Metro Global’s huge losses
Credit to Author: EMETERIO SD. PEREZ| Date: Tue, 23 Jul 2019 16:23:34 +0000
Far Eastern University Inc. (FEU) has authorized capital stock (ACS) of 20 million common shares with par value of P100 per share. Of the university’s ACS, 1,510 subscribed to 11,160,637 common shares of which 1,467 are Filipinos and 43 are foreigners – 23 Americans, 12 Canadians, six Chinese, and seven Australians. FEU classified one under “others.”
While 1,467 Filipinos were reported in FEU’s general information sheet (GIS) to have paid for 16,288,045 subscribed common shares, or 98.86 percent, 19 of them subscribed to 10,971,659 FEU common shares or 66.59 percent and 1,448 to 5,316,386 FEU common shares, or 32.27 percent. FEU defined 5,316,386 FEU common shares as the “number of shares in the hands of the public.”
FEU’s 43 foreigner stockholders paid for their subscription to 188,978 common shares.
In a filing posted on the website of the Philippine Stock Exchange (PSE), FEU said it amended on July 22, 2019 its GIS to reflect the appointment of Sherissa P. Nuesa as a member of Talent Management Committee. On April 17, 2019, the school said it amended its GIS to reflect the inclusion of Jose T. Sio as a trustee and of Victorino T. Tolosa as chief information officer.
In the same GIS, FEU simplified it by grouping the university’s ownership of 16,288,045 common shares as being owned by 1,467 Filipino stockholders.
On July 22, 2019, FEU common shares traded at P890 each from opening to closing. The stock hit a 30-day high of P895 and a month’s low of P890.
Public ownership. Metro Global Holdings Corp. (MGHC) reported in a public ownership report (POR) as of June 30, 2019 the company’s public stockholders as holders of 238,484,301 MGHC common shares or 11.92 percent of 2 billion outstanding common shares.
In the same POR, Metro Global had only one principal or substantial stockholder in Fil-Estate Management Inc. with direct ownership of 1,759,750 common shares, or 87.99 percent.
Of the 2 billion issued and outstanding common shares, nine directors held 1,750,504 MGHC common shares, or 0.08 percent. Of MGHC’s outstanding, Noel Carino was the biggest stockholder among them. He owned 1,506,500 MGHC common shares, or 0.07 percent, as of July 22, 2019, followed by Robert John T. Sobrepena, 241,000 MGHC common shares. Three of the company’s directors held 1,000 MGHC common shares each, namely Rafael Perez de Tagle Jr., Ferdinand T. Santos and Francisco C. Gonzalez. Four directors held a nominal MGHC common share each – Alice O. Bondoc, Jaime M. Cacho and Eduardo R. Santos.
Under stockholders’ equity, Metro Global said its deficit as of March 31, 2019 totaled P2,615,740,109, up from P2,613,018,687. It incurred a net loss of P2,721,421 in the first three months against P867,677 loss in the same period in 2018.
Due Diligencer’s take
Metro Global happened to have only 299.85 million common shares listed on PSE. Had its issued and outstanding common shares also been listed, the public stockholders who trade on listed
common shares would have been hurt financially.
Even if only 14.99 percent of the company’s 2 billion outstanding MGHC common shares are listed, it does not necessarily follow that the public who trade on listed stocks owe PSE and the Securities and Exchange Commission (SEC) some kind of gratitude.
As a matter of fact, Metro Global should not have been allowed by both PSE and SEC to accumulate so much deficit. At first sign of losses, their officials should have reviewed MGHC’s financials and should not have allowed the company to keep such huge deficit or accumulated losses.
If other listed stocks are able to pile up retained earnings even if they report consolidated financial filings, why can’t others do the same?
For instance, Ayala Corp., which is owned by the Zobel family, had as of March 31, 2019 accumulated retained earnings of P205.16 billion. Should the public be grateful, too, to the SEC and PSE? Nevermind if most of AC’s retained earnings go to the Zobels, who control the company.
How about SM Investments Corp.? SMIC, the holdings company of businessman Henry Sy Sr and his family, reported in a financial filing that as of March 31, 2019, it had consolidated retained earnings of P271.497 billion.
How about the other companies which became listed because of the public? Just asking.
esdperez@gmail.com
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