In 2006, the biggest publicly listed money spinners in terms of profits were:

1. Philippine Long Distance Telephone of telcom mogul Manny Pangilinan and the Salim family of Indonesia, P35.3 billion
2. First Philippine Holdings Corp. of the (Oscar) Lopez family, P15.46 billion
3. SM Investments Corp. of Henry Sy Sr., P15.24 billion
4. Ayala Corp. of the Zobel-Ayala family, P14.46 billion
5. Meralco, again, of the (Oscar and Manolo) Lopez family, P13.88 billion
6. Globe Telecom, again of the Ayala family, P11.75 billion
7. San Miguel Corp. of Danding Cojuangco, Henry Sy and Kirin Brewery, P10.17 billion
8. Piltel of again, Manny Pangilinan, P10.07 billion; 9. Bank of PI of still again, the Ayala family, P9.14 billion; and 10. JG Summit Holdings of taipan John Gokongwei Jr., P8.69 billion.

Among the holding companies, the biggest money makers in 2006 were:

1. SM Investments Corp. P15.24 billion
2. Ayala Corp. P14.4 billion
3. JG Summit Holdings P8.69 billion;
4. Benpres Holdings, also of Lopez, P4.6 billion
5. Aboitiz Equity Holdings P3.8 billion
6. A. Soriano Corp. P3.1 billion
7. Filinvest Development of Andrew Gotianun, P1.42 billion
8. DMCI Holdings of the Consunji family, P1.38 billion
9. PAL Holdings of Lucio Tan, P1.2 billion; and
10. Alliance Global of Andrew Tan and George Yang, P888 million.

In the first half of 2007, the 10 largest profit makers were:

1. PLDT P17 billion
2. Ayala Corp. P11.49 billion
3. SMC P7.87 billion
4. Globe P6.42 billion
5. PAL Holdings P6.32 billion
6. SM Investments Corp. P5.86 billion
7. Bank of PI P5.7 billion
8. PNOC Energy Development P4.2 billion
9. JG Summit P3.83 billion; and Metrobank of taipan George Ty P3.69 billion.

In the first semester, listed domestic companies increased their earnings by a whopping 41.4 percent to P148.75 billion from P105.2 billion in the same period last year.

Francis Lim, president and CEO of the Philippine Stock Exchange that conducted the study, says the performance of the listed companies last year once again provides clear proof that steps being taken by the government to improve the countrys macro-economic environment, especially to lower interest and inflation rates, have benefited companies.”
Lim says the combined gross revenues of the listed companies went up by15.1 percent to P1.18 trillion during the first half of the year from P1.02 trillion a year earlier.

Lim sees further improvement in the balance of 2007 and a continued rise in the stock market.
As of June 30, 2006, the market capitalization of listed companies amounted to P6.33 trillion. That increased to P7.6 trillion in the first quarter and further to P8.32 trillion in the second quarter of 2007.

Between June 2006 and June 2007, owners of listed stocks hauled in an additional P1.987 trillion in wealth. Thats 1,987 billion pesos of added wealth without their owners exerting much effort.

If you assume that the 160 richest families of this country owned the listed stocks, each of these families made additional wealth of P12.42 billion on the average, in just 12 months. Of course, some of the listed companies are owned by foreign investors, in whole and in part. In terms of voting control, for instance, PLDT is run by foreign owners, with Manny Pangilinan serving as their surrogate.

Indeed, of total market cap of P8.32 trillion, only P4.38 billion is domestic capitalization, leaving P3.94 trillion or 47.3 percent as foreign market cap. The P3.94 trillion foreign market cap is understated because companies like PLDT, which is foreign-controlled, is reckoned as domestic.

The PSE-listed companies reported combined six-month net income of P148.75 billion. Holding companies accounted for P38.9 billion or 26 percent of total profits, followed by the industrial sector, P35.27 billion or 23.7 percent, services P31.79 billion or 21.4 percent, financials P24.27 billion or 16.3 percent, property P14.8 billion or 10 percent; and mining P3.62 billion 2.4 percent. SMEs had a P54.57 million share or a paltry one-third of one percent or 0.03 percent.

The Big Boys made 99.7 percent of total profits of listed stocks; the SMEs settled for barely a third of a percent. Thats how ridiculous the income disparity is.
biznewsasia@gmail.com

Popularity: 19% [?]