Stocks in Focus: THU 01 JUNE 2017

Strategy: Earnings quality improves

More companies outperform expectations; gaming, banking & property sectors perform
(AS OF MAY 31, 2017)
well. The earnings performance of listed companies was quite favorable in 1Q17. Out of the 53
INDICES
listed companies that we monitor, 20 or 38.5% performed better than expectations, exceeding
Close Points % YTD%
the number of companies that performed in line (18 or 34.6%) and below expectations (15 or PSEi 7,837.12 -23.65 -0.30 14.57
28.8%). All Shares 4,685.50 -5.28 -0.11 12.74
Financials 1,939.77 2.45 0.13 17.17
Median 1Q17 earnings growth of the listed companies that we monitor was only 9.9% as growth Holding Firms 7,825.61 -14.00 -0.18 11.92
was pulled down by some sectors that suffered from lower y/y earnings. Note that the telecom Industrial 11,061.28 -11.02 -0.10 3.86
Mining & Oil 12,474.02 -8.70 -0.07 5.20
and cement sectors showed weaker earnings coming from a high base in 2016, while media
Property 3,647.77 -12.38 -0.34 18.96
companies suffered from the absence of political ad spending in 2017.
Services 1,674.89 -11.25 -0.67 28.55

However, there were also sectors that performed well, including the gaming, banking and Dow Jones 21,008.65 -20.82 -0.10 6.31
property sectors. The gaming sector benefited from the accelerating growth of gross gaming S&P 500 2,411.80 -1.11 -0.05 7.73
revenues, allowing the combined core profits of gaming companies to reach Php2.4 Bil, a reversal Nasdaq 6,198.52 -4.67 -0.08 15.15
from the Php516 Mil net loss registered in 1Q16. Although median profit growth of the banking
and property sectors was not impressive at 5.9% and 11.2% respectively, earnings quality was INDEX GAINERS
very good. Banks showed substantial growth in their core lending business. Meanwhile, property Ticker Company Price %
companies reported a strong pick up in their take up sales, alleviated concerns of a glut. EDC Energy Dev't Corp 6.1 2.69
AGI Alliance Global Inc 15.48 1.84
MEG Megaworld Corporation 4.7 1.51
Other News: PGOLD Puregold Price Club 43.25 1.05
SECB Security Bank Corporation 217.8 1.02
MEG: MEG expects Php3Bil sales from luxury project
Economy: House passes tax reform package INDEX LOSERS
Economy: SEC releases draft circular on higher minimum public float Ticker Company Price %
Economy: Domestic liquidity expands in April RLC Robinsons Land Corp 24.8 -3.31
PCOR Petron Corporation 10.98 -2.49
ICT Int'l Container Term 100 -1.96
Market Summary: ALI Ayala Land Inc 39.4 -1.87
TEL PLDT Inc 1728 -1.82
The PSEi declined on Wednesday, losing 23.65 points or 0.30% to close at 7,837.12
TOP 5 MOST ACTIVE STOCKS
Index decliners led gainers 15 to 13, while 2 issues remained unchanged. Sectors ended mostly Ticker Company Turnover
in the red with Services (-0.52%) leading the decliners and Financials (+0.13%) as the lone gainer. AGI Alliance Global Inc 2,423,519,000
Significant index decliners were RLC (-3.31%), PCOR (-2.49%), ICT (-1.96%), ALI (-1.87%), and TEL PLDT Inc 1,638,617,000
SMPH SM Prime Hldgs Inc 908,582,000
TEL (-1.82%). Meanwhile, significant index gainers were EDC (+2.69%), AGI (+1.84%), and MEG
GTCAP GT Capital Hldgs Inc 813,843,800
(+1.51%). ALI Ayala Land Inc 759,301,400

Value turnover decreased to Php17.1Bil from Php7.4Bil the previous session. Foreigners
continued to be net buyers, accumulating Php572Mil worth of shares.

Disclaimer: All content provided in COL Reports are meant to be read in the COL Financial website. Accuracy and completeness of content cannot be guaranteed if reports are viewed outside of
the COL Financial website as these may be subject to tampering or unauthorized alterations.
 DAILY NOTES I PHILIPPINE EQUITY RESEARCH

THU 01 JUNE 2017

Stocks in Focus:

APRIL LYNN TAN, CFA Strategy: Earnings quality improves

VP & HEAD OF RESEARCH

More companies outperform expectations; gaming, banking & property sectors perform
well

The earnings performance of listed companies was quite favorable in 1Q17. Out of the 53
listed companies that we monitor, 20 or 38.5% performed better than expectations, exceeding
the number of companies that performed in line (18 or 34.6%) and below expectations (15 or
28.8%).

Median 1Q17 earnings growth of the listed companies that we monitor was only 9.9% as
growth was pulled down by some sectors that suffered from lower y/y earnings. Note that the
telecom and cement sectors showed weaker earnings coming from a high base in 2016, while
media companies suffered from the absence of political ad spending in 2017.

However, there were also sectors that performed well, including the gaming, banking and
property sectors. The gaming sector benefited from the accelerating growth of gross gaming
revenues, allowing the combined core profits of gaming companies to reach Php2.4 Bil, a
reversal from the Php516 Mil net loss registered in 1Q16. Although median profit growth of
the banking and property sectors was not impressive at 5.9% and 11.2% respectively, earnings
quality was very good. Banks showed substantial growth in their core lending business.
Meanwhile, property companies reported a strong pick up in their take up sales, alleviated
concerns of a glut.

Some consumer companies also outperformed expectations as they managed the impact of
rising raw material costs through price increases and lower operating expenses (CNPF, JFC).

Exhibit 1: 1Q17 Earnings Summary (vs. COL Forecast)

Above Inline Below
BPI CHIB BDO
EW UBP PNB
MBT CEB ABS
SECB MWC ICT
EEI AEV NIKL
GMA7 AGI CHP
IMI DMC COSCO
PX DNL GTCAP
SCC EMP MPI
AC PGOLD SM
FPH URC CIC
JGS RWM BEL
JFC GLO FGEN
RRHI TEL MER
CNPF AP RLC
BLOOM ALI
MCP FLI
EDC MEG
VLL
COL Financial Group, Inc. SMPH 2
Total 20 18 15
 IMI DMC COSCO
PX DNL GTCAP
SCC EMP MPI
AC PGOLD SM
FPH URC DAILY NOTES I CIC
PHILIPPINE EQUITY RESEARCH
JGS RWM BEL
THU 01 JUNE 2017 JFC GLO FGEN
RRHI TEL MER
CNPF AP RLC
BLOOM ALI
MCP FLI
EDC MEG
VLL
SMPH
Total 20 18 15
Percentage 38.50% 34.60% 28.80%

Source: COL estimates

Banking Sector: Lending operations post strong results; earnings quality improves

Banks generally delivered higher profits in 1Q17, with six of the nine banks that we monitor
posting higher earnings y/y. Of the three banks with lower earnings, only RCB reported weaker
core operations (weighed down by higher funding costs). PNB’s earnings fell 54% y/y largely
due to lower gains on sale of assets while SECB posted slightly lower profits (-6.4% y/y) amidst
weaker trading gains. As a whole, total industry profits increased 2.5% y/y. While this is slower
than the 2017 growth of 11.9%, earnings quality improved. Indeed, net interest income
expanded 15.4% y/y, offsetting the 49.4% decline in trading gains. Moreover, as of end-March,
banks’ loan portfolio grew by an average of 21% y/y, faster than the 17% y/y average growth in
1Q16 and the 20% growth as of end 2016. Net interest margin also improved ~8 basis points
to 3.16%.

Compared to our estimates, four banks (BPI, EW, MBT, and SECB) performed above our
expectations; two (CHIB, UBP) reported in line results; and two (BDO, PNB) booked weaker-
than-expected numbers. BPI outperformed our expectations on the back of stronger-than-
expected trading income during the period. Meanwhile, EW and MBT beat our estimates
on lower-than-expected provisioning. Finally, SECB ended above our forecast mainly due to
higher-than-expected trading gains (despite it being lower y/y). Among the underperformers,
BDO trailed our estimates mainly due to higher-than-expected operating expenses and
provisioning, while PNB underperformed on weaker-than-expected net interest and non-
interest income.

Property Sector: Residential and rental businesses continue to grow; threat of glut
continues to abate

Property companies registered an average net income growth of 11.4% in 1Q17 as both
residential and leasing businesses continued to grow. Combined revenues from residential
development increased by 8.9% y/y to Php45.9 Bil in 1Q17 as companies continued to increase
completion of projects, allowing them to realize revenues from past take up sales. Meanwhile,
recurring income from property companies’ leasing businesses (including offices, retail and
hotel) grew by 15.9% to Php31.0 Bil as companies expanded their leasing portfolio.

COL Financial Group, Inc. 3

 DAILY NOTES I PHILIPPINE EQUITY RESEARCH

THU 01 JUNE 2017

The market also continued to absorb the excess inventory of residential properties. In 1Q17,
take up sales jumped by 19.6% to Php88.2 Bil. Growth was much faster than the 4.5% increase
registered in 2016. This was despite the fact that launches remained subdued, falling by
19.1% to Php32.5 Bil. As a result, concerns of a glut continued to abate, encouraging property
companies to once again increase their project launches.

Compared to expectations, SMPH and VLL surprised positively, while ALI, FLI and MEG
performed in line with expectations. Only RLC disappointed due to the significant decline in
its residential revenues.

Consumer Sector: Profits sustain growth despite challenges

Median earnings growth of consumer companies in 1Q17 reached 12.8% as 10 of the 12

companies we follow delivered higher profits y/y. Median revenue growth remained strong
at 11.7%, although retailers reported a slower increase of 8.7% coming from high base in 2016
due to the elections. As expected, gross margins fell for most food companies (CNPF, JFC, URC)
due to higher commodity prices and the weaker peso. However, the impact on profits was
more subdued as some companies managed the growth of their operating expenses.

Three out of the 12 companies that we cover (CNPF, JFC, and RRHI) outperformed our estimates.
CNPF sustained the double-digit growth of its branded food business while managing the
impact of higher raw material prices through price adjustments and cost-cutting initiatives.
JFC incurred a slower than expected growth in operating expenses due to the conclusion of
its major investments in information technology. Finally, RRHI grew profits at a faster pace due
to sustained topline growth augmented by improvements in gross margins as it implemented
price increases for supermarkets and as it consolidated The Generics Pharmacy in its drug
segment.

Meanwhile, URC and PIP both reported lower earnings y/y. URC continued to face problems in
its domestic coffee business and its Vietnam operations. Meanwhile, PIP suffered from lower
revenue and higher operating expenses. Both companies also performed below expected.
Although URC’s headline profits were in line with COL expectations, its earnings guidance was
disappointing. CIC also reported weaker than expected profits due to higher than expected
operating expenses.

Power sector: Mixed results

Earnings results of power companies were mixed in 1Q17 with median earnings growth
reaching only 3.7%, as the strong performance of EDC and SCC was offset by the weak
performance of FGEN. Profits of AP and MER were flattish. EDC’s profits grew by 23.6% due
to the strong performance of Unified Leyte and Burgos Wind, and the subdued growth of
expenses. Meanwhile, SCC’s profits jumped by 52.0% largely due to the strong growth of its
coal mining business as it benefited from higher sales volume and selling price.

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 DAILY NOTES I PHILIPPINE EQUITY RESEARCH

THU 01 JUNE 2017

Relative to expectations, core profits of two out of the five power companies that we
cover were better than expected, while two companies generated disappointing earnings
results. EDC and SCC delivered better than expected profits, while FGEN and MER delivered
disappointing profits. AP delivered in line results. SCC’s earnings beat estimates due to the
better than expected performance of its coal mining business, partly offset by its weaker than
expected power generation revenues. EDC booked stronger than expected revenues and
lower than expected operating costs. Meanwhile, FGEN’s earnings disappointed as the lack of
supply contracts of its new gas plants dragged down overall profitability of the group. MER’s
disappointing result was due to lower than expected sales volume growth during 1Q17.

In terms of the performance based on plant type, revenues of large hydro plants (Magat,
Ambuklao-Binga, Pantabangan-Masiway) beat forecasts mainly to better water availability
during the period compared to the same period last year. However, this was offset by the lower
than expected revenues of plants that were exposed to the spot market (such as EDC’s Bacman
geothermal plant and FGEN’s San Gabriel and Avion) as a result of the persistent weakness of
WESM prices. Unplanned plant outages also negatively affected the results of some companies
such as AP and SCC.

Telecom Sector: Profits decline as expected; competition still shows signs of easing

The telecom industry’s core earnings declined by 20.9% y/y to Php9.0Bil during 1Q17 as
revenues fell (due to weakness in non-data revenues) while depreciation expenses increased.
However, the double digit decline in telcos’ earnings was already expected. Recall that it was
only during 3Q16 that the telco industry suffered a huge decrease in yields brought about by
the introduction of the Php50 per 1 GB of data. Thus, the first quarter of 2016 was still a high
base.

Despite the y/y decline in profits, focus should be on telcos data revenues, which remained
strong, growing by 10.1% to Php32.5 Bil and now accounts for 48.7% of the total industry
revenues, up from 43.4% during the same period last year. There was also a significant decline
in subsidy expense in both telcos and stabilization in their ARPUs, supporting our view that
price competition is easing.

GLO’s 1Q17 core net income was down by 12.1% y/y to Php3.7Bil, in line with both COL and
consensus estimates. Meanwhile TEL’s 1Q core profits fell 26.0% y/y to Php5.3 Bil. Although
results were slightly below COL and consensus estimates, we remain confident that earnings
would catch up in the last three quarters of the year given the strength of TEL’s data business.

Gaming Sector: Recovery continues despite the entry of Okada

The strong performance of gaming companies in last nine months of 2016 continued in
1Q17 as the three integrated resort operators reported a combined core net income of
Php2.4 Bil, a reversal from the Php516 Mil net loss registered in 1Q16. The existing casino
operators performed strongly despite the entry of Okada Manila, implying that there was no
cannibalization.

COL Financial Group, Inc. 5

 DAILY NOTES I PHILIPPINE EQUITY RESEARCH

THU 01 JUNE 2017

Total gross gaming revenue (GGR) increased by 27.4%, accelerating from the 23.1% growth
registered in 2016 and was the main driver of earnings growth. BLOOM and MCP showed
significant improvements in GGR of 39.7% and 77.4% respectively as both benefited from the
strong growth in their VIP volume. On the other hand, RWM registered weaker earnings as GGR
fell 5.6%. Although its mass market GGR increased by 10.2%, this was not enough to offset the
36.1% drop in its VIP GGR.

Despite RWM’s weaker earnings, the company still performed in line with expectations. BLOOM
and MCP performed above expectations.

Other News:

RESEARCH ANALYSTS MEG: MEG expects Php3Bil sales from luxury project
FRANCES ROLFA NICOLAS
ANDY DELA CRUZ
MEG expects to sell Php3Bil worth of units at a low-rise residential tower in McKinley West,
JUSTIN RICHMOND CHENG
Taguig City. The Albany will be a low-density and low-rise residential tower composed of 64
KYLE JEMMRIC VELASCO
spacious units ranging from two-bedroom (123 sqm) to four-bedroom suites (up to 349 sqm).
JOHN MARTIN LUCIANO
The residential tower’s two-bedroom suite is priced at approximately Php35Mil while the
penthouse suite is priced at around Php96Mil. (source: MEG)

Economy: House passes tax reform package

The House of Representatives approved House Bill No. 5636 or the proposed Tax Reform
for Acceleration and Inclusion (TRAIN) Act. Under the personal income tax segment of the
package, taxpayers earning up to Php250,000 a year will be tax exempt, while the ultra-rich or
those earning more than Php5Mil annually will pay Php1.45Mil plus 35% in excess of Php5Mil.
The new tax schedule is targeted to start in 2018. Projected revenues forgone from lower
personal income tax will be cushioned by higher excise levies on oil and cars, excise tax of
Php10/liter on sugar-sweetened beverages and removal of VAT exemptions of some sectors.
Moreover, income tax-exemption threshold of 13th month pay, bonuses and other benefits
was raised to Php100,000 from Php82,000. The bill will now be submitted to the Senate for
deliberations. (source: Businessworld, Inquirer)

Economy: SEC releases draft circular on higher minimum public float

In a press release, the SEC cited a draft memorandum circular that will increase the public
float of Philippine-listed companies from the current 10% to 20% starting July 1. Companies
planning to do initial public offerings will have to comply immediately with the 20% minimum
public ownership requirement. Meanwhile, those already listed will be required to increase
their public float to at least 15% on or before the end of 2018 and then to at least 20% on or
before the end of 2020. Officer-in-charge of the Office of the Commission Secretary Armando
Pan said that public consultation for the draft memorandum will run until June 15. (source:
Businessworld)

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 DAILY NOTES I PHILIPPINE EQUITY RESEARCH

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Economy: Domestic liquidity expands in April

Domestic liquidity (M3) expanded 11.2% y/y to Php9.5Tril in April 2017, slightly slower than
the 11.6% y/y (revised) expansion in the previous month. Demand for credit remains the
principal driver of money supply growth. Domestic claims grew 13.8% y/y in April largely
due to sustained growth in credit to the private sector. Meanwhile, net claims on the central
government expanded by 4.3% y/y as a result of increased borrowings by the government. Net
foreign assets in peso terms also expanded 3.6% y/y with foreign exchange inflows coming
mainly from overseas Filipinos’ remittances and BPO receipts as the drivers behind the increase
in the BSP’s NFA position. Meanwhile, the Net foreign assets of banks expanded on the back
of the growth in banks’ foreign assets due to higher loans and investments in marketable debt
securities. (source: BSP)

Summary of Changes in Shareholdings:

Acquired or Price per
Stock Volume Person (Designation)
Disposed share
Antonino A. Picazo
MPI 300,000 A 4.60
(Corporate Secretary)
56,600 25.60 Jesus Roberto S. Reyes
EW A
8,400 25.70 (Director, President and & Deputy CEO)
Maria Cristina C. Gotianun
SCC 940 A 158.00
(Director, EVP & Chief Information Officer)
Manuel V. Pangilinan
MPI 2,000,000 A 4.60
(Chairman, Director)
source: PSE

COL Financial Group, Inc. 7

 Calendar of Events DAILY NOTES I PHILIPPINE EQUITY RESEARCH

THU 01 JUNE 2017 May

S M T W TH F S

1 1 2 3 4 5 6

7 8 9 10 11 12 13

14 15 16 17 18 19 20

21 22 23 24 25 26 27

28 29 30 31 1 2 3
4 5 6 7 8 9 10

K ey Event s Ho li day

MAY 1 MAY 1 5 MAY 2 4

L abor Day C HIB: Ex- date Ph p0 . 8 0 Ca s h D i v i d e n d F D C : E x- d ate Ph p0 . 0 5 9 Ca s h D i v i d end
P IP: Ex- d ate Ph p0 . 0 6 9 Ca s h D i v i d e n d I PM : An n u a l S h a re h o l d e r s M eeti ng
MAY 2 MAC AY: Ex- d ate Ph p0 . 1 2 Ca s h D i v i d e n d P PC : An n u a l Sh a re h o l d e r s M eeti ng
I C T: Ex- date Php2.47 Ca sh Divid en d GP H: An n u a l S h a re h o l d e r s M e e ti n g FM E T F: An n u a l S h a re h o l d e r s M eeti ng
S HLPH: Ex- date Php1.65 Ca sh D ivid en d A P: An n u a l S h a re h o l d e r s M e e ti n g
S CC: An n u a l Sha re holders M eet in g A E V: An n u a l S h a re h o l d e r s M e e ti n g MAY 2 5
EM P: An n u a l Sh a re h o l d e r s M e e ti n g AC R : An n u a l S h a re h o l d e r s M eeti ng
MAY 4 P HN: An n u a l S h a re h o l d e r s M e e ti n g PA L : An n u a l Sh a re h o l d e r s M eeti ng
E W: Ex- date Php0.34 Ca sh Divid en d A BG: An n u a l S h a re h o l d e r s M e e ti n g G SM I : An n u a l Sh a re h o l d e r s M eeti ng
CHI B : An nua l Sha reholders M eet in g
MAY 1 6 MAY 2 6
MAY 5 LBC : Ex- d ate Ph p0 . 5 8 Ca s h D i v i d e n d R W M : E x- d ate Ph p0 . 0 4 Ca s h D i v i d end
PSB : Ex- date Php0.75 Ca s h Divid en d AT I: Ex- d ate Ph p0 . 4 3 Ca s h D i v i d e n d S L F: E x- d ate Ph p0 . 4 3 5 Ca s h D i v i d end
MRSGI ; Annua l Sha rehold ers M eet in g F P H: Ex- d ate Ph p1 . 0 0 Ca s h D i v i d e n d G MA 7 : An n u a l Sh a re h o l d e rs M eeti ng
S HLP H: Ann u a l Sh a re h o l d e r s M e e ti n g G MA P: An n u a l Sh a re h o l d e rs M eeti ng
MAY 6 PXP: An n u a l S h a re h o l d e r s M e e ti n g M PI : An n u a l S h a re h o l d e r s M eeti ng
PSE: An n u a l Sha reholders M eet in g P CO R : An n u a l S h a re h o l d e r s M e e ti n g H LC M : An n u a l Sh a re h o l d e rs M eeti ng
D M C : An n u a l Sh a re h o l d e r s M e e ti n g O M : An n u a l Sh a re h o l d e r s M eeti ng
MAY 8 NI: An n u a l S h a re h o l d e r s M e e ti n g U B P: An n u a l Sh a re h o l d e r s M eeti ng
S ECB : Ex- date Php1.50 Cash D ivid en d P I P: An n u a l Sh a re h o l d e r s M eeti ng
S M: Ex- date Php7.77 Ca sh Divid en d MAY 1 7 P B B : An n u a l Sh a re h o l d e r s M eeti ng
E DC: An nua l Sha re holders M eet in g A LHI: Ex- d ate Ph p0 . 0 6 Ca s h D i v i d e n d T E C H : An n u a l Sh a re h o l d e r s M eeti ng
MAX S: Annua l Sha reholders M eet in g F LI: Ex- d ate Ph p0 . 0 6 1 Ca s h D i v i d e n d S O C : An n u a l Sh a re h o l d e r s M eeti ng

MAY 9 MAY 1 8 MAY 2 9

S MPH: Ex- date Php0.26 Ca sh D ivid en d X; Ex- d ate Ph p0 . 0 5 Ca s h D i v i d e n d F P H : An n u a l S h a re h o l d e r s M eeti ng
R CB : Ex- date Php0.55 Ca s h D ivid en d GLO : Ex- d ate Ph p2 2 . 7 5 Ca s h D i v i d e n d N I K L : An n u a l S h a re h o l d e r s M eeti ng
FGEN: An nua l Sha re holders M eet in g C R O W N: An n u a l S h a re h o l d e r s M e e ti n g
FFI : An n ua l Sha re holders M eet in g MAY 3 0
MAY 1 9 M E R : An n u a l S h a re h o l d e r s M eeti ng
MAY 1 0 S PM : An n u a l Sh a re h o l d e r s M e e ti n g P G O L D : An n u a l Sh a re h o l d e r s M eeti ng
X : An n ual Sha reholders M eet in g C EB: An n u a l Sh a re h o l d e r s M e e ti n g I O N : An n u a l Sh a re h o l d e r s M eeti ng
GTC AP: Annua l Sha re hold ers M eet in g MA R C : An n u a l Sh a re h o l d e r s M e e ti n g S P C : An n u a l S h a re h o l d e r s M eeti ng
AB : An n u a l Sha re holders M eet in g C SB : An n u a l Sh a re h o l d e r s M eeti ng
MAY 2 3
MAY 1 1 M V C : Ex- d ate Ph p0 . 0 7 Ca s h D i v i d e n d MAY 3 1
MFC: Ex- date Php0.205 Ca sh D ivid en d C EI: An n u al S h a re h o l d e r s M e e ti n g LOTO : An n u a l S h a re h o l d e r s M eeti ng
AT: An n ual Sha reholders M eet in g I D C : An n u a l S h a re h o l d e r s M eeti ng
T U G S : An n u a l S h a re h o l d e r s M eeti ng
MAY 1 2 R O C K : An n u a l Sh a re h o l d e rs M eeti ng
LOTO: Ex- date Php0.30 Cash Divid en d L FM : An n u a l Sh a re h o l d e r s M eeti ng
PF: An n ua l Sha reholders M eet in g

COL Financial Group, Inc. 8

 DAILY NOTES I PHILIPPINE EQUITY RESEARCH

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Important Rating Definitions

BUY
Stocks that have a BUY rating have attractive fundamentals and valuations based on our analysis. We expect the share price to outperform the market
in the next six to 12 months.

HOLD
Stocks that have a HOLD rating have either 1) attractive fundamentals but expensive valuations 2) attractive valuations but near-term earnings outlook
might be poor or vulnerable to numerous risks. Given the said factors, the share price of the stock may perform merely in line or underperform in the
market in the next six to twelve months.

SELL
We dislike both the valuations and fundamentals of stocks with a SELL rating. We expect the share price to underperform in the next six to12 months.

Important Disclaimer
Securities recommended, offered or sold by COL Financial Group, Inc. are subject to investment risks, including the possible loss of the principal
amount invested. Although information has been obtained from and is based upon sources we believe to be reliable, we do not guarantee its accuracy
and said information may be incomplete or condensed. All opinions and estimates constitute the judgment of COL’s Equity Research Department as of
the date of the report and are subject to change without prior notice. This report is for informational purposes only and is not intended as an offer or
solicitation for the purchase or sale of a security. COL Financial and/or its employees not involved in the preparation of this report may have investments
in securities of derivatives of the companies mentioned in this report and may trade them in ways different from those discussed in this report.

COL Research Team

APRIL LYNN TAN, CFA

VP & Head of Research
[email protected]

CHARLES WILLIAM ANG, CFA GEORGE CHING RICHARD LAÑEDA, CFA

Deputy Head of Research Senior Research Manager Senior Research Manager
[email protected] [email protected] [email protected]

FRANCES ROLFA NICOLAS ANDY DELA CRUZ JUSTIN RICHMOND CHENG

Research Analyst Research Analyst Research Analyst
[email protected] [email protected] [email protected]

KYLE JEMMRIC VELASCO JOHN MARTIN LUCIANO

Research Analyst Research Analyst
[email protected] [email protected]

Contact

COL FINANCIAL GROUP, INC.

2402-D East Tower, Philippine Stock Exchange Centre,
Exchange Road, Ortigas Center, Pasig City
1605 Philippines
Tel No. +632 636-5411
Fax No. +632 635-4632
Website: www.colfinancial.com

COL Financial Group, Inc. 9