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2008 Annual Report

. We are the dominant technology-based gaming firm in the country and a principal technology enabler to the Bureau of Internal Revenue. with less than 150 employees at the end of 2008. This is just the beginning. but a highly productive one. gaming-based revenue streams for various agencies of the Philippine government. sports betting kiosks and mobile games. we have delivered almost a billion pesos in revenues. PhilWeb Corporation delivers world-class. and to Philippine Amusement and Gaming Corporation (PAGCOR).about us PhilWeb Corporation is the first and largest (by market capitalization) listed Internet company in the Philippines. innovative. fair. We are a lean organization. in their efforts to increase tax collections. entertaining and legal technology-based gaming products to the Filipino public. safe. In the five years since your Company entered the gaming business. the regulatory agency for all games of chance.000 customers a day through our nationwide network of online cafés. and we develop emerging. The Company today serves over 50.


Annual Report 2008 1 7 15 17 19 23 25 26 28 29 30 31 33 57 Letter to shareholders PAGCOR e-Games Cafés Mobile Gaming Sports Betting Board of directors Executive officers Statement of management’s responsibility Report of independent auditors Balance sheets Statements of operations Statements of changes in equity Statements of cash flows Notes to financial statements Corporate information .


we are poised to move to a higher level of corporate performance where dependable profitability generates consistent dividends for investors. only then does the product get mainstreamed in the minds of consumers. The year 2008 marked a seminal point in the history of your Company. of these revenues were generated by our core PEGS business. not all consumers are aware of the PEGS product and the entertainment 2 . which is why our cafés continue to experience high average revenue growth. Majority. With only a few cafés open. this speaks of the infancy of the business model. your Company’s revenues totaled -P-450 million. that the former exceeds the latter. As in any successful franchise. prospects it offers. 68% higher than the previous year. Rather. no one would have been aware of their excellent products with only a few stores around.letter to shareholders dear valued shareholders. we are not yet at this stage. PhilWeb Corporation. As profitable as the PEGS model is. Thus. While opening 45 cafés was our fastest café-opening rate ever. At this stage. but not all. In 2008. With three years of solid financial results behind us. in its infancy. 45 more than we had in december 2007. There needs to be a few hundred stores open before consumers become fully aware of the product and what it offers. This may seem paradoxical since one might expect a certain amount of cannibalization as new cafés are opened. This café-casino business is only in its early stages of growth and will be a fantastic revenue driver for many years. when comparing the pace of revenue growth to that of café growth. we can compare the PEGS Cafés today to other successful franchises when their brands were initially launched. this is only a 59% growth year on year. the average café’s revenue continues to grow even as more cafés open up. recession-proof core business. RecessiOn-pROOf ReVenues Indeed. our PAGCOR e-Games Cafés or PEGS. Once this “tipping point” is achieved. It is important to note. the past three years of strong growth have shown that we have a remarkable. We ended 2008 with 121 cafés.

to 17.574 from 8. with a record Casino Win of -P-194 million or a win rate of 3. 2008 gROwth highlights It is also interesting to note that our strongest performing month in 2008 was december. it also set the records for the strongest days of the PEGS café business. it is even more heartening to see our other business units doing well and contributing to Core Net Income. we are tracking 107% growth in your Company’s revenue from PEGS.14 million for the day. when compared to the same period last year. with a total of -P-8. to -P-1. Three days later. Total Bet Volume for PEGS reached a record -P-5.47 billion from -P-857 million Total PhilWeb Revenue from PEGS grew 82% The financial performance of the PEGS café network continues to defy the credit crunch that is affecting so much of the world today.2 billion from -P-28. On december 23. cOntRibutORs tO cORe net incOme As satisfying as it is to note our revenue growth rates.Some of our other 2008 growth highlights vs. to -P-47. with the record for daily Casino Win reset with a new total of -P-8. As a result. december 2008 turned in not only a spectacular performance.7 billion. 3 .6 billion Total Casino Win grew 72%. Early April is already showing promise. we set the record for total daily Casino Win. which is traditionally not a strong performer considering all the holidays and events during the month. • • We expect this recession-proof revenue performance to continue.239 Total Bet Volume grew 65%. we set the record for Gross Bets in one day with a total of -P-239 million wagered in our cafés.55 million on April 4. if not accelerate. as we continue to open more cafés this year. Instead. As of this writing: • • • January 2009 has beaten december 2008 February beat January day-on-day March 2009 is historically the best month ever. 2007 include: • • • • Number of Players per day grew 113%.4%.

We also reinvigorated our kiosk network offering Basketball Jackpot last year.letter to shareholders Basketball Jackpot. totaling . and are confident that this unit will deliver profits in 2009 and beyond. as well as the current PBA. after the Bureau of Internal Revenue and the Bureau of Customs. PAGCOR is the third largest contributor of revenues to the government. We continue to work very closely with PAGCOR to deliver new gaming opportunities to tourists and Filipinos.” With this regulatory foundation in place. our total cash bank balance was -P-702 million. paRtneRing with pagcOR The Philippines has a unique position in the ASEAN region. We are bullish on the ability of NBA Ending to increase revenues for Basketball Jackpot. It is the first country to have established a strong regulatory framework supporting the gaming industry. and is thus perfect for penetrating many provincial cities. PBL and UAAP combined. PAGCOR has already approved our NBA Ending product and we are rolling it out in time for the NBA playoffs that runs from now until June. a 31% growth P from previous year and a record for your Company. We focus very keenly on cash management in our gaming businesses. 2008. Also among our PAGCOR-related projects for 2009 are plans to double the number of outlets that offer our Basketball Jackpot game. As of this writing. one that has now been in place for close to thirty years. by making this game available in our PEGS Cafés. We also plan to enhance the game by offering NBA games.-61 million in 2008. This Net Income figure includes our equity in the net earnings of ISM Communications Corporation. had another consistent and solid year. On July 11. by . All these business units contributed to a total consolidated Net Income of . renewable for another twenty-five years. passing Republic Act 9487. land-based casino. offering enhancements 4 stellaR cash flOws One measure of our financial performance that should not be missed is our stellar cash flow. as there are over 1. Congress reaffirmed this regulatory superiority. There are not many more areas where a full-blown. Premyo Sa Resibo. PBL and UAAP games it covers.-292 million. all our financial condition is in excellent shape. PAGCOR can focus on increasing the revenues that it delivers to the Philippine Government. our mobile raffle. The PEGS Café model involves comparatively minimal capital and operating costs.-102 million that P P was contributed in 2007. compared to about 300 for the PBA.300 NBA games in one year. Taking into account only the Net Income contributed by our core gaming businesses. At yearend. through the Philippine Amusement and Gaming Corporation or PAGCOR. a growth of -P-206 million or 41% from a year ago. By all measures. also delivered modest growth. which extended the life of PAGCOR for “another period of twenty-five years. with its huge capital outlay and operating costs. known as the PAGCOR Charter. our Core Net Income had a growth rate of 92%. We continue to invest in our mobile businesses. our sports-betting game sold in Internet Sports Betting Stations. There are now 13 PAGCOR land-based casinos nationwide. makes financial sense. growing our management team and planning more product launches this year. a drop from the . never allowing betting on credit and reconciling all accounts on a daily basis. The PEGS Café expansion fits in nicely with PAGCOR’s growth objectives.

as well as tweaking existing ones to enhance their profitability. we tripled the headcount of our Mobile group. The Philippines continues to be the text capital of the world. As of this writing. For example. We got rid of some unprofitable sites and opened new ones. We are working 5 . PhILWEB lOOking beyOnD Unlike many industries that are playing it safe during the current worldwide recession. thus strengthening the entire network. Mobile continues to be a growth area for your Company. we have 138 PEGS Cafés and 155 Basketball Jackpot kiosks. This group will be launching several new products this year. Most of these are simple SMS messages. hiring more managers with telco and VAS experience. your Company looks at the near future with great optimism. with 50 more cafés in the pipeline. working hand-in-hand with PAGCOR. as Filipinos learn to use the phone for entertainment.3 billion texts sent per day. today we are the largest operator of café. but the volume for games and gaming is growing as well.61 102 231 75 41 121 ISM like a thermal printer. In 2008. a stand-alone computer and new signage. of course.or kiosk-based gaming. with 1. It can also work in countries where there is poor credit card penetration or where people prefer to pay cash for gaming entertainment. There are many opportunities in front of us and we are bullish that we can create more shareholder value from these projects. This network model will work in many countries where the population cannot afford to own their own computers and connects to the Internet via cafés.

By the end of 2009. This financial situation. It is a time when financially strong companies like us can seek further growth. we expect to have positive Retained Earnings on our Balance Sheets. as a result of our continued strong profitability. Many over-leveraged companies. As we look forward to delivering on these opportunities to you. our stockholders. will find themselves in financial distress during this worldwide credit crunch. We also continue to be on the constant lookout for potential acquisitions of companies involved in the gaming industry. when combined with our robust cash position. It is your unwavering support that has enabled us to work hard towards delivering on the great promise and potential of your Company. we would also like to thank you for the faith you have shown us over the past years. brings into play the prospect of distributing dividends to stockholders. Ongpin Chairman dennis O. Valdes President 6 . both local and international.letter to shareholders on several opportunities where we can “export” the PEGS model to these countries. 30 April 2009 Roberto V.

713 cities and municipalities all over the country. Thus. Cruz. including 21 new cities in 2008 alone. SVP-PEGS ROLLOUT DaViD JuDe l. the PEGS network grew not only in size. In key cities. The 45th new PEGS Café for 2008 opened in Sta. We are now in 50 cities and towns. We believe in following the examples of other successful franchise brands in expanding the PEGS Café network. establishing a rollout rate of a new café almost every week. number of players. Masbate. sta. café netwORk We ended the year with 121 cafés. consumers are not yet aware of the product and the exciting gaming and entertainment opportunities we offer. as our Rollout team achieved its biggest growth to date by opening 45 new PEGS Cafés during the year. As in the cases of these successful franchises.The PAGCOR e-Games (PEGS) Café network broke practically all of its records in 2008. SVP-PEGS CAFÉ OPERATIONS . we also see that overall local demand improves once second and third PEGS Cafés open up. we can see that we have far more work to do in the months ahead in order to get to our tipping point. When there are only a few cafés in the network. but even more dramatically. on december 26. This opening rate represents a 59% year-on-year growth vs. a “tipping point” must be reached in terms of visibility. 7 (LEFT TO RIGhT) OliVeR R. Manila. The majority of 2008’s 45 new cafés opened outside Metro Manila – in places such as Ilocos Norte. total bets and profits. in reach. PLAYERS AT PEGS ROxAS BOULEVARd IN PASAY CITY This is in line with our strategy of shifting focus to opportunities and potential outside the capital region. Palawan and Cagayan de Oro. the PEGS team delivered a stellar performance during the year. 2008 saw new focus and effort from the PEGS Rollout team to build PEGS Cafés beyond the metropolitan base. the 76 PEGS Cafés we had in the network at the end of 2007. ana. As there are 1. consumers learn of the games we offer and are attracted to try out our products. as more cafés open all over the country. however. gO. In terms of number of cafés.

For the past few years. your Company’s focus in the PAGCOR e-Games business has been on rollout.574 Players per day in our cafés at the end of 2008. -P-239 million of that on december 23 alone. this shows that additional cafés are getting their growth from new players rather than cannibalizing existing cafés. in terms of increasing Bet Volume. a total of -P-5. with december achieving the highest Bet Volumes in the history of PhilWeb. We started 2008 at 1. We welcomed an average of 17.pagcor e-games In fact. the total of which represents the average Player Spending during a visit. again a growth of 70% vs.239 Players per day. we have already reached 130 PEGS Cafés. average Player Spending was -P-2. 8 . previous year. Indeed. we averaged only 8. This statistic is easily trackable.747.6 billion in 2007 to a staggering -P-47. a phenomenal yearon-year growth of 65%. Bet Volumes rose steadily throughout the year. We also track the average Player Buy-In and Reloads.862 terminals.2 billion in 2008. network growth continues in 2009. In 2007. At the end of the first quarter. The fact that the growth rate of Bet Volumes is higher than the growth rate of café openings implies that the average café continues to do better than in previous years. bet VOlumes Bet Volumes increased from -P-28. with over 50 more in the pipeline. despite the additional cafés offering the same games.496 terminals and grew this by 91% to 2. having these players spend more. since our casino games software is able to store all gaming information since we started the business. The combination of getting more players. especially in the crowded metropolitan Cafés. and increasing PEGS Cafés and terminals has had a synergistic effect in achieving the total Bet Volume growth of 65%. we also started to expand existing sites by adding more terminals. This strategy has been remarkably successful. At end-december 2008.5 billion for the month. but in 2008.

Our PEGS Café network had a total Casino Win rate of 3. which has a relatively low Casino Win rate. Other games.PEGS OLONGAPO casinO win Casinos around the world measure Casino Win as the first figure towards revenue recognition. Our PEGS Marketing team embarked on a focused in-store campaign with a priority objective of driving players away from baccarat. WOMEN COMPRISE NEARLY hALF OF ALL PLAYERS 9 . Although seemingly small. Winning percentages reflect the games that players choose in the PEGS Cafés.1% in 2008.0% in 2007.1% percentage point improvement meant an additional -P-5 million to the Casino Win. The improvement in the Casino Win rate was largely due to our improved marketing for our slot machine games. with a Casino Win rate just over 1%. which have a higher house advantage. the 3. a 0. Some games have high payout rates and therefore lower Casino Win rates. a slight improvement vs. based on our Bet Volumes. like slot machines and roulette can have win rates of close to 5%. to slots. The classic high-payout game is Baccarat. AS OF 2008.

At the end of March. PEGS SUBIC 10 . we were tracking a year-on-year growth rate of 107%. it is at an average of 38. Total Casino Win for 2008 totaled -P-1.47 billion. we were able to reduce the annual average baccarat play to 41% of Gross Bets. the -P-857 million the previous year. when we started our campaign. PhilWeb’s Revenue from PEGS in 2008 increased by 82% compared to 2007. is the Bureau of Internal Revenue (BIR). of course.pagcor e-games When the PEGS system started. The single-day Casino Win record was also set in december.14 million on december 26.2%. Their portion of the Casino Win is 28%. december was the strongest month. typical baccarat volume was over 50% of Bet Volume.5% and falling — March 2009 was at 34. The first party. In 2008. ReVenue fROm pegs Casino Win is divided among all the parties involved in running the PEGS Cafés. -P-8. The rest is then allocated between PAGCOR and PhilWeb. The next in line is the Café operator. a 72% improvement vs. PAGCOR pays a 5% franchise tax on all its gaming revenues to the BIR and this amount is taken from the Casino Win as well. Another 2% of the Casino Win is allocated for marketing funds. with a record -P-175 million in Casino Win. And our figures from the first quarter of 2009 show that we are doing even better. comparable to a land-based casino. Most of the operators of the 130 PEGS Cafés are smalland-medium-scale entrepreneurs who run a variety of businesses. and as of the time of this writing.

It did not follow any established international business models.and four-year-old in-store terminals began to reach full depreciation and obsolescence. we doubled the number of servers and exponentially increased bandwidth ahead of demand. low-capital-cost business opportunity. three. whose staff needed little or no retraining to use the faster. Another major project was the replacement of our existing point-of-sale (POS) system. simpler and more flexible program. and fresher environment in the Cafés. we went deep into the details of the business and developed hundreds of technical and operational improvements. MABALACAT. Operators. In 2008. We were able to develop and implement a new POS quickly and seamlessly. The Thin Client is a new type of computer that is stripped down to the very basics. . struggled to develop the business and learned how to make it work. safer and more efficient cash management. PAMPANGA cOntinuOus impROVement The success of the PEGS business is the result of continuous improvement. as our initial. Your Company. Players enjoy a more private. as well as installing backup resources for security and disaster recovery. with unanimous approval from our Operators. we have invested over P200 million in the technology behind running the PEGS software as efficiently and effectively as possible. When the PEGS Café system started four years ago. We spent a lot of 2008 improving the product. Because it is less complex. we have begun a system-wide migration to “Thin Client” systems. working with PAGCOR. relaxed. 11 Major technical improvements centered on increasing the capacity of our current gaming architecture. Also on the technical side. it was a virtually unknown product with no brand or market presence.A MALL-BASEd PEGS CAFÉ. which had begun to show its age when confronted with the terrific pace of system growth. and a pioneer brand in a dynamic field with exciting growth. To address the network’s rapid growth. on the other hand. PEGS Cafés today offer unique advantages. from more attractive and visible standard signage to faster. with the same levels of excitement and service as traditional land-based casinos. have found the PEGS to be a unique. flexible. To date.

to help inform and motivate our Operators as well as provide a venue for PhilWeb and PAGCOR to address Operators’ concerns quickly and effectively. This comprehensive document was in part the result of operations surveys to identify both best practices and problem areas. ENJOY PERSONALIzEd hELP FROM OUR GAMING ASSISTANTS 12 . far less electricity consumption (not least because they generate less heat and thus place less load on air conditioning systems). hardware and software upgrades. NOT ALL OF WhOM ARE COMPUTER-SAVVY. PEGS Operations in 2008 began to hold quarterly PEGS Operators’ General Assemblies. Other technical improvements in 2008 included new designs for site is more reliable and delivers major savings to operators in the form of lower capital investment. which for the first time codifies the process of setting up and successfully managing the PEGS Café business. and enhanced levels of maintenance and support. we proactively and continuously evaluated and improved systems to prevent problems from happening in the first place. OUR PLAYERS. Operational improvements were led by the release of a PAGCOR E-Games Café Manual of Operations. In particular. and lower maintenance costs. we took a page from classic Japanese quality management philosophy: instead of focusing on solving problems when they happen.

wider reach. Our terminals now offer 145 games in total. AVP-BIGGAME OPERATIONS . making it the secondlargest operator in the business. it was more of a missionary operation. when they decided to focus on their other businesses. and now provide quarterly upgrades in the form of new games. to keep operators informed of the fast-moving changes in our IT infrastructure and operations. opening sites where we could not engage an independent operator. BGI was the first PAGCOR e-Games operator. By the end of 2008. or in a few cases. By yearend. Inc. a wholly owned subsidiary of PhilWeb. and high speed and efficiency have made the PEGS Café network better prepared to keep pushing the envelope on profitability in 2009. and eliminated unpopular or underperforming ones.biggame BigGame. BGI. 13 feRDimaRk l. a startling improvement over its -P-10 million in revenues the previous year. (BGI) serves both as the flagship operator and the development laboratory for the entire PAGCOR e-Games network. Originally. better value proposition to customers. The hundreds of improvements we develop for all cafés are tested first in selected BGI Cafés. and increase profitability. has developed from a break-even startup to a major contributor of revenue to your Company. Larger volume. which was doubled compared to previous year. PhilWeb decided to change the reactionary business model to a more aggressive one. with four cafés. Tech digits. mostly virtual slot machine games. maRianO. At the same time. We negotiated improved marketing support levels from PAGCOR. BGI owned 17 of the 121 PAGCOR e-Games cafés. BGI began 2008 with modest profitability. PhilWeb acquired it in 2005 from the original owners. taking over sites where the operators wanted to sell out of the business. in the form of an increased Free drinks subsidy (67% higher than 2007). and an increased Player’s day subsidy. and launched a monthly PEGS newsletter. BGI contributed -P-56 million to topline revenues. We improved our online casino software. FREE dRINkS FUEL PLEASANT GAMING ExPERIENCES We also conducted dozens of smaller programs aimed at continuous improvement of procedures and processes. In 2008. we added 14 new games.

If successful.BigGame ThE hIGh-ROLLER AREA AT BGI’S PEGS ESPAñA This was accomplished by two strategies. featuring premium furnishings. with more promotions and tactical advertising. Secondly. aimed at making BGI cafés the cleanest. BGI re-imaged all cafés. and achieved faster service turnarounds and a higher service level. enhanced privacy and a very high level of amenities. individual site activities and system-wide activities. staff uniforms and signage. with common site design elements. BGI has also concentrated on improving service and performance. the Big Lounge. with greater room for expansion. The Big Lounge. and those determined to have potential were extensively renovated and expanded.000 or more in a single session. BGI also developed and implemented load-sharing redundant network connections to reduce bandwidth downtime to near zero. most inviting and most efficient in the network. and it will continue to leverage this investment to improve these returns even further. This was accompanied by a program of better site maintenance. with Gross Bets running into the hundreds of thousands. it set a goal to be the best managed and marketed operator network. 14 . It established benchmarks and targets. They feature new seats. negotiating to acquire prime locations with its own rollout team. those who typically deposit -P-5. Your company has found that investing in better management and facilities for BGI has resulted in good returns. Marketing research tells us that over 70% of revenues come from the top 27% of players. it will be rolled out throughout the system. Among our product developments. better cubicles. for the first time. BGI expanded more aggressively. we introduced. The new cafés we added in 2008 are larger. Apart from appearances. a high-roller area at PEGS España. All sites were evaluated for performance. upgraded amenities and better ventilation and energy efficiency. First. creating a consistent standard look. is designed to attract and retain such players. Marketing was stepped up as well. in some cases doubling capacity.

We realized that the gaming sector in mobile is growing fast. As of december 2008. To date. PSR has forged a key strategic partnership with the country’s largest retail group.started in June 2006. Aside from strong partnerships with the mobile telcos. and 2009 will see several important new products. SM. allowing consumers to participate in PSR without using a cellular phone. your Company beefed up its mobile department in 2008. companies issuing unregistered receipts. over a million consumers have joined the program. pRemyO sa ResibO PSR continues to solidify its status as the country’s longest running and most successful mobile raffle program. Official Receipt number and amount) are used to expose receipts that are outright fakes. over 140 million raffle entries were processed since the program BIR COMMISSIONER SIxTO ESqUIVIAS IV WITh PSR WINNERS bills payment counters. in preparation for the rollout of more mobile games. PhilWeb has installed PSR terminals at all SM malls nationwide. balDeRRama. and companies actually operating while pretending they are non-operational. The last quarter of 2008 was spent on develoment. among others. More corporate partnerships will be formalized in 2009 due to the increasing number of companies that have expressed interest in supporting the program. Over -P-120 million worth of prizes have been given away. mall information counters and business service centers. PSR also remains an important source of data for the Bureau of Internal Revenue (BIR) in identifying tax evaders. The information (Tax Identification Number. SVP-MOBILE . These terminals are located at all SM Buoyed by the success of “Premyo Sa Resibo” (PSR). and we can take advantage of it with the experience gained in PSR. from just three direct staff to eight. The Mobile group constantly refreshes PSR via marketing efforts including TV and radio commercials and 15 geRaRDO a. or TIN.

similar to a “look under the bottle cap” promotion. In addition to the foregoing games. Special events will also be held in areas with high people traffic. . for example. GARY TEVES AWARdS P1 MILLION TO A WINNER newspaper ads. In this way. Raffle entries submitted via the mobile phones and terminals are charged . To join. In addition.-5.00 and will be available to P subscribers of all mobile telcos. a subscriber needs to simply text BId <product code> <space> <bid amount> to 9779 at -P-2.-1 million P bi-weekly cash prize. The format is simple: text in a bid for the item representing how much you wish to pay. win the right to buy a brand new laptop for -P-647. PSR also embarked on a roadshow.50 per entry.-100. a highvalue product not falling into one of these categories will be offered as a special item. The lowest unique bid at the end of the week wins the item at the bid price. where the program will immediately text him back to say whether or not he has won.000 and 24 winners of . digital cameras. More than 6. for example a set of golf clubs or a fashionable handbag.000 cash.-1. This game has an “instant prize” format. Cebu City and Legaspi City. Each text entry will be charged . ResibOnanza An exciting mobile game aimed at supporting the BIR’s Ask for Receipt Campaign will be launched in 2009. PSR was restructured to get more winners by giving away daily and weekly cash prizes. In 2008 alone. three prize categories will be up for auction: mobile phones. there have been 36 winners of . high-end appliances and high-tech gadgets. Bid Wars promises to be an exciting game where lucky players can win and purchase items they desire at the price they want. RESIBOnanza marketing efforts will be supported by TV ads.000 cash. The simplicity of the mechanics plus the excitement of instant prizes is the formula that will ensure another winning mobile product for Philweb.-10.000. together with the .50 per text gaming FINANCE SEC. This will ensure a wide audience reach that will induce trial and participation. 107 P P winners of .-5. 16 . Bid Wars is offered by PhilWeb in partnership with The Philippine Star and SM Appliance Center. the lowest unique bid received in a day wins -P-1. Pampanga. Prizes to be given away include a brand new car every week.52 or whatever was the lowest unique bid. For daily prizes. and conducted national draws in San Fernando. the consumer just texts in the TIN of the establishment found on his receipt. San Pablo Laguna. a consumer could.000. and cell phone load. 18 winners of . every month.200 prizes will be given away monthly. Each week. Baguio City. consumer electronics like cell phones. PhilWeb Mobile group will be launching many more in 2009. P biD waRs Bid Wars is an SMS-based reverse auction game exclusively for Smart and Talk ‘N Text subscribers. P portable players.-1 million. A car was P P also given away as a special prize in the december Grand Christmas draw. In RESIBOnanza.-2. print placements and radio spots.

This roll out is being done via the addition of a stand-alone computer exclusively selling Basketball Jackpot. When two name teams contest a game. like 92 – 91. is to start selling the game within our PEGS Café network as well. 17 SENIOR MANAGER eRRick R. one challenge of our BJ team is how to keep increasing outlets selling the game. 43 and so forth. with 100 possible two-digit combinations and thus. And when indeed. as it is known on the street. the winning two-digit combination would be 93 – the ending number of the winning team’s score paired with the ending number of the losing team’s score. BJ. a 1% chance of guessing the correct outcome. The stand-alone kiosk inside the PEGS will add over 130 new points of sale to the game and the sports betting group is already midway through the roll out process. the game ends with a down-to-the-wire result. involves guessing the correct ending numbers of the scores during a basketball game. Thus. like 21. 32. With over 150 kiosks. Punters improve their odds by theorizing as to whether a game might be closely fought or a wipeout. It’s a frighteningly simple game. of course. if Team A were to beat Team B by a score of say. gOnzalez A PROTOTYPE BASkETBALL JACkPOT STANd . The answer. 89 – 83.spORts betting Our Sports Betting operation is primarily composed of the game Basketball Jackpot and is sold through a network of 150 kiosks. the betting can skyrocket on number combinations that are one or two points apart. there are many happy winners at Basketball Jackpot.

BJ is already offered on all PBA. 18 . during the off-season. In addition to the existing variants (Last Two. Last Two Jackpot Special is essentially the combination of q2.000 jackpot. plus the continued expansion of the kiosk network. six-digit wager. Last Two Jackpot Special combination will win a -P.100.300 NBA games a year. PBL and UAAP games. our kiosks are only active three days a week. and are actually closed nearly three months a year. Basketball Jackpot will continue to grow as a revenue driver for PhilWeb. There are over 1. q3 and L2 to make one. Thus. PAGCOR has just allowed BJ for the games of the National Basketball Association. Last Three and quarter Ending). a new progressive jackpot has been introduced called the Last Two Jackpot Special. so we foresee a great future for our new NBA Ending variant of Basketball Jackpot. but in total these represent only about 300 games a year.sports betting AdVERTISING MATERIAL FOR NBA ENdING Another challenge has been to find more basketball games to bet on. a portion of all bets will be added to the jackpot prize. so that the succeeding game’s jackpot is increased. Another BJ tactic to increase revenues is to increase the number of betting variations. With new variants like NBA Ending and Last Two Jackpot Special. The big difference is that a bettor who guesses the six-digit. And if no one guesses the number AdVERTISING MATERIAL FOR BASkETBALL JACkPOT correctly.

Metro Pacific Investment Corporation and Maynilad Water Services. Inc. Alphaland Corporation and developing Countries Investment Corporation.. vicechairman of Philex Mining Corporation. PNOC Energy development Corporation. Ongpin is a certified public accountant and has an MBA from the harvard Business School. he is a director of the Philippine Long distance Telephone Company (PLdT). Inc.. Petron Corporation and Araneta Properties. Philippine National Bank. Northwestern University. ONGPIN was elected chairman of PhilWeb Corporation in January 2000. he is also a director of ISM Communications Corp.. Recto has a degree in Industrial Engineering from the University of the Philippines. he served as Undersecretary of the department of Finance of the Republic of the Philippines. DENNIS O. Cornell University. Inc. the year he founded the Company.C. he is a member of the Integrated Bar of the Philippines and has a Master of Laws degree from the University of Michigan Law School. graduated magna cum laude in Business Administration and Accountancy from the University of the Philippines and has an MBA from the kellogg School of Management. RAY C. U. Before his work with the government. chairman of the various subsidiaries of ePLdT.) from 1987 to 1988. he was a partner of SyCip Salazar hernandez & Gatmaitan from 1982 to 2000. ESPINOSA was elected vice-chairman of PhilWeb Corporation in June 2006. Inc. VALDES was elected president of PhilWeb Corporation in June 2006. Mr. Belle Corporation. in charge of handling both the International Finance Group and the Privatization Office from 2000 to 2003. he was formerly the managing partner of SyCip Gorres Velayo & Co. director and corporate secretary of Cyber Bay Corp. his previous work experience includes ten years with the Inquirer Group of Companies.. he is also chairman of ISM Communications Corporation. director of Shangri-La Asia (hong kong). he was CFO of Alaska Milk Corporation and prior to that.S. as well as deputy chairman of the South China Morning Post (hong kong). he is a certified public accountant.A. and a law lecturer at the Ateneo de Manila School of Law from 1983 to 1985 and 1989. 19 . Eastern Telecommunications Philippines.. vice-chairman of the PLdT Beneficial Trust Fund. when ePLdT acquired 20% of PhilWeb. Prior to that he spent six years with The NutraSweet Company developing their sweetener business in Asia. Mr.. a foreign associate at Convington and Burling (Washington. as well as an MBA from the Johnson School. RECTO was elected vice-chairman of PhilWeb Corporation in March 2005. he is a director of Eastern Telecommunications Philippines. and served as Minister of Trade and Industry of the Republic of the Philippines from 1979 to 1986. president and CEO of ePLdT. as a director of the newspaper. he is vice-chairman of Alphaland Corporation and president of Petron Corporation.ROBERTO V. and served as its president from 2005 to June 2006. and director and chairman of the Audit and Nomination Committee of Lepanto Consolidated Mining Company. printing and ink-making operations. Inc. d. and also expanding their Internet. Inc. ERIC O.

he is chairman and president of Aldevinco. and Cyber Bay Corporation. he is chairman of Coxinvest LLC. and is also the chairman of Liberty Telecoms holdings. the Asian development Bank and a hong kong-based.. director of Southeast Asia Cement Corp. Inc. Inc. The Purefoods-hormel Company. Alsons Consolidated Resources. Mr. chairman of BoieTakeda Chemicals. he has a BS degree in Mechanical Engineering from Far Eastern University... among others. ANG was elected a director of PhilWeb Corporation in November 2001.) Inc. ARANETA was elected a director of PhilWeb Corporation in March 2003. Inc. and Philcomsat holdings. Inc. and the Public Estates Authority. Cox has a BA from the University of California at San diego and an MBA from the University of California Marshall School of Business. president or director in over 35 companies related to or subsidiaries of San Miguel Corporation. a consulting company based in California... chairman and CEO of Petron Corporation and vice-chairman of the Manila Electric Company (MERALCO). Inc. In the past. a hong kongbased. Inc. he is currently vice-chairman. Manila Economic and Cultural Office.. among others.A. RAMON S. he served as managing director of Lombard Asian Private Investment Company. Magnolia.. chairman and president of Boie.. Petronas Energy (Phils. he has also served as an Undersecretary of the department of Trade and Industry of the Republic of the Philippines.S. he was previously CEO of Paper Industries Corporation of the Philippines (PICOP) and executive managing director of Northern Cement Corporation. RANDALL D. he holds the positions of chairman. Inc. 20 . and The Professional Group. honda Philippines.. BENITO R. president and COO of San Miguel Corporation. he is chairman and CEO of Araneta Properties.. U. he was formerly president of Yes Television Asia and a board and execom member of Good Morning Securities.board of directors TOMAS I. COX was elected a director of PhilWeb Corporation in december 2005. among others. Philippine-American drug Co. director of dBP-daiwa Securities Corp.. Philippine diamond hotel & Resort. Alto Power Management Corp. ALCANTARA was elected a director of PhilWeb Corporation in May 2002. boutique investment bank. Inc. private equity fund associated with CALPERS..

. a hong kong mobile operator. In the past. In the Philippines.. LOCSIN was elected a director of PhilWeb Corporation in January 2000. Jansen Pharmaceuticals and J&J Medical Phils. as well as director. and a postgraduate fellowship with the Coro Foundation. he was former group managing director of Sunday Communications Limited. Inc. Ehrlich. he is the former. Tanjuatco and Factoran.. MARIO J. GALICIA. group vice-president for corporate services of Metro Pacific Corp. Inc. he is also a director of ISM Communications Corporation. he served as a director of Belle Corporation. 21 . Oreta. chairman of kbro. he is also a director of ISM Communications Corporation and Toyota Pasong Tamo.board of directors CRAIG E. he has a Bachelor of Science degree from the University of the Philippines. he is currently the group vicepresident of ePLdT. a hong kong resident since 1987. Inc. human resources director of Johnson & Johnson (Phils. was elected a director of PhilWeb Corporation in december 2005... and Inpilcom.5 billion customers across 218 countries and territories. long-time chairman of the GSM Association (GSMA). Bharti Airtel. EHRLICH was elected a director of PhilWeb Corporation in May 2002. and founding chairman of Novare Technologies Ltd. he is a board member of the International Telecommunications Union (ITU). the global trade association representing more than 700 secondand third-generation network operators and over 180 manufacturers and suppliers. Southwest Resources. and Pilipino Telephone Co.. Philippine Long distance Telephone Co.and middle-income housing as well as resort development. ORETA was elected a director of PhilWeb Corporation in March 2005.. Taiwan’s largest cable TV company.. he is president of Alphaland Corporation and chairman/founder of Major holdings... Inc. holds a BA degree from the University of California Los Angeles. MARIO A. / del Monte International Inc. he is a director and vicechairman of ISM Communications Corporation. a master’s degree from Occidental College. and treasurer of hideco Sugar Milling Co. Mr. Inc. hutchison Telecommunication Group. Inc. serving more than 3. and was the founder and managing partner of the law firm of Tanjuatco. executive vice-president and COO of Philippine Airlines. India’s largest (by market capitalization) company. MARIANO L. and group manager of del Monte Philippines. president of Aeropartners. a hong kong software development company. APC Group. JR..) Inc. he was formerly a senior vice-president of Fort Bonifacio development Corp.. Inc. whose interests include low. Inc. he finished his Bachelor of Laws at the Ateneo de Manila University and is a member of the Integrated Bar of the Philippines. he is president and COO of Eastern Telecommunications Philippines.

22 . Philcomsat holdings Corporation. he is the Corporate Secretary of ISM Communications Corporation. operator of Netopia. Inc. which are clients of the law firm of Castillo Laman Tan Pantaleon & San Jose (CLTPSJ).. and Itogon-Suyoc Resources.. Inc. WENCESLAO. Inc. and director of Vinmer Realty. and Bay Resources and development Corporation. Inc. he is a certified public accountant and has a Master’s degree (with distinction) in Business Management from the Asian Institute of Management. CLIBURN ANTHONY A. he is a member of the Integrated Bar of the Philippines. GEORGE N. vice-president of Leafar Commercial Corporation.executive officers RAFAEL B.. JR. Inc. from 1998 to 1999. he has a Bachelor of Laws (cum laude) from Mindanao State University. a director of Mabuhay holdings Corporation. Gothong and Aboitiz. Inc.. Inc. where he graduated as the class valedictorian. and Corporate Secretary of Alsons Consolidated Resources Inc. Wenceslao & Associates. ORTIGAS was elected a director of PhilWeb Corporation in April 2002. and Mandaue Land Consortium. he is senior vice-president of ePLdT. Inc.. and director of ISM Communications Corporation and delegate general partner of Ortigas and Company.. he is also either a director or Corporate Secretary of various companies. he was an associate professor and held various key positions in the Asian Institute of Management from 1989 to 1997. Inc. he was formerly an associate of the Rodrigo Berenguer Guno law firm. was elected a director of PhilWeb Corporation in May 2004.M. and Solid Group.. Inc. Inc. Inc. Inc. chairman and director of Ck3k. Inc. Inc. Partnership. Ltd. ORBE was elected Assistant Corporate Secretary of PhilWeb Corporation in June 2006. SAN JOSE was elected Corporate Secretary of PhilWeb Corporation in January 2000. president and director of Rising Sons of 3k. and GSC-3kCk. he is presently the chairman and president of d.. AngloPhilippine holdings Corporation. chairman.. managing director of R-I Consortium and director of Belle Bay City Corporation. director and treasurer of Creative Trade Center Services. DELFIN J. Premiere Entertainment Productions. chairman of Philippine Ecopanel. Inc.. the largest chain of Internet cafés in the Philippines. Concrete Aggregates Corp. TAN was elected a director of PhilWeb Corporation in June 2006. ROBERTO V. he is a member of the Integrated Bar of the Philippines and a Senior Partner of CLTPSJ. Interport Resources Corporation. he was executive vice-president and CFO of William. he is executive vice-president of Sagitro. and Fabricom Manufacturing Corporation. and president and CEO of digital Paradise. president and director of Bay dredging.

AVP. mariano. Ton Orbe 23 . sta. Senior Consultant. Bobby Mauricio. SVP. manalo. ana. VP.executiVe OfficeRs Roberto V. sproule. BigGame Operations errick R. Errick Gonzalez. Senior Mgr. Internal Audit scott a. go. Ongpin Chairman Ray c.. gonzalez. Ardie Balderrama. santiago Jr. Ongpin. SVP. Marketing Josephine a. PEGS Café Operations ferdimark l. SVP. SVP. prieto. balderrama. Valdes business aRea manageRs Oliver R. VP and Chief Financial Officer melecio a. Orbe. PEGS Roll Out David Jude l. Ferdie Mariano. Senior Mgr. to the Chairman cliburn anthony a. Recto Dennis O. Apa Ongpin. Mobile florentino b. Chief Technical Adviser manageRs standing (l-r): Oliver Go. Basketball Jackpot gerardo a. mauricio. espinosa Vice Chairman Vice Chairman President eric O. Mobile suppORt gROup manageRs Rafael g... Legal zaldy m. VP and Asst.

dennis Valdes. Scott Sproule.seated (l-r): zaldy Prieto. dJ Sta. Ana 24 .