Lopez Holdings suffers P881-M net loss over COVID-19 pandemic, ABS-CBN shutdown

Lopez Holdings Corp. suffered net losses amounting to P881 million in the second quarter as its business was dragged by the COVID-19 pandemic and the shutdown of ABS-CBN's broadcast operations.

In a regulatory filing, Lopez Holdings reported a reversal of the P1.890-billion net income the same period last year, reflecting a 146% decline.

This comes as revenues fell to P24.588 billion from P35.143 billion, while costs and expenses declined to P18.941 billion from P27.206 billion.

The latest figures brought the first-half net income attributable to equity holders to P275 million, down by 93% from P4.181 billion in 2019.

"Lower revenues from all business units and higher costs that include one-off expenses related to the group’s COVID-19 response and share in the net loss reported by ABS-CBN’s media and entertainment businesses accounted for the results," the filing read.

To recall, its subsidiary ABS-CBN Corp. ceased the use of government-assigned broadcast frequencies on May 5, 2020, in compliance with an order of the National Telecommunications Commission (NTC).

The regulator backtracked from earlier pronouncements and instead ordered ABS-CBN Corp. to stop operating its various television and radio stations absent a congressional franchise which lapsed on Monday, May 4, 2020.

ABS-CBN signed off on the evening of May 5, following a broadcast of its news program TV Patrol, in compliance with the cease and desist order.

The NTC order was released days after the Office of the Solicitor General warned NTC commissioners that they could face Anti-Graft and Corrupt Practices Act charges should they issue ABS-CBN Corp. and its affiliate ABS Convergence Inc. a provisional authority (PA) to operate after its franchise lapses on May 4, 2020.

Prior to the warning, the NTC said it would heed orders of both houses of Congress to grant ABS-CBN a PA to allow the company to continue operating while its franchise is being deliberated.

Lopez Holdings' subsidiary First Philippine Holdings Corp. (FPH) also reported a decline in its net income attributable to equity holders, down 26% to P5.018 billion from P6.754 billion.

FPH is the parent company of clean and renewable energy firm First Gen Corp., which in turn controls geothermal energy energy firm Energy Development Corp.

FPH also owns construction firm First Balfour Inc., pipeline operator First Philippine Industrial Corp., property firm Rockwell Land Corp., investment community First Philippine Industrial Park, and First Philec Corp., the intermediary holding company for investments in manufacturing.

In July, a House of Representatives panel voted to deny the franchise application of ABS-CBN Corp.

The panel denied the bid, even as several government agencies such as the Bureau of Internal Revenue (BIR), the Securities and Exchange Commission (SEC), and the Department of Justice (DOJ) maintained that the broadcaster had no violations. -NB, GMA News