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Business Approach

HOW WE DELIVER OUR STRATEGY

We continue to see robust opportunities in the water and environmental space. This is driven by increasing population and continued economic growth in the region. To sustain growth, it is important that development-centered indicators, such as access to water and sanitation, are accorded due importance, given the evident challenges to water security, even in urban areas.

EXTERNAL ENVIRONMENT

Since the adoption of the United Nations Sustainable Development Goals (SDG) in 2015, the importance of providing safe and equitable access to water and sanitation services to more communities has steadily increased. Looking particularly at the SDG Targets on Water and Sanitation, key deliverables such as access to drinking water, sanitation services, and overall reduction of pollution to water bodies are set to be achieved by 2030.

These imperatives can only be achieved through the collaboration of all concerned stakeholders, both public and private. Specifically, the organization, Global Reporting has indicated that “Countries are increasingly acknowledging the significant role companies can play to help meet the SDGs. Forty-three Voluntary National Reviews show that 93 percent of the countries had consulted the private sector in reviewing their national strategy and progress on the SDGs. In addition, 68 percent of the reports also recognized private investment as a crucial alternative means to complement public expenditure on the SDGs, and 43 percent of the reports stated efforts made by the countries to develop more public-private partnerships on SDG implementation.”

Philippines. Currently, access to safe drinking water and sanitation services still needs significant improvement. At the national level, only 43.5 percent of the population has access to piped water. For sanitation, an alarmingly low 2.4 percent has access to piped sewer service. Majority are served by way of septic tanks, while the remainder are still without coverage.

To address this gap, the government needs to provide the necessary infrastructure to fast-track coverage expansion, and improve service delivery. The “Build, Build, Build” banner program of the Duterte administration has provided notable encouragement, with the hope of faster development and implementation of water and used water infrastructure projects. To rightly realize the program’s full potential, it is important to establish an integrated enabling framework and structure for private sector participation.

OUTLOOK

Our commitment to development through the provision of sustainable access to water and sanitation is supportive of addressing the challenges of the industry. We have successfully replicated the gains of the Manila Concession to our operating subsidiaries across the region. We have transitioned from a largely Manila-based business to a portfolio of businesses addressing the water and sanitation needs of our customers. We will continue to expand our portfolio to achieve our growth aspirations, aligned with regional development and environmental sustainability.

Sustaining the growth momentum is a challenge, in light of new realities in the environment. In recent years, the industry has become more competitive as more players have begun to take notice of the potential in the market. In spite of this, we remain firm in pursuing our mission by continuously innovating, refining our customer service and business processes, and expanding market reach. This is reflected in the plans of our major business units.

The Manila Concession remains robust, and continues to be the standard in the provision of water and sanitation services. While the Rate Rebasing exercise has yet to conclude, we remain dedicated to fulfilling our service obligations to our Manila Concession customers. Our business plan is devoted to expanding water distribution and sanitation services in the concession area, and in continuously improving service and efficiency standards.

We expect that most of the future growth will come from our Non- Manila Concession businesses. The continued growth of the operating subsidiaries will be complemented by future mergers and acquisitions, and the development of even more new businesses across the region. We hold on to the belief that addressing the needs of water stressed areas communities with sustainable access to water and sanitation, is a potent catalyst for economic development.

As we continue our growth journey, we are committed to embed the practice of risk management and governance across the Enterprise. We will ensure the provision of efficient and reliable support, as we continue to standardize our business processes. Our objective is to further enable new business development in expanding the portfolio of businesses.