Mabuhay Holdings Corporation

Message from the Chairman and the President

2023 Annual Report

Our Company, Mabuhay Holdings Corporation, conducted its 2023 Annual Stockholders Meeting at the end of September last year. We are holding this year’s ASM during the last week of June, and plan to hold it even a bit earlier next year, in order to eventually match the ASM schedule specified in the ByLaws of our Company, which is the end of April every year

We would like to talk a bit about the Philippine economy in general, before we report on the status of our Company. In the past months, the Philippine economy did not appear to be in good shape. The outstanding debt of the national government had ballooned to over 15 trillion Pesos in April. The stock market index had plunged to the 6,400 level, which is 20% lower than the pre-Pandemic level of 8,000. The Philippine currency has also weakened significantly recently, with the exchange rate of Peso dropping to an all-time low against the US dollar, at around 58.80 Pesos to one US dollar. Mainly due to the depreciation of the Peso, the inflation rate in recent months exceeded the forecast of the government, and in order to control this situation, the Banko Sentral has maintained high interest rates for Peso borrowing, which is not good for new investment projects and the economy as a whole. Central Bank has cautioned the business community that the economic growth of 2024 may not be as good as what the government predicted earlier. However, despite the fact that we are confronted with many hardships, our economic planners believe that the situation will improve starting the third quarter of this year, with bigger volume of exports expected.

Similarly, the business performance of our Company did not present a rosy picture in the past months. The biggest drawback was the plunge of the share price of Philippine Infradev Holdings, Inc. and the subsequent suspension of share-trading of this company in the Philippine Stock Exchange. You will recall that we had an affiliated company known as IRC Properties, Inc., of which we were the major and managing shareholder. This company had completed several affordable housing projects in Binangonan, Rizal during the decade under our management. In 2018, Mabuhay decided to sell the bulk of its shareholding in IRC Properties, Inc. to a group of investors who were contemplating the construction of the Makati Subway System, while retaining enough shares to remain a significant minority shareholder. This company was renamed Philippine Infradev Holdings, Inc. by the new controlling shareholders. Regrettably, the Makati Subway Project did not take off the ground and the trading of Infradev shares was recently suspended by the Philippine Stock Exchange due to its failure to submit the audited financial statements for the year 2023. We hope the trading of the Infradev shares will resume soon so that it will not affect the value of our Company’s assets too much.

After completing the Verde Vita subdivision project in Trece Martires of Cavite Province, our wholly-owned subsidiary, T&M Holdings, Inc., purchased a 3.679- hectare property in Lipa City of Batangas Province, which we are in the planning process to develop into another affordable housing project. Our Company has been debt-free for the past many years, but since we paid cash for the purchase of the land in Lipa City, we may need to acquire a development loan when we start the construction of the houses. Nevertheless, this development loan, if ever borrowed, will be in the nature of a bridge financing only, since we expect PagIbig Fund to pay us fully once the construction of the houses is completed.

The management team of Mabuhay Holdings Corp. will focus on the Lipa City affordable housing project in 2024 and early next year. At the same time, we will also look for investment opportunities which are in line with the development directions of the government and our Company.

The members of the Board of Directors and the Management Team of Mabuhay Holdings Corporation would like to express the deepest gratitude to the shareholders for their trust and support all these years.

Atty. Roberto V. San Jose                                                                           Esteban G. Peña Sy

Chairman                                                                                                      President