The Philippine Stock Exchange (PSE) saw its attributable net income decline 25.1% to P170.46 million in the second quarter from P227.57 million a year earlier after the allocation of mark-to-market provisions.
“The net income was a bit lower […] due to a large mark-to-market provision for our investments of PSE 106 million,” PSE President and Chief Executive Officer Ramon S. Monzon said in a press conference Saturday.
In the second quarter, PSE’s mark-to-market loss on fair value financial assets reached PSE140.52 million, a reversal of last year’s mark-to-market gain of PSE57.68 million.
Mark-to-market losses occur when securities are marked to market at a lower price than the price paid for their acquisition.
“The funds were invested in traded equities and US dollar-denominated locally issued bonds,” the company said in its Friday report.
PSE’s net profit attributable to the parent company decreased by 1% to P374.05 million in the first half from P377.98 million in the previous year.
The mark-to-market loss for the first half rose to P145.29 billion, a big jump from P3.58 million last year.
Meanwhile, the local exchange operator is encouraging more bid requests to meet its target of P200 billion from capital raising activities in 2022.
“We hope to get more applications and hope to reach 200 billion pesos by the end of the year,” Mr. Monzon said at the press conference.
PSE was able to raise P76.17 billion in capital from year-to-date offerings stemming from eight initial public offerings (IPOs), five private placements and three stock options (SROs).
“At the rate we are proceeding, we believe we will have a record number of IPOs in any given year for 2022. However, we don’t think we can […] breaking the same amount of capital raised last year,” said Mr. Monzon.
“Our listing pipeline remains robust. We have four IPOs and two SROs applications. These six fundraising activities are expected to raise an additional 72.61 billion pesos in capital,” he added.
The SROs come from Ayala-led P32 billion Globe Telecom, Inc. and Solar Philippine Nueva Ecija Corp. worth P3.3 billion
The IPOs that the operator is expected to list this year are: Upson International Corp. of P5.43 billion, Prime Infra Capital, Inc. of P28.19 billion, ORCA Cold Chain Solutions of P1.6 billion and Alternergy Holdings Corp P2.18 billion.
“Right now we don’t think we can reach the same record as last year, but we hope that we can at least reach the 200 billion pestrict mark in terms of capital raised,” Mr. Monzon said.
On the other hand, he said that market volatility was a factor in the success of IPOs in the second half.
“Given market volatility and lower market levels, some companies that have IPO plans may delay those IPO plans because they will not be able to realize the prices or valuation they have for their companies,” Mr Monzon said. — Justine Irish D. Tabile