Sara Cheung - Vice President, Group Corporate Communications John Ryan - Head of Investor Relations, Executive Vice President and Group Corporate Communications

Good day, everyone, and thank you for joining us today to discuss First Pacific’s 2017 First-Half Financial and Operating Results. The results presentation is available on First Pacific’s website, www.firstpacific.com. For media on this call, please note the Q&A session is open for investors and analysts only. If you would like to raise questions, please contact us when the call finished. For today’s conference call, we have with us Mr. Manuel Pangilinan, our Managing Director and CEO; Mr. Robert Nicholson, Executive Director; Mr. Chris Young, Executive Director and CFO; Mr. Edward Tortorici; and other senior executives. At this point, I would like to turn to Mr. John Ryan from Corporate Communications for his presentation.

Thanks, Sara. Good evening and good day, folks. This presentation currencies mentioned will be United States dollars unless I tell you otherwise. Let us turn to Page 3 of the presentation, which hasn’t changed in a little while, but there’s a large change at the top, where you can see that Ed Tortorici has been a Director of First Pacific for over a quarter century or so has retired, so continue as consultant for some time. And he’s replaced by Chris Young, who has been in the First Pacific group in one role or another in our various companies for over 20 years, most recently as CFO at First Pacific. He has been appointed from the end of today’s Board meeting. And the senior supporting staff on the bottom row have not changed. Turning to Page 4, there’s a snapshot of our larger and more important investee companies. So far this year, our ownership in these assets has not had any kind of meaningful change. Now if you turn to Page 5, there’s a snapshot of the value of those investee companies as of the end of June. Our GAAP then was about $7.8 billion divided, as you can see in pie chart, telecommunications about a quarter a bit smaller than that and investment in MPIC, the biggest infrastructure company in the Philippines, and our food investments with the very strong growth in Indofood share price over the past 18 months or so, has grown to be rather larger than the other individual areas of investments. On the right-hand side, our investment objectives have been slightly updated to introduce a bit of visible emphasis on ESG criteria. As we have seen today, the environment and social and corporate governance matters are increasingly important to our shareholders in the wider investor community. We published our first ESG reports about a month ago and we’re happy to talk about that in the Q&A if you would like, investment criteria really not changed. Page 6 has our traditional larger pie chart showing the full valuation of the assets that we are listed in and one or two assets below that level, such as Meralco. Overall, they’re about $35.5 billion, with proportions not too dissimilar from the GAAP pie chart on the previous page. Now, let’s have a quick look at our earnings for the first-half of the year on Page 7. As we have suggested in our meetings with investors over the past few months, our contribution from these investee companies is up in the first-half of the year and we expect that this will herald an increase in contribution and recurring profit in net profit for the year as a whole. And looking forward over the medium-term, we are confident that our group of investments will produce steadily stronger results going forward, and that will mean for First Pacific a steady earnings growth after two or three years of decline. And that we are hopeful, will result in an upturn in our dividend income perhaps as early as next year, with the caveat, of course, that this does depend to a great extent on exchange rates. Let us note that the Philippine peso is down about 6% in the first-half of the year. Now if you look on Page 8, there’s some important information there about our cash flow and debt profile. With us on this call is Joseph Ng, our very patient and hard working Head of Treasury, who over the course of 18 to 24 months has brought us significant reductions in the size of our interest bill and the size of the overall debt outstanding, whereas we are now in a position, whereas you can see on the bottom left chart, we have no debt obligations due until 2019, when one of our first bond matures. And if you look at the chart above that describing our cash flow, there has been some condensation of data here, net loan repayments being the biggest figure on that chart. That is consistent to a great extent of bonds that matured last month in July. It was our most expensive borrowing at 7.375%, we’re very glad to see that interest bill go. Now, please note, the dividend and fee income there does not contain a very large payment from Indofood. Let me remind you, while the Indofood pays its dividend once a year, it’s generally in the first-half of the year. But because of the Muslim holiday calendar for one reason or another, the company could not get approval from the shareholders for payment of that dividend until the first week of July, that came in about $69 million. So that closing free cash of $58 million, you see on the right-hand side of that chart, is a little bit misleading. As of now, we’ve got double or 1.5 times that amount of money currently in cash right now at head office. We are hopeful that 2017 will mark a low point over recent years of our dividend income, with 2017’s improved results by the operating companies resulting in an uptick next year of dividend income to First Pacific. Again, please note that this does depend on some stability in exchange rates. Now just a quick note on those two pie charts at the bottom. The unsecured share of all of our debt outstanding is now about four-fifth of the total. We’ve made significant strides towards pushing that up towards our eventual goal of 100% of all our debt income secured. Now, let’s have a quick look on how those operating company is performed. Indofood on Page 9, saw its revenues rise quite strongly, mostly because of the Consumer Branded Products business and the agribusiness delivering strong growth, followed by distribution; Bogasari, of course, hurt by lower wheat prices, which reduced its own contribution to the overall company, Bogasari being the flour and pasta divisions of Indofood. Now, you see core income notwithstanding how this chart appears to show a steep increase, it wasn’t up very much. It was mostly flat and that’s because of the Muslim holiday calendar that I referred to, which meant, there were lower sales in the – towards the end of June than you usually see. And there will be a corresponding uptick in the 2H numbers for Indofood. So the full-year results for Indofood will very likely be rather stronger than the half-year numbers you see here. Now as the biggest food company in Indonesia, they face quite a bit of competition, but we’re very happy to record that in the first-half of the year, nearly all of their businesses, except for Bogasari, saw stronger sales. Now, within Consumer Branded Products, which as you see on Page 10, is about half of all their sales. The dairy business did have a bit of difficulty with milk prices. But going forward, it seems that the strong sales growth we see in all the product categories there from noodles to snack food, dairy and beverages, will continue growing quite well. As you can see in the very large chart on the left-hand side of the page, we had a 1 percentage point increase in the EBIT margins overall, driven clearly by the agribusiness, where much stronger palm oil prices drove a sharp increase in the EBIT margins there. Now palm oil prices are quite cyclical and we will see in the second-half of this year that they’ll be down a bit from the first-half. But to sum, Indofood will have rather better results for the full-year than we’ve seen as the half-year. Now, let’s turn to Page 11, where we’ve got a fascinating story of the PLDT turnaround from the old [stodgey] [ph] business of – as many was saying in the Board meeting earlier today, they only sold one product and that was voice. As you can see on this chart, big on the left-hand side of Page 11, that voice, which was their only product a few years ago, continues to decline quite strongly. Their second ever product texting continues to go down. And as you can see, the recovery is being led by revenue from data services. These, of course, are lower margin businesses. So we’re on a secular trend of margins coming down. And the aim of PLDT is to turn it towards revenue growth, which we would hope to see perhaps next year, leading as our primary goal to earnings growth going forward. Now apart from the earnings fee, most visible aspects of PLDT’s earnings, of course, in the first-half of the year is that, they’ve sharply reduced their forecast of CapEx spending from 46 billion pesos to 38 billion. And this quite honestly is simply that that sheer volume of CapEx work cannot physically be done in the time that they would have budgeted that. So a lot of that work is being pushed through into 2018. However, their CFO reiterated to our Board earlier today that, they do expect to have LTE, the very important 4G technology reaching 70% population coverage, as planned, by the end of this calendar year. And PLDT is very confident when they say that their mobile network is much better than Globe’s, their main competitor in terms of download speed and quality of your connections. Globe still has an edge in terms of breadth. So that edge is declining quite rapidly, as our CapEx spend goes out. Now let’s move on to Metro Pacific, the biggest infrastructure firm in the Philippines. Page 13 has a reminder of the main investments that Metro has. I don’t think there have been any major changes this year. There’re up to 13 hospitals now, a business that began in 2008, with a small investment in one hospital. The road investments there on the left are much the same. The bulk of it in the Philippines with a little bit in Thailand, very profitable investment there on the Don Muang Tollway and also in Vietnam, the CII Bridges & Roads. And of course, just over a year ago, there was that big change in their electricity investments, which is reflected in the addition of global business power to their portfolio. And more recently, in the first-half of this year, they’ve increased their stake in Beacon Electric to 100%. And you’ll see that when they report their full-year numbers, in fact, they may have done that in the first-half; Beacon Electric is fully consolidated. Now, Page 14 shows you a comparison of how the contribution has changed from the first-half of 2016 to the same period this year. Essentially, we’ve got continuing very strong earnings growth at Metro Pacific and that has been driven by a bigger investment in electricity, very strong growth in the toll roads, stronger contribution by hospitals, however small a share of the total it is. The water contribution held back to a certain extent by lower temperatures than we saw in the same period in 2016. There has been some positive developments on what seems to be the never-ending story of disputes over tariffs with various regulators, Manny can fill you in on details about that. But it looks like there is visible progress in Maynilad Water Company's quest to sort out its tariff issues with its own regulator. For the full-year, Metro Pacific will again, as in the previous few years, have a very strong earnings. And we are very confident that the future there is quite bright. We’re looking at economic growth in that company, continuing to deliver increasing demand for electricity and services like roads and hospital and so on that Metro Pacific offers. Now, if we turn to page 15, Goodman Fielder is the newest major investments that we have at First Pacific. Overall, New Zealand has led the results at that company with strong sales growth. But we’ve seen normalized profit was quite disappointing, down 15% to A$18 million, owing largely to a decline in the contribution from Papua New Guinea, where they had some difficulties with sales in the second-half of 2016 and in the first-half of this year, and we’re looking for a stronger turnaround in the second-half of 2017 there. Now in newer markets, such as ASEAN markets like Philippines and Vietnam are growing very well indeed. So the international business has a very bright future in front of it, notwithstanding the disappointments, the genuine disappointments at Papua New Guinea over that six or eight-month period into the first-half of this year. Our colleagues, Stanley Yang and Robert Nicholson, can speak to this in the Q&A going forward. Now very quickly on Page 16 now, the last of our major investment, Philex, one of the biggest copper and gold mining companies in the Philippines. They reported a decline in core income, because as you can see here, smelting charges were higher. They also had some higher costs, because the ore that was coming out in the first-half of the year was in the form of much larger boulders than in the year earlier period, big boulders, cost more money and take longer to smash down into the fine powder that they eventually need for smelting. So that eventually set down into a slight decline in their core income, notwithstanding a staggeringly large increase in copper prices, which very much helped them. Now if you want to ask how their core income is down, where their contributions in First Pacific is up in the first-half of the year, it’s quite simply because of the difference in treatment the income derived when the metals are produced under the various accounting standards. In the Philippines, you can account for us on production for that ore that was produced late in 2016 was recorded as income that year and not in the first-half, when it was sold, where it was recorded for First Pacific. So we had artificial boost in the contribution as it were because of the slightly different accounting treatment between the two systems. Now on Page 17, the conclusion we’ve got here essentially is unchanged from the conclusion we had at our full-year earnings report. In March, our NAV discount [preys] [ph] on our minds, it’s been high 40s, as much as 50%, for too long a time. Though, we are heartened to see that after today’s earning report – earnings report, it’s down to about 45% at today’s closing share price. And let us hope that, we can see some progress moving downward from that level. As said, our investments are well-positioned for growth this year and going forward. We expect that this will be reflected in our NAV discount, as the market absorbs the confidence that we’ve got in the prospects going forward. We’re identifying assets which don’t meet our return requirements. We can speak to this in some more detail. [Call Ends Abruptly]