Name: JENNYLYN T.

LAVAPIE Grade and Section: ABM12Y1-9

SUBJECT: Business Finance

PERFORMANCE TASK 1:
ENRICHMENT- SITUATIONAL ANALYSIS

Excerpts from news articles about some Philippines listed companies are shown below.
Answer the questions after each excerpt. (10 points each)

a. The following information from a business article titled, “PLDT cuts full-year profit
forecast after third-quarter results disappoint” was posted on Interaksyon.com (Date
accessed: March 11, 2015) on November 4, 2014. From the article, PLDT
management reported that PLDT’s 2014 third-quarter net income was down to P7.9
billion in the same period in 2013.
“Our third quarter results reflect intensifying competition in the cellular space of our
business, to which we have taken measures to respond to competition and stabilize
our share of market. Smart, Sun and Talk N’ Text undertook to match or neutralize
price aggression on the prepaid front, effectively lowering price points for the same
level of activity”, Manuel V. Pangilinan , PLDT Chairman said .
“ * * ”

“Based on this market assessment and on the information available to the company,
PLDT is revising its profit guidance for the full-year to P37 billion from the P39.5 billion
previously disclosed,” Mr. Pangilinan said.

Question: How do you think will PLDT investors react to this piece of information?
What do you think will happen to its stock price ? Explain your answer.
“ * * ”

For me, the investor reacts disappointed to the company. Also, the investors will know what
is going on in the profit of the company. If their shareholder wealth is still on the increase side
or not. The stock price will increase in some bills or payments on their internet that people
use to maintain their profit or increase their profit. We experience a pandemic now that is why
many people demand the internet. Since it is one way to communicate with their loved ones.
Also, some students need the internet for their online classes. So, it is a high demand in the
market it is an advantage for PLDT to take the risk to provide their internet suddenly some
costumer is not satisfying to their service that is why some investors and costumers choose
on other market or invest in other company. That is why the stock price of PLDT will increase
if they want to maintain their profit and protect their investors.
 b. On October 13, 2014, the following information from an article titled, “Petron
completes $2-B refinery upgrade: Firm doubling production capacity” was posted on
Business.inquirer.net (Date Accessed: March 11, 2015):

Dubbed as Refinery Expansion Project (RMP-2), this project started in 2011. “With
the upgrade, Petron said it would significantly increase production. Its gasoline
production alone is projected to double from the current 18,0000 barrels per day to
36,000 barrels per day.”
In the same article, Mr. Ramon Ang, the president of Petron also made the following
statements:
“For Petron, this means increasing our revenues while improving profitability,” Ang
said. “With increased production, Petron will enhance the country’s supply security
and further lessen its dependence on higher-costing imported fuel products. We will
also be the only oil company capable of locally-producing more efficient and
environment-friendly fuels that meet or exceed global standards.”

Question: What do you think will be the effects of this project on the long-term profits
of Petron Corporation? What do you think will be the possible effects of this news on
the share price of Petron Corporation?

The effect of this project on the long-term profits of Petron corporation will increase.
Improving or upgrade is the key to the long-term profit success of their company. It is the best
strategy to increase their sales or revenues. The stock price of Petron Corporation might
increase since if they do this project, many people will demand their services. If many people
demand or want their services, the price of the stock will increase. It will help their company
to attract a customer. It is an advantage of Petron Corporation over other competitors.

1.5. EVALUATION Go beyond walls: Apply it in real life!

You are the finance manager of a firm that manufactures slippers, sandals and shoes. The owner
of the business approached you and asked for your opinion on how to save money- in effect
increasing profits- without sacrificing the quality of your products.

a. What departments in your company will you tap to gather data that can help you in your
analysis?

As the finance manager of a firm that manufactures slippers, sandals, and shoes, first I will ask
the Accounting Department, Operation Department and the Marketing Department. Each has
essential role in the business that can provide information on how to save money while
increasing profits.

b. What type of information will you ask them for?

• In Accounting Department, I will ask about the current financial of the company.
• In Operation Department, I will ask them if the product delivered will and the customer
is satisfying to the product. Since if the customer is happy to the product, it produces
high profit to the company.
• In marketing Department, I will ask help to create a marketing strategy and objective
for the proposal of the project that we need to do. Since marketing department is
excellent in doing a marketing strategy for the company

c. Create a proposal that you will present to the owners of the company. Use the format given
below for your proposal. (You may add another sheet of bond paper if necessary.)
Objective Activity/ Project Person Estimat Time Expected
s /Department ed Frame Result
(Project name Involved Budget
(Make this and how to (# of
SMART) execute) month
s or
years
to
finish
the
project
)

Increase Increase Profit • Accou Less • The

profit and reduce nting than profit
without cost but not 400,00 6
Depar will
sacrifice scarify the 0 mont
tment increas
hs
the quality. • Opera e but
quality tion the
within 6 • To quality
Depar
months execut still
tment
e this
also • Marke there.
project,
reduce ting • The
the cost. we
Depar quality
need a
tment will not
marketi
affect
ng
to the
strateg
increas
y.
ing
• In profit.
marketi It
ng reduce
strateg s cost
y, we but it
will increas
identify es
the profit
good of the
way to
increas
e our compa
profit in ny.
selling
our
product
with a
good
quality
but we
just
have a
low
expens
e.