8990 HOLDINGS, INC. AND SUBSIDIARIES...8990 holdings, inc. and subsidiaries map showing the relationship between and among the parent company and its subsidiaries december 31, 2016

8990 HOLDINGS, INC. AND SUBSIDIARIES

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND

SUPPLEMENTARY SCHEDULES

CONSOLIDATED FINANCIAL STATEMENTS

Statement of Management’s Responsibility for Consolidated Financial Statements Consolidated Statements of Financial Position as of December 31, 2016 and 2015 Consolidated Statements of Comprehensive Income for the Years Ended December 31, 2016, 2015 and 2014 Consolidated Statements of Changes in Equity for the Years Ended December 31, 2016, 2015 and 2014 Consolidated Statements of Cash flows for the Year Ended December 31, 2016, 2015 and 2014 Notes to Consolidated Financial Statements SUPPLEMENTARY SCHEDULES

Independent Auditor’s Report on Supplementary Schedules Part I I. Reconciliation of Retained Earnings Available for Dividend Declaration (Part I, 4C; Annex 68-C) II. Schedule of All the Effective Standards and Interpretations (Part I, 4J) III. Map of the Relationships of the Companies within the Group (Part I, 4H) Part II – Supplementary Schedules Required by Annex 68-E A. Financial Assets B. Amounts Receivable from Directors, Officers, Employees, Related Parties and Principal Stockholders (Other than Related Parties) C. Amounts Receivable from Related Parties which are Eliminated During the Consolidation of Financial Statements D. Intangible Assets – Other Assets E. Long-term Debt F. Indebtedness to Related Parties (Long-term Loans from Related Companies) G. Guarantees of Securities of Other Issuers H. Capital Stock OTHER SCHEDULE

Financial Ratios

Schedule I


11th Floor Liberty Center, 104 H.V. Dela Costa

Salcedo Village, Makati City

RECONCILIATION OF RETAINED EARNINGS

AVAILABLE FOR DIVIDEND DECLARATION

AS OF DECEMBER 31, 2016

Unappropriated retained earnings, beginning P=1,886,815,918

Add: Net income during the year 2,713,922,838

Less: Cash dividend declaration (1,655,397,216)

Unappropriated retained earnings, ending P=2,945,341,540

AdoptedNot

Adopted

Not

Applicable

a

a

a

First-time Adoption of Philippine Financial Reporting Standards a

a

Amendments to PFRS 1: Limited Exemption from Comparative PFRS 7 Disclosures for

First-time Adopters a

Amendments to PFRS 1: Severe Hyperinflation and Removal of Fixed Date for

First-time Adopters** a

Amendments to PFRS 1: Government Loans** a

Share-based Payment aAmendments to PFRS 2: Vesting Conditions and Cancellations aAmendments to PFRS 2: Group Cash-settled Share-based Payment Transactions aAmendments to PFRS 2: Classification and Measurement of Share-based Payment

Transactions* (effective January 1, 2018) a

PFRS 3

(Revised) Business Combinations a

Insurance Contracts aAmendments to PAS 39 and PFRS 4: Financial Guarantee Contracts a

PFRS 5 Non-current Assets Held for Sale and Discontinued Operations aPFRS 6 Exploration for and Evaluation of Mineral Resources a

Financial Instruments: Disclosures aAmendments to PFRS 7: Transition aAmendments to PAS 39 and PFRS 7: Reclassification of Financial Assets aAmendments to PAS 39 and PFRS 7: Reclassification of Financial Assets – Effective Date and

Transition a

Amendments to PFRS 7: Improving Disclosures about Financial Instruments aAmendments to PFRS 7: Disclosures – Transfers of Financial Assets aAmendments to PFRS 7: Disclosures – Offsetting Financial Assets and Financial Liabilities aAmendments to PFRS 7: Mandatory Effective Date of PFRS 9 and Transition Disclosures*

(effective when PFRS 9 is first applied) a

PFRS 8 Operating Segments aPFRS 9 Financial Instruments (2014)* (effective January 1, 2018) a

Consolidated Financial Statements aAmendments to PFRS 10: Transition Guidance aAmendments to PFRS 10: Investment Entities a

Amendments to PFRS 10: Investment Entities – Applying the Consolidation Exception a

Amendments to PFRS 10: Sale or Contribution of Assets between an Investor and its

Associate or Joint Venture* (effective date deferred indefinitely) a

Joint Arrangements aAmendments to PFRS 11: Transition Guidance a

Amendments to PFRS 11: Accounting for Acquisitions of Interests in Joint Operations a

Disclosure of Interests in Other Entities aAmendments to PFRS 12: Transition Guidance a

Amendments to PFRS 12: Investment Entities aAmendments to PFRS 10: Investment Entities – Applying the Consolidation Exception a

PFRS 13 Fair Value Measurement a

PFRS 14 Regulatory Deferral Accounts aPFRS 15 Revenue from Contract with Customers (effective January 1, 2018) aPFRS 16 Leases* (effective January 1, 2019) a

Presentation of Financial Statements aAmendments to PAS 32 and PAS 1: Puttable Financial Instruments and Obligations Arising

on Liquidation a

Amendments to PAS 1: Presentation of Items of Other Comprehensive Income a

Amendments to PAS 1: Disclosure Initiative a

PHILIPPINE FINANCIAL REPORTING STANDARDS AND INTERPRETATIONS


SCHEDULE OF ALL THE EFFECTIVE STANDARDS AND INTERPRETATIONS

UNDER PFRS IN COMPLIANCE WITH SRC RULE 68, AS AMENDED

DECEMBER 31, 2016

Framework for the Preparation and Presentation of Financial Statements

Conceptual Framework Phase A: Objectives and Qualitative Characteristics

Practice Statement Management Commentary

Philippine Financial Reporting Standards (PFRS)

PFRS 1

(Revised)

Amendments to PFRS 1: Additional Exemptions for First-time Adopters

PFRS 2

PFRS 4

PFRS 7

PFRS 10

PFRS 11

PFRS 12

Philippine Accounting Standards (PAS)

PAS 1

(Revised)

SCHEDULE II

Page 1

AdoptedNot

Adopted

Not

ApplicablePHILIPPINE FINANCIAL REPORTING STANDARDS AND INTERPRETATIONS

PAS 2 Inventories a

Statement of Cash Flows a

Amendments to PAS 7: Disclosure Initiative* (effective January 1, 2017) a

PAS 8 Accounting Policies, Changes in Accounting Estimates and Errors a

PAS 10 Events After the Reporting Period a

PAS 11 Construction Contracts a

Income Taxes a

Amendments to PAS 12 - Deferred Tax: Recovery of Underlying Assets a

Amendments to PAS 12 - Recognition of Deferred Tax Assets for Unrealized Losses* (effective

January 1, 2017) a

Property, Plant and Equipment a

Amendments to PAS 16: Bearer Plants a

Amendments to PAS 16: Clarification of Acceptable Methods of Depreciation and a

PAS 17 Leases a

PAS 18 Revenue a

Employee Benefits a

Amendments to PAS 19: Defined Benefit Plans – Employee Contributions a

PAS 20 Accounting for Government Grants and Disclosure of Government Assistance a

The Effects of Changes in Foreign Exchange Rates aAmendments: Net Investment in a Foreign Operation a

PAS 23

(Revised) Borrowing Costs a

PAS 24

(Revised) Related Party Disclosures a

PAS 26 Accounting and Reporting by Retirement Benefit Plans aSeparate Financial Statements aAmendments to PAS 27: Investment Entities aAmendments to PAS 27: Equity Method in Separate Financial Statements aInvestments in Associates and Joint Ventures aAmendments to PFRS 10: Sale or Contribution of Assets between an Investor and its

Associate or Joint Venture* (effective date deferred indefinitely) a

Amendments to PAS 28: Investment Entities – Applying the Consolidation Exception aPAS 29 Financial Reporting in Hyperinflationary Economies a

Financial Instruments: Presentation aAmendments to PAS 32 and PAS 1: Puttable Financial Instruments and Obligations Arising

on Liquidation a

Amendments to PAS 32: Classification of Rights Issues aAmendments to PAS 32: Offsetting Financial Assets and Financial Liabilities a

PAS 33 Earnings Per Share aPAS 34 Interim Financial Reporting a

Impairment of Assets aAmendment to PAS 36: Recoverable Amount Disclosures for Non-financial Assets a

PAS 37 Provisions, Contingent Liabilities and Contingent Assets aIntangible Assets aAmendments to PAS 38: Clarification of Acceptable Methods of Depreciation and aFinancial Instruments: Recognition and Measurement a

Amendments to PAS 39: Transition and Initial Recognition of Financial Assets and Financial

Liabilities a

Amendments to PAS 39: Cash Flow Hedge Accounting of Forecast Intragroup Transactions aAmendments to PAS 39: The Fair Value Option aAmendments to PAS 39 and PFRS 4: Financial Guarantee Contracts a

Amendments to PAS 39 and PFRS 7: Reclassification of Financial Assets aAmendments to PAS 39 and PFRS 7: Reclassification of Financial Assets – Effective Date and

Transition a

Amendments to Philippine Interpretation IFRIC 9 and PAS 39: Embedded Derivatives** a

Amendments to PAS 39: Eligible Hedged Items** a

Amendments to PAS 39: Novation of Derivatives and Continuation of Hedge Accounting** aPAS 40 Investment Property a

Agriculture aAmendments to PAS 41: Bearer Plants a

PAS 19

(Revised)

PAS 7

PAS 12

PAS 16

PAS 21

PAS 27

(Revised)

PAS 28

(Revised)

PAS 32

PAS 36

PAS 38

PAS 39

PAS 41

Page 2

AdoptedNot

Adopted

Not

ApplicablePHILIPPINE FINANCIAL REPORTING STANDARDS AND INTERPRETATIONS

IFRIC 1 Changes in Existing Decommissioning, Restoration and Similar Liabilities a

IFRIC 2 Members’ Share in Co-operative Entities and Similar Instruments a

IFRIC 4 Determining Whether an Arrangement Contains a Lease a

IFRIC 5 Rights to Interests Arising from Decommissioning, Restoration and Environmental

Rehabilitation Funds** a

IFRIC 6 Liabilities Arising from Participating in a Specific Market – Waste Electrical and Electronic

Equipment a

IFRIC 7 Applying the Restatement Approach under PAS 29, Financial Reporting in Hyperinflationary

Economies a

Reassessment of Embedded Derivatives** a

Amendments to Philippine Interpretation IFRIC–9 and PAS 39: Embedded Derivatives** a

IFRIC 10 Interim Financial Reporting and Impairment a

IFRIC 12 Service Concession Arrangements a

IFRIC 13 Customer Loyalty Programmes a

PAS 19 - The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their

Interaction a

Amendments to Philippine Interpretations IFRIC – 14, Prepayments of a Minimum Funding

Requirement and their Interaction** a

IFRIC 16 Hedges of a Net Investment in a Foreign Operation aIFRIC 17 Distributions of Non-cash Assets to Owners** aIFRIC 18 Transfers of Assets from Customers** aIFRIC 19 Extinguishing Financial Liabilities with Equity Instruments** aIFRIC 20 Stripping Costs in the Production Phase of a Surface Mine aIFRIC 21 Levies a

SIC-7 Introduction of the Euro aSIC-10 Government Assistance – No Specific Relation to Operating Activities aSIC-13 Jointly Controlled Entities – Non-Monetary Contributions by Venturers aSIC-15 Operating Leases – Incentives aSIC-25 Income Taxes – Changes in the Tax Status of an Entity or its Shareholders** aSIC-27 Evaluating the Substance of Transactions Involving the Legal Form of a Lease aSIC-29 Service Concession Arrangements: Disclosures aSIC-31 Revenue – Barter Transactions Involving Advertising Services** aSIC-32 Intangible Assets – Web Site Costs** a

* These standards will be effective for periods subsequent to 2016 and are not early adopted by the Group.

** These standards have been adopted in the preparation of consolidated financial statements but the Group has no significant transactions covered

in both years presented.

Philippine Interpretations - Standing Interpretations Committee (SIC)

Philippine Interpretations - International Financial Reporting Interpretations Committee (IFRIC)

IFRIC 9

IFRIC 14

Page 3

Schedule III

8990 HOLDINGS, INC. AND SUBSIDIARIES MAP SHOWING THE RELATIONSHIP BETWEEN AND AMONG

THE PARENT COMPANY AND ITS SUBSIDIARIES

DECEMBER 31, 2016

8990

Holdings,

Inc.

8990 HDC

ERDC THI RLC

FH 8990 LHDC 8990 DHDC 8990 MHDC 8990 LRC


SCHEDULE A - FINANCIAL ASSETS

DECEMBER 31, 2016

Value Based on

Name of Issuing Entity and Amount Shown in Market Quotations Income Received and

Description of Each Issue the Balance Sheet/Notes at Balance Sheet Date Accrued

Azalea Resorts and Vacation Club, Inc.

Preferred shares P=28,112,000 P=–* P=–

Azalea Leisure Residences Corporation

Preferred shares 1,132,028,629 –* 45,509,947

Pico de Loro Beach and Country Club

Club shares 633,500 ‒* ‒

*The shares are unquoted instruments


SCHEDULE B - AMOUNTS RECEIVABLE FROM DIRECTORS, OFFICERS, EMPLOYEES, RELATED PARTIES

AND PRINCIPAL STOCKHOLDERS (OTHER THAN RELATED PARTIES)

DECEMBER 31, 2016

Balance Balance at End of Year

Name and Designation at Beginning of Debtor of Year Additions Collections Write Offs Current Noncurrent Total

Azalea Leisure Residences Corporation P=115,988,334 P=29,006,485 (P=342,769) P=– P=144,652,050 – P=144,652,050

Januarius Resources Realty Corporation 50,030,000 – (50,030,000) – – –

Azalea Resorts and Vacation Club, Inc. 32,205,294 – – – 32,205,294 – 32,205,294

New Ideas Verbalize, Inc. 21,256,401 2,778,639 24,035,042 24,035,042

Bon Giorno Homes, Inc. 13,635,148 3,877,883 (89,301) – 17,423,731 – 17,423,731

8990 Cebu Housing Development Corporation 13,519,938 109,095 13,629,033 13,629,033

8990 Iloilo Housing Development Corporation 11,919,110 7,860 – 11,926,970 – 11,926,970

8990 Commercial Management Corporation 4,849,770 68,649 – – – – 4,918,419

Kwantlen Development Corporation 765,503 (766,503) – – – –

Modernland 758,632 140,670 – 899,301 – 899,301

8990 Visayas Housing Development Corporation 16,857 64,665 – – 81,523 – 81,523

Urban Basic Housing Corporation – 13,166,940 (717,291) – 12,449,649 – 12,449,649

Others 47,970,548 17,698,836 – – 65,669,384 – 65,669,384


SCHEDULE C - AMOUNTS RECEIVABLE FROM RELATED PARTIES WHICH ARE ELIMINATED

DURING THE CONSOLIDATION OF FINANCIAL STATEMENTS

DECEMBER 31, 2016

Balance Balance at End of Year

Name and Designation at Beginning of Debtor of Year Additions Collections Write Offs Current Noncurrent Total

8990 Holdings, Inc. P=41,485,775 P=794,710,218 (P=288,840,206) P=– 547,355,787 P=– 547,355,787

Fog Horn, Inc. 1,100,000 1,051,915,885 (767,059,982) – 285,955,903 – 285,955,903

8990 Housing Development Corporation 855,138,422 906,859,209 (1,748,489,660) – 13,507,971 – 13,507,971

8990 LHDC 582,314,762 1,646,920,263 (345,937,288) – 1,883,297,737 – 1,883,297,737

8990 Leisure and Resorts Corporation 13,131,396 471,793 – – 13,603,189 – 13,603,189

8990 Davao HDC 170,375,528 907,475,755 (288,089,507) – 789,761,776 – 789,761,776

8990 Mindanao HDC 117,271,991 194,899,134 (99,466,985) – 212,704,140 – 212,704,140

Tondo Holdings, Inc. 797,309,763 862,952,223 (53,337,828) – 1,606,924,158 – 1,606,924,158

Euson Realty 94,616,003 159,239,262 (1,784,615) – 252,070,650 – 252,070,650

RLC Coastal Estates, Inc. – 264,310,914 – – 264,310,914 – 264,310,914


SCHEDULE D - INTANGIBLE ASSETS - OTHER ASSETS

DECEMBER 31, 2016

Description Beginning Additions Charged to Cost Charged to Other Changes Ending

Balance at Cost and Expenses Accounts Additions Balance

(Deductions)

Software costs P=1,492,522 P=– P=– P=– P=– P=1,492,522


SCHEDULE E - LONG-TERM DEBT

DECEMBER 31, 2016

Amount Shown under Caption

"Current Portion of Long Term

Debt" in Related Balance Sheet

Amount Shown under Caption

"Long-Term Debt" in Related

Balance Sheet

Remarks

Title of Issue and Amount Authorized

Type of Obligation by Indenture

Loans payable P=10,965,461,989 P=2,769,966,306 P=8,195,495,683 Interest rates ranging from

3% to 8.1%;

Maturity dates ranging in

maturity from 3 months to 5

years.

Bonds payable P=9,000,000,000 – P=8,906,782,331 Interest rates ranging from

6.1% to 6.9%;

Maturity dates ranging in

maturity from 5 to 10 years.


SCHEDULE F - INDEBTEDNESS TO RELATED PARTIES (LONG-TERM LOANS FROM RELATED COMPANIES)

DECEMBER 31, 2016

Name of Related Party Balance at Beginning of the Period Balance at End of the Period

NONE TO REPORT


SCHEDULE G - GUARANTEES OF SECURITIES OF OTHER ISSUERS

DECEMBER 31, 2016

Name of issuing entity

of securities guaranteed

by the Title of issue of each class Total amount guaranteed Amount owned by person Nature of guarantee

Company for which this of securities guaranteed and outstanding for which this statement is filed

statement is filed

NONE TO REPORT


SCHEDULE H - CAPITAL STOCK

DECEMBER 31, 2016

Number of Shares Number of Shares Held by

Number of Reserved for Options, Directors,

Shares Number of Shares Issued Warrants, Conversion Related Officers and

Title of Issue Authorized and Outstanding and Other Rights parties Employees Others

Common Shares at P=1 par value 7,000,000,000 5,517,990,720 – – 470,012,568 –

8990 HOLDINGS, INC. AND SUBSIDIARIES FINANCIAL RATIOS

December 31, 2016 December 31, 2015

Current ratio 1.10:1.00 1.99:1.00

Book value per share P=3.49 P=3.14

Debt-to-equity ratio 1.24:1.00 0.86:1.00

December 31, 2016 December 31, 2015

Gross margin 53.94% 55.02%

EBITDA margin 53.79% 50.96%

Net income margin 38.55% 40.13%

RATIOS:

• Current ratio is computed by dividing the current assets by current liabilities.

• Net book value is computed by dividing the stockholders’ equity by total outstanding shares.

• Debt-to-equity ratio is computed by dividing the sum of short-term and long-term interest bearing

loans by total stockholders’ equity.

• Gross margin is computed by dividing the gross income by revenues.

• Earnings before interest, taxes, depreciation and amortization (EBITDA) margin is computed by

dividing the EBITDA by revenues.

• Net income margin is computed by dividing the net income by revenues.

Documents

8990 HOLDINGS, INC. AND SUBSIDIARIES...8990 holdings, inc. and subsidiaries map showing the relationship between and among the parent company and its subsidiaries december 31, 2016