August imports surge 22% to $4.41B
The country’s import bill grew 22 percent year on year to $4.41 billion in August, increasing for the 10th straight month, the National Statistics Office said Tuesday.Total external trade—the combined value of outbound and inbound goods—in the eight months to August reached $68.3 billion, an increase of 31.3 percent from last year. The trade balance remained in favor of the rest of the world, with the Philippines posting a deficit of $2.34 billion, although this was better than the $4.01-billion gap recorded in the same period of 2009. Compared with July imports valued at $4.68 billion, shipments in August represented a decrease of 5.7 percent. A strong inflow of goods from abroad, which indicated a similar movement in exports, is considered a good sign for a country like the Philippines, which relies heavily on foreign supplies of electronics inputs for its biggest source of export revenues. NSO documents showed that electronic products accounted for 37.3 percent of total imports in August, with the value rising 27.2 percent year on year to $1.64 billion. Semiconductor devices and parts made up 30.4 percent of all electronics shipments, racking up $1.34 billion in bills. The operation of modern electronic devices such as computers, cell phones, transistors, solar panels, diodes and integrated circuits depend on semiconductor materials. Silicon is widely used in the production of commercial semiconductors. Electronics imports in August increased by 0.7 percent from $1.63 billion in July.
August shipments of mineral fuels, lubricants and related materials—the second-biggest subgroup in terms of value—also rose 0.7 percent to $634.75 million. Transport equipment, the country’s third-largest import for the month, increased by 0.4 percent to $216.26 million. Fourth were industrial machinery and equipment, payments for which jumped 43.7 percent to $189.33 million. In fifth place were cereals, which rose 67.9 percent to $152.48 million.
Cebu Pacific stock offering raises P23.3B
Investors snapped up shares of Gokongwei-led Cebu Air Inc. on its stock trading debut Tuesday as the Cebu Pacific airline operator made global history for a share offering worth at least $539 million, the biggest stock deal by a budget carrier.
Shares of Cebu Air—the biggest in the Philippines in terms of passengers carried and the third-largest budget carrier in Asia—rose 6.4 percent to P133 each from the IPO price of P125. It was the day’s most actively traded stock at the Philippine Stock Exchange where it ended its first day of trading with a market capitalization of P76.6 billion. The company, which started trading under the ticker “CEB,” raised P23.3 billion from the sale of primary and secondary shares prior to the exercise of the option given to its underwriters to sell up to P3.49 billion worth of additional shares. This was so far the biggest stock offering size seen at the PSE in five years. Citing wire data, Cebu Air said its IPO had topped IPOs previously held by other budget carriers across the globe such as Ryan Air ($159.6 million), Air Asia ($220.32 million) and Tiger Airways ($175.94 million). “As expected, the shares sizzled as the IPO was well received. Cebu Air managed to fly past by the day’s negative sentiment in the market,” said Astro del Castillo, managing director at local fund management firm First Grade Holdings. Explaining the market’s strong appetite for the shares, he said: “It’s the only airline that’s really listed in the market and is profitable.” The carrier sold 186.6 million shares, or 30.4 percent of its outstanding stock, of which 70 percent was taken up by foreign investors and the rest by local investors. The shares, mostly secondary shares sold by parent firm JG Summit Holdings Inc., were transferred to public hands via special block sales at the local bourse. Citigroup Global Markets Ltd., Deutsche Bank AG Hong Kong branch and J.P. Morgan Securities Ltd. acted as joint global coordinators, book runners and international lead managers for this offering, while ATR KimEng Capital Partners Inc. was the domestic underwriter. Including the over-allotment shares, Cebu Air could sell shares worth a total of P26.8 billion, making it the second-biggest IPO in local stock market history. The over-allotment option covering 27.99 million shares has yet to be finalized but there were buyers already lined up to take up the shares, said Cebu Air senior vice president BJ Sebastian. Sebastian added that Cebu Air has yet to declare employee stock option plans under the offering.
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