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CASE 4: JOLLIBEE CORP.

Ref.: THOMSON REUTERS EIKON/DATASTREAM:
Jollibee Foods Corporation is a Philippines-based company engaged in the development,
operation and franchising of quick-service restaurants under the brand name Jollibee. In the
Philippines, the Company through its subsidiaries, operates and franchises quick-service
restaurants under the trade names Chowking, Greenwich, Red Ribbon, and MangInasal. Through
subsidiaries and affiliates overseas it develops and operates its international brands Yonghe King,
Hongzhuangyuan, San Pin Wang and 12 Sabu. The Company has approximately 800 Jollibee
stores in the Philippines, among which approximately 400 were franchised and approximately 400
were Company owned. There were also Approximately 100 Jollibee stores overseas, including
the United States, Vietnam, Hong Kong, Brunei, Jeddah and Qatar. They offer food products that
are prepared on-site based on original Company recipes. These products are sold under various
trademarks including but not limited to Champ, Chickenjoy and Yum.
http://en.wikipedia.org/wiki/Jollibee
Jollibee Foods Corporation abbreviated as JFC and popularly known as Jollibee (PSE: JFC) is
a Filipino multinational chain of fast food restaurants headquartered in Pasig City, Philippines. It
is the parent of Jollibee, the country's leading fast-food chain brand. Among its licensed brands are
Chowking, Greenwich Pizza, Red Ribbon, Mang Inasal and Burger King Philippines.[2] Since its
inception, JFC expanded and to date, it has a total of 2,510 stores worldwide with a system wide
retail sales totaling to 82.1 billion pesos for the fiscal year 2011.[3]
History
In 1975 Tony Tan and his family opened a Magnolia Ice Cream parlor[4] in Cubao.[5] Sometime
in 1978, Tony Tan and his brothers and sisters engaged the services of a management consultant,
Manuel C. Lumba. Lumba shifted the business focus from ice cream to hotdogs,[4] after his studies
showed that a much larger market was waiting to be served. Lumba became Tan's last business
and management mentor.
The Jollibee mascot was inspired by local and foreign children's books. Lumba created the
product names "Jollibee" and "Chickenjoy". He had the company incorporated and leased a house
on Main St. in Cubao, Quezon City as the first headquarters. Lumba formulated a long-term
marketing strategy: listing up a number of consumer promotions and traffic building schemes.
Tan stressed that developing internal strengths was critical. The stores were re-designed, the
service transformed into a full self-service, fast-food operation with drive-throughs. Not long
after, Tan and Lumba went on an observation tour in the United States, attending food service and
equipment conventions. Tan placed Lumba in charge of franchise development.[citation needed]
Expansion and acquisitions
The company acquired 80% of Greenwich Pizza in 1994, enabling it to penetrate the pizzapasta segment. From a 50-branch operation, Greenwich has established a strong presence in the
food service industry. In early 2006, Jollibee Foods Corp. bought out the remaining shares of its
partners in Greenwich Pizza Corp., equivalent to a 20% stake, for P384 million in cash.[6]
In 2000, the company acquired Chowking, allowing Jollibee to be part of the Asian quick service
restaurant segment.[7][8] In 2007, Jollibee acquired the Chinese fast-food chain Hongzhuangyuan.[9]

in overseas markets. it also has locations in the United States.. In the Philippines.[16] On October 1. Burger King business in the Philippines and SuperFoods business in Vietnam and other Southeast Asian countries.5 million) deal with Beijingbased Hong Zhuang Yuan through its wholly owned subsidiary Jollibee Worldwide Pte..000. Ltd. The same year. Currently the largest fast-food chain in the country. the chain serves Pepsi products.555 53.Jollibee purchased 70% of Taipei restaurant Lao Dong in June and Chun Shui Tang tea house in 2006.555 53. chicken and some local Filipino dishes. in which Jollibee will have a 12% stake for $950. a Filipino food chain specializing in barbecued chicken. United Arab Emirates and Brunei. Jollibee opened 93 stores. On October 19. Jollibee entered into a joint-venture contract with US-based Chow Fun Holdings LLC. Aside from its flagship brand Jollibee. The sale is subject to the approval of China's Ministry of Commerce. Ltd.372 47. 2011.5 million. Jollibee signed a deal to acquire 55 percent of China's Guangxi San Ping Wang Food and Beverage Management Co.[18] and sold Délifrance to CaféFrance.059 62. Hong Kong.[13][14][15] The same month. Jollibee acquired Chowking stores in the US from their licensee.001 as of end December 2011.958 43. Mang Inasal. Yonghe King (China) and Hong Zhuang Yuan (China). for P3 billion ($68. Last year. operators of the San Pin Wang beef noodle business for 30 million RMB. In 2004. 2008. Vietnam.059 62. Greenwich. Burger King. Jollibee acquired Chinese fast food chain Yonghe Dawang for $22.372 47. Jollibee serves Coca-Cola products for its beverages. Jollibee acquired a 54% stake in BK Titans.892 71. 2010. the developer and owner of Jinja Bar Bistro in New Mexico. Jollibee opened 260 new stores. the group's other brands are Chowking. of which 167 were in the Philippines led by Mang Inasal (86) and Jollibee (40).8 million).[17] In 2011.[19] Overseas.5 billion ($55. Indonesia. the sole franchisee of Burger King in the Philippines. Jollibee acquired 70% share of Mang Inasal. This brought the company's total number of stores to 2. Jollibee formally signed a P2.[10][11][12] On August 26.[20] Products and locations Jollibee is an American-style fast-food restaurant with Filipino-influenced dishes specializing in burgers. Jollibee Income Statement Annual Standardised in Millions of Philippine Pesos   2012 2011 2010 2009 2008 96  45  67  N/A  78  31-Dec2012 31-Dec2011 31-Dec2010 31-Dec2009 31-Dec2008 71.958 43. Red Ribbon. led by Yonghe King in China (70) and Jollibee Vietnam (11).[21] Saudi Arabia.892 Gross Revenue -- -- -- -- -- Sales Returns and Allowances -- -- -- -- -- Earnings Quality Score Period End Date Revenue Net Sales . Jollibee closed Manong Pepe foodchain in favor of Mang Inasal. Inc. spaghetti.

575 2. Expenses.Net Operating -- -- -- -- -- Interest Exp.062 Research & Development -- -- -- -- -- 228 213 177 257 158 228 213 177 257 158 Amortization of Intangibles -- -- -- -- -- Amortization of Acquisition Costs -- -- -- -- -- Interest Expense.Operating -- -- -- -- -- Investment Income .111 Selling/General/Admin.372 47.388 35.341 6.780 -- -- -- -- -- Gross Profit 18.Operating -- -- -- -- -- Interest Expense(Income) .935 51. Total Cost of Revenue Excise Taxes Payments Depreciation/Amortization Depreciation Other Operating Expenses.255 38.Excise Tax Receipts -- -- -- -- -- -- -- -- -- -- Interest Income.081 Labor & Related Expense 3.Operating -- -- -- -- -- Interest Expense .266 8.388 35.059 62.152 10.Net-Operating.(Inc.247 952 1. Non-Bank -- -- -- -- -- Other Revenue -- -- -- -- -- Total Revenue 71.555 53.484 2.569 8.550 6.370 1.Operating -- -- -- -- -- Interest Capitalized .122 Advertising Expense 1.621 2.958 43. Total Foreign Currency Adjustment Unrealized Losses (Gains) Minimum Pension Liability Adjustment .591 2.011 5.117 9.).892 Cost of Revenue.Operating -- -- -- -- -- Interest/Investment Income .935 51. Total 52.124 11.954 2. Net . Total -- -- -- -- -- Unusual Expense (Income) -- -- -- -- -- Purchased R&D Written-Off -- -- -- -- -- Restructuring Charge -- -- -- -- -- Litigation -- -- -- -- -- Impairment-Assets Held for Use -- -- -- -- -- Impairment-Assets Held for Sale Loss(Gain) on Sale of Assets Operating -- -- -- -- -- -- -- -- -- -- Other Unusual Expense (Income) -- -- -- -- -- -- (410) (619) (409) (420) -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- Other Revenue. Total Selling/General/Administrative Expense 13.780 52.226 2.403 43.474 2.255 38.Operating -- -- -- -- -- Interest Income .879 6.977 2.403 43.310 1.

322 Minority Interest 15 (22) (15) (2) (3) Equity In Affiliates -- -- -- -- -- U.085 49.784 Operating Income 4.728 3.863 4.211 Provision for Income Taxes 1.254 3.198 2.713 3.S. Net Non-Operating (206) (291) (193) (219) (105) (206) (291) (193) (219) (105) -- -- -- -- -- (76) 0 (2) -- -- -- -- -- -- -- Investment Income .232 3. Items Net Income .319 Total Operating Expense Interest Expense . Net Net Income Before Extra.Other Operating Expense -- -- -- -- -- Other.Non-Operating Interest/Invest Income .665 2.Non-Operating Gain (Loss) on Sale of Assets Other.).319 Preferred Dividends -- -- -- -- -- General Partners' Distributions -- -- -- -- -- Miscellaneous Earnings Adjustment -- -- -- -- -- Pro Forma Adjustment -- -- -- -- -- Interest Adjustment . Net -- (410) (619) (409) (420) 66.150 1. Total (12) (112) (32) (55) 103 0 -- -- -- -- 529 -- -- -- 0 Foreign Currency Adjustment -- -- -- -- -- Unrealized Gains (Losses) Minimum Pension Liability Adjustment Other Non-Operating Income (Expense) -- -- -- -- -- -- -- -- -- -- 529 -- -- -- 0 Net Income Before Taxes 4.713 58.186 3.198 2.470 4.728 3.665 2.728 3.Non-Operating Interest Income .665 2.710 3.218 3.655 3.665 2.232 3. GAAP Adjustment -- -- -- -- -- 3.198 2.153 44.198 2.. Net Non-Operating 270 180 163 164 208 Interest Inc.247 40.232 3.358 4.213 2.Net-Non-Op.Primary EPS -- -- -- -- -- Total Adjustments to Net Income -- -- -- -- -- Income Available to Com Excl ExtraOrd 3.(Exp.232 3.728 3.Non-Operating Interest Capitalized .Non-Operating (76) 0 (2) -- -- Interest Income(Exp).108 Interest Expense.667 2.346 4.104 973 988 889 Net Income After Taxes 3.319 Accounting Change -- -- -- -- -- Discontinued Operations -- -- -- -- -- Extraordinary Item -- -- -- -- -- Tax on Extraordinary Items -- -- -- -- -- Total Extraordinary Items -- -- -- -- -- 3.319 Income Available to Com Incl ExtraOrd 3.

Supplemental -- -- -- -- -- Other Unusual Expense(Income).90 -- 0.27 Basic EPS Including Extraordinary Items 3.186 3.026 1.REIT -- -- -- -- -- (Gain) Loss on Sale of Assets.61 2.728 3. Suppl.061 1.030 1.086 1.20 0.25 1.25 DPS .044 1. -- -- -- -- -- Basic EPS after Stock Based Comp.Com Stock Issue 2 -- -- -- -- -- Dividends per Share .25 Diluted EPS Including ExtraOrd Items Supplemental (PHP Millions) 3.43 0.021 1.Common Stock Primary Issue Gross Dividends .10 3.37 Dividends per Share .00 -- Special DPS .14 3.27 Dilution Adjustment -- -- -- -- -- Diluted Net Income 3.58 3. Exp. Suppl.039 1. -- -- -- -- -- Impairment-Assets Held for Use.706 2 2 2.Common Stock Issue 2 -- -- -- -- -- Special DPS . -- -- -- -- -- Diluted EPS after Stock Based Comp. Supplemental -- 74 66 148 107 206 280 193 219 105 Interest Capitalized.51 3. Supplemental Normalized Income Before Taxes Effect of Special Items on Income Taxes . Supplemental Depreciation.58 2.Common Stock Issue 4 -- -- -- -- -- 2.665 2. Exp.58 2.198 2.029 Diluted EPS Excluding ExtraOrd Items 3.Com Stock Issue 3 -- -- -- -- -- Dividends per Share . Supplemental -- -- -- -- -- Interest Expense (Financial Oper).022 Basic EPS Excluding Extraordinary Items 3.08 2.10 3.Basic Weighted Average Shares 1. -- -- -- -- -- Non-Recurring Items.742 3. Exp.042 1.08 2.58 0.12 2.358 4.14 3.Com Stock Issue 4 -- -- -- -- -- 0.Common Stock Primary Issue 2.215 0 -- 0 23 1 Special DPS .863 4. -- -- -- -- -- Stock-Based Compensation. Suppl.51 3.12 2. Supplemental. Total -- -- 0 86 4 Total Special Items 0 -- 0 86 4 4. Supplemental -- -- -- -- -- Purchased R&D Written-Off.294 -- -- -- 866 Pro Forma Stock Compensation Expense -- -- -- -- -- Net Income after Stock Based Comp.57 0.729 Funds From Operations . Suppl.319 Diluted Weighted Average Shares 1. Supplemental -- -- -- -- -- Restructuring Charge.58 3.232 3.61 2. -- -- 0 86 4 Litigation Charge.032 1.Common Stock Interest Expense. Suppl -- -- -- -- -- Net Revenues -- -- -- -- -- 2. -- -- -- -- -- Impairment-Assets Held for Sale.Common Stock Issue 3 -- -- -- -- -- Special DPS .

Supplemental Equity in Affiliates.104 973 1. Avail to Com. Supplemental -- -- -- -- -- 396 5.840 Current Tax .14 3. General & Admin.232 3.310 1.055 -- -- -- -- -- -- -- -- -- 1. Supplemental Current Tax .111 Normalized EBITDA Tax & Pension Items (PHP Millions) 7.797 3.472 4.542 2.325 Normalized Inc.26 Amort of Acquisition Costs.188 1.728 2. Supplemental Minority Interest.220 5.132 4.218 3.67 2.093 3.Domestic . EPS.052 4.Inc Tax Ex Impact of Sp Items 1. Supplemental -- -- -- -- -- Amort of Intangibles.198 2. -- -- -- -- -- Reported Gross Profit -- -- -- -- -- Reported Operating Profit -- -- -- -- -- Reported Operating Profit Margin -- -- -- -- -- Reported Ordinary Profit -- -- -- -- -- Reported Net Income After Tax -- -- -- -- -- Reported Basic EPS -- -- -- -- -- Reported Diluted EPS -- -- -- -- -- Reported Net Business Profits -- -- -- -- -- Islamic Income -- -- -- -- -- Zakat -- -- -- -- -- Islamic Section.247 952 1.150 1.27 Diluted Normalized EPS 3.12 2.041 986 830 -- -- -- -- -- Rental Expense.012 890 Normalized Income After Taxes 3.213 2.Total 1.903 11.277 1. Supplemental Advertising Expense.728 3. Supplemental Labor & Related Expense Suppl.883 4.08 2.370 1.470 4.730 2.062 (51) 0 (2) -- -- 15 (22) (15) (2) (3) Research & Development Exp. 3.254 3. Supplemental -- -- -- -- -- Normalized EBIT 4. Supplemental -- 71 62 63 27 Audit Fees -- -- -- -- -- Audit-Related Fees -- -- -- -- -- Tax Fees -- -- -- -- -- All Other Fees -- -- -- -- -- Reported Recurring Revenue -- -- -- -- -- Reported Net Premiums Written -- -- -- -- -- Reported Total Revenue -- -- -- -- -- Reported Operating Revenue -- -- -- -- -- Reported Total Cost of Revenue -- -- -- -- -- Reported Total Sales.51 3.64 2.713 3.10 3.346 4.322 Basic Normalized EPS 3.58 3.

Foreign -- -- -- -- -- Current Tax .Current Tax .104 973 988 889 Domestic Tax .Domestic Net Interest Cost .Foreign -- -- -- -- -- Current Tax .Domestic Service Cost .Domestic (89) (96) (71) (40) (35) Actuarial Gains and Losses .Domestic Foreign Pension Plan Expense .Total Income Tax .Foreign -- -- -- -- -- Net Interest Cost .Total Deferred Tax .Domestic -- -- -- -- -- -- -- -- -- -- Interest Cost .277 1.Other -- -- -- -- -- 1. Net .Local -- -- -- -- -- Current Tax .Domestic -- -- -- -- -- Deferred Tax .Other -- -- -- -- -- Foreign Tax .Total Deferred Tax .Foreign -- -- -- -- -- Service Cost .Other -- -- -- -- -- Local Tax .188 1.Local -- -- -- -- -- Deferred Tax .Foreign -- -- -- -- -- Transition Costs .Foreign -- -- -- -- -- Deferred Tax .Foreign -- -- -- -- -- Expected Return on Assets .150 1.041 986 830 (127) (84) (68) 2 60 Deferred Tax .Foreign -- -- -- -- -- Prior Service Cost .Total Domestic Pension Plan Expense Interest Cost .Domestic Curtailments & Settlements Domestic (18) (3) 0 2 1 -- -- -- -- 0 Transition Costs .Foreign -- -- -- -- -- Curtailments & Settlements .Total Income Tax by Region .Other -- -- -- -- -- (127) (84) (68) 2 60 1.Foreign -- -- -- -- -- Actuarial Gains and Losses .Domestic -- -- -- -- -- Other Pension.Other -- -- -- -- -- Other Tax -- -- -- -- -- -- -- -- -- -- Domestic Tax -- -- -- -- -- Foreign Tax -- -- -- -- -- Local Tax -- -- -- -- -- Other Tax -- -- -- -- -- 101 157 156 141 146 108 153 136 97 88 -- -- -- -- -- 100 103 91 82 91 -- -- -- -- -- Expected Return on Assets .Domestic Prior Service Cost .

-- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- Transition Costs . Actuarial Gains and Losses .Post-Retirement -- -- -- -- -- Service Cost .Foreign -- -- -- -- -- Expected Rate of Return .End PHP 0.00% 6.PostRetir.00% 8.Post-Retirement -- -- -- -- -- Pension Payment Rate .End PHP 0.End PHP 1.Post-Retir.Domestic -- -- -- -- -- Pension Payment Rate .PostRetir.PostRetir.Domestic Expected Rate of Return .Foreign -- -- -- -- -- Discount Rate .00% 8.Post-Retirement -- -- -- -- -- 7.End PHP 0.00% 8.Foreign -- -- -- -- -- Total Plan Interest Cost 108 153 136 97 88 Total Plan Service Cost 100 103 91 82 91 Total Plan Expected Return (89) (96) (71) (40) (35) -- -- -- -- -- PHP 1.Post-Retirement -- -- -- -- -- Net Interest Cost .Post-Retirement Expected Return on Assets .48 I Post-Retirement Plan Expense Total Pension Expense Defined Contribution Expense Domestic Defined Contribution Expense Foreign Defined Contribution Expense Retirement Assumptions Discount Rate .50% 11.25% 5.End PHP 0.00 F (31-Dec) Pd.00% Compensation Rate .Other Pension. -- -- -- -- -- 7.00 F (31-Dec) Pd.00% 10.00% 8.58 F (31-Dec) Pd. Net -- -- -- -- -- 101 157 156 141 146 -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- 6.00 S (31-Dec) Pd.15% Discount Rate .Domestic Compensation Rate .57 I PHP 0.Foreign -- -- -- -- -- Compensation Rate .Domestic Total Plan Other Expense Dividends and Capital Changes Jollibee Foods Ord Shs .Post-Retirement -- -- -- -- -- Prior Service Cost .Foreign -- -- -- -- -- -- -- -- -- -- Interest Cost .00% 8.48 I PHP 0. Net .65 F PHP 0. Curtailments & Settlements .25 S PHP 0.00% Expected Rate of Return .00 S (31-Dec) Pd.00% 11.00% 8.00% 5.Post-Retirement -- -- -- -- -- Other Post-Retirement.

End PHP 0.977 6.57 I (30-Sep) Pd.974 1.End -Dividends & Capital Changes After Dec-2012 Jollibee Foods Ord Shs 2013 Cash Dividend PHP 0.941 -- -- -- -- -- 296 303 139 146 136 2.00 I (31-Mar) Pd.715 2.(31-Dec) Pd.389 1.727 Inventories .900 1.977 1.729 2.170 8. Total 643 707 879 820 823 Earnings Quality Score Period End Date Assets (PHP Millions) Cash and Short Term Investments Cash Accounts Receivable .854 1.660 1.849 6.755 1.43 I (31-Mar) Pd.End Balance Sheet Annual Standardised in Millions of Philippine Pesos   2012 96  45  67  N/A  78  31-Dec2012 31-Dec2011 31-Dec2010 31-Dec2009 31-Dec2008 8.498 2.End -- PHP 0.End -- -- -- PHP 0. Net Total Receivables.521 2.849 6.Work In Progress -- -- -- -- -- 2.Raw Materials Inventories .00 I (30-Jun) Pd.37 I (31-Mar) Pd.00 I (31-Mar) Pd.973 1.Trade.00 I (30-Jun) Pd.879 8.00 I (30-Jun) Pd.Other Total Inventory Inventories .End PHP 0.End -- -- 2011 2010 2009 2008 PHP 0.455 2.00 I (30-Jun) Pd.838 1.End PHP 0.End (30-Sep) Pd.882 Provision for Doubtful Accounts (260) (165) (136) (100) (77) 2.630 2.086 1.Finished Goods -- -- -- -- -- Inventories .134 1. Gross 2.End PHP 0.End (31-Dec) Pd.Short Term Receivables .36 I (31-Mar) Pd.977 6.End PHP 0.End PHP 0.354 132 200 161 208 374 LIFO Reserve -- -- -- -- -- Prepaid Expenses 751 648 412 510 396 Other Current Assets.655 8.655 8.859 Cash & Equivalents -- -- -- -- -- Short Term Investments -- -- -- -- 20 2.750 2.End PHP 0.170 8.50 I (31-Mar) Pd.End PHP 0.250 1.End (30-Sep) Pd.00 I (30-Jun) Pd.End (30-Sep) Pd.Other .805 Accounts Receivable . Net Notes Receivable .End PHP 0.00 F (31-Dec) Pd.End PHP 0.860 2.62 I (30-Sep) Pd.Trade.

097 10.509 2.882 33.717 4.Net 11.842 305 407 4.363 12.186 Goodwill .Gross Natural Resources .746 29.484 1.Long Term -- -- -- -- -- 1.581 Accumulated Depreciation.075) 8.Long Term Asset Other Long Term Assets Total Assets Liabilities (PHP Millions) Accrued Expenses Notes Payable/Short Term Debt Current Port.126 Accounts Payable 4.Restricted Cash . of LT Debt/Capital Leases .623 13.Current Asset Other Current Assets Buildings . Total (14.937 12.509 Payable/Accrued -- -- -- -- -- 5.705 8.573 777 2.894 896 198 155 77 3.720 3.012 3 22 -- -- 882 893 176 155 77 116 120 33 45 44 2.320 963 Machinery/Equipment .059 10.344 0 900 1.Gross 15.Overfunded Defered Income Tax .357 2.535 7.580 9.435) (12.602 3. Total .804 12.765 Property/Plant/Equipment.492 2.Other Note Receivable .255 4.712 41.Gross -- -- -- -- -- Accumulated Intangible Amortization -- -- -- -- -- 3.274 4.978 12.548 9.Gross Other Property/Plant/Equipment Gross Goodwill.Gross 293 673 205 204 209 -- -- -- -- -- -- -- -- -- -- 924 877 -- -- -- Property/Plant/Equipment.734) (13.991 4.300 Land/Improvements .085) (9.293 13.Current -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- 643 707 879 820 823 Total Current Assets 15.030 968 920 841 760 Discontinued Operations . Net Intangibles.986 4.661 8.472 308 299 -- -- -- -- -- -- -- -- 1.342 1.Gross -- -- -- -- -- Accumulated Goodwill Amortization -- -- -- -- -- -- -- -- -- -- Intangibles .516 1. Total .170 10.Affiliate Companies LT Investments .827 5.727 27.029 8.Gross Leases .Current Asset Discountinued Operations .034) (11.594 5.454 9.991 38. Net Long Term Investments LT Investment .728 3.572 13.Gross 362 405 976 913 822 Construction in Progress .603 14.259 13.225 1.341 54 38 Deferred Income Tax .Long Term Other Long Term Assets.Gross 662 679 1.404 2. Total Deferred Charges Pension Benefits .205 3.LT Asset -- -- -- -- -- Restricted Cash .

040 Limited Partner -- -- -- -- -- 3.618 2. Total 1.897 2.551 1.267 2.230 16.033 Security Deposits Income Taxes Payable Other Payables Deferred Income Tax .235 2.831 19.Non Redeemable Convertible Preferred Stock .Underfunded Other Long Term Liabilities Discontinued Operations .446 12.308 1. Total Reserves Pension Benefits .626 13.064 1.Common .295 870 634 1. Total 1.046 2.055 1.Current Liability Discontinued Operations .634 8.694 9.051 1.053 1.989 Redeemable Preferred Stock.102 13.832 13.804 11.363 16.266 15. Total -- -- -- -- -- Redeemable Preferred Stock Redeemable Convertible Preferred Stock -- -- -- -- -- -- -- -- -- -- Preferred Stock . Net -- -- -- -- -- Preferred Stock .LT Liability Minority Interest Other Liabilities.051 1.040 Common Stock 1.480 31 31 31 31 46 288 279 212 174 401 1.006 (181) (181) (181) (181) (181) Total Liabilities Shareholders Equity (PHP Millions) Additional Paid-In Capital Retained Earnings (Accumulated Deficit) Treasury Stock .Curr Liability Other Current Liabilities Total Current Liabilities Capital Lease Obligations Total Debt Deferred Income Tax Deferred Income Tax .010 1.929 790 783 768 156 72 790 783 768 156 72 733 704 562 3 3 1.228 17.Other Current liabilities.064 1.Liabilities -- -- -- -- -- 20.831 1.652 Dividends Payable 26 7 103 357 339 Customer Advances 76 95 -- -- -- 600 301 -- -- -- 79 155 168 136 82 -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- 514 312 363 553 2.427 5.055 1.438 2.757 2.522 1.797 2.053 1.943 52 2.484 Long Term Debt 855 3.Non Redeemable.Preferred -- -- -- -- -- General Partner -- -- -- -- -- Common Stock.949 Total Long Term Debt 855 3.943 52 2.620 4.881 1.563 1.700 12.438 2.215 1.Non Rdmbl -- -- -- -- -- -- -- -- -- -- Treasury Stock .571 12.484 -- -- -- -- -- 5.

140 Full-Time Employees 13.024 Treas Shares .604 8.190 9.222 17.325 -- 3.882 33.Net .893 20.Common Stock Prmry Issue 16 16 16 16 16 Treasury Shares .Preferred Issue 5 -- -- -- -- -- Shares Outstanding .681 16.Preferred Issue 1 -- -- -- -- -- Treasury Shares .727 27.Redeemable -- -- -- -- -- 733 704 562 3 3 Total Equity & Minority Interest 21.216 10.160 19.715 3.017 7.047 1.Preferred Issue 2 -- -- -- -- -- Shares Outstanding .991 38.519 17.120 16.133 -- -- 29.ESOP Debt Guarantee -- -- -- -- -- Unrealized Gain (Loss) 103 103 107 90 20 (358) (187) (317) (101) 23 (351) (187) (317) (101) 23 (7) 0 -- -- -- -- -- -- -- -- -- -- -- -- -- Total Equity 21.Preferred Issue 3 -- -- -- -- -- Shares Outstanding .035 1.035 1.126 Shares Outstanding .035 1.285 14.544 3.Preferred Issue 2 -- -- -- -- -- Treasury Shares .Common Issue 4 -- -- -- -- -- Total Preferred Shares Outstanding -- -- -- -- -- Shares Outstanding .039 1.Common Issue 3 -- -- -- -- -- Shares Outstanding .035 1.Preferred Issue 4 -- -- -- -- -- Treasury Shares .Common Issue 2 -- -- -- -- -- Shares Outstanding .039 1.Common Stock Primary Issue 1.Preferred Issue 6 -- -- -- -- -- Treasury Shares .211 8.746 29.Common Issue 3 -- -- -- -- -- Treasury Shares .Common Issue 4 -- -- -- -- -- Total Common Shares Outstanding Shares Outs .024 1.Preferred Issue 1 -- -- -- -- -- Shares Outstanding .136 Total Liabilities & Shareholders' Equity 41.Preferred Issue 6 -- -- -- -- -- Minority Interest .851 10.Non Redeemable Number of Common Shareholders Other Property/Plant/Equipment .Preferred Issue 3 -- -- -- -- -- Treasury Shares . Total Translation Adjustment Other Equity Minimum Pension Liability Adjustment Other Comprehensive Income Supplemental (PHP Millions) Minority Interest .363 Other Equity.282 14.201 Part-Time Employees -- -- -- -- -- 3.047 1.Common Issue 2 -- -- -- -- -- Treasury Shares .Preferred Issue 4 -- -- -- -- -- Shares Outstanding .Preferred Issue 5 -- -- -- -- -- Treasury Shares .

535 7.399 11.208 10.Net -- -- -- -- -- 8.993 10. Supplemental Long Term Debt Maturing within 1 Year -- -- 2. Suppl. . -- -- -- -- -- 76 95 -- -- -- Deferred Revenue .038 Net Debt (2. -- -- -- -- -- Accumulated Intangible Amort.950 Reported Total Assets -- -- -- -- -- Reported Total Liabilities -- -- -- -- -- Shareholders' Equity Excl.556 2.Intangibles .688) (332) (3.438 12.. -- -- -- -- -- Reported Shareholder's Equity -- -- -- -- -- Reported Net Assets -- -- -- -- -- Reported Net Assets to Total Assets -- -- -- -- -- Reported Return on Assets -- -- -- -- -- Reported Return on Equity -- -- -- -- -- Islamic Investments & Deposits -- -- -- -- -- Islamic Receivables -- -- -- -- -- Islamic Debt -- -- -- -- -- Islamic Section.508 -- -- -- 2. Suppl. Suppl.455 10.991 4.Long Term -- -- -- -- -- Total Risk-Weighted Capital -- -- -- -- -- Tier 1 Capital % -- -- -- -- -- Total Capital % -- -- -- -- -- Trading Account -- -- -- -- -- Credit Exposure -- -- -- -- -- Non-Performing Loans -- -- -- -- -- Assets under Management -- -- -- -- -- Total Current Assets less Inventory 12. -- -- -- -- -- Curr Port .705 8.401 -- Long Term Debt Maturing in Year 3 -- -- 25 34 -- Long Term Debt Maturing in Year 4 -- -- 2 16 -- Long Term Debt Maturing in Year 5 -- -- 2 4 -- Goodwill .Net Deferred Revenue .Current Debt & Lease.501 54 -- Long Term Debt Maturing in Year 2 -- -- 25 2. Suppl -- -- -- -- -- Accumulated Goodwill Amortization Suppl.984 9.Fin Sector.946) Tangible Book Value 12. Pension Items (PHP Millions) .186 Short Term Debt Financial Sector.129 12. Suppl.LTD/Cap Lse Fin Sec.177) (3.077 10. -- -- -- -- -- Capital Lease Oblig.374) (6. Stock Subscr.205 3. Supplemental -- -- -- -- -- Total Long Term Debt. -- -- -- -- -- Long Term Debt Financial Sector.

809 852 927 1.637 2.988 -- 2.268 722 848 1.809 852 927 -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- . Supplemental Operating Lease Payments Due in Year 1 Operating Lease Payments Due in Year 2 Operating Lease Payments Due in Year 3 Operating Lease Payments Due in Year 4 Operating Lease Payments Due in Year 5 Operating Lease Payments Due in Year 6 Operating Lease Payments Due in Year 7 Operating Lease Payments Due in Year 8 16.988 -- 2.862 6.534 7.809 852 927 1.988 -- 2.310 -- 31. Supplemental -- -- -- -- -- Interest Costs -- -- -- -- -- Executory Costs -- -- -- -- -- Capital Lease Payments Due in Year 1 -- -- -- -- -- Capital Lease Payments Due in Year 2 -- -- -- -- -- Capital Lease Payments Due in Year 3 -- -- -- -- -- Capital Lease Payments Due in Year 4 -- -- -- -- -- Capital Lease Payments Due in Year 5 -- -- -- -- -- Capital Lease Payments Due in Year 6 -- -- -- -- -- Capital Lease Payments Due in Year 7 -- -- -- -- -- Capital Lease Payments Due in Year 8 -- -- -- -- -- Capital Lease Payments Due in Year 9 -- -- -- -- -- Capital Lease Payments Due in Year 10 Capital Lease Payments Due in 2-3 Years Capital Lease Payments Due in 4-5 Years Cap.392 -- 2.931 852 927 1. Lease Pymts.988 -- 15. in Year 6 & Beyond -- -- 4 20 -- -- -- 0 0 -- Total Capital Leases. Due in Year 6 & Beyond -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- Total Operating Leases.434 -- Long Term Debt Maturing in 4-5 Years Long Term Debt Matur.Long Term Debt Maturing in Year 6 -- -- -- -- -- Long Term Debt Maturing in Year 7 -- -- -- -- -- Long Term Debt Maturing in Year 8 -- -- -- -- -- Long Term Debt Maturing in Year 9 -- -- -- -- -- Long Term Debt Maturing in Year 10 -- -- -- -- -- Long Term Debt Maturing in 2-3 Years -- -- 51 2.

Domestic -- -- -- -- -- Intangible Assets .740 1.Post-Retirement -- -- -- -- -- 7.201 973 532 Plan Assets .Foreign -- -- -- -- -- Post-Retirement Obligation -- -- -- -- -- 1. Pymts.853 3.Post-Retirement -- -- -- -- -- (495) -- (164) (241) (454) Funded Status .Domestic Expected Rate of Return .Foreign -- -- -- -- -- Expected Rate of Return . Due in 2-3 Years Operating Lease Pymts.Domestic -- -- -- -- -- Pension Payment Rate .00% Compensation Rate .Domestic Plan Assets .00% 8.00% 10.00% 11.Post-Retirement -- -- -- -- -- Pension Payment Rate .Domestic Accumulated Obligation .PostRetirement Unfunded Plan Obligations Period End Assumptions Discount Rate .402 -- 1.Domestic -- -- -- -- -- Prepaid Benefits .00% 8.Foreign -- -- -- -- -- Discount Rate .Post-Retirement -- -- -- -- -- Intangible Assets .00% -- 11. Due in Year 6 & Beyond Total Funded Status Pension Obligation .965 -- 5.Foreign -- -- -- -- -- Prepaid Benefits .Domestic Compensation Rate .365 1.214 986 Pension Obligation .897 -- 1. -- -- -- -- -- 7.977 -- 5.00% -- 8.705 1.705 1.618 1.Foreign -- -- -- -- -- Funded Status .Domestic .00% Expected Rate of Return . Due in 4-5 Years Oper.Operating Lease Payments Due in Year 9 -- -- -- -- -- -- -- -- -- -- 3.Foreign -- -- -- -- -- Net Assets Recognized on Balance Sheet -- -- (164) (241) (454) Prepaid Benefits .Post-Retir. Lse.082 (495) -- (164) (241) (454) 1.15% Discount Rate .Foreign -- -- -- -- -- Plan Assets .402 3.Foreign -- -- -- -- -- Operating Lease Payments Due in Year 10 Operating Lease Pymts.Foreign -- -- -- -- -- Compensation Rate .237 2.Foreign Accumulated Obligation .Domestic -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- 6.00% 8.977 -- 18.Domestic Funded Status .853 5.Post-Retirement -- -- -- -- -- Accumulated Obligation .25% -- 8.00% 8.

365 1. Net .Domestic 72.14% -- -- -- -- -- -- -- -- -- -- -- -- -- -- Total Plan Obligations 1.Domestic -- -- -- -- -- Other Assets.Foreign Other Investments % .54% 20. Net .Post-Retirement -- -- -- -- -- Private Investments % .Domestic -- -- -- -- -- Real Estate % .PostRetirement .201 973 532 Asset Allocation Equity % .14% -- -- -- -- Debt Securities % .Post-Retirement -- -- -- -- -- Net Domestic Pension Assets -- -- -- -- -- Net Foreign Pension Assets -- -- -- -- -- Net Post-Retirement Assets -- -- -- -- -- -- -- -- -- -- 23.Foreign Private Investments % .Foreign -- -- -- -- -- Accrued Liabilities .Foreign -- -- -- -- -- Equity % .Foreign -- -- -- -- -- Other Assets.72% -- 24.402 -- 1.897 -- 1.Domestic -- -- (164) (241) (454) Accrued Liabilities .99% Equity % . Net .214 986 Total Plan Assets 1.Post-Retirement -- -- -- -- -- Real Estate % .Post-Retirement -- -- -- -- -- 4.Foreign -- -- -- -- -- Debt Securities % .Domestic Other Investments % .36% 22.Post-Retirement -- -- -- -- -- Other Assets.Domestic Debt Securities % .Domestic -- -- -- -- -- Private Investments % .Intangible Assets .Post-Retirement -- -- -- -- -- Accrued Liabilities .Foreign -- -- -- -- -- Real Estate % .PostRetirement -- -- -- -- -- -- -- -- -- -- Other Investments % .