ABS-CBN opens headquarters of global support unit

MANILA, Philippines - ABS-CBN Broadcasting Corporation officially opened in Manila yesterday the regional operating headquarters of its wholly-owned subsidiary, ABS-CBN Shared Service Center Pte. Ltd.

ABS-CBN SSCL, a Singapore-registered company, is intended to provide support services to ABS- CBN and its subsidiaries, including ABS-CBN Global Ltd. and its regional offices worldwide.

The headquarters was established and jointly registered with the Securities and Exchange Commission and the Board of Investments, with a capitalization of $200,000 or approximately P10 million.

Initially, it will provide financial accounting and manpower services for ABS-CBN and its subsidiaries under arms-length service agreements.

ABS-CBN corporate planning head Charles Gamo said this is expected to give greater operational efficiency and yield savings to the company.

The company’s net income fell 21 percent to P191 million at end-March 2009 from P242 million in the same period last year.

ABS-CBN chief financial officer Rolando Valdueza blamed the decline on cable unit SkyCable’s losses for the period as well as the drop in airtime revenues.

He said SkyCable posted losses of more than P18 million in the first quarter.

ABS-CBN’s revenues rose 24 percent to P5.29 billion, including SkyCable’s contribution of P878 million.

But its expenses rose a faster 28 percent to P4.95 billion from P3.88 billion last year, with this year’s general and administrative expenses jumping 53 percent to P1.71 billion from P1.11 billion year-on-year.

In contrast, the company cut its production costs four percent to P1.45 billion this year from P1.51 billion last year.

ABS-CBN’s consolidated airtime revenues of P2.76 billion also dropped two percent from the same period last year. For anchor TV station Channel 2 alone, airtime revenues slipped five percent to P2.52 billion, with advertising minutes declining as much as 20 percent.

Valdueza said the decline in airtime revenues started last December and extended to February this year.

“From January to April, our airtime revenues fell by only four percent from five percent in the first quarter. From January to May, we expect a negative one, if not flat,” he said.

For the full year, airtime revenues are likely to be flat or slightly higher than last year, he said.

ABS-CBN, however, claimed that national TV audience measurement of Taylor Nelson Sofres (TNS) showed its total day ratings increasing its lead from 16 percent in February to 18 percent in April. — Mary Ann Ll. Reyes