MANILA, July 18, 2017—Philippine Ports Authority (PPA) General Manager Jay Daniel R. Santiago has reset the revenue targets for the agency for the remaining period of the fiscal year.
This after the PPA posted a 32% hike in net income for the January to May 2017 period to P3.96 billion from P3 billion in the same period last year.
It maybe recalled that the PPA in February downgraded its revenue forecast for the year to at best flat due to the deteriorating foreign exchange rates, transfer of control of several high-yielding ports to local governments and Freeport zones, issues clouting the operations of the mining industry, among others. Last year, the Corporate Operating Budget (COB) of the PPA was at P14.297 billion.
“In view of this, all Port Managers were enjoined to reassess their accomplishments from the start of the year to the present and forecast their revenues for the remaining months of the year keeping in mind the prevailing economic conditions,” Santiago said.
“For the year 2017, growth in terms of Gross Domestic Product is at 7.5%, so this should be your guide,” Santiago explained.
“The intention is to set a more realistic revenue commitment taking into account the development in the economy during the first half of the year,” Santiago added.
In the first five months of the year, the Authority performed well in terms of Revenue as total earnings generated during the period in review continued to be strong showing an 11.63% growth, expanding to P6.050 billion from the P5.419 billion posted in May 2016. The positive deviation in revenue from last year’s performance is primarily the result of heightened business activity at the ports coupled with the impact of foreign exchange on dollar denominated tariff.
Conversely, Fund Management Income (FMI) declined by 6.38% to P34.21 million from last year’s P36.54 million. The deviation is attributable to the fluctuations in the interest rates on special and high-yield savings deposits.
Total expenditures, covering both Operating and Non-Operating expenses, amounted to Php2.084 billion as of end of May – P2.022 billion of which was disbursed for Operating Expenditures and the residual amount of P62.61 million for Non-Operating Expenditures.
Corporate Expenses went down by 13.63% to 2.084 billion from the amount expended during the previous year which totaled P2.413 billion. The decrease, for the most part, was credited to the decline in Operating Expenses mainly as a result of downswing in costs incurred for Repairs & Maintenance (R&M) and Dredging Projects of the Authority as well as fairly reduced outlays related to Personal Services and other Administrative Costs.
On the contrary, Non-Operating Expenses inched up by 15.75% to P62.61 million from P54.09 million in 2016. The upturn was mainly due to increase in Financial Expenses particularly Interest Expense on Foreign Loans and Other Expenses.
Likewise, the PPA maintained its position in the ‘Billionaires’ club of Government-Owned and Controlled Corporations (GOCCs) at fourth spot after remitting Php1.95 billion in terms of dividends to the national treasury in May of this year.