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Investor FAQs
Shareholder Governnace Structure
P & L Issues Why is Ayala investing in power and what is its strategy? What types/sources of power are you looking at? What are the key highlights of your solar power initiatives? What are the key highlights of the NorthWind acquisition? What are the key highlights of your mini-hydro power joint venture? What infrastructure projects is Ayala interested in?
Shareholder Governnace Structure Who are Ayala’s top shareholders? Ayala Corporation has 578M outstanding common shares. Below are the company's top stockholders as of September 30, 2011 as registered with BPI Stock Transfer:
Filipino - 70% Note that scripless shares lodged under the Philippine Central Depository (PCD) cannot be broken down into ultimate beneficial ownership as these are held in “street” name, either under the broker’s name or under the custodian bank’s name.
P & L Issues
What have been the major contributors to Ayala's net income (income contribution of the subsidiaries and affiliates)?
Breakdown in %:
What is the company's Return on Equity (ROE)?
*Based only on O/S common shares and does not include preferred shares
What has your historical debt been like? What is your debt strategy moving forward?
Strategy
What were your recent fund-raising activities?
In 2010 the company raised P28.0B consisting of:
Cash Flows and Dividend Policy Cash Dividends Received
Capex and Investments How much capex did the group spend in 2010? What is the capex budget for 2011?
Why is Ayala investing in power and what is its strategy? We beleve the power sector remains attractive. There is an imminent under supply situation in the country and new investments are needed, thereby presenting growth opportunities. Around 8,000 mw of new installed capacity would be required in the next 10 years, and the EPIRA (Electric Power Industry Reform Act) Law and Renewable Energy law provide an opening for new capacity and new entrants. We believe the RE Law specifically provides an avenue for Ayala to enter in a manner that is consistent with its sustainability thrust – balancing environment, social and business impact (triple bottom line). We are therefore looking at assembling a portfolio of power assets in accordance with the ‘triple bottom line’ approach. Our goal over the medium-term is to assemble a portfolio of power assets comprising both renewable and conventional energy sources with the intent of balancing the cost of delivery with sustainable practices. What types/sources of power are you looking at? We are looking at investing in both emerging renewable energy (large and mini-hydro, wind and solar) as well as large scale thermal power plants (coal, hydro, natural gas, geothermal). For the first 5 years, we envision around half of the portfolio to be in hydro / mini-hydro as they are cost competitive and green, around 30% to be in coal (cost competitive), and 20% in wind and solar (emerging technologies). Natural gas and geothermal assets would take more time to be developed. We are in the process of developing focused platforms for each technology – and currently discussing joint venture agreements with various partners (who have service contracts and technical capability) for each technology. Our recent acquisition of 50% of NorthWind is one of these platforms we are looking at to enable our participation in the wind segment. What are the key highllights of your solar power initiatives? The JV company, called PhilNewEnergy, is a company 60% controlled by Ayala (though Michigan Power) and 40% controlled by Mitsubishi (through Diamond Generation Asia). The JV’s purpose is to jointly explore the potential and develop multiple solar power plants throughout the Philippines.
What are the key highlights of the NorthWind acquisition?
Ayala Corporation, through Michigan Power, Inc., a 100%-owned subsidiary, acquired a 50% effective stake in NorthWind Power Development Corporation (NorthWind). NorthWind owns and operates the 33-MW wind farm located in Bangui Bay, Ilocos Norte. The wind farm has 20 wind turbines and is the first commercial wind farm ever established in Southeast Asia. The 50% stake was acquired from existing shareholders of NorthWind. What are the key highlights of your mini-hydro joint venture?
Ayala Corporation through its wholly-owned subsidiary Michigan Power Inc. (MPI) entered into a joint venture (JV) with Sta. Clara Power Corporation (SCP) for the development of run-of-the-river (ROR) hydroelectric power projects across the Philippines. MPI will take a 70% stake in the JV and has committed an initial equity infusion of about PhP 600 million. What infrastructure projects is Ayala eyeing under the government's PPP roll-out this year?
Among the projects that the government announced for PPP roll-out in 2011, we are internally evaluating a couple of tollroad projects that may have potential value propositions. We are also evaluating the LRT1 and MRT 3 O&M and may express interest to participate in the bid.
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