DUE DILIGENCER
NICKEL Asia Corp. (NAC) has 13,632,970,117 outstanding NAC common shares, with P0.50 par value. Its short and long-term debits amounted to P2.551 billion, which means a stockholder owes its creditors P0.1849 each. Its retained earnings totaling P15.21 billion divided into P13.624 billion unappropriated and P1.585 billion appropriated as of Mar. 31, 2020 more than made up for its huge debts.
In a compensation filing, NAC named its highest-paid executive officers as follows: Gerard H. Brimo, chairman of the nine-man board; Martin Antonio G. Zamora, president and chief executive officer; Emmanuel L. Samson, chief financial officer; Jose B. Anievas, chief operating officer; and Rolando R. Cruz, vice president for project development and research.
In 2018, Nickel Asia paid them salary of P39.539 million and bonus of P33.308 million; in 2019, salary of P50.672 million and bonus of P32.762 million. In 2020, NAC estimated their salary at P45.166 million and their bonus at P26.668 million.
In the compensation filing, NAC paid “all other officers and directors as a group unnamed” salary of P41.841 million and bonus of P20.970 million in 2018; and salary of P43.270 million and bonus of P22.524 million in 2019. Up to Dec. 31, 2020, the company projected them to receive salary of P49.567 million and bonus of P16.672 million.
*****
As Nickel Asia said in the footnotes regarding ESOP, which stands for executive stock option plan, it made this exclusive to executives. is quoting verbatim these footnotes: “On Apr. 5, 2018, the New Plan was approved by the parent company’s BOD (board of directors) and was ratified by the stockholders on May 28, 2018. As at Mar. 31, 2020, the New Plan is yet to be approved by the SEC (Securities and Exchange Commission). The basic terms and conditions of the New Plan are as follows:
“1. The New Plan covers up to 155.0 million shares allocated to the parent company’s eligible participants.
“2. The eligible participants are the directors and officers of the parent company and its subsidiaries, specifically those with positions of assistant vice president and higher, including the resident mine managers of the subsidiaries.
“3. The exercise price is P4.38, which is equivalent to P2.43 after the effect of stock dividends.
“4. The New Plan was granted on June 15, 2018. 5. The term of the New Plan shall be five years and the shares will vest to the participant yearly at a rate of 25 percent after the first year of the New Plan.
“6. The participant can exercise the vested options by giving notice within the term of the New Plan, and can opt to either purchase the shares at the exercise price or request the parent company to advance the purchase price and to sell the shares in which case the participant will receive the sales proceeds less the exercise price.”
*****
A public ownership report (POR) as of Mar. 31, 2020 listed three principal stockholders as holders of 8,974,087,114 NAC common shares, or 65.826 percent of 13,632,970,117 outstanding common shares. The principal owners were Sumitomo Metal Mining Philippine Holdings Corp., 3,614,397,887 common shares, or 26.512 percent; Manta Resources Corp., 3,529,392,736 common shares, or 25.889 percent; and Ni Capital Corp., 1,830,296,491 common shares, or 13.426 percent.
Sumitomo Metal Mining Co. Ltd. is also one of NAC’s principal stockholders, according to the POR, which it held through Sumitomo Metal Mining Philippine Holdings.
Nickel Asia attributed to its public stockholders their ownership of 4,576,696,986 NAC common shares, or 33.571 percent of outstanding. The POR also named the company’s nine directors as direct and indirect holders of 32,469,866 common shares, or 0.238 percent. Their respective ownerships are as follows: Brimo, 28,360,009 common shares, or 0.208 percent; Philip T. Ang, 3,174,767 common shares, or 0.023 percent; Zamora, 16,211 common shares; Toru Higo and Masahiro Kamiya, 2,023 common shares each; Luis Juan L. Virata, one common share; Maria Patricia Z. Riingen, 911,800 common shares; and Frederick Y. Dy and Fulgencio S. Factoran Jr., 1,516 each.
Nickel Asia credited its public stockholders with 4,576,696,986 NAC common shares, or 33.571 percent.
What would listed stocks do with their retained earnings?