The Bellwether Vol. 3 No. 7

July 31, 2015

 

SSI Group, Inc.: The primary beneficiary of global retail expansion

 

SSI reported Php267.03mn in net income during the first quarter of 2015, ahead of its full-year target of Php1.23bn-1.25bn. CBRE cited that Manila is one of the potential destination of international retail brands as its rank improves.

 

Peso Yield Curve: Market activity limited at the front end

 

Yields rose by an average of 15bps on defensive trading amid global uncertainties and probable bond exchange this year. Greece and China influence lackluster appetite towards EM sovereign bonds.

 

Philippine Power Sector: Lower electricity cost

 

WESM prices spiked in June compared in May on power plant outages. DOE plans to bid new power supply agreements under the Demand Aggregation and Supply Auctioning Policy to support the power requirements of several distribution utilities. It expects 10,551-MW capacity to come in the next three years.

 

Concepcion Industrial Corporation (CIC): Picking up steam

 

Overall sales increased more than 15% in 2Q15, better than the slow start in 1Q15. 1H15 numbers are expected to be satisfactory despite a substantially higher base due to "front-loading" ahead of a price increase in 2014. CIC targets an earnings growth of 15% for FY2015.

 

Crown Asia Chemicals Corporation (CROWN): Revenue boost in 2H15 from PPR Plant

 

First Metro Research visited CROWN's manufacturing plant in Guiguinto, Bulacan. Their Polypropylene Random Copolymer Plant (PPR) is almost finished, commencing its pilot production. The plant will produce pipes suitable for residential cold and hot water system, underground heating system, compressed air pipelines and conveying system. In 1Q15, CROWN reported 96.6% earnings growth amounting to Php17.2mn.

 

Philippine Consumer Sector: Ready to rebound

 

The consumer sector is down 4.1% year-to-date versus the 3.7% rise in PSEi. Net income results in 1Q15 were mostly positive, with only EMP's net income falling 13.4%. Inflation eased further in June to 1.2%, which has yet to take full effect on consumer companies' performance. This will likely be reflected over 2H15.

The Bellwether Vol. 3 No. 7

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