** **

** **

**SECURITIES AND EXCHANGE COMMISSION**

**Washington****, D.C.****20549**

** **

**FORM 6 -K**

** **

**Report of Foreign Private Issuer**

** **

**Pursuant to Rule 13a-16 or 15d-16**

**of the Securities Exchange Act of 1934**

** **

**For the month of May 2007**

** **

**Commission File Number 1-03006**

** **

**Philippine Long Distance Telephone Company**

(Exact Name of Registrant as specified in its Charter)

 

**Ramon****Cojuangco Building**

**Makati Avenue**

**Makati****City**

**Philippines**

(Address of principal executive offices)

 

(Indicate by check mark whether the registrant filesor will file annual reports under cover of Form 20-F or Form 40-F.)

 

| Form 20-F:  √ | Form 40-F: |
|---------------------|------------|

 

(Indicate by check mark whether by furnishing theinformation contained in this form, the registrant is also thereby furnishingthe information to the commission pursuant to Rule 12g3-2(b) under theSecurities Exchange Act 1934.)

 

| Yes: | No: √ |
|------|-------------|

 

(If “Yes” is marked, indicate below the file numberassigned to the registrant in connection with Rule 12g3-2(b):  82-_____)

 

EXHIBITS

 

| Exhibit Number |                                                                                                                                                                   |   | Page   |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|
|           |                                                                                                                                                                   |   |   |
| 1.1            | Announcement date May 8, 2007                                                                                                                                          |   |   |
|           |                                                                                                                                                                   |   |   |
|           | Management’s Discussion and Analysis of Financial Condition and Results of Operations                                                                             |   | 43     |
|           |                                                                                                                                                                   |   |   |
|           | Consolidated Financial Statements as at March 31, 2007 (unaudited) and December 31, 2006 (audited) and for the three months ended  March 31, 2007 and 2006 (unaudited) |   | 97     |

 

 

SIGNATURES

 

 

 

Pursuant to the requirements of theSecurities Exchange Act of 1934, the registrant has duly caused this report tobe signed on its behalf by the undersigned, thereunto duly authorized.

 

 

 

PHILIPPINE LONG DISTANCE TELEPHONE COMPANY

 

 

 

 

| By:        /s/Ms. Lourdes C. Rausa-Chan                                                  |
|------------------------------------------------------------------------------------------|
| Ma. Lourdes C. Rausa-chan                                                                |
| Senior Vice President, Corporate Affairs and Legal Services Head and Corporate Secretary |
|                                                                                     |

 

 

 

 

 

 

Date:  May 8, 2007

Exhibit 1.1

 

MANAGEMENT’S DISCUSSION AND ANALYSIS OF 

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

For the Three Months Ended March 31, 2007

* *

*Inthe following discussion and analysis of our financial condition and results ofoperations, unless the context indicates or otherwise requires, references to“we,” “us,” “our” or “PLDT Group” mean the Philippine Long Distance TelephoneCompany and its consolidated subsidiaries, and references to “PLDT” mean thePhilippine Long Distance Telephone Company, not including its consolidatedsubsidiaries (see Note 2 – Summary of Significant Accounting Policies andPractices to the accompanying unaudited consolidated financial statements for alist of these subsidiaries, including a description of their respectiveprincipal business activities).*

* *

*Thefollowing discussion and analysis of our financial condition and results ofoperations should be read in conjunction with the accompanying unauditedconsolidated financial statements and the related notes.  Our financialstatements, and the financial information discussed below, have been preparedin accordance with Philippine Financial Reporting Standards, which differ incertain significant respects from generally accepted accounting principles inthe United States.*

* *

*Thefinancial information appearing in this report and in the accompanying unauditedconsolidated financial statements is stated in Philippine pesos.  Allreferences to “pesos,” “Philippine pesos” or “Php” are to the lawful currencyof the Philippines; all references to “U.S. dollars,” “US$” or “dollars” are tothe lawful currency of the United States; all references to “Japanese yen,”“JP¥” or “¥” are to the lawful currency of Japan**and all references to “Euro” or “€” are to thelawful currency of the European Union**.  Translations of Philippine pesoamounts into U.S. dollars in this report and in the accompanying unauditedconsolidated financial statements were made based on the exchange rate of Php48.217to US$1.00, the volume weighted average exchange rate at March 31, 2007 quotedthrough the Philippine Dealing System.*

* *

*Someinformation in this report may contain forward-looking statements within themeaning of Section 27A of the U.S. Securities Act of 1933 and Section 21E ofthe U.S. Securities Exchange Act of 1934.  We have based these forward-lookingstatements on our current beliefs, expectations and intentions as to facts,actions and events that will or may occur in the future.  Such statementsgenerally are identified by forward-looking words such as “believe,” “plan,”“anticipate,” “continue,” “estimate,” “expect,” “may,” “will” or other similarwords.*

* *

*Aforward-looking statement may include a statement of the assumptions or basesunderlying the forward-looking statement.  We have chosen these assumptions orbases in good faith, and we believe that they are reasonable in all materialrespects.  However, we caution you that forward-looking statements and assumedfacts or bases almost always vary from actual results, and the differencesbetween the results implied by the forward-looking statements and assumed factsor bases and actual results can be material, depending on the circumstances.When considering forward-looking statements, you should keep in mind thedescription of risks and cautionary statements in this report.  You should alsokeep in mind that any forward-looking statement made by us in this report orelsewhere speaks only as at the date on which we made it.  New risks anduncertainties come up from time to time, and it is impossible for us to predictthese events or how they may affect us.  We have no duty to, and do not intendto, update or revise the forward-looking statements in this report after thedate hereof.  In light of these risks and uncertainties, any forward-lookingstatement made in this report or elsewhere might not occur.*

* *

**Financial Highlights and Key Performance Indicators**

* *

| ** ** | **March 31,** | ** ** | **December 31,** | ** ** | **Increase (Decrease)** |  
 

**2007**

 

**2006**

** **

**Amount**

** **

**%**

 
(in millions, except for operational data, exchange rates and earnings per common share)

(Unaudited)

 

(Audited)

 

 

 

 

 
** **

 

 

 

 

 

 

 

 
**Consolidated Balance Sheets**

 

 

 

 

 

 

 

 
Total assets

Php251,597

 

Php241,892

 

Php9,705

 

4

 
Property, plant and equipment 

164,492

 

164,190

 

302

 

–

 
Cash and cash equivalents and short-term investments

38,473

 

25,197

 

13,276

 

53

 
Total equity

104,245

 

104,523

 

(278)

 

–

 
Notes payable and long-term debt

74,913

 

80,154

 

(5,241)

 

(7)

 
Net debt(1) to equity ratio

0.35x

 

0.52x

 

–

 

–

 
** **

** **

** **

**Three Months Ended March 31,**

** **

**Increase (Decrease)**

 

**2007**

 

**2006**

** **

**Amount**

** **

**%**

 

(Unaudited)

**Consolidated Statements of Income**

** **

** **

** **

** **

** **

** **

** **

Revenues and other income

Php33,836

 

Php30,852

 

2,984

 

10

Expenses

20,525

 

19,580

 

945

 

5

Income before income tax

13,311

 

11,272

 

2,039

 

18

Net income attributable to equity holders of PLDT

8,575

 

8,581

 

(6)

 

–

Net income

8,731

 

8,762

 

(31)

 

–

Net income margin

26%

 

28%

 

–

 

–

Earnings per common share – basic

44.87

 

46.74

 

(1.87)

 

(4)

**Consolidated Statements of Cash Flows**

 

 

 

 

 

 

 

Net cash provided by operating activities

Php25,001

 

Php15,404

 

Php9,597

 

62

Net cash used in investing activities

13,672

 

5,824

 

7,848

 

135

*Capital expenditures*

*5,937*

* *

*4,908*

* *

*1,029*

* *

*21*

Net cash used in financing activities

5,934

 

3,971

 

1,963

 

49

**Operational Data**

** **

** **

** **

** **

** **

** **

** **

Number of cellular subscribers

25,483,459

 

20,899,631

 

4,583,828

 

22

Number of fixed line subscribers(2)

1,847,084

 

1,854,364

 

(7,280)

 

–

Number of broadband subscribers

327,467

 

145,193

 

182,274

 

126

*Fixed Line*

*152,645*

* *

*101,195*

* *

*51,450*

* *

*51*

*Wireless*

*174,822*

* *

*43,998*

* *

*130,824*

* *

*297*

Number of employees

26,058

 

20,134

 

5,924

 

29

*Fixed Line*

*8,702*

* *

*9,160*

* *

*(458)*

* *

*(5)*

*Wireless*

*5,295*

* *

*5,076*

* *

*219*

* *

*4*

*Information and Communications Technology*

*12,061*

* *

*5,898*

* *

*6,163*

* *

*104*

 

**Exchange Rates**

**Php per US$**

 

** **

 

 

 

 

March 31, 2007

Php48.217

 

 

December 31, 2006

49.045

 

 

March 31, 2006

51.158

 

 

December 31, 2005

53.062

 

 

______________

* *

*(1)     **Net debt is derived bydeducting cash and cash equivalents and short-term investments from total debt(notes payable and long-term debt).*

*(2)     **Previously set forth asnumber of fixed lines in service.  2006 was restated to reflect the effect ofthe change in parameters used to align with the PLDT Group’s policy onsubscriber count with the planned use of an integrated billing system for oursubscribers.*

 
****
**Overview**

 

We are the largest and most diversifiedtelecommunications company in the Philippines.  We have organized our businessinto three main segments:

 

•           *Wireless**—***wirelesstelecommunications services provided by Smart Communications, Inc., or Smart,and Pilipino Telephone Corporation, or Piltel, our cellular service providers;Smart Broadband, Inc., or Smart Broadband (formerlyknown as Meridian Telekoms, Inc., or Meridian), our wireless broadbandprovider; Wolfpac Mobile, Inc., or Wolfpac, our wireless content operator;Mabuhay Satellite Corporation, or Mabuhay Satellite, ACeS Philippines CellularSatellite Corporation, or ACeS Philippines, and Telesat, Inc., or Telesat, oursatellite and very small aperture terminal, or VSAT, operators;**

 

•           *Fixed Line**—***fixed linetelecommunications services are primarily provided through PLDT.  We alsoprovide fixed line services through PLDT’s subsidiaries PLDT Clark Telecom,Inc., Subic Telecommunications Company, Inc., PLDT-Maratel, Inc., PLDT GlobalCorporation, or PLDT Global, Piltel, Smart-NTT Multimedia, Inc., or SNMI and BonifacioCommunications Corporation,  which together account for approximately 3% of ourconsolidated fixed line subscribers; and

 

•           *Information and CommunicationsTechnology**—***informationand communications infrastructure and services for Internet applications,Internet protocol-based solutions and multimedia content delivery provided byPLDT’s subsidiary ePLDT, Inc., or ePLDT; call center services provided under *ePLDTVentus*, include Parlance Systems, Inc., or Parlance, and Vocativ Systems,Inc., or Vocativ; business process outsourcing, or BPO, provided by SPiTechnologies, Inc., or SPi (consolidated on July 11, 2006); Internet access andgaming services provided by ePLDT’s subsidiaries, Infocom Technologies, Inc.,or Infocom, Digital Paradise, Inc., or Digital Paradise, Digital ParadiseThailand, Ltd., or Digital Paradise Thailand, netGames, Inc., or netGames,Airborne Access Corporation, or Airborne Access, Level Up!, Inc., or Level Up!;and e-commerce, and IT-related services provided by other investees of ePLDT,as discussed in *Note 9 – Investments in Associates* to the accompanying unauditedconsolidated financial statements. 

** **

We registered totalrevenues and other income of Php33,836 million in the first quarter of 2007, anincrease of Php2,984 million, or 10%, as compared to Php30,852 million in thesame period in 2006, primarily due to an increase in our service revenues andother income by Php3,035 million and Php78 million, respectively.  

 

Expenses increased byPhp945 million, or 5%, to Php20,525 million in the first quarter of 2007 fromPhp19,580 million in the same period in 2006, largely resulting from increasesin compensation and benefits, financing costs, and professional and othercontracted services, partly offset by lower depreciation and amortization, andcost of sales.

 

Net incomeattributable to equity holders of PLDT decreased by Php6 million to Php8,575million in the first quarter of 2007 from Php8,581 million in the same periodin 2006.  Basic earnings per common share decreased to Php44.87 in the firstquarter of 2007 from Php46.74 in the same period in 2006 due to an increase inthe weighted average number of common shares outstanding to 188.6 million in thefirst quarter of 2007 from 181.2 million in the same period in 2006.

 

**Results of Operations**

** **

The table below shows the contribution by each of ourbusiness segments to our revenues and other income, expenses and net income forthe three months ended March 31, 2007 and 2006.  Most of our revenues arederived from our operations within the Philippines.

** **

 

**Wireless**

** **

** **

** **

**Fixed Line**

** **

** **

** **

**ICT**

** **

 

** **

**Inter-segment Transactions**

** **

**Total**

** **

** **

**(in millions)**

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
**For the three months  ended  March 31, 2007**(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
Revenues and other income

Php21,450

 

 

 

Php12,007

 

 

 

Php2,466

 

 

 

(Php2,087)

 

Php33,836

 

 

 
Service

20,811

 

 

 

11,828

 

 

 

2,425

 

 

 

(2,052)

 

33,012

 

 

 
Non-service

576

 

 

 

15

 

 

 

33

 

 

 

(11)

 

613

 

 

 
Other income

63

 

 

 

164

 

 

 

8

 

 

 

(24)

 

211

 

 

 
Expenses

10,866

 

 

 

9,430

 

 

 

2,316

 

 

 

(2,087)

 

20,525

 

 

 
Income before income tax

10,584

 

 

 

2,577

 

 

 

150

 

 

 

–

 

13,311

 

 

 
Net income for the period

6,894

 

 

 

1,678

 

 

 

159

 

 

 

–

 

8,731

 

 

 
Net income attributable to  equity holders of PLDT

6,729

 

 

 

1,678

 

 

 

168

 

 

 

–

 

8,575

 

 

 
** **

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
**For the three months ended  March 31, 2006** (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
Revenues and other income

19,670

 

 

 

12,269

 

 

 

872

 

 

 

(1,959)

 

30,852

 

 

 
Service

18,944

 

 

 

12,151

 

 

 

813

 

 

 

(1,931)

 

29,977

 

 

 
Non-service

679

 

 

 

13

 

 

 

53

 

 

 

(3)

 

742

 

 

 
Equity share in net income of associates

–

 

 

 

–

 

 

 

2

 

 

 

–

 

2

 

 

 
Other income

47

 

 

 

105

 

 

 

4

 

 

 

(25)

 

131

 

 

 
Expenses

9,545

 

 

 

11,136

 

 

 

858

 

 

 

(1,959)

 

19,580

 

 

 
Income before income tax

10,125

 

 

 

1,133

 

 

 

14

 

 

 

–

 

11,272

 

 

 
Net income for the period

7,891

 

 

 

842

 

 

 

29

 

 

 

–

 

8,762

 

 

 
Net income attributable to  equity holders of PLDT

7,693

 

 

 

842

 

 

 

46

 

 

 

–

 

8,581

 

 

 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
**Increase (Decrease)**

**Amount**

** **

**%**

 

**Amount**

 

**%**

 

**Amount**

 

**%**

 

**Amount**

 

**Amount**

 

**%**

 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
Revenues and other income

Php1,780

 

9

 

(Php262)

 

(2)

 

Php1,594

 

183

 

(Php128)

 

Php2,984

 

10

 
Service

1,867

 

10

 

(323)

 

(3)

 

1,612

 

198

 

(121)

 

3,035

 

10

 
Non-service

(103)

 

(15)

 

2

 

15

 

(20)

 

(38)

 

(8)

 

(129)

 

(17)

 
Equity share in net income of associates

–

 

–

 

–

 

–

 

(2)

 

(100)

 

–

 

(2)

 

(100)

 
Other income

16

 

34

 

59

 

56

 

4

 

100

 

1

 

80

 

61

 
Expenses

1,321

 

14

 

(1,706)

 

(15)

 

1,458

 

170

 

(128)

 

945

 

5

 
Income before income tax

459

 

5

 

1,444

 

127

 

136

 

971

 

–

 

2,039

 

18

 
Net income for the period

(997)

 

(13)

 

836

 

99

 

130

 

448

 

–

 

(31)

 

–

 
Net income attributable to  equity holders of PLDT

(964)

 

(13)

 

836

 

99

 

122

 

265

 

–

 

(6)

 

–

 
* *

**Wireless**

* *

Revenues and Other Income
 

Our wireless business segment offers cellularservices as well as wireless broadband, satellite, VSAT and other services.

 

The following table summarizes our service andnon-service revenues and other income from our wireless business for the threemonths ended March 31, 2007 and 2006 by service segment:

 

** **

**Three Months Ended March 31,**

 
** **

** **

** **

** **

** **

** **

** **

** **

** **

**Increase (Decrease)**

 
** **

**2007**

** **

**%**

** **

**2006**

** **

**%**

** **

**Amount**

** **

**%**

**(in millions)**

(Unaudited)

 
Wireless services:

 

 

 

 

 

 

 

 

 

 

 

Service Revenues

 

 

 

 

 

 

 

 

 

 

 

Cellular 

Php19,923

 

93

 

Php18,205

 

92

 

Php1,718

 

9

Wireless broadband, satellite, VSAT and others

888

 

4

 

739

 

4

 

149

 

20

 

20,811

 

97

 

18,944

 

96

 

1,867

 

10

Non-service Revenues

 

 

 

 

 

 

 

 

 

 

 

Sale of cellular handsets and SIM-packs

576

 

3

 

679

 

4

 

(103)

 

(15)

 

 

 

 

 

 

 

 

 

 

 

 

Other Income

63

 

–

 

47

 

–

 

16

 

34

 

 

 

 

 

 

 

 

 

 

 

 

Total Wireless Revenues and Other Income

Php21,450

 

100

 

Php19,670

 

100

 

Php1,780

 

9

 

*Service Revenues*

 

Our wireless servicerevenues increased by Php1,867 million, or 10%, to Php20,811 million in thefirst quarter of 2007 compared with Php18,944 million in the same period in 2006,mainly as a result of the growth in the cellular and wireless broadband subscriberbase, an increase in international inbound revenues and a reduction in domesticinterconnection costs due to a shift from off-network to on-network voice anddata usage.  As a percentage of our total wireless revenues and other income,service revenues contributed 97% and 96% in the first quarter of 2007 and 2006,respectively. 

 

*Cellular Service*

 

Our cellular service revenues consist of: 

 

•        revenues derived from actual usageof the network by prepaid subscribers and any unused peso value of expiredprepaid cards or electronic air time loads, net of content costs and discountsgiven to dealers; 

 

•        monthly service fees from postpaidsubscribers, including: (1) charges for calls in excess of allocated free localcalls; (2) toll charges for national and international long distance calls; (3)charges for text messages of our service customers in excess of allotted freetext messages; and (4) charges for value-added services, net of related contentprovider costs;

 

•        revenues generated from incomingcalls and messages to our subscribers, net of interconnection expenses; feesfrom reciprocal traffic from international correspondents; and revenues frominbound international roaming calls for the service; and

 

•        other charges, including those forreconnection and migration.

 

Our cellular servicerevenues in the first quarter of 2007 amounted to Php19,923 million, anincrease of Php1,718 million, or 9%, from Php18,205 million in the same periodin 2006.  Cellular service revenues accounted for 96% of our wireless servicerevenues in the first quarter of 2007 and 2006.  

 

As at March 31, 2007,Smart and Piltel cellular subscribers totaled 25,483,459, an increase of 4,583,828,or 22%, over their combined cellular subscriber base of 20,899,631 as at March 31,2006.  Prepaid subscribers accounted for 99% of our total subscriber base as atMarch 31, 2007 and 2006.  Prepaid and postpaid subscribers totaled 25,157,975and 325,484 as at March 31, 2007, reflecting net subscriber activations of 1,301,154and 6,921, respectively, in the first quarter of 2007.  

 

Smartmarkets nationwide cellular communications services under the brand names *SmartBuddy, Smart Gold,**addict mobile,**Smart Infinity*and*SmartKid prepaid.  Smart Buddy*and *Smart Kid prepaid* are prepaid serviceswhile *Smart Gold, Smart Infinity* and *addict mobile* are postpaidservices, which are all provided through Smart's digital network.  Piltelmarkets its cellular prepaid service under the brand name *Talk ‘N Text*which is provided through Smart’s network.

 

In2006, Smart focused on segmenting its market by offering sector-specific,value-driven packages such as *All Text* – a new variety of top-up serviceproviding a fixed number of messages with prescribed validity periods.  Offerings include *All Text 10 Bonus*, with asuggested retail price of Php12, which includes 10 messages to all networksplus five bonus on-network messages without expiration and *All Text 20*,which includes 100 on-network messages for Php20, with a validity period of oneday.  Effective March 24, 2007, *All Text 20* was replaced with *AllText Plus*, which offers 90 on-network messages plus 10 messages to allnetworks with one day validity period and is in effect until May 25, 2007.  *All Text*also has a voice counterpart in *All Talk 20* which is a call packageallowing three calls of up to three minutes each for local on-network calls,valid for one day.  Other voice offerings include: (a) the *Flat Rate Plus Call*promotion, which allows a subscriber to make: (1) an on-network call of up tothree minutes for Php10 or extend the call to five minutes for Php15; or (2) anoff-network call of up to two minutes for Php10 or extend the call up to threeminutes for Php15, which replaced the *Flat Rate Call* service effectiveMarch 29, 2007; and (b) *Tipid Talk*, a call package which allows asubscriber to make four calls of up to 30 seconds each for local on-networkcalls, valid for one day for Php10 and another variant allowing four calls ofup to 15 seconds each for local on-network calls, valid for one day forPhp5.50.  *All Text 10 Bonus, All Talk 20, Tipid Talk* and *Flat Rate PlusCall* are now permanent offerings.  Smart also continues to offer *Smart258*, a registration-based service which offers unlimitedon-network text messaging in load denominations of Php15, Php30 and Php60 withcorresponding expiration periods of 1, 2 and 4 days, respectively.  

 

OnJanuary 18, 2007, Smart introduced *LAHATxt*, a top-up service whichoffers a bundle of text messages available to all networks.  *LAHATxt 35*is available to all Smart prepaid subscribers and provides for 100 textmessages to all networks for Php35 with a one day validity period.  On theother hand, *Talk ‘N Text* subscribers have *LAHATxt 20* which allowsa subscriber to make 50 text messages to all networks for Php20, also valid forone day.  A variant of the *All Text* promotion, *Gaantxt Plus* isspecifically targeted at *Talk ‘N Text* subscribers.  For a load of Php10,the promotion gives 40 *Talk ‘N Text* to *Talk ‘N Text* messages plusfive messages to all networks valid for one day.  The *Gaantxt* Pluspromotion is valid until May 31, 2007.  

 

Smartlikewise has in place various promotions to stimulate international usage.  InJune 2006, *Smart IDD Libre Text Abroad* was launched wherein subscribersearned one free international text for every minute of IDD calling.  In October2006, this was replaced by *International Budget Text* packages.  Thesepackages, which have a limited duration and a varying number of allowablemessages, enable subscribers to send international text to pre-registeredrecipients of the subscriber’s choice on supported overseas carriers. 

 

Smartexpanded its roster of services with the commercial launch of its 3G servicesin May 2006.  These services include video calling, video streaming, high-speedInternet browsing and downloading of special 3G content, offered at ratessimilar to those of 2G services.  

 

InFebruary 2007, at the 3GSM Congress in Barcelona, Spain, Smart introduced the *SmartRemit*, a project which offers low-cost remittance services using its mobilephone-based financial services platform.  This will enable migrant workers inthe Middle Eastern and European countries to send remittances to the Philippines via SIM-based services using the services of Smart and its banking partnersabroad.

 

InMarch 2007, Mediaquest Holdings, Inc., in cooperation with Smart, introducedthe *Mobile TV* service using the Digital Video Broadcasting – Handheld,or DVB-H, platform via a test broadcast initially available in Metro Manila,Cebu and Davao.  *Mobile TV* is a broadcast service that deliversreal-time events through a digital TV signal optimized for mobile deviceswherein programs can be simultaneously viewed by an unlimited number ofsubscribers, thus making television viewing conveniently available always.

 

The following table summarizes key measures of ourcellular business as at and for the three months ended March 31, 2007 and 2006:

 

** **

**Three Months Ended March 31,**

** **

** **

** **

** **

** **

**Increase (Decrease)**

** **

**2007**

** **

**2006**

** **

**Amount**

** **

**%**

**(in millions)**

(Unaudited)

 

 

 

 

 

 

 

 

Cellular service revenues 

Php19,923

 

Php18,205

 

Php1,718

 

9

 

 

 

 

 

 

 

 

*By component*

*19,391*

* *

*17,647*

* *

*1,744*

* *

*10*

Voice 

8,874

 

8,246

 

628

 

8

Data

10,517

 

9,401

 

1,116

 

12

* *

* *

* *

* *

* *

* *

* *

* *

*By service type*

*19,391*

* *

*17,647*

* *

*1,744*

* *

*10*

Prepaid

17,962

 

16,486

 

1,476

 

9

Postpaid

1,429

 

1,161

 

268

 

23

* *

* *

* *

* *

* *

* *

* *

* *

*Others*(1)

*532*

* *

*558*

* *

*(26)*

* *

*(5)*

______________

 

 

 

 

 

 

 

* *

*(1)    **Refers to othernon-subscriber-related revenues consisting primarily of inbound internationalroaming fees, revenues from Smart’s public calling offices, revenues fromWolfpac and Smart Money Holdings Corporation and a small number of leased linecontracts.*

 

 

**March 31,**

** **

** **

** **

** **

** **

**Increase**

** **

**2007**

** **

**2006**

** **

**Amount**

** **

**%**

 

(Unaudited)

 

 

 

 

 

 

 

 

Cellular subscriber base 

25,483,459

 

20,899,631

 

4,583,828

 

22

Prepaid 

25,157,975

 

20,614,552

 

4,543,423

 

22

Smart 

17,762,723

 

15,256,105

 

2,506,618

 

16

Piltel

7,395,252

 

5,358,447

 

2,036,805

 

38

Postpaid

325,484

 

285,079

 

40,405

 

14

 

** **

 

**Three Months Ended March 31,**

 

** **

** **

** **

** **

**Increase (Decrease)**

 

**2007**

** **

**2006**

** **

**Amount**

** **

**%**

 

(Unaudited)

Systemwide traffic volumes (in millions)

 

 

 

 

 

 

 

Calls (in minutes) 

1,470

 

1,385

 

85

 

6

Domestic – outbound

872

 

868

 

4

 

–

International

598

 

517

 

81

 

16

Inbound

551

 

476

 

75

 

16

Outbound

47

 

41

 

6

 

15

 

 

 

 

 

 

 

 

Text messages

56,357

 

49,774

 

6,583

 

13

Standard

6,911

 

8,478

 

(1,567)

 

(18)

Bucket-Priced

48,810

 

40,631

 

8,179

 

20

Value-Added Services

636

 

665

 

(29)

 

(4)

* *

*VoiceServices*

 

Cellular revenues fromvoice services, which include all voice traffic and voice value-added servicessuch as voice mail and international roaming, increased by Php628 million, or 8%,to Php8,874 million in the first quarter of 2007 from Php8,246 million in thesame period in 2006 primarily due to an increase in domestic voice,international long distance and international voice roaming revenues,international inbound revenues, and a decrease in interconnection expense relatingto domestic and international long distance calls.  The increase in domestic andinternational outbound and inbound revenues may be attributed to increasedtraffic mainly on account of subscriber growth.  The decrease ininterconnection expense resulted from increased on-net voice usage broughtabout by bucket-priced promotions designed to encourage the use of on-net voiceservices.

 

Air time rates for postpaid subscribers vary depending on thetype of postpaid plan selected by subscribers.  

 

*Data Services*

 

Cellularrevenues from data services, whichinclude all text messaging-related services as well as value-added services,increased by Php1,116 million, or 12%, to Php10,517 million in the firstquarter of 2007 from Php9,401 million in the same period in 2006.  Cellulardata services accounted for 53% of cellular service revenues in the firstquarter of 2007 as compared to 52% in the same period in 2006.  

 

The following table shows the breakdown of cellulardata revenues for the three months ended March 31, 2007 and 2006:

* *

** **

**Thee Months Ended March 31,**

** **

** **

** **

**Increase (Decrease)**

** **

**2007**

** **

**2006**

** **

**Amount**

** **

**%**

**(in millions)**

(Unaudited)

 

** **

** **

** **

** **

** **

** **

** **

Text messaging

 

 

 

 

 

 

 

Domestic 

Php9,270

 

Php7,863

 

Php1,407

 

18

Standard

5,536

 

5,812

 

(276)

 

(5)

Bucket-Priced

3,734

 

2,051

 

1,683

 

82

International

365

 

434

 

(69)

 

(16)

 

9,635

 

8,297

 

1,338

 

16

 

 

 

 

 

 

 

 

Value-added services

 

 

 

 

 

 

 

Non-Zed(1)

507

 

613

 

(106)

 

(17)

*Smart Zed*TM 

45

 

100

 

(55)

 

(55)

*Smart Money*

20

 

23

 

(3)

 

(13)

Mobile Banking

1

 

1

 

–

 

–

Roaming SMS, *Pasa Load*, MMS and WAP**

309

 

367

 

(58)

 

(16)

 

882

 

1,104

 

(222)

 

(20)

Total 

Php10,517

 

Php9,401

 

Php1,116

 

12

_________________

*(1)   Value-added servicesdeveloped by Smart on its own platform.*

 

Textmessaging-related services contributed revenues of Php9,635 million in thefirst quarter of 2007, an increase of Php1,338 million, or 16%, compared to Php8,297million in the same period in 2006, and accounted for 92% and 88% of the totalcellular data revenues in the first quarter of 2007 and 2006, respectively.The increase in revenues from text messaging-related services resulted mainly from Smart’s variousbucket-priced text promotional offerings.  Text messaging revenues from thevarious bucket plans totaled Php3,734 million.  Value-added services, which contributed revenues of Php882 million in the firstquarter of 2007, decreased by Php222 million, or 20%, from Php1,104 million in thesame period of 2006, primarily due to lower usage of *Non-Zed*and *SmartZed*TM services, partially offset by higher usage of WAP and*Pasa Load* services in the first quarter of 2007 as compared to the sameperiod in 2006.  

* *

Standardtext messages totaled 6,911 million in the first quarter of 2007, a decrease of1,567 million, or 18%, from 8,478 million in the same period in 2006 mainly dueto a shift to bucket-priced text services.  Bucket-pricedtext**messages in the first quarterof 2007 totaled 48,810 million, an increase of 8,179 million, or 20%, ascompared to 40,631 million in the same period in 2006. 

 

*SubscriberBase, ARPU and Churn Rates*

* *

Prepaid subscribersaccounted for approximately 99% of our 25,483,459 subscribers as at March 31,2007, while postpaid subscribers accounted for the remaining 1%.  The cellularprepaid subscriber base grew by 22% to 25,157,975 as at March 31, 2007 from20,614,552 as at March 31, 2006, whereas the postpaid subscriber base increasedby 14% to 325,484 as at March 31, 2007 from 285,079 as at March 31, 2006.  

 

Our net subscriber activations for the three months endedMarch 31, 2007 and 2006 were as follows:

** **

 

**Three Months Ended March 31,**

 

** **

** **

** **

** **

**Increase**

 

**2007**

** **

**2006**

** **

**Amount**

** **

**%**

 

(Unaudited)

Prepaid

 

 

 

 

 

 

 

Smart

880,281

 

111,987

 

768,294

 

686

Piltel

420,873

 

374,022

 

46,851

 

13

** **

 

 

 

 

 

 

 

Postpaid

6,921

 

5,001

 

1,920

 

38

 

 

 

 

 

 

 

 

Total

1,308,075

 

491,010

 

817,065

 

166

 

Revenues attributable to our cellular prepaidservice amounted to Php17,962 million in the first quarter of 2007, a 9%increase over the Php16,486 million earned in the same period in 2006.  Prepaidservice revenues in the first quarter of 2007 and 2006 accounted for 93% ofvoice and data revenues.  Revenues attributable to Smart’s postpaid serviceamounted to Php1,429 million in the first quarter of 2007, a 23% increase overthe Php1,161 million earned in the same period in 2006, and accounted for 7% ofvoice and data revenues in 2007 and 2006.

 

The following table summarizes our cellular ARPUs forthe three months ended March 31, 2007 and 2006:

 

 

**Three Months Ended March 31,**

 

**Gross**

** **

**Increase (Decrease)**

** **

**Net**

 

**Increase (Decrease)**

 

**2007**

** **

**2006**

** **

**Amount**

** **

**%**

** **

**2007**

** **

**2006**

 

**Amount**

 

**%**

 

(Unaudited)

Prepaid

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Smart

323

356

 

(33)

 

(9)

 

267

 

294

 

(27)

 

(9)

Piltel

228

245

 

(17)

 

(7)

 

187

 

207

 

(20)

 

(10)

Prepaid – Blended

295

328

 

(33)

 

(10)

 

244

 

272

 

(28)

 

(10)

Postpaid – Smart

2,045

1,867

 

178

 

10

 

1,483

 

1,386

 

97

 

7

Prepaid and Postpaid Blended

318

349

 

(31)

 

(9)

 

260

 

287

 

(27)

 

(9)

 

ARPU is computed foreach month by dividing the revenues for the relevant services for the month bythe average of the number of subscribers at the beginning and at the end of themonth.  Gross monthly ARPU is computed by dividing the revenues for therelevant services, gross of dealer discounts and allocated content-providercosts, including interconnection income but excluding inbound roaming revenues,by the average number of subscribers.  Net monthly ARPU, on the other hand, iscalculated based on revenues net of dealer discounts and allocatedcontent-provider costs and interconnection income net of interconnectionexpense.  ARPU for any period of more than one month is calculated as thesimple average of the monthly ARPUs in that period.

 

Prepaidservice revenues consist mainly of charges for subscribers’ actual usage oftheir loads.  Gross monthly ARPU for Smart prepaid subscribers in the firstquarter of 2007 was Php323, a decrease of 9%, compared to Php356 in the sameperiod in 2006.  The average outbound domestic and international voice revenueper subscriber declined in the first quarter of 2007 compared to the sameperiod in 2006, but was partly offset by an increase in the average textmessaging revenue.  On a net basis, ARPU in the first quarter of 2007 was Php267,a decrease of 9%, compared to Php294 in the same period in 2006.  Gross monthlyARPU for *Talk ‘N Text* subscribers in the first quarter of 2007 was Php228,a decrease of 7%, compared to Php245 in the same period in 2006.  The decline was primarily attributable to thedecrease in the average outbound domestic and international voice revenue persubscriber as well as the average inbound domestic voice revenue per subscriberpartly offset by an increase in the average text messaging revenue persubscriber.  On a net basis, ARPU in thefirst quarter of 2007 decreased by 10% to Php187 from Php207 in the same periodin 2006. 

 

Monthly ARPU forSmart’s postpaid services is calculated in a manner similar to that of prepaidservice, except that the revenues consist mainly of monthly service fees andcharges on usage in excess of the monthly service fees.  

 

Gross monthly ARPU forpostpaid subscribers increased by 10% to Php2,045 while net monthly ARPUincreased by 7% to Php1,483 in the first quarter of 2007 as compared to Php1,867and Php1,386 in the same period in 2006, respectively.  Prepaid and postpaidmonthly gross blended ARPU was Php318 in the first quarter of 2007, a decreaseof 9%, compared to Php349 in the same period in 2006.  Monthly net blended ARPUdecreased by 9% to Php260 in the first quarter of 2007 as compared to Php287 inthe same period in 2006.

 

Our quarterly prepaid and postpaid ARPUsfor the three months ended March 31, 2007 and 2006 were as follows:

*** ***

 

**Prepaid**

** **

**Postpaid**

 

**Smart**

** **

**Piltel**

** **

**Smart**

 

**Gross**

** **

**Net**

** **

**Gross**

** **

**Net**

** **

**Gross**

** **

**Net**

** **

(Unaudited)

**2007**

 

 

 

 

 

 

 

 

 

 

 

First Quarter

Php323

 

Php267

 

Php228

 

Php187

 

Php2,045

 

Php1,483

** **

 

 

 

 

 

 

 

 

 

 

 

**2006**

 

 

 

 

 

 

 

 

 

 

 

First Quarter

Php356

 

Php294

 

Php245

 

Php207

 

Php1,867

 

Php1,386

Second Quarter

344

 

294

 

234

 

202

 

1,920

 

1,414

Third Quarter

323

 

280

 

213

 

184

 

1,891

 

1,403

Fourth Quarter

332

 

286

 

213

 

184

 

1,939

 

1,425

 

Churn,or the rate at which existing subscribers have their service cancelled in agiven period, is computed based on total disconnections in the period, net ofreconnections in the case of postpaid subscribers, divided by the average ofthe number of subscribers at the beginning and at the end of a month, alldivided by the number of months in the same period.

 

Werecognize a prepaid cellular subscriber as an active subscriber when thatsubscriber activates and uses the SIM card in the subscriber’s handset, whichcontains pre-stored air time.  The pre-stored air time, equivalent to Php1 plus50 free SMS, can only be used upon purchase or reload of air time of anyvalue.  Subscribers can reload their air time by purchasing prepaid “call andtext” cards; by purchasing additional air time “over the air” via *Smart**Load*or *Smart Load* “All Text”; and by receiving loads of Php2, Php5, Php10and Php15 via *Pasa**Load*, or through their handsets using *SmartMoney*.  Reloads have validity periods ranging from one day to two months,depending on the amount reloaded.  A prepaid cellular subscriber isdisconnected if the subscriber does not reload within four months after thefull usage or expiry of the last reload.  Our current policy is to recognize aprepaid subscriber as “active” only when the subscriber activates and uses theSIM card and reloads at least once during the month of initial activation or inthe immediate succeeding month.    

 

For Smartprepaid, the average monthly churn rate for the first quarter of 2007 was 2.7%compared to 3.4% in the same period in 2006, while the average monthly churnrate for *Talk ‘N Text* subscribers was 3.4% in the first quarter of 2007compared to 3.7% in the same period in 2006.  

 

The average monthlychurn rate for Smart's postpaid subscribers for the first quarter of 2007 was 1.1%compared to 1.3% in the same period in 2006.  Smart's policy is to redirectoutgoing calls to an interactive voice response system if the postpaidsubscriber's account is either 45 days overdue or the subscriber has exceededthe prescribed credit limit.  If the subscriber does not make a payment within44 days of redirection, the account is disconnected.  Within this 44-dayperiod, a series of collection activities are implemented, involving thesending of a collection letter, call-out reminders and collection messages viatext messaging.

 

*Wireless Broadband, Satellite, VSAT and Other Services*

 

Our revenues fromwireless broadband, satellite, VSAT and other services consist mainly ofwireless broadband service revenues for Smart Broadband, rentals received forthe lease of Mabuhay Satellite’s transponders and Telesat’s VSAT facilities toother companies, charges for ACeS Philippines’ satellite phone service andservice revenues generated from PLDT Global’s subsidiaries.  Gross revenuesfrom these services for the first quarter of 2007 amounted to Php888 million,an increase of Php149 million, or 20%, from Php739 million in the same periodin 2006 principally due to the growth in our wireless broadband businesspartially offset by lower satellite transponder rental revenues.

 

Smart Broadband offers a number of wirelessbroadband services and had 163,799 subscribers as at March 31, 2007.  *SmartBro*,the fixed wireless broadband service of Smart linked to Smart’s wirelessbroadband-enabled base stations, allows people to connect to the Internet usingan outdoor aerial antenna installed in a subscriber’s home.  Wireless broadbandrevenues contributed Php414 million in the first quarter of 2007, increasing byPhp294 million, or 245%, from Php120 million in the same period in 2006.

 

Wealso offer *PLDT WeRoam*, a wireless broadband service, running on Smart’snationwide wireless network (using GPRS, EDGE and WiFi technologies) and PLDT’sextensive IP infrastructure.  Some of the recent enhancements to the serviceare the inclusion of international roaming in key roaming countries all overthe world and national WiFi roaming access.  Principally targeted to thecorporate market, the service had 11,023 subscribers as at March 31, 2007compared to 5,083 subscribers as at March 31, 2006 and contributed Php29million to our data revenues, an increase of Php1 million, or 4%, from Php28million in the same period in 2006.  

 

*Non-service Revenues*

 

Our wireless non-service revenues consist of:

 

•           proceeds from sales of cellularhandsets; and

 

•           proceeds from sales of cellularSIM-packs.

 

Our wireless non-service revenues decreased by Php103million, or 15%, to Php576 million in the first quarter of 2007 as compared toPhp679 million in the same period in 2006 primarily due to a lower volume ofpostpaid handsets sold and a lower average revenue per handset and SIM-pack,partly offset by a higher volume of prepaid handsets and SIM-packs sold in thefirst quarter of 2007.  

 

*Other Income*
 

Allother income/gains such as rental income and which do not fall under serviceand non-service revenues are included under this classification.  Our wirelessbusiness segment generated other income of Php63 million in the first quarterof 2007, an increase of Php16 million, or 34%, as compared to Php47 million in thesame period in 2006 largely due to a higher gain on the sale of fixed assets. 

 

*Expenses*
 

Expenses associatedwith our wireless business in the first quarter of 2007 amounted to Php10,866million, an increase of Php1,321 million, or 14%, from Php9,545 million in thesame period in 2006.  A significant portion of this increase was attributableto higher financing costs, depreciation and amortization, and rent, which waspartially offset by lower cost of sales and provisions.  As a percentage of ourtotal wireless revenues and other income, expenses associated with our wirelessbusiness accounted for 51% and 49% in the first quarter of 2007 and 2006,respectively.

 

Cellular businessexpenses accounted for 94% of our wireless business expenses, while wirelessbroadband, satellite, VSAT and other business expenses accounted for theremaining 6% of our wireless business expenses in the first quarter of 2007 ascompared to 95% and 5%, respectively, in the same period in 2006.

 

The following table summarizes the breakdown of ourwireless-related expenses for the three months ended March 31, 2007 and 2006and the percentage of each expense item to the total:

 

 

**Three Months Ended March 31,**

 

** **

 

** **

 

** **

 

** **

** **

**Increase (Decrease)**

 

**2007**

 

**%**

 

**2006**

 

**%**

** **

**Amount**

** **

**%**

** **

(Unaudited)

**(in millions)**

 

Wireless services

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

Php2,925

 

27

 

Php2,576

 

27

 

Php349

 

14

Rent

1,989

 

18

 

1,702

 

18

 

287

 

17

Compensation and benefits(1)

1,216

 

11

 

1,042

 

11

 

174

 

17

Cost of sales

1,149

 

11

 

1,202

 

12

 

(53)

 

(4)

Maintenance

897

 

8

 

923

 

10

 

(26)

 

(3)

Selling and promotions

873

 

8

 

826

 

9

 

47

 

6

Professional and other contracted services

565

 

5

 

422

 

4

 

143

 

34

Taxes and licenses

354

 

3

 

347

 

4

 

7

 

2

Communication, training and travel

239

 

2

 

253

 

2

 

(14)

 

(6)

Insurance and security services

198

 

2

 

215

 

2

 

(17)

 

(8)

Provisions

109

 

1

 

158

 

2

 

(49)

 

(31)

Amortization of intangible assets

42

 

1

 

69

 

1

 

(27)

 

(39)

Financing costs

(32)

 

–

 

(421)

 

(4)

 

389

 

92

Other expenses

342

 

3

 

231

 

2

 

111

 

48

Total 

Php10,866

 

100

 

Php9,545

 

100

 

Php1,321

 

14

__________

*(1)    **Includes salaries andbenefits, incentive plan, pension and manpower rightsizing program, or MRP,costs.*

 

Depreciation and amortization charges increased by Php349million, or 14%, to Php2,925 million in the first quarter of 2007, principallydue to an increase in our depreciable asset base mainly transmissionfacilities, broadband and 3G network, and customer-deployed equipment.

 

Rent expensesincreased by Php287 million, or 17%, to Php1,989 million on account of anincrease in domestic fiber optic network, or DFON, facilities leased by Smartfrom PLDT, as well as higher satellite transmission and site rental expenses.As at March 31, 2007, we had 4,390 GSM cell sites and 7,194 base stations,compared with 4,329 GSM cell sites and 6,411 base stations as at March 31, 2006.

 

Compensation and benefits expenses increased by Php174million, or 17%, to Php1,216 million, primarily due to higher accrued bonuses, pensionand other employee benefits of Smart, partly offset by lower accrued long-termincentive plan and MRP costs.  Smart and subsidiaries’ employee headcountincreased by 221, or 4%, to 5,245 in the first quarter of 2007 as compared to 5,024in the same period in 2006.  For further discussion on our long-term incentiveplan, please see *Note 21 –Employee Benefits* to the accompanying unauditedconsolidated financial statements.

 

Costof sales decreased by Php53 million, or 4%, to Php1,149 million due to adecrease in the average cost of phone kits and SIM-packs sold in the firstquarter of 2007.  The breakdown of cost of sales for our wireless business forthe three months ended March 31, 2007 and 2006 is as follows:

 

** **

**Three Months Ended March 31,**

** **

** **

** **

** **

** **

**Decrease**

** **

**2007**

** **

**2006**

** **

**Amount**

** **

**%**

** **

(Unaudited)

**(in millions)**

 

 

 

 

 

 

 

Cost of cellular handsets and SIM-packs sold

Php1,105

 

Php1,155

 

(Php50)

 

(4)

Cost of satellite air time and terminal units

44

 

47

 

(3)

 

(6)

 

Php1,149

 

Php1,202

 

(Php53)

 

(4)

 

Maintenance expenses decreasedby Php26 million, or 3%, to Php897 million mainly due to lower site repairs andmaintenance costs for network facilities and IT software, and a decrease infuel costs for power generation, partly offset by higher expenses forelectricity consumption for cell sites and offices.

 

Selling and promotionsincreased by Php47 million, or 6%, to Php873 million due to higher advertising,promotions and commissions expenses.

 

Professionaland other contracted services increased by Php143 million, or 34%, to Php565million, primarily due to increased contracted service, consultancy andtechnical service, market research and call center service fees.

 

Taxesand licenses increased by Php7 million, or 2%, to Php354 million, primarily dueto an increase in royalty and franchise fees, and higher non-creditable inputtax, partly offset by lower business-related taxes and licenses.

 

Communication,training and travel expenses decreased by Php14 million, or 6%, to Php239million due to lower foreign travel expenses incurred in the first quarter of2007, partly offset by higher freight and hauling charges, and local travelexpenses.

 

Insurance and securityservices decreased by Php17 million, or 8%, to Php198 million, primarily due tothe decrease in site security expenses and lower charges on insurancecontracts.

 

Provisions decreased by Php49 million, or 31%, toPhp109 million primarily due to a lower level of write-down of slow-movinghandsets to net realizable values.  The breakdown of provisions for the threemonths ended March 31, 2007 and 2006 is as follows:

 

** **

**Three Months Ended March 31,**

** **

** **

** **

** **

** **

**Increase (Decrease)**

** **

**2007**

** **

**2006**

** **

**Amount**

** **

**%**

** **

(Unaudited)

**(in millions)**

 

 

 

 

 

 

 

Doubtful accounts

Php48

 

Php49

 

(Php1)

 

(2)

Write-down of inventories to net realizable values 

61

 

109

 

(48)

 

(44)

 

Php109

 

Php158

 

(Php49)

 

(31)

 

Amortizationof intangible assets decreased by Php27 million, or 39%, to Php42 millionmainly due to intangible assets relating to technology application arising fromthe acquisition of Wolfpac which was fully amortized by end 2006; no similartransaction was incurred in the first quarter of 2007. 

 

Net financing gains decreased by Php389 million, or 92%,to Php32 million on account of lower foreign exchange gains recognized in thefirst quarter of 2007 as compared to the same period in 2006 due to lowerappreciation of the Philippine peso to the U.S. dollar in 2007, partly offsetby lower accretion on financial liabilities.  The breakdown of our financingcosts (gains) for our wireless business for the three months ended March 31,2007 and 2006 is as follows:

 

** **

**Three Months Ended March 31,**

** **

** **

** **

** **

** **

**Change**

** **

**2007**

** **

**2006**

** **

**Amount**

** **

**%**

** **

(Unaudited)

**(in millions)**

 

 

 

 

 

 

 

Interest on loans and related items

Php400

 

Php405

 

(Php5)

 

(1)

Accretion on financial liabilities – net

223

 

545

 

(322)

 

(59)

Financing charges

34

 

25

 

9

 

36

Dividends on preferred stock subject to mandatory redemption

5

 

49

 

(44)

 

(90)

Loss (gain) on derivative transactions – net

(13)

 

1

 

(14)

 

(1,400)

Capitalized interest 

(41)

 

(61)

 

20

 

33

Interest income

(275)

 

(370)

 

95

 

26

Foreign exchange gains – net

(365)

 

(1,015)

 

650

 

64

 

(Php32)

 

(Php421)

 

Php389

 

92

 

Otherexpenses increased by Php111 million, or 48%, to Php342 million primarily dueto higher various business and operational-related expenses. 

 

Provision for Income Tax
 

Provisionfor income tax increased by Php1,456 million, or 65%, to Php3,690 million in thefirst quarter of 2007 from Php2,234 million in the same period in 2006.  In thefirst quarter of 2007, the effective tax rate for our wireless business was 35%as compared to 22% in the same period in 2006 mainly due to recognition ofdeferred tax assets of Piltel in 2006.  

 

Net Income
 

Our wireless businesssegment recorded a net income of Php6,894 million in the first quarter of 2007,a decrease of Php997 million, or 13%, over Php7,891 million registered in thesame period in 2006, notwithstanding the increase in income before tax, onaccount of higher provision for income tax largely due to Piltel’s recognitionof deferred tax assets in 2006. 

 

Fixed Line
 

***Revenues and OtherIncome***

*** ***

Our fixed linebusiness provides local exchange service, international and national longdistance services, data and other network services, and miscellaneousservices.  Total fixed line revenues generated from our fixed line business in thefirst quarter of 2007 totaled Php12,007 million, a decrease of Php262 million,or 2%, from Php12,269 million in the same period in 2006.  

 

The following table summarizes revenues from ourfixed line business for the three months ended March 31, 2007 and 2006 byservice segment:

 

 

**Three Months Ended March 31,**

 

** **

** **

** **

** **

** **

** **

** **

** **

**Increase********(Decrease)**

 

**2007**

** **

**%**

** **

**2006**

** **

**%**

** **

**Amount**

** **

**%**

** **

(Unaudited)

**(in millions)**

 

 

 

 

 

 

 

 

 

 

 

Fixed line services:

 

 

 

 

 

 

 

 

 

 

 

Service Revenues

 

 

 

 

 

 

 

 

 

 

 

Local exchange

Php3,905

 

33

 

Php4,352

 

35

 

(Php447)

 

(10)

International long distance

2,400

 

20

 

2,559

 

21

 

(159)

 

(6)

National long distance

1,593

 

13

 

1,810

 

15

 

(217)

 

(12)

Data and other network

3,563

 

30

 

3,066

 

25

 

497

 

16

Miscellaneous

367

 

3

 

364

 

3

 

3

 

1

 

11,828

 

99

 

12,151

 

99

 

(323)

 

(3)

Non-Service Revenues

15

 

–

 

13

 

–

 

2

 

15

Other Income

164

 

1

 

105

 

1

 

59

 

56

Total Fixed Line Revenues and Other Income

Php12,007

 

100

 

Php12,269

 

100

 

(Php262)

 

(2)

 

Service Revenues
 

*Local Exchange Service*

 

Our local exchange service revenues consist of: 

 

•           flat monthly fees for our postpaidand fixed charges for our bundled and data services; 

 

•           installation charges and otherone-time fees associated with the establishment of customer service;

 

•           revenues from usage of prepaidcards for calls within the local area and any unused peso value of expiredprepaid cards; and

 

•           charges for special features,including bundled value-added services such as call waiting, call forwarding,multi-party conference calling, speed calling and caller ID. 

 

 

The following table summarizes key measures of ourlocal exchange service business as at and for the three months ended March 31,2007 and 2006:

 

 

**Three Months Ended March 31,**

 

** **

** **

** **

** **

**Increase (Decrease)**

 

**2007**

** **

**2006**

** **

**Amount**

** **

**%**

 

(Unaudited)

 

 

 

 

 

 

 

 

Total local exchange service revenues (in millions)

Php3,905

 

Php4,352

 

(Php447)

 

(10)

Number of fixed line subscribers

1,847,084

 

1,854,364

 

(7,280)

 

–

Number of fixed line employees

8,702

 

9,160

 

(458)

 

(5)

Number of fixed line subscribers per employee

212

 

203

 

9

 

4

 

Revenues from ourlocal exchange service decreased by Php447 million, or 10%, to Php3,905 millionin the first quarter of 2007 from Php4,352 million in the same period in 2006.The decrease was primarily due to the appreciation of the peso which requiredus to make downward adjustments in our monthly local service rates and adecline in the number of fixed line subscribers.  The percentage contributionof local exchange revenues to our total fixed line service revenues decreasedto 33% in the first quarter of 2007 as compared to 36% in the same period in2006.

 

Initially intended asan affordable alternative telephone service for consumers under difficulteconomic conditions, our prepaid fixed line services**now form animportant part of our overall churn and credit risk exposure management andsubscriber retention strategy.  Prepaid**subscribers are charged based onusage at a rate of Php1.00 per minute for local calls, but the rates charged forprepaid and postpaid fixed line subscribers for national and international longdistance calls are the same.  A prepaid fixed line subscriber is recognized asan active subscriber when that subscriber activates and uses a prepaid callcard.  Prepaid fixed line subscribers can reload their accounts by purchasingcall cards that are sold in denominations of Php500, Php300 and Php150.  Allsales of prepaid cards, whether through dealers or through PLDT's businessoffices, are non-refundable.

 

In May 2006, PLDT launched *Pwede!Card*, the first reloadable PIN-based prepaid card that provides access to arange of voice and Internet services at affordable rates.  *Pwede! Card*is applicable to a host of fixed line and wireless services including local,domestic and international long distance calls, text messaging, payphones andprepaid Internet service.

 

InJuly 2006, PLDT launched *Telepwede*, an upgraded prepaid fixed lineservice.  *Telepwede*subscribers are charged Php115 per month to receiveincoming calls.  Since *Telepwede* runs on the prepaid platform of *Pwede!*Card, subscribers can reload for as low as Php30 to make outgoing calls.Charges are at Php2 per local call (for an unlimited duration), Php2.50 perminute for PLDT to PLDT NDD, Php5.00 per minute for PLDT to non-PLDT NDD, andPhp6.50 per minute for calls to cellular phones.  IDD call rates are classifiedinto three: Php8 per minute for top 95 destinations, Php10 per minute for 8 Middle East countries and Php15 per minute for the rest of the world.  *Vibe* prepaiddial-up service can also be accessed at Php1 per 10 minutes with an additionalaccess fee of Php2 per log-on. 

 

Pursuant to a currency exchange rate adjustment mechanismauthorized by the Philippine National Telecommunications Commission, or theNTC, we adjust our postpaid monthly local service rates upward or downward by1% for every Php0.10 change in the peso-to-dollar exchange rate relative to abase rate of Php11.00 to US$1.00.  In the first quarter of 2007, we implementedtwo downward adjustments in our monthly local service rates, while there were threedownward adjustments in the same period in 2006.  The average Philippine pesoto U.S. dollar rate factored in our monthly local service rates in the firstquarter of 2007 was Php49.09 to US$1.00, compared to an average of Php52.58 toUS$1.00 in the same period in 2006.  This change in the average peso-to-dollarrate translated to a peso appreciation of 7%, which resulted in a net decreaseof approximately 6% in our average monthly local service rates in the firstquarter of 2007. 

 

*International Long Distance Service*

 

Our international long distance service revenues,which we generate through our international gateway facilities, consist of:

 

•        inbound call revenues representingsettlements from foreign telecommunications carriers for inbound internationalcalls, virtual transit and hubbing service and reverse charged calls such asreceived collect and home country direct service;

 

•        access charges paid to us by otherPhilippine telecommunications carriers for terminating inbound internationalcalls to our local exchange network; and

 

•        outbound call revenuesrepresenting amounts billed to our customers (other than our cellularcustomers) for outbound international calls, net of amounts payable to foreigntelecommunications carriers for terminating calls in their territories.

 

The following table shows information about ourinternational fixed line long distance business for the three months ended March31, 2007 and 2006:

 

** **

**Three Months Ended March 31,**

** **

** **

** **

** **

** **

**Increase (Decrease)**

** **

**2007**

** **

**2006**

** **

**Amount**

** **

**%**

 

(Unaudited)

 

 

 

 

 

 

 

 

Total international long distance service revenues (in millions)

Php2,400
 

Php2,559

 

(Php159)

 

(6)

Inbound

2,032

 

2,147

 

(115)

 

(5)

Outbound

368

 

412

 

(44)

 

(11)

 

 

 

 

 

 

 

 

International call volumes (in million minutes, except call ratio)

577

 

514

 

63

 

12

Inbound

513

 

468

 

45

 

10

Outbound

64

 

46

 

18

 

39

Inbound-outbound call ratio

8.0:1

 

10.2:1

 

–

 

–

 

Our totalinternational long distance service revenues decreased by Php159 million, or 6%,to Php2,400 million in the first quarter of 2007 from Php2,559 million in thesame period in 2006, primarily due to the peso appreciation and a decrease inaverage termination rates for inbound calls mitigated by an increase in callvolumes.  The percentage contribution of international long distance servicerevenues to our total fixed line service revenues decreased to 20% in the firstquarter of 2007 from 21% in the same period in 2006.

 

Ourrevenues from inbound international long distance service decreased by Php115million, or 5%, to Php2,032 million due to the appreciation of the Philippinepeso to the U.S. dollar coupled with a decrease in average rate per minute dueto the change in call mix with more traffic terminating to cellular operatorswhere the net revenue kept by us is lower.  These decreasing effects werepartially offset by an increase in inbound traffic volume by 45 million minutesto 513 million minutes in the first quarter of 2007.  The appreciation of the Philippine peso to the U.S.dollar with average rates of Php48.567 in the first quarter of 2007 and Php51.683in the same period in 2006 contributed to the decrease in our inboundinternational long distance revenues in peso terms, since settlement chargesfor inbound calls are billed in U.S. dollars or in special drawing rights, anestablished method of settlement among international telecommunicationscarriers using values based on a basket of foreign currencies that aretranslated into pesos at the time of billing.

 

Ourrevenues from outbound international long distance service decreased by Php44 million,or 11%, to Php368 million in the first quarter of 2007 primarily due to adecline in average revenue per minute as a result of a lower average collectionrate with the introduction of low-rate services such as *PLDT ID-DSL* and *BudgetCard*, and the peso appreciation in 2006, which more than offset theincrease in outbound international call volumes in 2006.

 

OnSeptember 15, 2005, we introduced *PLDT ID-DSL*, a service that allowsoverseas calls for registered *myDSL* plan subscribers using a regularPLDT fixed line or a voice pad dialer for as low as US$0.10 per minute orUS$0.08 per minute, respectively, depending on the subscribers’ DSL plan.  

 

Toaddress the market’s demand for low-priced international calls, PLDT enhancedthe *Budget Card*, a prepaid call card, offering a reduced IDD rate ofPhp5 per minute, as a promotional offer starting September 24, 2005, for callsto 89 overseas destinations including the United States, Canada, Japan and China*.*  On March 4, 2006, *Budget Card* calling rates has been furtherlowered to Php3, Php5 and Php8 per minute calls, depending on the destination,and now has 100 overseas destinations.  *Budget Cards* are sold indenominations of Php200 and Php100, which must be consumed within 30 days fromfirst use.

 

National Long Distance Service
 

Our national long distance service revenues consistof: 

 

•              per minute charges for calls madeby our fixed line customers outside of the local service areas but within thePhilippines, net of interconnection charges payable for calls carried throughthe backbone network of, and/or terminating to the customer of, anothertelecommunications carrier; 

 

•              access charges received from othertelecommunications carriers for calls carried through our backbone networkand/or terminating to our customers; and

 

•              fixed charges paid by othertelephone companies, charges retained by PLDT for calls terminating to cellularsubscribers within the local area, and local access charges paid by cellularoperators for calls by cellular subscribers that terminate to our localexchange network.

 

The following table shows our national long distanceservice revenues and call volumes for the three months ended March 31, 2007 and2006:

 

** **

**Three Months Ended March 31,**

** **

** **

** **

** **

** **

**Decrease**

** **

**2007**

** **

**2006**

** **

**Amount**

** **

**%**

 

(Unaudited)

 

 

 

 

 

 

 

 

Total national long distance service revenues (in millions)

Php1,593

 

Php1,810

 

(Php217)

 

(12)

National long distance call volumes (in million minutes)

540

 

545

 

(5)

 

(1)

 

Our national longdistance service revenues decreased by Php217 million, or 12%, to Php1,593million in the first quarter of 2007 from Php1,810 million in the same periodin 2006, primarily due to a decrease in call volumes coupled with lower averagerevenue per minute in the first quarter of 2007.  Accordingly, the percentagecontribution of national long distance revenues to our fixed line servicerevenues accounted for 13% and 15% in the first quarter of 2007 and 2006,respectively.

 

InJanuary 2006, PLDT launched the *10-10-10* promotion where we charge aflat rate of Php10 per call for an unlimited duration terminating from PLDT toPLDT and Smart and *Talk ‘N Text*subscribers for a Php50 monthly servicefee. 

 

PLDTlimited the Php10 per call service for Smart and *Talk ‘N Text* tosubscribers who registered on or before February 24, 2006.  PLDT fixed linesubscribers, however, can still register and avail themselves of the unlimitedPhp10 per call service for national long distance calls within the PLDTnetwork.

 

Dataand Other Network Services
 

Ourdata and other network service revenues include charges for leased lines,IP-based, packet-based and switched-based services.  These services are usedfor domestic and international communications such as private networking,broadband and narrowband Internet-based data communications, and packet-basedcommunication.  

 

Thefollowing table shows information about our data and other network servicerevenues for the three months ended March 31, 2007 and 2006:

 

** **

** **

**Three Months Ended March 31,**

** **

** **

** **

** **

** **

** **

**Increase**

** **

** **

**2007**

** **

**2006**

** **

**Amount**

** **

**%**

**(in millions)**

 

(Unaudited)

 

 

 

 

 

 

 

 

 

Data and other network service revenues

 

Php3,563

 

Php3,066

 

Php497

 

16

Number of DSL broadband subscribers

 

152,645

 

101,195

 

51,450

 

51

Number of PLDT Vibe narrowband subscribers

 

299,832

 

300,157

 

(325)

 

–

 

In thefirst quarter of 2007, our data and other network services posted revenues ofPhp3,563 million, an increase of Php497 million, or 16%, from Php3,066 millionin the same period in 2006, primarily due to increases in leased lines,IP-based and switched-based data services, particularly Diginet and DFON rental,and *PLDT DSL* mitigated by lower *PLDT Vibe* services.  The revenuecontribution of this service segment to our fixed line service revenuesincreased to 30% in the first quarter of 2007 from 25% in the same period in2006.

 

IP-based products include *PLDT**DSL* (*myDSL andBizDSL*), *PLDT Vibe* and I-Gate.  *PLDT**DSL*broadband Internet service is targeted forheavy individual Internet users as well as for small and medium enterprises,while*PLDT Vibe,* PLDT’s dial-up/narrowband Internetservice, is targeted for light to medium residential or individual Internetusers.  I-Gate, our dedicated leased line Internet access service, on the otherhand, is targeted to enterprises and value-added service providers.  

 

*DSL* contributed revenues of Php876 million in the firstquarter of 2007, an increase of Php133 million, or 18%, from Php743 million in thesame period in 2006, primarily due to an increase in the number ofsubscribers.  *DSL* reached 152,645 subscribers as at March 31, 2007compared with 101,195 subscribers in the same period in 2006.  *DSL*offersa number of packages with maximum speeds ranging from 88 kbps to 5 Mbpsdepending on the plan. 

 

*PLDTVibe* revenues decreased by Php15million, or 16%, to Php80 million in the first quarter of 2007 from Php95million in the same period in 2006, primarily due to a decrease insubscribers.  As at March 31, 2007, *PLDTVibe*registered users totaled 299,832, of which 92,629 were exclusivepostpaid users, 194,890 were exclusive prepaid users, and 12,313 were bothpostpaid and prepaid users.  As at March 31, 2006, *PLDT Vibe* registeredusers totaled 300,157, of which 114,249 were exclusive postpaid users, 158,537were exclusive prepaid users, and 27,371 were both postpaid and prepaid users.

 

In support of the growing datarequirements of the small and medium enterprise market, the network footprintsof BRAINS, IP-VPN and *Shops.work,* PLDT’s private local networkingservices, have been expanded with the roll-out of NGN facilities in key businessareas across the country.

 

The continued growth in data services revenues can beattributed to several product offerings.  The steady demand for dedicatedconnectivity or private networking from the corporate market using PLDT’straditional international and domestic data offerings – Fibernet, Arcstar,Acacia, I-Gate, Diginet, BRAINS, IP-VPN and *Shops.work*, among others –continues to provide us with a stable revenue source.  

 

Diginet,our domestic private leased line service, has been providing Smart’s increasingfiber optic and leased line data requirements.  Diginet revenues increased byPhp201 million, or 14%, to Php1,607 million in the first quarter of 2007 ascompared to Php1,406 million in the same period in 2006 mainly due to Smart’sDFON rental of Php1,214 million and Php995 million in the first quarter of 2007and 2006, respectively.

* *

Miscellaneous
 

Miscellaneous service revenues are derived mostlyfrom directory advertising and facilities rental.  In the first quarter of 2007,these revenues increased by Php3 million, or 1%, to Php367 million from Php364million in the same period in 2006.  The improvement was mainly due to anincrease in the sale of Smart products, primarily *Smart Load,* broughtabout by the launching of the *Pwede! Card* in May 2006 coupled with anincrease in facility management fees, mitigated by a decrease in rental income broughtabout by a decline in co-location charges.  The percentage contribution ofmiscellaneous service revenues to our total fixed line service revenues was 3%in the first quarter of 2007 and 2006.

 

*Non-service Revenues*

 

Non-service revenues increased by Php2 million, or 15%,to Php15 million in the first quarter of 2007 from Php13 million in the sameperiod in 2006 primarily due to proceeds from computer sales in relation to ourDSL promotion.

 

*Other Income*

 

All other income/gainssuch as rental income and gain on disposal of property, which do not fall underservice and non-service revenues are included under this classification.  In thefirst quarter of 2007, our fixed line business segment registered an increasein other income of Php59 million, or 56%, to Php164 million from Php105 millionin the same period in 2006 mainly due to income from disposal of various materials.

 

Expenses
 

Expensesrelated to our fixed line business totaled Php9,430 million in the firstquarter of 2007, a decrease of Php1,706 million, or 15%, as compared to Php11,136million in the same period in 2006.  The decrease was primarily due to lower depreciationand amortization, partially offset by higher financing costs and professionaland other contracted services expense.  

 

The following table shows the breakdown of our totalfixed line-related expenses for the three months ended March 31, 2007 and 2006and the percentage of each expense item to the total:

 

 

**Three Months Ended March 31,**

 

** **

 

** **

 

** **

 

** **

** **

**Increase (Decrease)**

 

**2007**

 

**%**

 

**2006**

 

**%**

** **

**Amount**

** **

**%**

** **

(Unaudited)

**(in millions)**

 

 

 

 

 

 

 

 

 

 

 

Fixed line services:

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits(1)

Php2,382

 

25

 

Php2,216

 

20

 

Php166

 

7

Depreciation and amortization

2,289

 

24

 

4,971

 

45

 

(2,682)

 

(54)

Financing costs

1,838

 

20

 

1,408

 

13

 

430

 

31

Maintenance

928

 

10

 

808

 

7

 

120

 

15

Professional and other contracted services

430

 

5

 

214

 

2

 

216

 

101

Rent

423

 

5

 

427

 

4

 

(4)

 

(1)

Selling and promotions

362

 

4

 

386

 

3

 

(24)

 

(6)

Taxes and licenses

235

 

2

 

196

 

2

 

39

 

20

Insurance and security services

139

 

1

 

133

 

1

 

6

 

5

Communication, training and travel

130

 

1

 

124

 

1

 

6

 

5

Provisions

123

 

1

 

79

 

1

 

44

 

56

Cost of sales

47

 

1

 

32

 

–

 

15

 

47

Other expenses

104

 

1

 

142

 

1

 

(38)

 

(27)

Total 

Php9,430

 

100

 

Php11,136

 

100

 

(Php1,706)

 

(15)

____________

*(1)   Includes salaries andbenefits, incentive plan, pension and MRP costs.*

 

Compensation and benefits expenses increased by Php166million, or 7%, to Php2,382 million, primarily due to the effect of collectivebargaining agreement-related increases in salaries and benefits, and anincrease in pension benefits, partially offset by a reduction in the number offixed line employees due to PLDT’s manpower rightsizing program.  For furtherdiscussion on our long-term incentive plan, please see *Note 21 – EmployeeBenefits* to the accompanying unaudited consolidated financial statements.

 

Depreciationand amortization charges decreased by Php2,682 million, or 54%, to Php2,289million due to PLDT’s additional depreciation charges on certain properties andequipment affected by our NGN roll-out recognized in 2006 amounting to Php1,941million; no similar additional depreciation recognized in 2007.  

 

Financing costs increased by Php430 million, or 31%,to Php1,838 million largely due to (1) higher loss on derivative transactions in the first quarter of 2007; (2) lowerforeign exchange gains recorded in 2006 as a result of lower foreign currencydebt levels; and (3) lower interest income.  The breakdown of financing costsfor our fixed line business for the three months ended March 31, 2007 and 2006is as follows: 

 

** **

**Three Months Ended March 31,**

** **

** **

** **

** **

** **

**Change**

** **

**2007**

** **

**2006**

** **

**Amount**

** **

**%**

** **

(Unaudited)

**(in millions)**

 

 

 

 

 

 

 

Interest on loans and related items

Php1,451

 

Php1,718

 

(Php267)

 

(16)

Loss on derivative transactions 

366

 

21

 

345

 

1,643

Hedge costs

354

 

341

 

13

 

4

Accretion on financial liabilities – net

45

 

69

 

(24)

 

(35)

Financing charges

1

 

11

 

(10)

 

(91)

Interest income

(55)

 

(108)

 

53

 

49

Capitalized interest

(73)

 

(68)

 

(5)

 

(7)

Foreign exchange gains – net

(251)

 

(576)

 

325

 

56

 

Php1,838

 

Php1,408

 

Php430

 

31

 

Maintenance expenses increasedby Php120 million, or 15%, to Php928 million, primarily due to highermaintenance costs for domestic cable and wire facilities as more operating andmaintenance-related restorations were incurred in the first quarter of 2007 ascompared to the same period in 2006.  

 

Professional and othercontracted services increased by Php216 million, or 101%, to Php430 millionprimarily due to PLDT’s higher consultancy service fees coupled with higher contractedservices in the first quarter of 2007.

 

Rentexpenses decreased by Php4 million, or 1%, to Php423 million due to thedecrease in transponder lease charges, partially offset by an increase ininternational leased circuits charges and higher office and building rentals.

 

Selling and promotionexpenses decreased by Php24 million, or 6%, to Php362 million, primarily as aresult of a decline in PLDT’s promotional activities in relation to variousproducts and services, partly offset by higher public relations expense in2006.

 

Taxesand licenses increased by Php39 million, or 20%, to Php235 million, mainly onaccount of higher business-related taxes incurred in the first quarter of 2007as compared to the same period in 2006.

 

Insuranceand security services increased by Php6 million, or 5%, to Php139 million,primarily due to higher premiums on property all-risk, industrial all-risk andindustrial fire insurance. 

 

Communication,training and travel expenses increased by Php6 million, or 5%, to Php130million due to an increase in local and foreign travel and training in thefirst quarter of 2007 as compared to the same period in 2006.

 

Provisionsincreased by Php44 million, or 56%, to Php123 million primarily on account of thenegative Php85 million provision for onerous contracts in the first quarter of2006; no similar transaction was provided for in the same period in 2007.  Thiswas partially offset by PLDT’s lower provision for doubtful accounts as aresult of lower anticipated uncollectible receivables.  The breakdownof provisions for our fixed line business for the three months ended March 31, 2007and 2006 is as follows:

 

** **

**Three Months Ended March 31,**

** **

** **

** **

** **

** **

**Increase (Decrease)**

** **

**2007**

** **

**2006**

** **

**Amount**

** **

**%**

** **

(Unaudited)

**(in millions)**

 

 

 

 

 

 

 

Doubtful accounts

Php114

 

Php155

 

(Php41)

 

(26)

Onerous contracts and assessments

9

 

(76)

 

85

 

112

 

Php123

 

Php79

 

Php44

 

56

 

Costof sales increased by Php15 million, or 47%, to Php47 million in the firstquarter of 2007 due to the computer-bundled sales in relation to our DSLpromotion and *WeRoam* subscriptions.

 

Otherexpenses decreased by Php38 million, or 27%, to Php104 million due to variousbusiness and operational-related expenses resulting from continuingcost-containing activities.

 

Provision for Income Tax
 

Provision for income tax amounted to Php899 millionin the first quarter of 2007 as compared to Php291 million in the same periodin 2006 primarily due to net movement in deferred tax assets owing to higher foreignexchange differentials realized in 2006.

 

Net Income 
 

In the first quarterof 2007, our fixed line business segment contributed a net income of Php1,678million, an increase of Php836 million, or 99%, as compared to Php842 millionin the same period in 2006 mainly as a result of a 15% decrease in fixedline-related expenses, particularly depreciation and amortization partiallyoffset by a slight decrease in our service revenues.  

 

Information and Communications Technology
 

***Revenues and Other Income***
 

Our information andcommunications technology, or ICT, business is conducted by ePLDT and itssubsidiaries.  

*** ***

OnJuly 11, 2006, ePLDT acquired a 100% equityinterest in SPi Technologies, Inc., or SPi, and its direct and indirectPhilippine and offshore subsidiaries.  SPi is the second largest pure-play BPO service provider and the ninth largest independent BPO service provider worldwide.  It has operations in 19 locations in North America,Europe and Asia.  On August 11, 2006, SPi acquired 100% of CyMed, Inc., a leadingmedical transcription company based in Richmond, Virginia.  

 

On February 16, 2006, ePLDT acquired a 60% equity interest in Level Up!, a leading publisherof online games in the Philippines.  The acquisition of Level Up!, togetherwith netGames, ePLDT’s online gaming subsidiary, will strengthen ePLDT’s onlinegaming business in the Philippines.

 

Forfurther discussion, see *Note 2 – Summary of Accounting Policies andPractices – Basis of Preparation*to the accompanying unaudited consolidatedfinancial statements.

 

In thefirst quarter of 2007, our information and communications technology businessgenerated revenues of Php2,466 million, an increase of Php1,594 million, or 183%,from Php872 million in the same period in 2006.  This increase was largely dueto the consolidation of SPi and Level Up! and the continued increase of ourcall center revenues.  Going forward, we currently expect revenues from ourcall center and BPO businesses to continue to contribute significantly to ourinformation and communications technology revenues in light of the growingdemand for our call center and BPO services.

 

The following table summarizes revenues from ourinformation and communications technology business for the three months ended March31, 2007 and 2006 by service segment:

 

** **

**Three Months Ended March 31,**

 

** **

 

** **

 

** **

 

** **

** **

**Increase (Decrease)**

 

**2007**

 

**%**

 

**2006**

 

**%**

** **

**Amount**

** **

**%**

** **

(Unaudited)

**(in millions)**

 

Service Revenues

 

 

 

 

 

 

 

 

 

 

 

Call center

Php782

 

32

 

Php563

 

65

 

Php219

 

39

BPO

1,269

 

51

 

–

 

–

 

1,269

 

100

Internet and gaming 

237

 

10

 

142

 

16

 

95

 

67

*Vitro*ä data center

112

 

4

 

83

 

10

 

29

 

35

Others

25

 

1

 

25

 

3

 

–

 

–

 

2,425

 

98

 

813

 

94

 

1,612

 

198

Non-service Revenues

 

 

 

 

 

 

 

 

 

 

 

Point Product Sales

33

 

2

 

53

 

6

 

(20)

 

(38)

 

 

 

 

 

 

 

 

 

 

 

 

Other Income

8

 

–

 

4

 

–

 

4

 

50

 

 

 

 

 

 

 

 

 

 

 

 

Equity in net income of associates

–

 

–

 

2

 

–

 

(2)

 

(100)

 

 

 

 

 

 

 

 

 

 

 

 

Total ICT Revenues and Other Income

Php2,466

 

100

 

Php872

 

100

 

Php1,594

 

183

 

*Service Revenues*

 

Servicerevenues generated by our information and communications technology segmentamounted to Php2,425 million in the first quarter of 2007, an increase of Php1,612million, or 198%, as compared to Php813 million in the same period in 2006primarily as a result of the consolidation of SPi and Level Up! and thecontinued growth of our call center business. 

 

*Call**Center*

 

We are focused on developingour call center business which capitalizes on the availability ofEnglish-speaking college graduates in the Philippines with a strongcustomer service orientation.  ePLDT has established one umbrella brand name, *ePLDTVentus*, for all of its call center businesses, including Vocativ andParlance.  Ventus provides offshore contact center outsourcing solutionsspecializing in inbound customer care.  Vocativ provides customer and technicalsupport to its clients in the Philippines, United States and the United Kingdom, while Parlance provides exclusive customer support and billing requirements to oneof the largest direct-to-home satellite television providers in the United States.  In total, we own and operate approximately 5,720 seats with 4,620 customerservice representatives, or CSRs, as at March 31, 2007 compared toapproximately 3,690 seats with 3,842 CSRs as at March 31, 2006.  In 2006, *ePLDT Ventus* launched two new sitesbringing our total call center site count to seven as at March 31, 2007.  

 

Call center revenues consist of:

 

•              inbound calls for customer care,product inquiries, sales and technical support based on active minutes,billable hours and full-time equivalents;

 

•              outbound calls for sales andcollections based on active minutes, billable hours and full-time equivalents;and 

 

•              service income for e-mailhandling, web chat, web co-browsing, data entry and BPO based on transactionvolume.

 

Revenues related to our call center business increasedby Php219 million, or 39%, to Php782 million in the first quarter of 2007 fromPhp563 million in the same period in 2006 primarily due to the combined effectsof the following:

 

•              an increase in programs beinghandled by Vocativ from the first quarter of 2006 brought about by theacquisition of additional clients in the same period in 2007; 

 

•              an increase in the number ofregistered minutes for Parlance’s inbound projects and hours for outboundprojects; 

 

•              an increased call volume handledby Ventus due to the expansion of our domestic call center group, whichcurrently serves internal (Smart) and external (credit card companies) clients;

 

•              the expansion of Vocativ’s existingTaguig facility by 660 seats to approximately 1,870 seats in the first quarterof 2007 from approximately 1,210 seats in the same period in 2006;

 

•              the expansion of Ventus’ existing Iloilo facility by 80 seats to approximately 450 seats in the first quarter of 2007 fromapproximately 370 seats in the same period in 2006; 

 

•              the expansion of Ventus’ back-up/overflowMakati facility by 220 seats to approximately 300 seats in the first quarter of2007 from approximately 80 seats in the same period in 2006, which providedcapacity for seasonal requirements of Iloilo-based programs;

 

•              the commencement of operations atthe 820-seat Ventus Pasig call center in August 2006; and

 

•              the commencement of operations atthe 780-seat Parlance Libertad call center in September 2006.

 

Call center revenuesaccounted for 32% and 69% of total information and communications technologyservice revenues in the first quarter of 2007 and 2006, respectively.

* *

*Businessprocess outsourcing*

*** ***

BPOrevenues consist of:

 

•             editorial and content productionservices to the scholarly scientific, technical and medical (SSTM) journalpublishing industry;

 

•             digital content conversionservices to information incentive organizations such as online and traditionalpublishers, libraries, educational institutions, Global 1,000 corporations andgovernment agencies worldwide;

 

•             pre-press project managementservices to book publishers;

 

•             litigation support services whichinvolve conventional coding and electronic discovery support services forinternational law firms, corporate counsels and government agencies; and

 

•             conversion services of medicalrecord/data from handwritten or speech format to electronic format. 

 

Weprovide our BPO services primarily through SPi and its subsidiaries, which weacquired on July 11, 2006.  In the first quarter of 2007, BPO contributedrevenues of Php1,269 million, primarily from SPi services, and accounted for 52%of service revenues.

* *

*Internet and gaming*

 

ePLDT has also invested in a number of othere-commerce and Internet-related businesses, which include:

 

•              a 99.6% interest in Infocom, anInternet service provider offering consumer prepaid and postpaid Internetaccess, corporate leased lines, dedicated dial-up, multi-user dial-up,broadband Internet access through DSL, web consulting and development, hostingand other value-added services.  In addition, Infocom, through its CustomerService Outsourcing Group, handles PLDT group’s nationwide technical helpdeskoperations;

 

•              a 75% interest in DigitalParadise, an Internet café business with the brand *Netopia*; 

 

•              an 80% interest in netGames, apublisher for Massively Multi-player Online Games in the Philippines and thePhilippine licensee of *Khan Online*, *Pangya* and *Flyff*, andthe owner of Juanworld, a community gaming portal;

 

•              a 60% interest in Level Up!, a leading publisher of online gamesin the Philippines with approximately 80% of the online gaming market.  LevelUp! was consolidated to ePLDT in May 2006;

 

•              a 51% interest in Airborne Access,the country’s leading operator of WiFi hotspots, which provides wirelessInternet access in hotspots equipped with WiFi access points; and

 

•              a 51% interest in Digital Paradise Thailand, an affiliate of Digital Paradise, offering similar products andservices with four branches in Bangkok, Thailand. 

 

Internet service revenues consist of: 

 

•              revenues derived from actual usageof the Internet access network by prepaid subscribers and any unused peso valueof expired prepaid cards or electronic Internet time loads, net of discountsgiven to dealers; 

 

•              monthly service fees from postpaidcorporate and consumer subscribers including: (1) charges for Internet usage in excess of allocated free plan Internet hours;(2) one-time installation and activation fees; and (3) fees for value-addedservices including e-mail and web hosting services;

 

•              one-time fees generated from thereselling of Internet-related solutions such as security solutions and domainregistration; 

 

•              franchise and royalty fees for *Netopia* Internetcafés, including a one-time subscription fee and monthly recurring franchisefees based on certain conditions in the franchise agreement; 

 

•              revenues from community access ofcomputers and desktop publishing based on actual usage, net of discounts givento users; and 

 

•              online gaming revenues from uniquesubscribers, including one-time sale of gaming cards and electronic pins, andtop-up fees upon actual consumption of gaming credits or after expiration ofany unused peso value thereof.

 

Revenues from ourInternet and gaming businesses increased by Php95 million, or 67%, to Php237million in the first quarter of 2007 from Php142 million in the same period in2006 primarily due to the consolidation of Level Up! in May 2006 which resultedin additional revenues of Php45 million and an increase in Infocom’s revenuesby Php30 million.  Our Internet and gaming business revenues accounted for 10%and 17% of service revenues of our information and communications technologybusiness in the first quarter of 2007 and 2006, respectively.

 

*Vitro*ä data center

 

ePLDToperates an Internet data center under the brand name *Vitro*ä which provides co-location services, server hosting, hardware and software maintenanceservices, website development and maintenance services, webcasting andwebhosting, shared applications, data disaster recovery and business continuityservices, intrusion detection, and security services such as firewalls andmanaged firewalls.  

 

*Vitro*ä revenues consist of:

 

•              monthly service fees derived fromco-location services, server hosting, hardware and software maintenanceservices, website development and maintenance services, web hosting, datarecovery security services and other value-added services; and 

 

•              installation charges or one-timefees associated with the set-up of services and professional services ofVitro’s certified professionals.

 

In the first quarter of 2007, *Vitro*ä contributed revenues of Php112 million, an increase of Php29 million,or 35%, from Php83 million in the same period in 2006, primarily due to anincrease in co-location revenues and server hosting.  *Vitro*ä revenues accounted for 5% and 10% of service revenues of ourinformation and communications technology business in the first quarter of 2007and 2006, respectively.

 

*Others*

 

Otherrevenues consist of:

 

•              fees generated from the issuanceof digital certificates and licenses; and 

 

•              revenues derived from IThelpdesk/contact center solutions and terminals for credit, debit and creditcard transactions.

 

Revenuesfrom other businesses related to our information and communications technologysegment remained stable at Php25 million in the first quarter of 2007 and 2006,largely due to IT helpdesk/contact center services rendered coupled with anincrease in the number of digital certificates sold.

 

Pleaserefer to *Note 9 – Investments**in Associates* to the accompanying unauditedconsolidated financial statements for further discussion on ePLDT’s otherinformation and communications technology services.

 

*Non-service Revenues*

 

Non-servicerevenues consist of sales generated from reselling certain software licenses,server solutions, networking products, storage products and data securityproducts.  In the first quarter of 2007, non-service revenues generated by ourinformation and communications technology business decreased by Php20 million,or 38%, to Php33 million as compared to Php53 million in the same period in2006, primarily due to higher revenues from sales of software licenses.

 

*Other Income*
 

All other income/gainswhich do not fall under service and non-service revenues are included underthis classification.  Other income generated from our information andcommunications technology business increased to Php8 million in the firstquarter of 2007 from Php4 million in the same period in 2006 primarily due to higherincome from subsidiaries and affiliates.  

 

*Equity Share in Net Income of Associates*

 

ePLDT’s equity share in net income of associatesamounted to Php2 million in the first quarter of 2006 due to ePLDT’s share inthe earnings of its unconsolidated subsidiary, ePDS, Inc.

* *
*Expenses*
 

Expenses associatedwith our information and communications technology business totaled Php2,316million in the first quarter of 2007, an increase of Php1,458 million, or 170%,from Php858 million in the same period in 2006 primarily due to theconsolidation of SPi and Level Up! resulting to an increase in compensation andbenefits, professional and other contracted services, and depreciation andamortization.  We currently expect these expenses to be significantly highergoing forward as a result of the full year consolidation of SPi and Level Up!.As a percentage of our information and communications technology revenues,expenses related to our information and communications technology business were94% and 98% for the first quarter of 2007 and 2006, respectively.  

 

The following table shows the breakdown of our totalinformation and communications technology-related expenses for the three monthsended March 31, 2007 and 2006 and the percentage of each expense item to thetotal:

 

 

**Three Months Ended March 31,**

 

** **

 

** **

 

** **

 

** **

** **

**Increase (Decrease)**

 

**2007**

 

**%**

 

**2006**

 

**%**

** **

**Amount**

** **

**%**

** **

(Unaudited)

**(in millions)**

 

 

 

 

 

 

 

 

 

 

 

Information and communications technology services:

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits(1)

Php1,184

 

51

 

Php386

 

45

 

Php798

 

207

Professional and other contracted services

320

 

14

 

23

 

3

 

297

 

1,291

Depreciation and amortization

234

 

10

 

120

 

14

 

114

 

95

Rent

152

 

7

 

99

 

12

 

53

 

54

Maintenance

127

 

5

 

58

 

7

 

69

 

119

Communication, training and travel

102

 

4

 

30

 

3

 

72

 

240

Selling and promotions

65

 

3

 

36

 

4

 

29

 

81

Amortization of intangible assets

34

 

1

 

–

 

–

 

34

 

100

Cost of sales

24

 

1

 

45

 

5

 

(21)

 

(47)

Taxes and licenses

19

 

1

 

8

 

1

 

11

 

138

Insurance and security services

11

 

1

 

5

 

1

 

6

 

120

Equity share in net losses of associates

6

 

–

 

–

 

–

 

6

 

100

Provisions

1

 

–

 

1

 

–

 

–

 

–

Financing costs (gains)

(9)

 

–

 

13

 

1

 

(22)

 

(169)

Other expenses

46

 

2

 

34

 

4

 

12

 

35

Total 

Php2,316

 

100

 

Php858

 

100

 

Php1,458

 

170

____________

 

*(1)   Includes salaries andbenefits, incentive plan, pension and MRP costs.*

 

Compensationand benefits increased by Php798 million, or 207%, to Php1,184 million largelydue to the increased number of employees and corresponding salaries andemployee benefits resulting from the expansion of our call center businessesand the consolidation of SPi and Level Up! in 2006.  ePLDT’s employee headcountincreased by 6,163, or 104%, to 12,061 in the first quarter of 2007 from 5,898in the same period in 2006.  

 

Professionaland other contracted services increased by Php297 million to Php320 millionprimarily due to services sub-contracted by SPi from third parties related toits BPO services.

 

Depreciation andamortization charges increased by Php114 million, or 95%, to Php234 millionprimarily due to an increase in the depreciable asset base in relation to theexpansion of our call center businesses and the consolidation of SPi in July2006.  

 

Rentexpenses increased by Php53 million, or 54%, to Php152 million primarily due tothe opening of two additional call center sites in 2006 which led to increasedrental of leased circuits.

 

Maintenance expensesincreased by Php69 million, or 119%, to Php127 million primarily due to higherhosting-related costs incurred in the first quarter of 2007 partially offset byVitro’s lower hardware and server maintenance costs.

 

Communication,training and travel expenses increased by Php72 million, or 240%, to Php102million, primarily due to the increased cost of phone lines, bandwidth andinformation system charges, coupled with the increase in foreign and localtravel costs incurred by our call center and BPO businesses. 

 

Selling and promotionexpenses increased by Php29 million, or 81%, to Php65 million mainly due tohigher commissions expenses as well as advertising and marketing spending ofnetGames and Level Up!.

 

Anamortization of intangible assets amounting to Php34 million was recognized in thefirst quarter of 2007 in relation to the acquisition of SPi and Level Up!.  See*Note 11 – Goodwill and Intangible Assets* to the accompanying unaudited consolidated financial statements for further discussion.  

 

Costof sales decreased by Php21 million, or 47%, to Php24 million primarily due toa decrease in the cost of point products sold in the first quarter of 2007.

 

Taxesand licenses increased by Php11 million, or 138%, to Php19 million due tohigher business-related taxes accrued and paid in the first quarter of 2007 ascompared to the same period in 2006.

 

Insurance and securityservices increased by Php6 million, or 120%, to Php11 million, primarily due tohigher premium costs and an increase in the value of assets insured in thefirst quarter of 2007 as compared to the same period in 2006.

 

ePLDT’sequity share in net losses of associates amounted to Php6 million in the firstquarter of 2007, primarily due to amortization of intangibles pertaining toPhilweb Corporation, or Philweb, acquisition.  ePLDT acquired a total of 25.5%equity interest in Philweb in May 2006 and October 2006.

 

Provisionsremained stable at Php1 million mainly due to anticipated uncollectibleaccounts specifically identified in the first quarter of 2007 and 2006.

 

Financingcosts recognized a gain of Php9 million in the first quarter of 2007, primarilydue to a gain on derivative transactions; no similar transaction was recordedin the same period in 2006.

 

Other expenses increasedby Php12 million, or 35%, to Php46 million mainly due to higher business-relatedcosts, such as office supplies.

 

*Benefit from Income Tax*
 

Benefit from income tax amounted to Php9 million in thefirst quarter of 2007 primarily due to the recognition of deferred tax assetspertaining to accrued pension cost, net operating loss carry-over and allowancefor doubtful accounts, as compared to Php15 million in the same period in 2006.

 

*Net Income*
 

In the first quarterof 2007, our information and communications technology business segment registereda net income of Php159 million as compared to Php29 million in the same periodin 2006 mainly as a result of a 183% increase in ICT-related revenues mainlyfrom the consolidation of SPi and increased contribution of our call centerbusiness, partly offset by the 170% increase in ICT expenses mainly from theopening of two call centers and the consolidation of SPi. 

 

**Liquidityand Capital Resources**

 

The following table shows our consolidated cash flowsfor the three months ended March 31, 2007 and for the year ended December 31,2006 as well as consolidated capitalization and other selected financial dataas at March 31, 2007 and 2006:

 

 

**Three Months Ended March 31,**

 

**2007**

 

**2006**

** **

(Unaudited)

**(in millions)**

 

 

 

**Cash Flows**

 

 

 

Net cash provided by operating activities

Php25,001

 

Php15,404

Net cash used in investing activities

13,672

 

5,824

*Capital expenditures*

*5,937*

* *

*4,908*

Net cash used in financing activities

5,934

 

3,971

Net increase in cash and cash equivalents

5,439

 

5,139

 

** **

 

** **

 

**March 31,**

** **

**December 31,**

 

**2007**

 

**2006**

**(in millions)**

(Unaudited)

 

(Audited)

**Capitalization**

 

 

 

Long-term portion of interest-bearing financial liabilities –  net of current portion:

 

 

 

Long-term debt

64,622

 

Php63,769

Obligations under capital lease

57

 

106

Preferred stock subject to mandatory redemption

1,247

 

1,369

 

65,926

 

65,244

 

 

 

 

Current portion of interest-bearing financial liabilities: 

 

 

 

Notes payable

198

 

201

Long-term debt maturing within one year

10,093

 

16,184

Obligations under capital lease maturing within one year

934

 

924

 

11,225

 

17,309

Total interest-bearing financial liabilities

77,151

 

82,553

Total equity

104,245

 

104,523

 

Php181,396

 

Php187,076

** **

 

 

 

**Other Financial Data**

 

 

 

Total assets

Php251,597

 

Php241,892

Property, plant and equipment - net

164,492

 

164,190

Cash and cash equivalents

22,309

 

16,870

 

As at March 31, 2007,our consolidated cash and cash equivalents totaled Php22,309 million.Principal sources of consolidated cash and cash equivalents in the firstquarter of 2007 were cash flows from operating activities amounting to Php25,001million and drawings from Smart’s and ePLDT’s debt facilities aggregating Php5,009million.  These funds were used principally for capital outlays of Php5,937 million,total debt principal payments of Php9,242 million and short-term investments ofPhp7,986 million.

 

***Operating Activities***

 

Our consolidated netcash flows from operating activities increased by Php9,597 million, or 62%, toPhp25,001 million in the first quarter of 2007 from Php15,404 million in thesame period in 2006.

 

A significant portion of our cash flow is generated byour wireless business, which contributed approximately 60% of our totalrevenues and other income in the first quarter of 2007 and 2006.  Revenues fromour fixed line and information and communications technology services accountedfor 33% and 7%, respectively, of our total revenues and other income in thefirst quarter of 2007 compared to 37% and 3%, respectively, in the same periodin 2006. 

 

Cash flows from operating activities of our wirelessbusiness amounted to Php17,131 million in the first quarter of 2007, an increaseof Php9,265 million, or 118%, compared to Php7,866 million in the same periodin 2006.  Likewise, cash flows from operating activities of our fixed linebusiness increased to Php7,370 million in the first quarter of 2007, comparedto Php7,222 million in the same period in 2006.  The increase in our cash flowsfrom operating activities was primarily due to the decrease in our workingcapital requirements owing to higher collections of accounts receivable complementedby a decrease in the settlement of various payables.  Our wireless businesssegment accounted for 69% of our cash flows from operating activities while ourfixed line segment accounted for 29% in the first quarter of 2007.  We believethat our continuing strong cash flows from operating activities on aconsolidated basis will allow us to defray our current liabilities despite ourcurrent ratio being less than 1:1 as at March 31, 2007. 

 

UntilApril 2006, Smart was subject to loan covenants that restricted its ability topay dividends, redeem preferred shares, make distributions to PLDT or otherwiseprovide funds to PLDT or any associate without the consent of its lenders.Smart was able to obtain waivers from Finnvera and certain of its lenders foreach of the dividend payments made by Smart to PLDT in March 2006, 2005, 2004,2003 and 2002 aggregating Php7,000 million, Php19,717 million, Php16,100million, Php6,166 million and Php1,540 million, respectively.  In 2005, Smartredeemed 380.8 million preferred shares previously issued to PLDT at aredemption price of Php13.875 per share, or a total redemption priceaggregating to Php5,283 million. 

 

Dividendpayments made by Smart to PLDT after April 2006 did not require prior creditorconsent as all loan facilities that contain such restrictions have already beenrepaid.  In March 2007, June 2006 and September 2006, dividend paymentsreceived from Smart amounted to Php8,000 million, Php7,000 million and Php6,600million, respectively.  In addition, Smart redeemed 392 million preferredshares at a total redemption price of Php5,441 million in June 2006.

 

Investing Activities 
 

Net cash used ininvesting activities amounted to Php13,672 million in the first quarter of 2007,an increase of Php7,848 million, or 135%, compared to Php5,824 million in thesame period in 2006.  This was primarily a result of: (1) an increase in capitalexpenditures by Php1,029 million; and (2) the increase in short-terminvestments by Php7,955 million in the first quarter of 2007 mainly due to Smart’sincreased investment in money market placements with over 90 days maturity.

 

Our consolidatedcapital expenditures in the first quarter of 2007 totaled Php5,937 million, anincrease of Php1,029 million, or 21%, from Php4,908 million in the same periodin 2006 primarily due to PLDT’s, Smart’s and ePLDT’s higher capital spending.Smart's capital spending of Php1,988 million in the first quarter of 2007 wasused primarily to further upgrade its core, access and transmission networkfacilities, expand its wireless broadband facilities and develop IT platformsfor new businesses.  PLDT's capital spending of Php3,824 million wasprincipally used to finance the expansion and upgrade of its submarine cablefacilities, fixed line data and IP-based network services.  ePLDT and itssubsidiaries’ capital spending of Php110 million was primarily used to fund itscontinued call center expansion.  The balance represented other subsidiaries’capital spending.  Consolidated capital expenditures in the first quarter of2006 amounted to Php4,908 million, of which Php2,569 million, Php1,955 millionand Php331 million were attributable to Smart, PLDT and ePLDT, respectively.

 

***Financing Activities***

 

On a consolidated basis, we used net cash of Php5,934million for financing activities, net of loan drawings by Smart, in the firstquarter of 2007, an increase of Php1,963 million, or 49%, compared to Php3,971 millionin the same period in 2006.  The net cash used in financing activities in 2006was mainly utilized for debt repayments and interest payments by PLDT andPiltel in line with their ongoing debt reduction programs, and dividendpayments distributed by PLDT to its common and preferred stockholders.  

 

Debt Financing 
 

Additions to our consolidated long-term debt in thefirst quarter of 2007 totaled Php5,009 million mainly from Smart's drawingsrelated to the financing of its network expansion projects.  Payments inrespect of principal and interest of our total debt amounted to Php9,240 millionand Php1,445 million, respectively, in the first quarter of 2007, of which Php7,657million and Php1,079 million were attributable to PLDT, respectively.

 

The following table shows our long-term debt, includingcurrent portion, as at March 31, 2007 and December 31, 2006:

 

** **

**March 31,**

** **

**December 31,**

** **

**Increase (Decrease)**

** **

**2007**

** **

**2006**

** **

**Amount**

** **

**%**

** **

(Unaudited)

** **

(Audited)

** **

** **

** **

** **

**(in millions)**

** **

** **

** **

** **

** **

** **

** **

U.S. Dollar Debt:

 

 

 

 

 

** **

 

Export Credit Agencies-Supported Loans

Php13,575

 

Php14,981

 

(Php1,406)

** **

(9)

Fixed Rate Notes

33,497

 

40,971

 

(7,474)

** **

(18)

Term Loans

17,556

 

18,611

 

(1,055)

** **

(6)

Satellite Acquisition Loans

1,796

 

2,083

 

(287)

** **

(14)

 

66,424

 

76,646

 

(10,222)

** **

(13)

Philippine Peso Debt:

 

 

 

 

 

** **

 

Peso Fixed Rate Corporate Notes

5,795

 

808

 

4,987

** **

617

Term Loans

2,496

 

2,499

 

(3)

** **

–

 

8,291

 

3,307

 

4,984

** **

151

 

Php74,715

 

Php79,953

 

(Php5,238)

** **

(7)

 

Fora complete discussion of our long-term debt, see *Note 17 – Interest-bearingFinancial Liabilities*to the accompanying unaudited consolidated financialstatements.

 

Our long-term debtdecreased by Php5,238 million, or 7%, to Php74,715 million as at March 31, 2007,largely due to debt amortizations in line with PLDT’s efforts to reduce itsoverall debt level, and also due to the appreciation of the peso.  PLDT’s debtwas reduced by 16% to Php44,043 million by March 31, 2007.  The debt levels ofSmart increased by Php14% to Php28,832 million while Mabuhay and ePLDTdecreased by 14% and 23%, respectively, to Php1,796 million and Php44 million,respectively, as at March 31, 2007 due to amortizations and prepayments during thefirst quarter of 2007.  

 

On October 16, 2006, Smart signed a U.S. Dollar Term Loan Facility with Metropolitan Bank and TrustCompany to finance the related Phase 9 GSM Facility for an amount of US$50million.  As at December 31, 2006, this facility remained undrawn.  Please see *Note17 – Interest-bearing Financial Liabilities*to the accompanying unauditedconsolidated financial statements for a detailed discussion of our long-termdebt.

 

The scheduled maturities of our outstanding consolidatedlong-term debt at nominal values as at March 31, 2007 are as follows:  

 

**Year**

** **

**US$ Loans**

** **

**Peso Loans**

** **

**Total**

(Unaudited)

 

 
 

 

 

 

 

 

 

 

 

2007(1)

 

US$169

 

Php8,164

 

Php279

 

Php8,443

2008

 

147

 

7,098

 

558

 

7,656

2009

 

263

 

12,666

 

570

 

13,236

2010 

 

71

 

3,413

 

1,378

 

4,791

2011

 

15

 

716

 

568

 

1,284

2012 and onwards 

 

830

 

40,027

 

4,964

 

44,991

 

 

US$1,495

 

Php72,084

 

Php8,317

 

Php80,401

 

Approximately Php35,410million principal amount of our consolidated outstanding long-term debt as at March31, 2007 is scheduled to mature over the period from 2007 to 2011.  Of thisamount, Php18,031 million was attributable to PLDT, Php15,539 million to Smartand the remainder to Mabuhay Satellite, Maratel and ePLDT.

 

*DebtCovenants*

 

Ourdebt instruments contain restrictive covenants, including covenants that couldprohibit us from paying dividends on common stock under certain circumstances,and require us to comply with specified financial ratios and other financialtests, calculated in conformity with Philippine Financial Reporting Standards,at relevant measurement dates, principally at the end of each quarterly period. We have complied with all of ourmaintenance financial ratios as required under our loan covenants and otherdebt instruments.

 

Please see *Note 17 – Interest-bearing FinancialLiabilities*to the accompanying unaudited consolidated financial statementsfor a detailed discussion of our covenants.

 

Financing Requirements
 

Webelieve that our available cash, including cash flow from operations, willprovide sufficient liquidity to fund our projected operating, investment,capital expenditures and debt service requirements for the next 12 months.  

 

As a result of our improving cash flows and reduceddebt levels, we restored the payment of dividends in May 2005 and currentlyintend to gradually increase our dividend payout ratio in succeeding years aswe improve our leverage ratios.For 2006, our dividend payout ratio was 60%of 2006 earnings which we currently intend to increase to 70% in 2007.

 

*Credit Ratings*****

 

None of our existing indebtedness contains provisionsunder which credit rating downgrades would trigger a default, changes inapplicable interest rates or other similar terms and conditions.  

 

PLDT’s current credit ratings are as follows:

 

**Rating Agency**

**Credit Rating**

** **

**Outlook**

 

 

 

 

Moody’s Investor Service

Foreign Currency Senior Unsecured Debt Rating

Ba2

Stable

 

Local Currency Corporate Family Rating

Baa3

Positive

 

 

 

 

Standard and Poor’s

Foreign Currency Senior Unsecured Debt Rating

BB+

Stable

 

 

 

 

Fitch

Long-term Foreign Currency Rating

BB

Stable

 

Long-term Local Currency Rating

BB+

Stable

 

Long-term Foreign Currency Issuer Default Rating

BB+

Stable

 

Long-term Local Currency Issuer Default Rating

BBB-

Positive

 

National Long-term Rating 

AAA(ph1)

Stable

 

OnApril 11, 2007, Moody’s has placed our Baa3 local currency corporate familyrating on review for a possible upgrade and simultaneously affirmed our Ba2foreign currency bond rating with a stable outlook.  The review was prompted bythe continued improvement in our financial profile and a strong operatingperformance.

 

OnNovember 3, 2006, Moody’s affirmed PLDT’s Ba2 senior unsecured foreign currencyrating and changed its outlook to stable from negative.  The rating action wasprompted by the change in outlook on the Philippines Ba3 country ceiling forforeign currency bonds to stable from negative.  On July 18, 2006, Moody’s upgraded PLDT’s local currency corporate family rating from Ba1 to Baa3 with apositive outlook.  

 

On August 18, 2006, Fitch upgraded PLDT’s long-term foreign currency IDR to “BB+” from “BB”with a stable outlook, at the same time upgrading PLDT’s global bonds andsenior notes to “BB+” from “BB” and affirmed PLDT’s long-term local currencyIDR of “BBB-” with a positive outlook.  Following the licensing of Fitch toprovide National ratings in the Philippines, Fitch assigned PLDT a Nationallong-term rating of “AAA(ph1)” with a stable outlook.  The ratings actionfollows Fitch’s announcement that it has upgraded the Country Ceiling on theRepublic of the Philippines to “BB+” from “BB.”

 

On August 30, 2006, Standard & Poor’s Ratings Services affirmed its ‘BB+’ foreigncurrency rating on PLDT with stable outlook.  At the same time, the rating onPLDT’s Series III Preferred Stock has been withdrawn as the preferred stockhave been fully converted into common equity.  

 

*EquityFinancing*

 

PLDT raised Php36million and Php21 million from the exercise by certain officers and executivesof stock options in the first quarter of 2007 and 2006, respectively.    

 

Cashdividend payments in the first quarter of 2007 amounted to Php62 million comparedto Php222 million paid to preferred shareholders in the same period in 2006.  

 

The following table sets forth dividend payments onshares of PLDT’s common stock for the first quarter of 2007 and 2006:

 

** **

** **

**Date**

** **

**Amount**

**Class**

** **

**Declaration**

** **

**Record**

** **

**Paid**

** **

**Per Share**

** **

**Total**

 

 

 

 

 

 

 

 

 

 

 

Common Stock

 

February 27, 2006

 

March 20, 2006

 

April 20, 2006

 

28.00

 

5,059

 

 

August 8, 2006

 

August 21, 2006

 

September 21, 2006

 

50.00

 

9,346

 

 

March 6, 2007

 

March 20, 2007

 

April 20, 2007

 

50.00

 

9,429

 

As at March 31, 2007, therewere 188.6 million PLDTcommon shares outstanding compared to 181.4 million common shares outstandingas at March 31, 2006.

 

***Contractual Obligations and Commercial Commitments***

 

*Contractual Obligations*

 

The following table discloses our consolidatedcontractual obligations outstanding as at March 31, 2007: 

 

 

**Payments Due by Period**

 

**Total**

** **

**Within 1 year**

** **

**2****-****3 years**

** **

**4****-****5 years**

** **

**After 5 years**

 

(Unaudited)

**(in millions)**

 

 

 

 

 

 

 

 

 

Long-term debt (1)

Php80,401

 

Php10,223

 

Php20,505

 

Php8,482

 

Php41,191

Long-term lease obligations:

 

 

 

 

 

 

 

 

 

Operating lease

1,517

 

1,469

 

47

 

1

 

–

Capital lease

3,230

 

557

 

1,112

 

803

 

758

Unconditional purchase obligations(2)

819

 

30

 

48

 

199

 

542

Other long-term obligations

1,438

 

–

 

1,438

 

–

 

–

Total contractual obligations

Php87,405

 

Php12,279

 

Php23,150

 

Php9,485

 

Php42,491

___________

*(1)    **Before deducting unamortizeddebt discount and debt issuance costs.*

* *

*(2)    **Based on the amended AirTime Purchase Agreement with AIL.*

* *

*Long-term Debt*

* *

For a discussion of our long-term debt, see *Note 17 – Interest-bearing Financial Liabilities*to the accompanying unaudited consolidated financialstatements.

* *

*Long-termOperating Lease Obligations*

 

***DigitalPassage Service Contracts***.  PLDThas existing Digital Passage Service Contracts with foreign telecommunicationadministrations for several dedicated circuits to various destinations for tento 25 years expiring at various dates.  As at March 31, 2007, PLDT’s aggregateremaining obligation under these contracts amounted to approximately Php4million.

 

***LicenseAgreement with Mobius Management Systems (Australia) Pty Ltd., or Mobius****.*PLDTentered into a license agreement with Mobius pursuant to which Mobius hasgranted PLDT a non-exclusive, non-assignable and non-transferable license forthe use of computer software components.  Under this agreement, Mobius is alsorequired to provide maintenance services for a period of one year at noadditional maintenance charge.  PLDT may purchase maintenance services uponexpiration of the first year for a fee of 15% of the current published licensefee.  As at March 31, 2007, PLDT’s aggregate remaining obligation under this agreementwas approximately Php5 million.

 

***OtherLong-term Operating Lease Obligations***.  The PLDT Group has various long-term lease contracts for periodsranging from two to ten years covering certain offices, warehouses, cell sites,telecommunication equipment locations and various office equipments.  Inparticular, Smart has lease obligations amounting to Php2,967 million as at March31, 2007 in respect of office and cell site rentals with over 3,000 lessorsnationwide, PLDT has lease obligations aggregating Php85 million as at March 31,2007 in respect of office and lot rentals with over 185 lessors nationwide,ePLDT has lease obligations amounting to Php148 million as at March 31, 2007 inrespect of certain office space rentals and PLDT Global has lease obligationsaggregating Php21 million as at March 31, 2007 in respect of certain officespace rentals.

 

*Long-term Capital Lease Obligation*s

 

For a discussion of our long-term capital leaseobligations, see *Note 17 –Interest-bearing Financial Liabilities*tothe accompanying unaudited consolidated financial statements.

 

*UnconditionalPurchase Obligations*

 

***Air Time Purchase Agreement with AIL*****.**  In March1997 (amended in December 1998), PLDT was a party to a Founder National ServiceProvider, or NSP, Air Time Purchase Agreement, or ATPA, entered into with AIL,under which PLDT was granted the exclusive right to sell AIL services as NSP inthe Philippines.  In exchange, the ATPA required PLDT to purchase from AIL aminimum of US$5 million worth of air time annually over ten years commencingJanuary 1, 2002, the purported date of commercial operations of Garuda ISatellite.  In the event that AIL’s aggregate billed revenue is less than US$45million in any given year, the ATPA states that PLDT has to make supplementalair time purchase payments not to exceed US$15 million per during the ten-yearterm.  

 

InSeptember 2006 (as amended in October 2006, November 2006 and January 2007),after lengthy negotiations including a collaboration arrangement with Inmarsat,AIL and ACeS signed a term sheet (“Banks’ Term Sheet”) with the majority ofAIL’s bank creditors.  The Banks’ Term Sheet was aimed to be used as basis forfurther good faith negotiations among the parties with a view to enter into afurther amendment to the Amended and Restated Credit Agreement.  Under theBanks’ Term Sheet, the majority banks, subject to the satisfaction of certainconditions, agreed to, among others:  (1) redenominate AIL’s debt, and (2)amend the Founder NSP ATPA payments to: (i) US$500,000 per year for each of theNSPs, including PLDT, PSN and Jasmine, from 2007 to 2010, and (ii) US$3,000,000per year each for PLDT and PSN from 2011 to 2015.  For further discussionplease see *Note 20 – Related Party Transactions* to the accompanyingunaudited consolidated financial statements.

 

As at March 31,2007,PLDT’s aggregate remaining minimum obligation under the amended ATPA wasapproximately Php819 million.

* *

*OtherLong-term Obligations*

 

***MandatoryConversion and Purchase of Shares***.As discussed in *Note 17 – Interest-bearing Financial Liabilities*to theaccompanying unaudited consolidated financial statements, PLDT had issued atotal of 3 million shares of Series V Convertible Preferred Stock, 5 millionshares of Series VI Convertible Preferred Stock and 4 million shares of SeriesVII Convertible Preferred Stock in exchange for a total of 58 million shares ofSeries K Class I Convertible Preferred Stock of Piltel, pursuant to the debtrestructuring plan of Piltel adopted in June 2001.  

 

Each share of Series V, VI and VII ConvertiblePreferred Stock is convertible at any time at the option of the holder into onePLDT common share.  On the date immediately following the seventh anniversaryof the issue date of the Series V and Series VI Convertible Preferred Stocksand on the eighth anniversary of the issue date of the Series VII ConvertiblePreferred Stock, the remaining outstanding shares under these series will bemandatorily converted to PLDT common shares.  Under a put option exercisablefor 30 days, holders of common shares received on mandatory conversion of the SeriesV, VI and VII Convertible Preferred Stocks will be able to require PLDT topurchase such PLDT common shares for Php1,700 per share, US$36.132 per share,and JP¥4,071.89 per share, respectively.

 

Asat March 31, 2007, 2,677,765 shares of Series V Convertible Preferred Stock and4,512,329 shares of Series VI Convertible Preferred Stock and all 3,842,000shares of Series VII Convertible Preferred Stock had been voluntarily convertedto PLDT common shares.  As at March 31, 2007, 43,675 shares of Series V and 782,775shares of Series VI Convertible Preferred Stocks remained outstanding.  Theaggregate value of the put option based on outstanding shares as at March 31,2007 was Php1,438 million, which is puttable on June 4, 2008, if all of theoutstanding shares of Series V and VI Convertible Preferred Stocks would be mandatorilyconverted and all the underlying shares of common stock would be put to PLDT atthat time.  The market value of the underlying shares of common stock was Php2,087million, based on the market price of PLDT common shares of Php2,525 per shareas at March 31, 2007.

 

Please refer to *Note 17 – Interest-bearingFinancial Liabilities*to the accompanying unaudited consolidated financialstatements for further discussion.

 

*Commercial Commitments*

 

As at March 31, 2007,our outstanding commercial commitments, in the form of letters of credit,amounted to Php1,724 million.  These commitments will expire within one year.

 

**Quantitativeand Qualitative Disclosures about Market Risk****s**

 

Our operations areexposed to various risks, including liquidity risk, foreign exchange risk andinterest rate risk.  The importance of managing these risks has significantlyincreased in light of considerable change and continuing volatility in both thePhilippine and international financial markets.  With a view to managing theserisks, we have incorporated financial risk management functions in ourorganization, particularly in our treasury operations and equity issues andsales of certain assets.

 

Liquidity Risk Management
 

We seek to manage our liquidity profile to be ableto finance our capital expenditures and service our maturing debts.  To coverour financing requirements, we currently intend to use internally generatedfunds and proceeds from debt and equity issues and sales of certain assets. 

 

As part of ourliquidity risk management program, we regularly evaluate our projected andactual cash flow information and continuously assess conditions in thefinancial markets for opportunities to pursue fund-raising initiatives.  Theseinitiatives may include bank loans, export credit agency-guaranteed facilities,and debt capital and equity market issues.

 

***Foreign Exchange Risk Management***

 

As at March 31, 2007, the Philippine peso hadappreciated by 2% against the U.S. dollar to Php48.217 to US$1.00 from Php49.045to US$1.00 as at December 31, 2006.  As at March 31, 2006, likewise, the peso hadappreciated by 4% to Php51.158 to US$1.00 from Php53.062 to US$1.00 as at December31, 2005.  The revaluation of our foreign-currency denominated assets andliabilities is recognized as foreign exchange gains or losses as at the balancesheet date.  Since most of our indebtedness is denominated in U.S. dollars, theappreciation or depreciation of the Philippine peso results in the recognitionof foreign exchange gains or losses.  The extent of foreign exchange gains orlosses is largely dependent on the amount of foreign currency debt and hedges wecarry.  As at March 31, 2007, consolidated foreign currency denominated debt wasreduced to Php66,424 million from Php96,962 million as at March 31, 2006.  Assuch, we recognized foreign exchange gains of Php588 million and Php1,578 millionin the first quarter of 2007 and 2006, respectively.  

 

Whilea certain percentage of our revenues are either linked to or denominated inU.S. dollars, most of our indebtedness and related interest expense, asubstantial portion of our capital expenditures and a portion of our operatingexpenses are denominated in foreign currencies, mostly in U.S. dollars.

* *

Asat March 31, 2007, approximately 90% of our total consolidated debts weredenominated in foreign currencies, principally in U.S. dollars.  Thus, astrengthening or weakening of the Philippine peso against the U.S. dollar willdecrease or increase both the principal amount of our unhedged foreigncurrency-denominated debts (representing 43% of our consolidated debts, or 28%net of our U.S. dollar cash balances as at March 31, 2007), and interestexpense on our debt in Philippine peso terms.  In addition, many of ourfinancial ratios and other financial tests are affected by the movements in thePhilippine peso to U.S. dollar exchangerate.

 

To manage our foreignexchange risks, stabilize cash flows, and improve investment and cash flowplanning, we enter into forward foreign exchange contracts, foreign currencyswap contracts, currency option contracts and other hedging products aimed atreducing and/or managing the adverse impact of changes in foreign exchangerates on our operating results and cash flows.  However, these hedges do notcover all of our exposure to foreign exchange risks.

 

Specifically,we use forward foreign exchange contracts, foreign currency swap contracts andcurrency option contracts to manage the foreign exchange risks associated withour foreign currency-denominated loans.  In order to manage hedge costs ofthese contracts, we utilize structures that include credit-linkage with PLDT asthe reference entity, a combination of currency option contracts, and fixed tofloating coupon only swap agreements.  Accounted for as either cash flow hedgesor transactions not designated as hedges, changes in the fair value of theseinstruments are recognized as cumulative translation adjustments in equityuntil the hedged item is recognized directly as income or expense for theperiod.  As at March 31, 2007, PLDT’s outstanding forward foreign exchangecontracts, principal-only long-term cross-currency swap contracts and currencyoption contracts amounted to US$77 million; US$550 million; and US$136 million,respectively.  Smart had outstanding forward foreign exchange contractsamounting to US$18 million as at March 31, 2007. 

 

For further discussions of these contracts, see *Note24 – Financial Assets and Liabilities – Derivative Financial Instruments*tothe accompanying unaudited consolidated financial statements.

 

***Interest Rate Risk Management***

 

On a limited basis, we enter into interest rate swapagreements in order to manage our exposure to interest rate fluctuations.  Asat March 31, 2007, PLDT’s outstanding interest rate swap contracts amounted toUS$63 million.  For further discussions of these contracts, see *Note 24 –Financial Assets and Liabilities – Derivative Financial Instruments*to theaccompanying unaudited consolidated financial statements.

 

Wemake use of hedging instruments and structures solely for reducing or managingfinancial risks associated with our liabilities and not for trading orspeculative purposes.

** **

**Impact of Inflation and Changing Prices**

** **

Inflation can be a significant factor in thePhilippine economy, and we are continually seeking ways to minimize itsimpact.  In recent periods, we do not believe inflation has had a materialimpact on our operations.  The average inflation rate in the Philippines in the first quarter of 2007 was 2.9%, compared to 7.3% in the same period in 2006.

** **

**OTHER INFORMATION**

 

***SPi’sAcquisition of Springfield Service Corporation, or Springfield***

 

OnApril 16, 2007, SPi acquired, through a wholly-owned U.S. subsidiary, 100% of Springfield for an aggregate purchase price of US$44 million, plus possible future earn outpayments.

 

Springfield, the 10th largest player in the medicalbilling and revenue cycle management market, has 383 employees operating in 5locations in the U.S. and provides billing and accounts receivable managementservices for over US$1.3 billion of physician charges annually.  Springfield offers practice management services including patient scheduling, coding andcompliance assistance consulting and specialized reporting services. Springfield is known for its superior operational capability on the GE Centricity BusinessSystem (formerly known as IDX Flowcast) and EPIC, two of the leading platformsin the industry, strong client relationships and experienced management team.

 

***Piltel’s Equity Restructuring***

*** ***

On April 20, 2007, the Securities and Exchange Commissionapproved Piltel’s request to undergo equity restructuring to eliminate thedeficit of Piltel as of December 31, 2006 amounting to Php22,251 millionagainst the additional paid-in capital.  The equity restructuring was approvedby Piltel’s Board of Directors on March 5, 2007.

 

***Asia-America Gateway Submarine Cable System***

 

On May 2, 2007, a consortium of major internationaltelecommunication operators, including PLDT, signed an agreement to build thefirst high-bandwidth optical fiber submarine cable system linking SoutheastAsia and the U.S.  The cable project, known as the *Asia-America Gateway,*will span 20,000 kilometers and will use the latest Dense Wavelength DivisionMultiplexing, or DWDM, technology to provide upgradeable, future prooftransmission facilities that will support bandwidth requirements for new andrevolutionary broadband applications.  It is expected that the *Asia-AmericaGateway* will cost approximately US$500 million (of which Php50 million representsPLDT’s investment) and will be ready for service by the end of 2008.

 

*Related Party Transactions*
 

*Cooperation Agreement with First Pacific and certain affiliates, or FPParties, NTT Communications and DoCoMo*

 

Inconnection with the transfer by NTT Communications Corporation, or NTTCommunications, of approximately 12.6 million shares of PLDT’s common stock toNTT DoCoMo, Inc, or DoCoMo, pursuant to a Stock Sale and Purchase Agreementdated January 31, 2006 between NTT Communications and DoCoMo, the FP Parties,NTT Communications and DoCoMo entered into a Cooperation Agreement, datedJanuary 31, 2006.  Under the Cooperation Agreement, the relevant partiesextended certain rights of NTT Communications under the Stock Purchase andStrategic Investment Agreement dated September 28, 1999, as amended, and theShareholders Agreement dated March 24, 2000, to DoCoMo, including:

 

•        certain contractual veto rights overa number of major decisions or transactions; and

 

•        rights relating to therepresentation on the board of directors of PLDT and Smart, respectively, andany committees thereof.

 

Keyprovisions of the Cooperation Agreement pertain to, among other things, restrictionson the ownership of shares of PLDT by NTT Communications and DoCoMo, limitationon competition, business cooperation, additionalrights of DoCoMo, change in control and termination.  See *Note 20 – RelatedParty Transactions* to the accompanying unaudited consolidated financialstatements for further details.

 

*Integrated i-mode ServicesPackage Agreement between DoCoMo and Smart –*An Integrated i-mode ServicesPackage Agreement was entered into by Smart and DoCoMo on February 15, 2006,under which DoCoMo agreed to grant Smart, on an exclusive basis within theterritory of the Philippines for a period of five years, an integrated i-modeservices package including a non-transferable license to use the licensedmaterials and the i-mode brand, as well as implementation support andassistance and post-commercial launch support from DoCoMo.  Pursuant to thisagreement, Smart is required to pay an initial license fee and running royaltyfees based on the revenue arising from i-mode subscription fees and datatraffic.  Outstanding obligation under this agreement amounted to Php48 millionand Php53 million as at March 31, 2007 and December 31, 2006, respectively.

 

*Advisory ServicesAgreement between DoCoMo and PLDT* –– AnAdvisory Services Agreement was entered into by DoCoMo and PLDT on June 5,2006, in accordance with the Cooperation Agreement between PLDT and DoCoMo.Pursuant to the agreement, DoCoMo will provide the services of certain keypersonnel in connection with certain aspects of the business of PLDT andSmart.  Also, the agreement governs the terms and conditions of theappointments and the corresponding fees related thereto.  Total fees under thisagreement for the three months ended March 31, 2007 amounted to Php19 million.Outstanding liability under this agreement amounted to Php19 million and Php32million as at March 31, 2007 and December 31, 2006, respectively.

 

*Other Agreements with NTTCommunications and/or its Affiliates*—Under certain agreements, (1) NTT Communications provides advisory services for various business areas ofPLDT; (2) PLDT is licensed to market managed data and other services using NTTCommunications’ Arcstar brand; and (3) PLDT and NTT Communications agreed tocooperative arrangements for conventional international telecommunicationsservices.  Total fees under these agreements totaled Php61 million and Php51million for the three months ended March 31, 2007 and 2006, respectively.PLDT’s outstanding obligations under these agreements amounted to Php29 millionand Php18 million as at March 31, 2007 and December 31, 2006, respectively.

 

*Agreements between Smartand Asia Link B.V*., *or ALBV* — Undercertain agreements, ALBV undertakes to provide technical support services andassistance in the operations and maintenance of Smart’s cellular business.Total fees under these agreements totaled Php165 million and Php142 million forthe three months ended March 31, 2007 and 2006, respectively.  Outstandingobligations of Smart under these agreements amounted to Php137 million and Php62million as at March 31, 2007 and 2006, respectively.  Outstanding prepaidmanagement fees as at March 31, 2007 and December 31, 2006 amounted to Php856million and Php869 million, respectively.  ALBV is a subsidiary of the FirstPacific Group.

 

*Agreements relating toinsurance companies* — Gotuaco delRosario and Associates, or Gotuaco, acts as the broker for certain insurancecompanies to cover certain insurable properties of the PLDT Group.  Insurancepremiums are remitted to Gotuaco and the broker’s fees are settled betweenGotuaco and the insurance companies.  In addition, PLDT has an insurance policywith Malayan Insurance Co., Inc., or Malayan, wherein premiums are directlypaid to Malayan.  Total insurance expenses paid under these agreements amountedto Php119 million and Php105 million for the three months ended March 31, 2007and 2006, respectively.  Two directors of PLDT have a direct/indirect interestin or serve as a director/officer of Gotuaco and Malayan.

 

For a more detailed discussion of the related partytransactions enumerated above, see *Note 20 –Related Party Transactions*to the accompanying**unaudited**consolidated financial statements.

 

 

**PHILIPPINE LONG DISTANCETELEPHONE COMPANY**

**AND SUBSIDIARIES**

 

**CONSOLIDATED FINANCIAL STATEMENTS**

 

AS AT MARCH 31, 2007 (UNAUDITED) AND DECEMBER 31, 2006(AUDITED)

AND FOR THE THREE MONTHS ENDED MARCH 31, 2007 AND 2006(UNAUDITED)
****
**PHILIPPINE LONG DISTANCE TELEPHONE COMPANY ANDSUBSIDIARIES**

** **

CONSOLIDATEDBALANCE SHEETS

**(in million pesos, except par value and share amounts)**

** **

** **

**March 31,  2007**

 

December 31, 2006

** **

**(Unaudited)**

 

(Audited)

**ASSETS**

**Noncurrent Assets**

** **

** **

** **

Property, plant and equipment (Notes 2, 3, 8 and 17)

**164,492**

 

164,190

Investments in associates (Notes 2, 9 and 17)

**631**

 

636

Investments-available-for-sale (Notes 2 and 24)

**120**

 

116

Investment properties (Notes 2, 3 and 10)

**582**

 

587

Goodwill and intangible assets (Notes 2, 3 and 11)

**12,019**

 

12,214

Deferred income tax assets (Notes 2 and 6)

**17,132**

 

19,658

Derivative assets (Notes 2 and 24)

**158**

 

434

Prepayments - net of current portion

**829**

 

843

Advances and refundable deposits - net of current portion (Notes 2 and 20)

**1,088**

 

1,066

Total Noncurrent Assets 

**197,051**

 

199,744

**Current Assets**

** **

 

 

Cash and cash equivalents (Notes 2, 13 and 24)

**22,309**

 

16,870

Short-term investments (Notes 2 and 24)

**16,164**

 

8,327

Trade and other receivables (Notes 2, 3, 14 and 24)

**10,010**

 

10,158

Inventories and supplies (Notes 2 and 15)

**1,277**

 

1,230

Derivative assets (Notes 2 and 24)

**43**

 

47

Current portion of prepayments

**4,591**

 

5,360

Current portion of advances and refundable deposits (Notes 2 and 20)

**152**

 

156

Total Current Assets 

**54,546**

 

42,148

 

**251,597**

 

241,892

 

** **

 

 

**EQUITY AND LIABILITIES**

**Equity****Attributable to Equity Holders of PLDT**(Notes 2, 7 and 16)

** **

 

 

Preferred stock, Php10 par value, authorized-822,500,000 shares; issued and  outstanding-442,111,762 shares as at March 31, 2007 and 442,375,057 shares  as at December 31, 2006

**4,421**

 

4,424

Common stock, Php5 par value, authorized-234,000,000 shares; issued and  outstanding-188,574,696 shares as at March 31, 2007 and 188,434,695 shares  as at December 31, 2006

**943**

 

942

Stock options issued (Note 21)

**25**

 

40

Equity portion of convertible preferred stock (Note 17)

**9**

 

9

Capital in excess of par value

**66,794**

 

66,574

Retained earnings (Note 7)

**31,899**

 

32,784

Cumulative translation adjustments (Note 24)

**(1,525)**

 

(1,796)

      Total Equity Attributable to Equity Holders of PLDT

**102,566**

 

102,977

**Minority interest**

**1,679**

 

1,546

Total Equity

**104,245**

 

104,523

**PHILIPPINE LONG DISTANCE TELEPHONE COMPANYAND SUBSIDIARIES**

** **

CONSOLIDATEDBALANCE SHEETS (*continued*)

(in million pesos, except par value and share amounts)

 

** **

**March 31,  2007**

 

December 31, 2006

** **

**(Unaudited)**

 

(Audited)

**Noncurrent Liabilities**

** **

 

 

Interest-bearing financial liabilities - net of current portion (Notes 2, 8, 17, 22 and 24)

**65,926**

 

65,244

Deferred income tax liabilities (Notes 2 and 6)

**379**

 

402

Derivative liabilities (Notes 2 and 24)

**6,410**

 

6,872

Pension and other employee benefits (Notes 2, 3 and 21)

**3,276**

 

2,982

Customers’ deposits

**2,193**

 

2,204

Other noncurrent liabilities (Notes 2, 3, 8, 14 and 18)

**7,813**

 

7,581

Total Noncurrent Liabilities

**85,997**

 

85,285

**Current Liabilities**

** **

 

 

Accounts payable (Notes 2 and 24)

**11,723**

 

8,634

Accrued expenses and other current liabilities (Notes 2, 3, 17, 19, 20 and 21)

**19,975**

 

19,102

Unearned revenues (Note 2)

**3,310**

 

3,274

Derivative liabilities (Notes 2 and 24)

**39**

 

108

Provisions for assessments (Notes 20, 22 and 23)

**455**

 

446

Current portion of interest-bearing financial liabilities (Notes 2, 8, 17, 22 and 24)

**11,225**

 

17,309

Dividends payable (Notes 2, 7, 17 and 24)

**10,171**

 

773

Income tax payable (Notes 2 and 6)

**4,457**

 

2,438

Total Current Liabilities

**61,355**

 

52,084

 

**251,597**

 

241,892

* *

*See accompanying Notes toUnaudited Consolidated Financial Statements.*

* *
****
**PHILIPPINE LONG DISTANCE TELEPHONE COMPANY ANDSUBSIDIARIES**

 

**CONSOLIDATED STATEMENTS OF INCOME**

**(in million pesos, except per share amounts)**

** **

** **

**Three Months Ended March 31,**

** **

**2007**

 

2006

** **

(Unaudited)

**INCOME**

** **

 

 

Service revenues

**33,012**

 

29,977

Non-service revenues (Note 5)

**613**

 

742

Equity share in net income of associates

**–**

 

2

Other income (Note 4)

**211**

 

131

 

**33,836**

 

30,852

**EXPENSES**

** **

 

** **

Depreciation and amortization (Notes 4 and 8)

**5,448**

 

7,667

Compensation and benefits (Notes 5 and 21)

**4,781**

 

3,644

Maintenance (Note 20)

**1,846**

 

1,654

Financing costs (Notes 5, 8, 17 and 24)

**1,797**

 

1,000

Selling and promotions

**1,296**

 

1,245

Professional and other contracted services (Notes 5 and 20)

**1,279**

 

584

Cost of sales (Notes 5, 20 and 22)

**1,220**

 

1,279

Rent (Note 22)

**690**

 

546

Taxes and licenses (Note 23)

**608**

 

551

Communication, training and travel

**425**

 

362

Insurance and security services (Note 20)

**328**

 

334

Provisions (Notes 3, 5, 14, 15, 20, 22 and 23)

**233**

 

238

Amortization of intangible assets (Note 11)

**76**

 

69

Equity in net losses of associates

**6**

 

–

Other expenses (Note 20)

**492**

 

407

 

**20,525**

 

19,580

**INCOME BEFORE INCOME TAX**

**13,311**

 

11,272

**PROVISION FOR INCOME TAX** (Notes 2 and 6)

**4,580**

 

2,510

**NET INCOME FOR THE PERIOD**

**8,731**

 

8,762

**ATTRIBUTABLE TO:**

** **

 

 

Equity holders of PLDT

**8,575**

 

8,581

Minority interest

**156**

 

181

** **

**8,731**

 

8,762

**Earnings Per Common Share** (Note 7)

** **

 

 

Basic

**44.87**

 

46.74

Diluted

**44.79**

 

44.38

* *

*See accompanying Notes to**Unaudited Consolidated Financial Statements.*

* *

* *
**
**PHILIPPINE LONGDISTANCE TELEPHONE COMPANY AND SUBSIDIARIES**

** **

**CONSOLIDATEDSTATEMENTS OF CHANGES IN EQUITY**

**(in million pesos)**

** **

 

**Preferred Stock**

**Common Stock**

**Stock Options Issued**

**Equity Portion of Convertible Preferred Stock**

**Capital in Excess of  Par Value**

**Retained Earnings (Deficit)**

**Cumulative Translation Adjustments**

**Equity Attributable to Equity Holders of the Parent**

**Minority Interest**

**Total  Equity**

Balances at January 1, 2006

4,433

904

67

49

53,918

12,583

1,253

73,207

1,162

74,369

Income for the period

–

–

–

–

–

8,581

–

8,581

181

8,762

Currency translation differences (Note 24)

–

–

–

–

–

–

(48)

(48)

(22)

(70)

Net loss on cash flow hedges (Note 24)

–

–

–

–

–

–

(2,136)

(2,136)

–

(2,136)

Total income and expense for the period recognized directly to equity

–

–

–

–

–

–

(2,184)

(2,184)

(22)

(2,206)

**Total income and expense for the period**

**–**

**–**

**–**

**–**

**–**

**8,581**

**(2,184)**

**6,397**

**159**

**6,556**

**Cash dividends**

**–**

**–**

**–**

**–**

**–**

**(5,104)**

**–**

**(5,104)**

**–**

**(5,104)**

**Issuance of capital stock - net (Note 16)**

**(2)**

**3**

**–**

**(32)**

**941**

**–**

** **

**910**

**–**

**910**

**Exercised shares**

**–**

**–**

**(10)**

**–**

**31**

**–**

**–**

**21**

**–**

**21**

**Balances at March 31, 2006**

**4,431**

******907**

**57**

**17**

**54,890**

**16,060**

**(931)**

**75,431**

**1,321**

**76,752**

 

 

 

 

 

 

 

 

 

 

 

Balances at January 1, 2007

4,424

942

40

9

66,574

32,784

(1,796)

102,977

1,546

104,523

Changes in equity:

 

 

 

 

 

 

 

 

 

 

Income for the period

–

–

–

–

–

8,575

–

8,575

156

8,731

Currency translation differences (Note 24)

–

–

–

–

–

–

(179)

(179)

(9)

(188)

Net gains on available-for-sale financial assets) (Note 24)

 

 

 

 

 

 

8

8

–

8

Net gains on cash flow hedges (Note 24)

–

–

–

–

–

–

442

442

–

442

Total income and expense for the period recognized directly to equity

–

–

–

–

–

–

271

271

(9)

262

**Total income and expense for the period**

**–**

**–**

**–**

**–**

**–**

**8,575**

**271**

**8,846**

**147**

**8,993**

**Cash dividends (Note 7)**

**–**

**–**

**–**

**–**

**–**

**(9,460)**

**–**

**(9,460)**

**–**

**(9,460)**

**Issuance of capital stock - net (Note 16)**

**(3)**

**1**

**–**

**–**

**169**

**–**

**–**

**167**

**–**

**167**

**Exercised shares (Note 21)**

**–**

**–**

**(15)**

**–**

**51**

**–**

**–**

**36**

**–**

**36**

**Minority interest**

**–**

**–**

**–**

**–**

**–**

**–**

**–**

**–**

**(14)**

**(14)**

**Balances at March 31, 2007**

**4,421**

**943**

**25**

**9**

**66,794**

**31,899**

**(1,525)**

**102,566**

**1,679**

**104,245**

* *

*See accompanying Notes to Unaudited Consolidated Financial Statements.*

* *
**
**PHILIPPINE LONG DISTANCETELEPHONE COMPANY AND SUBSIDIARIES**

 

**CONSOLIDATED STATEMENTS OF CASH FLOWS**

**(in million pesos)**

 

** **

**Three Months Ended March 31,**

** **

**2007**

** **

2006

** **

(Unaudited)

**CASH FLOWS FROM OPERATING ACTIVITIES**

** **

 

 

Income before income tax

**13,311**

 

11,272

Adjustments for:

** **

 

 

Depreciation and amortization (Note 8)

**5,448**

 

7,667

Interest on loans and related items - net of capitalized interest (Note 5)

**1,744**

 

1,998

Loss on derivative transactions - net (Note 5)

**311**

 

22

Accretion on financial liabilities - net (Note 5)

**269**

 

614

Provision for doubtful accounts (Note 5)

**163**

 

205

Amortization of intangible assets (Note 11)

**76**

 

69

Write-down of inventories to net realizable values (Note 5)

**61**

 

109

Provisions for onerous contracts and assessments (Note 5)

**9**

 

(76)

Equity share in net loss (income) of associates

**6**

 

(2)

Dividends on preferred stock subject to mandatory redemption (Note 5)

**5**

 

49

Interest income (Note 5)

**(333)**

 

(482)

Foreign exchange gains - net (Note 5)

**(588)**

 

(1,578)

Others

**18**

 

(18)

Operating income before working capital changes

**20,500**

 

19,849

Decrease (increase) in:

** **

 

 

Trade and other receivables

**(73)**

 

(1,138)

Inventories and supplies

**(84)**

 

(533)

Prepayments

**805**

 

(631)

Advances and refundable deposits

**3**

 

1,360

Increase (decrease) in:

** **

 

 

Accounts payable

**3,114**

 

(4,814)

Accrued expenses and other current liabilities

**652**

 

513

Unearned revenues

**62**

 

558

Pension and other employee benefits

**296**

 

481

Net cash generated from operations

**25,275**

 

15,645

Income taxes paid

**(274)**

 

(241)

Net cash provided by operating activities

**25,001**

 

15,404

**CASH FLOWS FROM INVESTING ACTIVITIES**

** **

 

 

Additions to property, plant and equipment

**(5,823)**

 

(4,779)

Proceeds from disposal of property, plant and equipment

**40**

 

257

Interest paid – capitalized to property, plant and equipment (Notes 5 and 8)

**(114)**

 

(129)

Payments for purchase of investments - net of cash acquired (Note 11)

**–**

 

(1,201)

Proceeds from disposal of investment properties

**2**

 

10

Increase in short-term investments

**(7,986)**

 

(31)

Interest received

**231**

 

314

Increase in advances and refundable deposits

**(22)**

 

(265)

Net cash used in investing activities

**(13,672)**

 

(5,824)

 

**PHILIPPINE LONG DISTANCE TELEPHONE COMPANY ANDSUBSIDIARIES**

** **

**CONSOLIDATED STATEMENTS OF CASH FLOWS (*continued*)**

(in million pesos)

 

** **

**Three Months Ended March 31,**

** **

**2007**

** **

2006

** **

(Unaudited)

**CASH FLOWS FROM FINANCING ACTIVITIES**

** **

 

 

Proceeds from availment of long-term debt

**5,009**

 

3,446

Payments of long-term debt

**(9,240)**

 

(4,678)

Payments of debt issuance costs

**(13)**

 

(3)

Proceeds from notes payable

**–**

 

127

Payments of notes payable

**(2)**

 

(126)

Payments of obligations under capital lease

**(55)**

 

(28)

Interest paid - net of capitalized portion

**(1,445)**

 

(1,322)

Settlements of derivatives

**(326)**

 

(1,393)

Cash dividends paid

**(62)**

 

(222)

Proceeds from issuance of capital stock

**36**

 

23

Redemption of shares

**(14)**

 

–

Increase (decrease) in:

** **

 

 

Customers’ deposits

**(10)**

 

(17)

Other noncurrent liabilities

**188**

 

222

Net cash used in financing activities

**(5,934)**

 

(3,971)

**EFFECT OF EXCHANGE RATE CHANGES ON CASH AND  CASH EQUIVALENTS**

**44**

 

(470)

**NET INCREASE IN CASH AND CASH EQUIVALENTS**

**5,439**

 

5,139

**CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD**

**16,870**

 

30,059

**CASH AND CASH EQUIVALENTS AT END OF PERIOD**

**22,309**

 

35,198

* *

*Seeaccompanying Notes to Unaudited Consolidated Financial Statements.*

* *

 
****
**PHILIPPINE LONG DISTANCE TELEPH****ONE COMPANY AND SUBSIDIARIES**

 

**NOTES TO CONSOLIDATED FINANCIAL STATEMENTS**

 

 

**1.       ****CorporateInformation**

 

ThePhilippine Long Distance Telephone Company, or PLDT, or Parent Company, wasincorporated under the old Corporation Law of the Philippines (Act 1459, asamended) on November 28, 1928, following the merger of four telephone companiesunder common ownership by United States entities.  In 1967, effective controlof PLDT was sold by General Telephone and Electronics Corporation (a major shareholder since PLDT’s incorporation) to a group of Filipinobusinessmen.  In 1981, in furtherance of the then existing policy of thePhilippine government to integrate the Philippine telecommunications industry,PLDT purchased substantially all of the assets and liabilities of the RepublicTelephone Company, which at that time was the second largest telephone companyin the Philippines.  In 1998, First Pacific Company Limited, or First Pacific,through its Philippine and other affiliates, acquired a significant interest inPLDT.  On March 24, 2000, NTT Communications Corporation, or NTTCommunications, through NTT Communications Capital (UK) Ltd., became PLDT’sstrategic partner with approximately 15% economic and voting interest in theissued and outstanding common stock of PLDT.  Simultaneous with NTTCommunications’ investment in PLDT, we acquired 100% of Smart Communications,Inc., or Smart.  On March 14, 2006, NTT DoCoMo, Inc., or DoCoMo, acquired from NTTCommunications 7% of PLDT’s outstanding common shares held by NTT Communications;NTT Communications retained a 7% equity shareholding.

 

On February 28, 2007, First Pacific acquired anadditional interest of approximately 46% in Philippine TelecommunicationsInvestment Corporation, or PTIC, for a consideration of Php25.2 billion.  Thisadditional investment in PTIC represents an attributable interest ofapproximately 6.4% issued common shares capital of PLDT, thereby raising FirstPacific’s interest in PLDT to approximately 29%.

 

Thecommon shares of PLDT are listed and traded on the Philippine Stock Exchange,or PSE, and prior to October 19, 1994, were listed and traded on the AmericanStock Exchange and the Archipelago Exchange (then the Pacific Exchange) in the United States.  On October 19, 1994, an American Depositary Receipt, or ADR, facility wasestablished, pursuant to which Citibank N.A., as the depositary, issued ADRsevidencing American Depositary Shares, or ADSs, with each ADS representing onePLDT common share with a par value of Php5 per share.  JP Morgan Chase Bank wasappointed as successor depositary for PLDT’s ADR facility effective February 10, 2003.  The ADSs are listed on the New York Stock Exchange, or NYSE, and on theNYSE Arca (formerly Archipelago Exchange) in the United States and are tradedon the NYSE.

 

On December 28, 2006, PLDTissued a notice of its intent to delist the ADSs from NYSE Arca (but willcontinue and maintain the listing of the ADSs on the NYSE) since there is noadditional advantage in having dual listing of the ADS, on both the NYSE andNYSE Arca.  The delisting from NYSE Arca will eliminate duplicativeadministrative burdens and costs.  The actual delisting from the NYSE Arca becameeffective last February 12, 2007.

 

PLDT’scharter, like those of all other Philippine corporations, was initially limitedto a period of 50 years but has since been extended twice for 25 years each,the last extension being for an additional 

25-yearperiod through 2028.  Under its amended charter (Republic Act No. 7082), whichbecame effective on August 24, 1991, PLDT is authorized to provide virtuallyevery type of telecommunications service, both within the Philippines andbetween the Philippines and other countries.

 

PLDT operates under the jurisdiction of the PhilippineNational Telecommunications Commission, or NTC, which jurisdiction extends,among other things, to approving major services offered by PLDT and certainrates charged by PLDT.

 

Ourregistered office address is Ramon Cojuangco Building, Makati Avenue, Makati City , Philippines.

 

 

 

**2.       ****Summary ofSignificant Accounting Policies and Practices**

 

**Basisof Preparation**

 

Ourunaudited consolidated financial statements have been prepared under the historicalcost convention as modified by the revaluation of derivative financialinstruments, available-for-sale financial assets and investment properties thathave been measured at fair values.  The carrying values of recognized assetsand liabilities that are hedged items in fair value hedges, and are otherwisecarried at cost, are adjusted to record changes in the fair values attributableto the risks that are being hedged.

 

Our unaudited consolidated financial statements havebeen prepared in conformity with accounting principles generally accepted inthe Philippines as set forth under Philippine Financial Reporting Standards, orPFRS.

 

Ourunaudited consolidated financial statements include, in our opinion,adjustments consisting only of normal recurring adjustments, necessary topresent fairly the results of operations for the interim periods.  The resultsof operations for the three months ended March 31, 2007 are not necessarilyindicative of the results of operations that may be expected for the full year.

 

Ourunaudited consolidated financial statements are presented in Philippine pesos,PLDT’s functional and presentation currency and all values are rounded to thenearest million except when otherwise indicated.

 

**Changesin Accounting Policies**

 

Theaccounting policies adopted are consistent with those of the previous financialyear except that we have adopted the following new and amendments to PhilippineAccounting Standards, or PAS, PFRS and Philippine Interpretations ofInternational Financial Reporting Interpretations Committee, or IFRIC, duringthe year.  Our adoption of these revised standards and interpretations did nothave any effect on our financial statements.  Our adoption, however, gave riseto additional disclosures on the following:

 

•        IFRIC 7 – Applying the RestatementApproach under PAS 29, Financial Reporting in Hyperinflationary Economies;

•        IFRIC 8 – Scope of PFRS 2,Share-based Payment;

•        IFRIC 9 – Reassessment of EmbeddedDerivatives;

•        IFRIC 10 – Interim FinancialReporting and Impairment;

•        IFRIC 11 – IFRS 2, Group andTreasury Share Transactions;

•        PAS 1 – Amendments – Presentationof Financial Statements – Capital Disclosures; and

•        PFRS 7 – Financial Instruments -Disclosures.

 

The principal effects of our adoption of the abovestandards are as follows:

 

***IFRIC 7, “Applying the Restatement Approach under PAS29, Financial Reporting in Hyperinflationary Economies”.*** The Interpretation requires that when a countrybecomes hyperinflationary, PAS 29 must be applied as if the country had alwaysbeen hyperinflationary and it provides guidance on calculating deferred taxesand comparatives.  As we do not operate in a hyperinflationary economy, thisstandard has had no impact on our unaudited consolidated financial statements.

 

***IFRIC 8, “Scope of PFRS 2, Share-based Payment”.***  The Interpretation clarifies that *PFRS 2,“Share-based Payment”*, applies to share-based payment transactions in whichthe entity cannot specifically identify some or all of the goods or servicesreceived.  If the value of the identifiable consideration received (if any)appears to be less than the fair value of the equity instruments granted or theliability incurred, this is an indication of other consideration (i.e.,unidentifiable goods or services) has been (or will be) received which shouldbe measured in accordance with PFRS 2.  The adoption has had no significantimpact on our unaudited consolidated financial statements as at March 31, 2007.

 

***IFRIC 9, “Reassessment of Embedded Derivatives”.***  The Interpretation clarifies when an entity shouldreassess whether an embedded derivative needs to be separated from the hostcontract after the initial hybrid contract is recognized.  It concludes thatreassessment is prohibited unless there is a change in the terms of thecontract that significantly modifies the cash flows that otherwise would berequired under the contract, in which case reassessment is required.  Theadoption has had no significant impact on our unaudited consolidated financialstatements as at March 31, 2007.

 

***IFRIC10, “Interim Financial Reporting and Impairment”.***  The Interpretations states that any such impairmentlosses recognized in an interim financial statement must not be reversed insubsequent interim or annual financial statements.  The adoption has had nosignificant impact on our unaudited consolidated financial statements as atMarch 31, 2007.

 

***IFRIC 11, “IFRS 2, Group and Treasury ShareTransactions”.***This******Interpretationaddresses issues whether transactions should be accounted for as equity-settledor as cash-settled under PFRS 2 and issues the concerning share-based paymentarrangement involving entities within the same group.  The adoption has had nosignificant impact on our unaudited consolidated financial statements as atMarch 31, 2007.

 

***TheAmendments to PAS 1, “Presentation of Financial Statements - CapitalDisclosures”.***  This amendmentrequires us to include new disclosures to enable users of the financialstatements to evaluate our objectives, policies and processes for managingcapital.  The adoption has had no significant impact on our unauditedconsolidated financial statements as at March 31, 2007 except for additionaldisclosures as required by the standard.

 

***PFRS 7, “Financial Instruments - Disclosures”.***  This introduces new disclosures to improveinformation about our consolidated financial statements and the nature andextent of risks arising from financial instruments.  The revised disclosures onfinancial instruments provided by this standard are included on our unauditedconsolidated financial statements.

 

**Basis of Consolidation**

 

Our unaudited consolidated financial statementsinclude the financial statements of PLDT and those of the following significantsubsidiaries (collectively, the PLDT Group).

 

**Name of Subsidiary**

**Place of Incorporation**

**Principal Activity**

**Percentage of Ownership**

**Direct**

**Indirect**

** **

 

 

** **

**Wireless**

Smart

Philippines

Cellular mobile services

100.0

–

Smart Broadband, Inc., or Smart Broadband, (formerly Meridian Telekoms, Inc., or Meridian)

Philippines

Internet broadband and distributor

–

100.0

Wolfpac Mobile, Inc., or Wolfpac 

Philippines

Mobile applications developer and  service provider

–

100.0

Pilipino Telephone Corporation, or Piltel

Philippines

Providing cellular and fixed line services

–

92.1

Telesat, Inc., or Telesat

Philippines

Satellite communications services

100.0

–

ACeS Philippines Cellular Satellite  Corporation, or ACeS Philippines

Philippines

Satellite phone services

88.5

11.5

Mabuhay Satellite Corporation, or  Mabuhay Satellite

Philippines

Satellite communications services

67.0

–

** **

 

 

 

 

**Fixed Line**

PLDT Clark Telecom, Inc., or  ClarkTel

Philippines

Telecommunications services

100.0

–

Subic Telecommunications Company, Inc.,  or SubicTel

Philippines

Telecommunications services

100.0

–

PLDT Global Corporation, or PLDT Global

British Virgin Islands

Telecommunications services

100.0

–

Smart-NTT Multimedia, Inc., or SNMI

Philippines

Data and network services

100.0

–

PLDT-Maratel, Inc., or Maratel

Philippines

Telecommunications services

97.5

–

Bonifacio Communications Corporation,  or BCC

Philippines

Telecommunications, infrastructure  and related value-added services

75.0

–

** **

 

 

 

 

**Information and Communications Technology**

ePLDT, Inc., or ePLDT

Philippines

Information and communications infrastructure for internet-based services, e-commerce, call centers  and IT-related services

100.0

–

Vocativ Systems, Inc., or Vocativ

Philippines

Call center services

–

100.0

Parlance Systems, Inc., or Parlance

Philippines

Call center services

–

100.0

ePLDT Ventus, Inc., or Ventus

Philippines

Call center services

–

100.0

SPi Technologies, Inc., or SPi, and Subsidiaries

Philippines

Business process outsourcing, or  BPO, services

–

100.0

Infocom Technologies, Inc., or Infocom

Philippines

Internet services

–

99.6

netGames, Inc., or netGames

Philippines

Publisher of online games

–

80.0

Digital Paradise, Inc., or Digital Paradise, (formerly Netopia Computer Technologies, Inc.)

Philippines

Internet access services

–

75.0

Level Up! (Philippines), Inc., or Level Up!

Philippines

Publisher of online games

–

60.0

Digital Paradise Thailand

Thailand

Internet access services

–

51.0

Airborne Access Corporation, or  Airborne Access

Philippines

Wireless internet services

–

51.0

 

Subsidiariesare consolidated from the date when control is transferred to the PLDT Groupand cease to be consolidated from the date when control is transferred out ofthe PLDT Group.

 

Weprepare our unaudited consolidated financial statements using uniformaccounting policies for like transactions and other events with similarcircumstances.  Intercompany balances and transactions, including intercompanyprofits and unrealized profits and losses, are eliminated.

 

Minority interests represent the equity interests inPiltel, Level Up!, Mabuhay Satellite, Maratel, BCC, Digital Paradise, DigitalParadise Thailand, netGames, Infocom, and Airborne Access, not held by the PLDTGroup.

 

***Smart’s20% Acquisition of******Wolfpac***

 

OnMay 8, 2006, Smart signed a share purchase agreement to acquire the remaining20% equity interest in Wolfpac, a company engaged in the business of consumermobile applications software development and content development.  Smartacquired an 80% equity interest in Wolfpac in October 2003.  The remaining 20%equity interest in Wolfpac was acquired in July 2006.

 

***ePLDT’s Acquisition of Level Up!***

 

On February 16, 2006, ePLDT acquired a 60% equityinterest in Level Up!, a leading publisher of online games in the Philippines.  The acquisition of Level Up!, together with netGames, ePLDT’s online gamingsubsidiary, is aimed to strengthen ePLDT’s online gaming business in the Philippines.  Post-closing conditions were completed on April 30, 2006.  In August 2006,the Shareholders Agreement and Share Purchase Agreement between ePLDT and LevelUp! were amended to reflect the removal of earn-out and price adjustmentprovisions thereby fixing the acquisition for 60% of Level Up! at the originalpurchase price of US$7 million.

 

***ePLDT’s Acquisition of SPi***

 

On July 11, 2006, ePLDT acquired a 100% equityinterest in SPi and its direct and indirect Philippine and offshoresubsidiaries for a total cash consideration of US$135 million.  As part of thetransaction, ePLDT also acquired a US$7 million debt owed by SPi to the sellerat face value.  In addition, ePLDT advanced US$16 million to SPi in order forSPi to fully pay its debt owed to DBS Bank Singapore.  ePLDT currently intendsto have this debt refinanced by SPi in due course.

 

***SPi’sAcquisition of CyMed, Inc., or CyMed***

 

OnAugust 11, 2006, SPi in turn acquired a 100% equity interest in CyMed for anaggregate purchase price of US$35 million, inclusive of certain debtobligations.  CyMed is a leading medical transcription company based in Richmond, Virginia, United States of America (USA).  It provides medical transcriptionservices and technology products through proprietary processes based on SixSigma quality management principles.  

 

***SPi’sAcquisition of Springfield Service Corporation, or Springfield***

 

On April 16, 2007, SPi acquired, through awholly-owned US subsidiary, 100% of Springfield for an aggregate purchase priceof US$44 million, plus possible future earn out payments.

 

Springfield, the 10th largest player in the medicalbilling and revenue cycle management market, has 383 employees operating in 5locations in the US and provides billing and accounts receivable managementservices for over US$1.3 billion of physician charges annually.  Springfield offers practice management services including patient scheduling, coding andcompliance assistance consulting and specialized reporting services. Springfield is known for its superior operational capability on the GE Centricity BusinessSystem (formerly known as IDX Flowcast) and EPIC, two of the leading platformsin the industry, strong client relationships and experienced management team.

 

***Piltel’sEquity Restructuring***

 

OnApril 20, 2007, the SEC approved Piltel’s request to undergo equityrestructuring to eliminate the deficit of Piltel as at December 31, 2006amounting to Php22,251 million against the additional paid-in capital.  Theequity restructuring was approved by Piltel’s Board of Directors on March 5,2007.

*** ***

***Investments in Associates***

 

Investment in associates is accounted for using theequity method of accounting.  An associate is an entity in which we havesignificant influence and which is neither a subsidiary nor a joint venture.

 

Underthe equity method, the investment in the associate is carried in the balancesheet at cost plus post acquisition changes in our share of net assets of theassociate.  Goodwill relating to an associate is included in the carryingamount of the investment and is not amortized.  The consolidated statement ofincome reflects the share of the results of operations of the associate.  Wherethere has been a change recognized directly in the equity of the associate, werecognize our share in any change and disclose this, when applicable, in ourconsolidated statements of changes in equity.  Profits and losses resultingfrom our transactions with and among our associates are eliminated to theextent of the interest in the associate.

 

Our reporting dates and that of our associates areidentical and our associate’s accounting policies conform to those used by usfor like transactions and events in similar circumstances.

 

***ForeignCurrency Translation***

 

Thefunctional and presentation currency of the PLDT Group (except for MabuhaySatellite, PLDT Global, Digital Paradise Thailand and SPi and certain of itssubsidiaries) is the Philippine peso.  Transactions in foreign currencies areinitially recorded in the functional currency rate prevailing at the date ofthe transaction.  Monetary assets and liabilities denominated in foreigncurrencies are translated at the functional currency rate of exchange prevailingat the balance sheet date.  All differences are recognized in the consolidatedstatement of income except for foreign exchange losses that qualify ascapitalizable borrowing costs during the construction period.  For income taxpurposes, exchange gains or losses aretreated as taxable income or deductible expenses in the period such exchangegains or losses are realized.

 

Thefunctional currency of Mabuhay Satellite, PLDT Global, SPi and certain of its subsidiaries is the U.S. dollar and Digital Paradise Thailand is the Thai baht.  As at the reporting date, the assets andliabilities of these subsidiaries are translated into the presentation currencyof the PLDT Group at the rate of exchange prevailing at the balance sheet date,and income and expenses of these subsidiaries are translated at the weightedaverage exchange rate for the period.  The exchange differences arising ontranslation are taken directly to a separate component of equity as cumulativetranslation adjustments.  On disposal of these subsidiaries, the amount of thecumulative translation adjustments recognized in equity relating tosubsidiaries are recognized in the consolidated statement of income. 

 

***Property, Plant and Equipment***

 

Property, plant and equipment, except for land, arestated at cost less accumulated depreciation and amortization and anyimpairment in value.  Land is stated at cost less any impairment in value.

The initial cost of property, plant and equipmentcomprises its purchase price and any costs directly attributable in bringingthe asset to its working condition and location for its intended use.Expenditures incurred after the assets have been put into operation, such asrepairs and maintenance and overhaul costs, are normally charged to income inthe period the costs are incurred.  In situations where it can be clearlydemonstrated that the expenditures have resulted in an increase in the futureeconomic benefits expected to be obtained from the use of an item of property,plant and equipment beyond its originally assessed standard of performance, theexpenditures are capitalized as additional costs of property, plant andequipment.  Cost also includes asset retirement obligation, interest onborrowed funds used during the construction period and qualified borrowingcosts from foreign exchange losses related to foreign currency-denominatedliabilities used to acquire such qualifying assets.  When assets are sold orretired, their costs and accumulated depreciation, amortization and impairmentlosses, if any, are eliminated from the accounts and any gain or loss resultingfrom their disposal is included in the unaudited consolidated statement ofincome of such period.

 

Depreciation and amortization are calculated on astraight-line basis over the estimated useful lives of the assets.

 

Theuseful lives and depreciation and amortization method are reviewed periodicallyto ensure that the periods and method of depreciation and amortization areconsistent with the expected pattern of economic benefits from items ofproperty, plant and equipment.  

 

Property under construction is stated at cost.  Thisincludes cost of construction, plant and equipment and other direct costs.Property under construction is not depreciated until such time that therelevant assets are completed and available for their intended use.

 

***Borrowing Costs***

 

Borrowing costs are capitalized if they are directlyattributable to the acquisition, construction or production of a qualifyingasset.  Capitalization of borrowing costs commences when the activities forintended use are in progress and expenditures and borrowing costs are beingincurred.  Borrowing costs are capitalized until the assets are ready for theirintended use.  If the resulting carrying amount of the asset exceedsits recoverable amount, an impairment loss is recognized.  Borrowing costsinclude interest charges and other costs incurred in connection with theborrowing of funds, as well as exchange differences arising from foreigncurrency borrowings used to finance these projects to the extent that they areregarded as an adjustment to interest cost.  

 

Allother borrowing costs are expensed as incurred.

 

Borrowingcosts are treated as deductible expenses for income tax reporting purposes inthe period they are incurred or realized.

 

***Asset Retirement Obligations***

 

Weare legally required under various lease agreements to dismantle theinstallations on leased sites and restore such sites to their originalcondition at the end of the lease contract term.  We recognized the fair valueof the liability for these obligations and capitalized the present value ofthese costs as part of the balance of the related property and equipmentaccounts, which are being depreciated on a straight-line basis over the usefullives of the related assets or the contract periods, whichever is shorter.

 

***Investment Properties***

 

Initially,investment properties are measured at cost including transaction costs.  Thecarrying amount includes the cost of replacing part of an existing investmentproperty at the time that cost is incurred if the recognition criteria are met;and excludes the costs of day to day servicing of an investment property.Subsequent to initial recognition, investment properties are stated at fairvalue, which reflects market conditions at the balance sheet date.  Gains orlosses arising from changes in the fair values of investment properties areincluded in the consolidated statement of income in the period in which theyarise.  

 

Investmentproperties are derecognized when they have either been disposed of or when theinvestment property is permanently withdrawn from use and no future benefit isexpected from its disposal.  Any gain and loss on the retirement or disposal ofan investment property is recognized in the consolidated statement of income inthe period of retirement or disposal.

 

***Business Combinations and Goodwill***

 

Business combinations are accounted for using thepurchase method of accounting.  This involves recognizing identifiable assets(including previously unrecognized intangible assets) and liabilities(including contingent liabilities and excluding future restructuring) of ouracquired business at fair value.

 

Goodwillacquired in a business combination is initially measured at cost, such cost,being the excess of the cost of the business combination over our interest inthe net fair value of the acquiree’s identifiable assets, liabilities andcontingent liabilities.  Following initial recognition, goodwill is measured atcost less any accumulated impairment losses.  For the purpose of impairmenttesting, goodwill acquired in a business combination is, from the acquisitiondate, allocated to each of our cash generating units, or groups of our cashgenerating units, that are expected to benefit from the synergies of thecombination, irrespective of whether our other assets or liabilities areassigned to those units or groups of units.  Each unit or group of units towhich the goodwill is allocated:  (1) represents our lowest level at which thegoodwill is monitored for internal management purposes; and (2) is not larger thana segment based on either our primary or secondary reporting format determinedin accordance with *PAS 14, “Segment Reporting”*.

 

Wheregoodwill forms part of a cash-generating unit (group of cash generating units)and part of the operation within that unit is disposed of, the goodwillassociated with the operation disposed of is included in the carrying amount ofthe operation when determining the gain or loss on disposal of the operation.Goodwill disposed of in this circumstance is measured based on the relativevalues of the operation disposed of and the portion of the cash-generating unitretained.

 

Whensubsidiaries are sold, the difference between the selling price and the netassets plus cumulative translation differences and unamortized goodwill isrecognized in the consolidated statement of income.

 

***Intangible Assets***

 

Intangible assets acquired separately are measured oninitial recognition at cost.  The cost of intangible assets acquired frombusiness combinations is initially recognized at fair value as at the date ofacquisition.  Following initial recognition, intangible assets are carried atcost less any accumulated amortization and any accumulated impairment loss.The useful lives of intangible assets are assessed at the individual asset levelas having either a finite or indefinite life.

 

Intangibleassets with finite lives are amortized over the useful economic life using thestraight-line method and assessed for impairment whenever there is anindication that the intangible assets may be impaired.  At a minimum, theamortization period and the amortization method for an intangible asset with afinite useful life is reviewed at each financial period end.  Changes in theexpected useful life or the expected pattern of consumption of future economicbenefits embodied in the asset are accounted for by changing the amortizationperiod, as appropriate, and treated as changes in accounting estimates.  Theamortization expense on intangible assets with finite lives is recognized inthe consolidated statement of income in the expense category consistent withthe function of the intangible asset.

 

Intangible assets with indefinite useful lives aretested for impairment annually either individually or at the cash-generatingunit level.  Such intangible assets are not amortized.  The useful life of anintangible asset with an indefinite life is reviewed annually to determinewhether indefinite life assessment continues to be supportable.  If not, thechange in the useful life assessment from indefinite to finite is made on aprospective basis.

 

Gains or losses arising from derecognition of anintangible asset are measured as the difference between the net disposalproceeds and the carrying amount of the asset and are recognized in theconsolidated statement of income when the asset is derecognized.

 

Intangible assets created within the business are notcapitalized and expenditure is charged against operations in the period inwhich the expenditure is incurred.

 

***Impairmentof Non-Financial Assets***

 

Weassess at each reporting period whether there is an indication that an assetmay be impaired.  If any such indication exists, or when the annual impairmenttesting for an asset is required, we make an estimate of the asset’srecoverable amount.  An asset’s recoverable amount is the higher between anasset’s or cash-generating unit’s fair value less costs to sell or its value inuse and is determined for an individual asset, unless the asset does notgenerate cash inflows that are largely independent from those of other assetsor groups of assets.  Where the carrying amount of an asset exceeds itsrecoverable amount, the asset is considered impaired and is written down to itsrecoverable amount.  In assessing the value in use, the estimated future cashflows are discounted to their present value using a pre-tax discount rate thatreflects current market assessments of the time value of money and the risksspecific to the asset.  In determining the fair value less costs to sell, anappropriate valuation model is used.  These calculations are corroborated byvaluation multiples, quoted share prices for publicly traded subsidiaries orother available fair value indicators.

 

Impairmentlosses of continuing operations are recognized in the consolidated statement ofincome in those expense categories consistent with the function of the impairedasset, except for property previously revalued where the revaluation was takento equity.  In this case, the impairment is also recognized in equity up to theamount of any previous revaluation.

 

Forassets excluding goodwill, an assessment is made at each reporting date as towhether there is any indication that previously recognized impairment lossesmay no longer exist or may have decreased.  If such indication exists, we makean estimate of recoverable amount.  A previously recognized impairment loss isreversed only if there has been a change in the estimates used to determine theasset’s recoverable amount since the last impairment loss was recognized.  Ifthis is the case, the carrying amount of the asset is increased to itsrecoverable amount.  That increased amount cannot exceed the carrying amountthat would have been determined, net of depreciation, had no impairment lossbeen recognized for the asset in prior periods.  Such reversal is recognized inthe consolidated statement of income.  After such a reversal, the depreciationcharged is adjusted in future periods to allocate the asset’s revised carryingamount, less any residual value, on a systematic basis over its remaininguseful life.

 

The following criteria are also applied in assessingimpairment of specific assets:

 

*Goodwill*

 

Goodwillis reviewed for impairment, annually or more frequently if events or changes incircumstances indicate that the carrying value may be impaired.

 

Impairment is determined for goodwill by assessing therecoverable amount of the cash-generating unit (or group of cash-generatingunits), to which the goodwill relates.  Where the recoverable amount of thecash-generating unit (or group of cash-generating units) is less than thecarrying amount of the cash-generating unit (group of cash-generating units) towhich goodwill has been allocated, an impairment loss is recognized.Impairment losses relating to goodwill cannot be reversed in future periods.  

 

*IntangibleAssets*

 

Intangibleassets with indefinite useful lives are tested for impairment annually eitherindividually or at the cash generating unit level, as appropriate.

 

*Associates*

*** ***

After application of the equity method, we determinewhether it is necessary to recognize an additional impairment loss of ourinvestment in associates.  We determine at each balance sheet date whetherthere is any objective evidence that our investment in an associate isimpaired.  If this is the case, we calculate the amount of impairment as beingthe difference between the fair value of the associate and the carrying amountand recognize the amount in the consolidated statement of income.

 

***Research and Development Costs***

 

Research and development costs are expensed asincurred.

 

***Cash and Cash Equivalents***

 

Cashincludes cash on hand and in banks.  Cash equivalents are short-term, highlyliquid investments that are readily convertible to known amounts of cash withoriginal maturities of three months or less from the date of acquisition andthat are subject to an insignificant risk of change in value.

 

***Tradeand Other Receivables***

 

Trade andother receivables are stated at face value, net of an allowance for any doubtfulaccounts.

 

***Allowance for Doubtful Accounts***

 

ThePLDT Group’s accounting policy in evaluating any impairment of receivable isdiscussed under impairment of financial assets section of this Note.Consequently, allowance for doubtful accounts is maintained at a levelconsidered adequate to provide for uncollectible receivables.  The level ofallowance is based on historical collections, write-off experience, currenteconomic trends, changes in our customer payment terms and other factors thatmay affect our ability to collect payments.  An evaluation of the receivables,designed to identify potential charges to the allowance, is performed on acontinuous basis during the period.

 

*Subscribers*.Full allowance is provided for receivables from permanently disconnectedsubscribers.  Permanent disconnections are made after a series of collectionsteps following non-payment by subscribers.  Such permanent disconnectionsgenerally occur within 105 days from the date of payment was due.  Partialallowance is provided for active subscribers based on the historical lossexperience and aging profile of the receivable.

 

*Trafficsettlement receivables - net*.  Fullallowance is provided for carrier accounts which are considered over-due andafter a review of the status of settlement with other carriers.

 

***Inventories and Supplies***

 

Inventories and supplies which include, among otherthings, cellular phone units, materials, spare parts, terminal units andaccessories, are valued at the lower of cost and net realizable value.

 

Cost is determined using the moving average method.Net realizable value is the estimated selling price in the ordinary course ofthe business less the estimated cost to sell.

 

***Interest-bearing Financial Liabilities***

 

Allloans and borrowings are initially recognized at the fair value of theconsideration received less directly attributable transaction costs.

 

After initial recognition, interest-bearing loans andborrowings are subsequently measured at amortized cost using the effectiveinterest method.

 

Gainsand losses are recognized in the consolidated statement of income when theliabilities are derecognized as well as through the amortization process.

 

***Convertible Preferred Stock***

 

*Peso-denominated*

 

The component of our convertible preferred stock thatexhibits characteristics of a liability is recognized as a liability in theconsolidated balance sheet, net of transaction costs.  The correspondingdividends on those shares are charged as interest expense in the consolidatedstatement of income.  On issuance of our convertible preferred stock, the fair valueof the liability component is determined using a market rate for an equivalentnon-convertible bond and this amount is carried as a long-term liability on theamortized cost basis until extinguished on conversion or redemption.

 

The remainder of the proceeds are allocated to theconversion option that is recognized and included in the equity section of theconsolidated balance sheets, net of transaction costs.  The carrying amount ofthe conversion option is not re-measured in subsequent periods.

 

Transaction costs are apportioned between theliability and equity components of the convertible preferred stock based on theallocation of proceeds to the liability and equity components when theinstruments are first recognized.

 

*Foreigncurrency-denominated*

 

Wetreated the Series VI and VII Convertible Preferred Stock as debt instrumentswith embedded call options.  The fair value of embedded call options as ofissuance date was bifurcated and thereafter accounted for separately at fairvalue through profit and loss.  The residual amount was assigned as a liabilitycomponent and accreted to the redemption amount up to the call option dateusing the effective interest rate method.

 

***Provisions***

 

Werecognize provisions when we have present obligations, legal or constructive,as a result of past events, and when it is probable that an outflow ofresources embodying economic benefits will be required to settle the obligationand a reliable estimate can be made of the amount of the obligation.  Where weexpect some or all of a provision to be reimbursed, the reimbursement isrecognized as a separate asset but only when the reimbursement is virtuallycertain.  The expense relating to any provision is presented in theconsolidated statement of income, net of any reimbursements.  If the effect ofthe time value of money is material, provisions are discounted using a current pre-taxrate that reflects, where appropriate, the risks specific to the liability.Where discounting is used, the increase in the provision due to the passage oftime is recognized as additional provisions.

 

***RetirementBenefits***

 

We havefunded retirement plans, administered by our respective Fund’s Trustees,covering permanent employees.  Retirement costs are actuarially determinedusing the projected unit credit of accrued benefit valuation method.  Thismethod reflects services rendered by employees to the date of valuation andincorporates assumptions concerning employees’ projected salaries.  Retirementcosts include current service cost plus amortization of past service cost,experience adjustments and changes in actuarial assumptions.  Past service costis recognized as an expense on a straight-line basis over the average perioduntil the benefits become vested.  If the benefits are already vestedimmediately following the introduction of, or changes to, a pension plan, pastservice cost is recognized immediately.  Actuarial gains and losses arerecognized as income or expense when the net cumulative unrecognized actuarialgains and losses at the end of the previous reporting period exceeded 10% ofthe higher of the defined benefit obligation and the fair value of plan assetsat that date.  These gains and losses are recognized over the expected averageremaining working lives of the employees participating in the plan.

 

Thedefined benefit asset or liability comprises the present value of the definedbenefit obligation less past service cost not yet recognized and less the fairvalue of plan assets out of which the obligations are to be settled directly.The value of any asset is restricted to the sum of any past service cost notyet recognized and the present value of any economic benefits available in theform of refunds from the plan or reductions in the future contributions to theplan.

 

Upon our adoption of PAS 19 in 2004, we opted toamortize our transition liabilities for the three years until December 31,2006, see *Note 21 – Employee Benefits*.

 

***Share-Based PaymentTransactions***

 

Certain of our employees (including directors) receiveremuneration in the form of share-based payment transactions, whereby employeesrender services in exchange for shares or rights over shares (“equity-settledtransactions”).

 

*Equity-settledtransactions*

 

Thecost of equity-settled transactions with employees is measured by reference tothe fair value of the stock options at the date at which they are granted.Fair value is determined using an option-pricing model, further details ofwhich are set forth in *Note 21 – Employee Benefits*.  In valuingequity-settled transactions, no account is taken of any performance conditions,other than conditions linked to the price of the shares of PLDT (“marketconditions”).

 

Thecost of equity-settled transactions is recognized, together with acorresponding increase in equity, over the period in which the performanceconditions are fulfilled, ending on the date on which the relevant employeesbecome fully entitled to the award (“vesting date”).  The cumulative expenserecognized for equity-settled transactions at each reporting date until thevesting date reflects the extent to which the vesting period has expired andthe number of awards that will ultimately vest, in the opinion of PLDT’s Boardof Directors, at that date, based on the best available estimate.

 

Noexpense is recognized for awards that do not ultimately vest, except for awardswhere vesting is conditional upon a market condition, which are treated asvesting irrespective of whether or not the market condition is satisfied,provided that all other performance conditions are satisfied.

 

Where the terms of an equity-settled award aremodified, an expense, at a minimum, is recognized as if the terms had not beenmodified.  An expense is recognized for any increase in the value of thetransactions as a result of the modification, as measured at the date ofmodification.

 

Where anequity-settled award is cancelled, it is treated as if it had vested on thedate of cancellation, and any expense not yet recognized for the award isrecognized immediately.  However, if a new award is substituted for thecancelled award, and designated as a replacement award on the date that it isgranted, the cancelled and new awards are treated as if they were modificationsof the original award, as described in the previous paragraph.

 

The dilutive effect of outstanding options isreflected as additional share dilution in the computation of earnings pershare, see *Note 7 – Earnings Per Common Share*.

 

*Cash-settledtransactions*

 

Our Long-Term Incentive Plan, or LTIP, grants shareappreciation rights, or SARs, to our eligible key executives and advisors.Under the LTIP, we recognize the services we receive from the eligible keyexecutives and advisors, and our liability to pay for those services, as theeligible key executives and advisors render services during the vestingperiod.  We measure our liability, initially and at each reporting date untilsettled, at the fair value of the SARs, by applying an option valuation model,taking into account the terms and conditions on which the SARs were granted,and the extent to which the eligible key executives and advisors have renderedservice to date.  We recognize any changes in fair value at each reporting dateuntil settled, in the results of operations for the period.

 

***Leases***

 

The determination of whether an arrangement contains alease is based on the substance of the arrangement at the inception date ofwhether the fulfillment of the arrangement is dependent on the use of aspecific asset or assets or the arrangement conveys a right to use the asset.  Areassessment is made after the inception date of the lease only if thefollowing criteria apply: (1) there is a change in the contractual terms, otherthan a renewal or extension of the arrangement; (2) a renewal option isexercised or an extension is granted, unless the term of the renewal orextension was initially included in the lease term; (3) there is a change inthe determination of whether fulfillment is dependent on a specified asset; or(4) there is a substantial change to the asset.

 

Wherea reassessment is made, lease accounting commences or ceases, as the case maybe, from the date when the change in circumstances gives rise to thereassessment for scenarios (1), (3) or (4) and at the date of renewal orextension period for scenario (2).

 

Forarrangements entered into prior to January 1, 2005, the date of inception isdeemed to be January 1, 2005 in accordance with the transitional requirementsof *IFRIC 4, “Determining Whether an Arrangement Contains a Lease”*.

 

Lease obligations having provisions for bargainpurchase options, ownership transfer at the end of the lease term, or where thepresent value of minimum lease payments approximate the fair market value ofthe property, are capitalized.  Any initial direct costs of the lessee areadded to the amount capitalized.  The related obligations are recognized asliabilities.  Finance lease payments are apportioned between the financecharges and reduction of the lease liability so as to achieve a constant rateof interest on the remaining balance of the liability.  Finance charges arecarried in the consolidated statement of income.

 

A financelease gives rise to a depreciation expense for the asset as well as a borrowingcost for each period.  Finance charges are charged directly to current operationsin the period such finance charges are incurred.  The depreciation policy forleased assets is consistent with that for depreciable assets that are owned.

 

Capitalizedleased assets are depreciated over the shorter of the estimated useful life ofthe asset or the lease term, if there is no reasonable certainty that we willobtain ownership of the leased asset at the end of the lease term.

 

Leases where the lessor retains substantially all therisks and benefits of ownership of the asset are classified as operatingleases.  Operating lease payments are recognized as an expense in theconsolidated statement of income on a straight-line basis over the lease term.For income tax reporting purposes, expenses that should have been incurredunder a lease agreement are considered as deductible expenses.

 

***RevenueRecognition***

 

Revenues for services are stated at amounts invoiced tocustomers, excluding value-added tax, or VAT.  We provide wirelesscommunication, fixed line communication, and information and communicationstechnology services.  We provide such services to mobile, business, residentialand payphone customers.  Revenues represent the value of fixed considerationthat have been received or are receivable.  Revenues are recognized when thereis evidence of an arrangement, collectibility is reasonably assured, and thedelivery of the product or service has occurred.  In certain circumstances,revenue is split into separately identifiable components and recognized whenthe related components are delivered in order to reflect the substance of thetransactions.  The value of components is determined using verifiable objectiveevidence.  Under certain arrangements where the above criteria are met, butthere is uncertainty regarding the outcome of the transaction for which servicewas rendered, revenue is recognized only to the extent of expenses incurred forrendering the service, and such amount is determined to be recoverable.  We donot provide our customers with the right to a refund.

 

*Service revenues*

 

*Subscriptions*

 

We provide telephone and data communication servicesunder prepaid and postpaid payment arrangements.  Revenues, including fees forinstallation and activation, are accrued upon subscription.

 

*Air time, traffic and value-added services*

 

Prepaidservice revenues collected in advance are deferred and recognized based on theearlier of actual usage or upon expiration of the usage period.Interconnection revenues for call termination, call transit, and network usageare recognized in the period the traffic occurs.  Revenues related to local,long distance, network-to-network, roaming and international call connectionservices are recognized when the call is placed or connection is provided, netof amounts payable to other telecommunication carriers for terminating calls intheir territories.  Revenues related to products and value-added services arerecognized upon delivery of the product or service.

 

*Business Process Outsourcing, or BPO*

 

Where applicable, supplemental revenuesare recognized depending on service levels or achievement of certainperformance measurement targets.  We recognize these supplemental revenues onlyafter it has achieved the required measurement targets.  When these servicelevels or performance measurement targets are not achieved, we grant service creditsas a reduction in fees.  Advance customer receipts that have not beenrecognized as revenue in accordance with its stated policies are recorded asadvances from customers and presented as a liability in the consolidated balancesheet.  If the fee is not fixed or determinable, revenue is not recognized onthose arrangements until the customer payment is received.  For arrangementsrequiring specific customer acceptance, revenue recognition is deferred untilthe earlier of the end of the deemed acceptance period or until a writtennotice of acceptance is received from the customer.  Revenue on servicesrendered to customers whose ability to pay is in doubt at the time ofperformance of services is also not recorded.  Rather, revenue is recognizedfrom these customers as payment is received.

* *

*Incentives*

* *

Werecord insignificant commission expenses based on the number of new subscriberconnections initiated by certain dealers.  All other cash incentives providedto dealers and customers are recorded as a reduction of revenue.  Product-basedincentives provided to dealers and customers as part of a transaction areaccounted for as multiple element arrangements and recognized when earned.

* *

*Non-service revenues*

* *

*Handset and equipment sales*

* *

Salesof cellular handsets and communication equipment are recognized upon deliveryto the customer.

 

*Interestincome*

 

Interest income is recognized as it accrues on a timeproportion basis taking into account the principal amount outstanding and theeffective interest rate.

 

***Income Taxes***

 

*Current tax*

 

Current tax assets and liabilities for the current andprior periods are measured at the amount expected to be recovered from or paidto the taxation authorities.  The tax rates and tax laws used to compute theamount are those that are enacted or substantively enacted as at the balancesheet date.

 

*Deferred income tax*

 

Deferred income tax is provided using the balancesheet liability method on all temporary differences at the balance sheet datebetween the tax bases of assets and liabilities and their carrying amounts forfinancial reporting purposes.

 

Deferredincome tax liabilities are recognized for all taxable temporary differencesexcept: (1) when the deferred income tax liability arises from the initialrecognition of goodwill or of an asset or liability in a transaction that isnot a business combination and, at the time of the transaction, affects neitherthe accounting profit nor taxable profit or loss and (2) with respect totaxable temporary differences associated with investments in subsidiaries,associates and interests in joint ventures, where the timing of the reversal ofthe temporary differences can be controlled and it is possible that thetemporary differences will not reverse in the foreseeable future.  Deferredincome tax assets are recognized for all deductible temporary differences,carryforward of unused tax credits from excess minimum corporate income tax, orMCIT, and unused tax losses, to the extent that it is probable that taxableprofit will be available against which the deductible temporary differences andcarryforward of unused tax credits and unused tax losses can be utilizedexcept: (1) when the deferred tax asset relating to the deductible temporarydifference arises from the initial recognition of an asset or liability in atransaction that is not a business combination and, at the time of thetransaction, affects neither the accounting profit nor taxable profit or lossand (2) with respect to deductible temporary differences associated withinvestments in subsidiaries, associates and interests in joint ventures,deferred tax assets are recognized only to the extent that it is probable thatthe temporary differences will reverse in the foreseeable future and taxableprofit will be available against which the temporary differences can beutilized.

 

Deferred income tax liabilities are not provided onnon-taxable temporary differences associated with investments in domesticsubsidiaries and associates.  With respect to investments in other subsidiariesand associates, deferred tax liabilities are recognized except when the timingof the reversal of the temporary difference can be controlled and it isprobable that the temporary difference will not reverse in the foreseeable future.

 

Thecarrying amount of deferred income tax assets are reviewed at each balancesheet date and reduced to the extent that it is no longer probable thatsufficient taxable profit will be available to allow all or part of thedeferred income tax asset to be utilized.  Unrecognized deferred income taxassets are reassessed at each balance sheet date and are recognized to theextent that it has become probable that future taxable profit will allow thedeferred income tax asset to be recovered.

 

Deferredincome tax assets and liabilities are measured at the tax rates that areexpected to apply in the period when the asset is realized or the liability issettled, based on tax rates (and tax laws) that have been enacted orsubstantively enacted as at the balance sheet date.

 

Incometax relating to items recognized directly in equity is included in the relatedequity account and not in the consolidated statement of income.

 

Deferred income taxassets and liabilities are offset, if a legally enforceable right exists tooffset deferred income tax assets againstdeferred income tax liabilities and thedeferred taxes relate to the same taxable entity and the same taxationauthority.

 

***Earnings Per Common Share, or EPS***

 

Basic EPS is calculated by dividing the consolidated netincome for the period attributable to common shareholders (consolidated netincome adjusted for dividends on all series of preferred shares except fordividends on preferred stock subject to mandatory redemption) by the weightedaverage number of common shares outstanding during the period, after givingretroactive effect to any stock dividend declarations.

 

DilutedEPS is calculated in the same manner assuming that, at the beginning of the periodor at the time of issuance during the period, all outstanding options areexercised and convertible preferred shares are converted to common shares, andappropriate adjustments to consolidated net income are effected for the relatedexpenses and income on preferred shares.  Outstanding stock options will have adilutive effect under the treasury stock method only when the average marketprice of the underlying common share during the period exceeds the exerciseprice of the option.  

 

Where the effect of the assumed conversion of thepreferred shares and the exercise of all outstanding options have ananti-dilutive effect, basic and diluted EPS are stated at the same amount.

 

If the required dividends to be declared on eachseries of convertible preferred shares divided by the number of equivalentcommon shares, assuming such convertible preferred shares are converted tocommon shares, would decrease the basic EPS, then such convertible preferredshares would be deemed dilutive.  As such, the diluted EPS will be calculatedby dividing consolidated net income attributable to common shareholders(consolidated net income, adding back any dividends and/or other chargesrecognized in the period related to the dilutive convertible preferred sharesclassified as liability, less dividends on non-dilutive preferred shares exceptfor dividends on preferred stock subject to mandatory redemption) by theweighted average number of common shares including the common share equivalentarising from the conversion of the dilutive convertible preferred shares.

 

***Investmentsand Other Financial Assets and Liabilities***

 

Financial assets and liabilities within the scope of PAS39 are classified as either financial assets and liabilities at fair valuethrough profit or loss, loans and receivables, held-to-maturity investments,and available-for-sale financial assets, as appropriate.  We determine theclassification of our financial assets and liabilities after initialrecognition and, where allowed and appropriate, re-evaluates this designationat each balance sheet date.  When financial assets and liabilities arerecognized initially, they are measured at fair value, plus, in the case ofinvestments not at fair value through profit or loss, directly attributable totransaction costs.  The fair value of investments that are actively traded inorganized financial markets is determined by reference to quoted market bidprices at the close of business on the balance sheet date.  For investmentswhere there is no active market, fair value is determined using valuationtechniques.  Such techniques include using recent arm’s length markettransactions; reference to the current market value of another instrument whichis substantially the same; discounted cash flow analysis or other valuationmodels.

 

Allregular way purchases and sales of financial assets are recognized on the tradedate, which is the date that we commit to purchase the asset.  Regular waypurchases or sales are purchases or sales of financial assets that requiredelivery of assets with the period generally established by regulation orconvention in the market place.

 

*Financial assets and liabilities at fair value throughprofit or loss*

 

Financialassets and liabilities at fair value through profit or loss includes financialassets and liabilities held for trading and financial assets and liabilitiesdesignated upon initial recognition as at fair value through profit and loss.

 

Financialassets and liabilities are classified as held for trading if they are acquiredfor the purpose of selling in the near term.  Derivatives, including separatedembedded derivatives are also classified as held for trading unless they aredesignated as effective hedging instruments or a financial guarantee contract.Gains or losses on investments or liabilities held for trading are recognizedin profit and loss.

 

Where acontract contains one or more embedded derivatives, the entire hybrid contractmay be designated as a financial asset and financial liability at fair valuethrough profit or loss, except where the embedded derivative does notsignificantly modify the cash flows or it is clear that separation of theembedded derivative is prohibited.

 

Financialassets and liabilities may be designated at initial recognition as at fairvalue through profit or loss if the following criteria are met: (i) the designationeliminates or significantly reduces the inconsistent treatment that wouldotherwise arise from measuring the assets and liabilities or recognizing gainsor losses on them on a different basis; or (ii) the assets and liabilities arepart of a group of financial assets which are managed and their performanceevaluated on a fair value basis, in accordance with a documented riskmanagement strategy; or (iii) the financial assets and liabilities contains anembedded derivative that would need to be separately recorded.

 

*Held-to-maturityinvestments*

 

Held-to-maturity investments are non-derivativefinancial assets which carry fixed or determinable payments and fixedmaturities and which we have the positive intention and ability to hold tomaturity.  After initial measurement held-to-maturity, investments are measuredat amortized cost.  This cost is computed as the amount initially recognizedminus principal repayments, plus or minus the cumulative amortization using theeffective interest rate method of any difference between the initiallyrecognized amount and the maturity amount, less allowance for impairment.  Thiscalculation includes all fees and points paid or received between parties tothe contract that are an integral part of the effective interest rate method,transaction costs and all other premiums and discounts.  Gains and losses arerecognized in the consolidated statement of income when the investments arederecognized or impaired, as well as through the amortization process.

 

*Loansand receivables*

 

Loans andreceivables are non-derivative financial assets with fixed or determinablepayments that are not quoted in an active market.  After initial measurement,loans and receivables are subsequently carried at amortized cost using theeffective interest rate method less any allowance for impairment.  Amortizedcost is calculated taking into account any discount or premium on acquisitionand includes fees that are an integral part of the effective interest ratemethod and transaction costs.  Gains and losses are recognized in theconsolidated statement of income when the loans and receivables arederecognized or impaired, as well as through the amortization process.

* *

*Available-for-sale financial investments*

 

Available-for-salefinancial assets are those non-derivative financial assets that are designatedas available-for-sale or are not classified in any of the three precedingcategories.  After initial measurement, available-for-sale financial assets aremeasured at fair value with unrealized gain or loss being recognized directlyin equity in the cumulative translation adjustments except when the financialasset is impaired.  When the investment is disposed of, the cumulative gain orloss previously recorded in equity is recognized in the consolidated statementof income.  Interest earned or paid on the investments is reported as interestincome or expense using the effective interest rate method.  Dividends earnedon investments are recognized in the consolidated statement of income when theright of payment has been established.

 

Weconsider whether a contract contains an embedded derivative, when the entityfirst becomes a party to it.  The embedded derivatives are separated from thehost contract which is not measured at fair value through profit or loss whenthe analysis shows that the economic characteristics and risks of embeddedderivatives are not closely related to those of the host contract.

 

***Impairment of Financial Assets***

 

We assessat each balance sheet date whether a financial asset or group of financialassets is impaired.

 

*Assetscarried at amortized cost*

*** ***

Ifthere is objective evidence that an impairment loss on loans and receivablescarried at amortized cost has been incurred, the amount of the loss is measuredas the difference between the asset’s carrying amount and the present value ofestimated future cash flows (excluding future expected credit losses that havenot been incurred) discounted at the financial asset’s original effectiveinterest rate (i.e., the effective interest rate computed at initialrecognition).  The carrying amount of the asset is reduced through an allowanceaccount.  The amount of the loss is recognized in the consolidated statement of income.

 

Wefirst assess whether objective evidence of impairment exists individually forfinancial assets that are individually significant, and individually orcollectively for financial assets that are not individually significant.  If itis determined that no objective evidence of impairment exists for anindividually assessed financial asset, whether significant or not, the asset isincluded in a group of financial assets with similar credit riskcharacteristics and that group of financial assets is collectively assessed forimpairment.  Assets that are individually assessed for impairment and for whichan impairment loss is or continues to be recognized are not included in acollective assessment of impairment.

 

If,in a subsequent period, the amount of the impairment loss decreases and thedecrease can be related objectively to an event occurring after the impairmentwas recognized, the previously recognized impairment loss is reversed.  Anysubsequent reversal of an impairment loss is recognized in the consolidated statement of income, to the extent thatthe carrying value of the asset does not exceed its amortized cost at thereversal date.

 

Inrelation to trade receivables, a provision for impairment is made when there isobjective evidence (such as the probability of insolvency or significantfinancial difficulties of the debtor) that we will not be able to collect allof the amounts due under the original terms of the invoice.  The carryingamount of the receivable is reduced through an allowance account.  Impaireddebts are derecognized when they are assessed as uncollectible.

 

*Available-for-salefinancial**investments*

 

Ifan available-for-sale asset is impaired, an amount comprising the differencebetween its cost (net of any principal payment and amortization) and itscurrent fair value, less any impairment loss previously recognized in the consolidated statement of income, is transferred fromequity to the consolidated statement of income.  Reversals in respect of equityinstruments classified as available-for-sale are not recognized in the consolidatedstatement of income.  Reversals of impairment losses on debt instruments arereversed through the consolidated statement of income, if the increase in fairvalue of the instrument can be objectively related to an event occurring afterthe impairment loss was recognized in the consolidated statement of income.

 

***Derecognition of Financial Assets and Liabilities***

 

*Financial assets*

 

A financial asset (or, where applicable, a part of afinancial asset or part of a group of similar financial assets) is derecognizedwhen:  (1) the rights to receive cash flows from the asset have expired; (2) weretain the right to receive cash flows from the asset, but have assumed anobligation to pay them in full without material delay to a third party under a“pass through” arrangement; or (3) we have transferred our right to receivecash flows from the asset and either (a) have transferred substantially all therisks and rewards of the asset, or (b) have neither transferred nor retainedsubstantially all the risks and rewards of the asset, but have transferredcontrol of the asset.

 

Wherewe have transferred our right to receive cash flows from an asset and haveneither transferred nor retained substantially all the risks and rewards of theasset nor transferred control of the asset, the asset is recognized to theextent of our continuing involvement in the asset.  Continuing involvement thattakes the form of a guarantee over the transferred asset is measured at thelower of the original carrying amount of the asset and the maximum amount of considerationthat we could be required to repay.

 

Where continuing involvement takes the form of awritten and/or purchased option (including a cash-settled option or similarprovision) on the transferred asset, the extent of our continuing involvementis the amount of the transferred asset that we may repurchase, except that inthe case of a written put option (including a cash-settled option or similarprovision) on an asset measured at fair value, the extent of our continuinginvolvement is limited to the lower of the fair value of the transferred assetand the option exercise price.

 

*Financial liabilities*

 

A financial liability is derecognized when theobligation under the liability is discharged or cancelled or expires.

 

Wherean existing financial liability is replaced by another from the same lender onsubstantially different terms, or the terms of an existing liability aresubstantially modified, such an exchange or modification is treated as aderecognition of the original liability and the recognition of a new liability,and the difference in the respective carrying amounts is recognized in the consolidated statement of income.

 

***Derivative Financial Instruments and Hedging***

 

We use derivative financial instruments such aslong-term currency swaps, foreign-currency options, forward currency contractsand interest rate swaps to hedge our risks associated with interest rate andforeign currency fluctuations.  Such derivative financial instruments areinitially recognized at fair value on the date on which a derivative contractis entered into and are subsequently re-measured at fair value.  Derivativesare carried as assets when the fair value is positive and as liabilities whenthe fair value is negative.

 

Anygains or losses arising from changes in fair value on derivatives during theperiod that do not qualify for hedge accounting are taken directly to the consolidated statement of income.

 

The fair value of forward currency contracts iscalculated by reference to current forward exchange rates for contracts withsimilar maturity profiles.  The fair value of long-term currency swaps, foreigncurrency options and interest rate swap contracts is determined by reference tomarket values for similar instruments.

 

Forthe purpose of hedge accounting, hedges are classified as: (1) fair valuehedges when hedging the exposure to changes in the fair value of a recognizedfinancial asset or liability or an unrecognized firm commitment (except forforeign-currency risk); or (2) cash flow hedges when hedging exposure tovariability in cash flows that is either attributable to a particular riskassociated with a recognized financial asset or liability or a highly probableforecast transaction or the foreign-currency risk in an unrecognized firmcommitment; or (3) hedges of a net investment in a foreign operation.

 

At the inception of a hedge relationship, we formallydesignate and document the hedge relationship to which we wish to apply hedgeaccounting and the risk management objective and strategy for undertaking thehedge.  The documentation includes identification of the hedging instrument,the hedged item or transaction, the nature of the risk being hedged and how theentity will assess the hedging instrument’s effectiveness in offsetting theexposure to changes in the hedged item’s fair value or cash flows attributableto the hedged risk.  Such hedges are expected to be highly effective inachieving offsetting changes in fair value or cash flows and are assessed on anon-going basis to determine that they actually have been highly effectivethroughout the financial reporting periods for which they are designated.

 

Hedgeswhich meet the strict criteria for hedge accounting are accounted for asfollows:

 

*Fairvalue hedges*

 

Thechange in the fair value of a hedging derivative is recognized in the consolidated statement of income.  The change in thefair value of the hedged item attributable to the risk hedged is recorded aspart of the carrying value of the hedged item and is also recognized in the consolidatedstatement of income.

 

Forfair value hedges relating to items carried at amortized cost, the adjustmentto carrying value is amortized through the consolidatedstatement of income over the remaining term to maturity.  Any adjustment to thecarrying amount of a hedged financial instrument for which the effectiveinterest rate method is used is amortized through the consolidated statement ofincome.

 

Amortizationmay begin as soon as an adjustment exists, beginning no later than when thehedged item ceases to be adjusted for changes in its fair value attributable tothe risk being hedged.

 

If the hedge item is derecognized, the unamortizedfair value is recognized immediately in the consolidatedstatement of income.

 

When an unrecognized firm commitment is designated as ahedged item, the subsequent cumulative change in the fair value of the firmcommitment attributable to the hedged risk is recognized as financial asset orliability with a corresponding gain or loss recognized in the consolidated statement of income.  The changes in thefair value of the hedging instrument are also recognized in the consolidatedstatement of income.

* *

*Cash flow hedges*

 

The effective portion of the gain or loss on thehedging instrument is recognized directly in equity, while any ineffectiveportion is recognized immediately in the consolidatedstatement of income.

 

Amountstaken to equity are transferred to the consolidatedstatement of income when the hedged transaction affects the consolidatedstatement of income, such as when the hedged financial income or financialexpense is recognized or when a forecast sale occurs.  Where the hedged item isthe cost of a non-financial asset or non-financial liability, the amounts takento equity are transferred to the initial carrying amount of the non-financialasset or liability.

 

Ifthe forecast transaction or firm commitment is no longer expected to occur,amounts previously recognized in equity are transferred to the consolidated statement of income.  If the hedginginstrument expires or is sold, terminated or exercised without replacement orrollover, or if its designation as a hedge is revoked, amounts previouslyrecognized in equity remain in equity until the forecast transaction or firmcommitment occurs.

 

*Hedges of a net investment*

 

Hedges of a net investment in a foreign operation,including a hedge of a monetary item that is accounted for as part of the netinvestment, are accounted for in a way similar to cash flow hedges.  Gains orlosses on the hedging instrument relating to the effective portion of the hedgeare recognized directly in equity while any gains or losses relating to theineffective portion are recognized in the consolidatedstatement of income.  On disposal of the foreign operation, the cumulativevalue of any such gains or losses recognized directly in equity is transferredto the consolidated statement of income.

 

**New Accounting Standards Subsequent to March 2007**

 

Following are the new PFRS and IFRIC, which will beeffective subsequent to March 31, 2007:

 

***IFRIC 12, “Service Concession Arrangements”.*** This will become effective on January 1, 2008.  Thisinterpretation, which covers contractual arrangements arising from entitiesproviding public services, is not relevant to our current operations.

 

***PFRS8, “Operating Segments”.***Thiswill be effective on January 1, 2009 and will replace *PAS 14, “SegmentReporting”,* and adopts a management approach to reporting segmentinformation.  The requirements of this standard will be included on ourconsolidated financial statements when the standard is adopted.

 

We expectthat the adoption of the pronouncements listed above will have no significantimpact on our consolidated financial statements in the period of our initialapplication.

 

 

 

**3.   Management’sUse of Estimates and Judgments**

 

In preparingour unaudited consolidated financial statements under PFRS, the management isrequired to make estimates and assumptions that affect amounts reported in our unauditedconsolidated financial statements and related notes.  In preparing our unauditedconsolidated financial statements, we have made our best estimates andjudgments of certain amounts, giving due consideration to materiality.  Webelieve the following represents a summary of these significant estimates andjudgments and related impacts and associated risks to our unauditedconsolidated financial statements.

 

*Estimatinguseful lives of property, plant and equipment*

 

We estimate the useful lives of our property, plant andequipment based on the periods over which our assets are expected to beavailable for use.  Our estimation of the useful lives of our property, plantand equipment is based on our collective assessment of industry practice,internal technical evaluation and experience with similar assets.  Theestimated useful lives of our property, plant and equipment are reviewed atleast annually and are updated if expectations differ from previous estimatesdue to physical wear and tear, technical or commercial obsolescence and legalor other limitations on the use of our assets.  It is possible, however, thatfuture results of operations could be materially affected by changes in ourestimates brought about by changes in the factors mentioned above.  The amountsand timing of recorded expenses for any period would be affected by changes inthese factors and circumstances.  A reduction in the estimated useful lives ofour property, plant and equipment would increase our recorded operatingexpenses and decrease our noncurrent assets.

 

Total carrying values of property, plant and equipment amountedto Php164,492 million and Php164,190 million as at March 31, 2007 and December31, 2006, respectively, see *Note 8 – Property, Plant and Equipment*.

 

*Goodwill andintangible assets*

 

Purchase accounting requires extensive use of accountingestimates and judgments to allocate the purchase price to the fair marketvalues of the acquiree’s identifiable assets and liabilities at the acquisitiondate.  It also requires the acquiree to recognize goodwill.  Our businessacquisitions have resulted in goodwill and intangible assets, which are subjectto a periodic impairment test and amortization, respectively, see *Note 11 –Goodwill and Intangible Assets*.  

 

Total carrying values of goodwill and intangible assetsas at March 31, 2007 and December 31, 2006 amounted to Php12,019 million andPhp12,214 million, respectively.  We have no impairment losses recognized forthe three months ended March 31, 2007 and 2006.

 

*Asset impairment*

 

PFRS requiresthat an impairment review be performed when certain impairment indicators arepresent.  In the case of goodwill, at a minimum, such asset is subject to ayearly impairment test and whenever there is an indication that such asset maybe impaired.  This requires an estimation of the value in use of the cash-generatingunits to which the goodwill is allocated.  Estimating the value in use requiresus to make an estimate of the expected future cash flows from the cash-generatingunit and to choose a suitable discount rate in order to calculate the presentvalue of those cash flows.

 

Determiningthe fair values of property, plant and equipment, investments and intangibleassets, which requires the determination of future cash flows expected to begenerated from the continued use and ultimate disposition of such assets,requires us to make estimates and assumptions that can materially affect our unauditedconsolidated financial statements.  Future events could cause us to concludethat property, plant and equipment, investments and intangible assetsassociated with an acquired business are impaired.  Any resulting impairmentloss could have a material adverse impact on our financial condition andresults of operations.

 

Thepreparation of estimated future cash flows involves significant judgments andestimations.  While we believe that our assumptions are appropriate andreasonable, significant changes in our assumptions may materially affect ourassessment of recoverable values and may lead to future additional impairmentcharges under PFRS.  We have no impairment losses recognized for the threemonths ended March 31, 2007 and 2006, see *Note 5 – Income and Expenses*.

 

*Investmentproperties*

 

We have adopted the fair value approach in determiningthe carrying value of our investment properties.  We have opted to rely onindependent appraisers in determining the fair values of our investmentproperties, and such fair values were determined based on recent prices ofsimilar properties, with adjustments to reflectany changes in economic conditions since the date of those transactions.  Theamounts and timing of recorded changes in fair value for any period woulddiffer if we made different judgments and estimates or utilized a differentbasis for determining fair value.

 

Total carrying values of investment properties as at March31, 2007 and December 31, 2006 amounted to Php582 million and Php587million, respectively, see *Note 10 – Investment Properties*.

 

*Deferred tax assets*

 

We review the carrying amounts of deferred tax assets ateach balance sheet date and reduce these to the extent that it is no longerprobable that sufficient taxable income will be available to allow all or partof the deferred tax assets to be utilized.  Our assessment on the recognitionof deferred tax assets on deductible temporary differences is based on theforecasted taxable income of the subsequent reporting periods.  This forecastis based on our past results and future expectations on revenues and expenses.As management believes, it will have no sufficient future taxable income toutilize the benefits of deductible temporary differences.  However, there is noassurance that we will generate sufficient taxable income to allow all or partof our deferred tax assets to be utilized.

 

Total unrecognizeddeferred tax assets as at March 31, 2007 and December 31, 2006 amounted to Php319million and Php299 million, respectively, see *Note 6 – Income Tax*.

 

*Financial assets and liabilities*

 

We carrycertain of our financial assets and liabilities at fair value, which requiresextensive use of accounting estimates and judgments.  In addition, certainliabilities acquired through debt exchange and restructuring are required to becarried at fair value at the time of the debt exchange and restructuring, see *Note**24 – Financial Assets and Liabilities*.  While significant components offair value measurement were determined using verifiable objective evidence(i.e., foreign exchange rates, interest rates, volatility rates), the amount ofchanges in fair value would differ if we utilized a different valuationmethodology.  Any change in fair value of these financial assets andliabilities would directly affect our consolidated statement of income andequity.

 

Total fairvalue of financial assets and liabilities as at March 31, 2007 amounted to Php48,804million and Php102,974 million, respectively, while the total fair value offinancial assets and liabilities as at December 31, 2006 amounted to Php35,952million and Php106,301 million, respectively.

 

*Estimating allowance for doubtful accounts*

 

Weestimate the allowance for doubtful accounts related to our trade receivablesbased on two methods.  The amounts calculated using each of these methods arecombined to determine the total amount we reserve.  We evaluate specificaccounts where we have information that certain customers are unable to meettheir financial obligations.  In these cases, we use judgment based on the bestavailable facts and circumstances, including but not limited to, the length ofour relationship with the customer and the customer’s current credit statusbased on third party credit reports and known market factors, to recordspecific reserves for customers against amounts due to reduce our receivablesto amounts that we expect to collect.  These specific reserves are re-evaluatedand adjusted as additional information received affects the amounts estimated.Full allowance is provided for receivables from permanently disconnectedsubscribers and carriers.  Such permanent disconnections generally occur within105 days from the date of payment was due.  Partial allowance is provided foractive subscribers and carriers based on the age status of receivables.

 

Theamounts and timing of recorded expenses for any period would differ if we madedifferent judgments or utilized different estimates.  An increase in our allowancefor doubtful accounts would increase our recorded operating expenses anddecrease our current assets.  

 

Provisionfor doubtful accounts amounted to Php163 million and Php205 million for thethree months ended March 31, 2007 and 2006, respectively.  Trade and otherreceivables, net of allowance for doubtful accounts, amounted to Php10,010 millionand Php10,158 million as at March 31, 2007 and December 31, 2006, respectively,see *Note 5 – Income and Expenses*and *Note 14 – Trade and OtherReceivables*.

 

*Assetretirement obligations*

*** ***

Assetretirement obligations are recognized in the period in which they are incurredif a reasonable estimate of fair value can be made. This requires an estimationof the cost to restore/dismantle on a per square meter basis, depending on thelocation, and is based on the best estimate of the expenditure required tosettle the obligation at the balance sheet date, discounted using a pre-taxrate that reflects the current market assessment of the time value of moneyand, where appropriate, the risk specific to the liability.  Total provisionfor asset retirement obligations amounted to Php854 million and Php831 million as at March31, 2007 and December 31, 2006, respectively, see *Note 8 – Property, Plantand Equipment* and *Note 18 – Other Noncurrent Liablities*.

 

*Revenue recognition*

 

Ourrevenue recognition policies require us to make use of estimates andassumptions that may affect the reported amounts of our revenues andreceivables.  

 

Ouragreements with domestic and foreign carriers for inbound and outbound trafficsubject to settlements require traffic reconciliations before actual settlementis done, which may not be the actual volume of traffic as measured by us.Initial recognition of revenues is based on our observed traffic adjusted byour normal experience adjustments, which historically are not material to our unauditedconsolidated financial statements.  Differences between the amounts initiallyrecognized and the actual settlements are taken up in the accounts upon reconciliation.However, there is no assurance that such use of estimates will not result in materialadjustments in future periods.

 

Revenuesunder a multiple element arrangement specifically applicable to our wirelessbusiness are split into separately identifiable components and recognized whenthe related components are delivered in order to reflect the substance of thetransaction.  The fair value of components is determined using verifiableobjective evidence.  Revenue for handset sales has been quantified andidentified separately using the residual value method from our cellular servicerevenue.  

 

Undercertain arrangements with our BPO services, if there is uncertainty regardingthe outcome of the transaction for which service was rendered, revenue isrecognized only to the extent of expenses incurred for rendering the serviceand such amount is determined to be recoverable.

 

*Pensionand other retirement benefits*

 

The determination of our obligation and cost for pensionand other retirement benefits is dependent on our selection of certainassumptions used by actuaries in calculating such amounts.  Those assumptionsare described in *Note 21 – Employee Benefits* and include, among otherthings, discount rates, expected returns on plan assets and rates ofcompensation increases.  Actual results that differ from our assumptions are recognizedas income or expense when the net cumulative unrecognized actuarial gains andlosses at the end of the previous reporting period exceed 10% of the higher ofthe defined benefit obligation and the fair value of plan assets at that date.  Whilewe believe that our assumptions are reasonable and appropriate, significantdifferences in our actual experience or significant changes in our assumptionsmay materially affect our pension and other retirement obligations.  

 

Unrecognized net actuarial loss as at March 31, 2007 amountedto Php4,657 million.  The accrued benefit cost as at March 31, 2007 andDecember 31, 2006 amounted to Php2,930 million and Php2,888 million, respectively.

 

*Share-based paymenttransactions*

 

Our LTIP grants share appreciation rights, or SARs, toour eligible key executives and advisors.  Under the LTIP, we recognize theservices we receive from the eligible key executives and advisors, and ourliability to pay for those services, as the eligible key executives andadvisors render services during the vesting period.  We measure our liability,initially and at each reporting date until settled, at the fair value of theSARs, by applying an option valuation model, taking into account the terms andconditions on which the SARs were granted, and the extent to which the eligiblekey executives and advisors have rendered service to date.  We recognize anychanges in fair value at each reporting date until settled, in the results ofoperations for the period. The assumptions and estimates are described in *Note21 – Employee Benefits* and include, among other things, annual stockvolatility, risk free interest rate, remaining life, and the fair value ofcommon stock.  While management believes that the assumptions and estimatesused are reasonable and appropriate, significant differences in our actualexperience or significant changes in the assumptions may materially affect thestock compensation costs charged to operations.  The fair value of the LTIPrecognized as an expense for the three months ended March 31, 2007 and 2006 amountedto Php260 million and Php321 million, respectively.  As at March 31, 2007 and December31, 2006, total LTIP liability amounted to Php5,289 million and Php5,030 million,respectively, see *Note 21 – Employee Benefits*.

 

*Legal contingencies*

 

We arecurrently involved in various legal proceedings.  Our estimate of the probablecosts for the resolution of these claims has been developed in consultationwith outside counsel handling our defense in these matters and is based upon ananalysis of potential results.  We currently do not believe these proceedingswill have a material adverse effect on our unaudited consolidated financialstatements.  It is possible, however, that future results of operations couldbe materially affected by changes in our estimates or in the effectiveness ofour strategies relating to these proceedings, see *Note 23 – Provisions andContingencies.*

 

*Determination of functionalcurrency*

* *

Based on the economic substance of the underlyingcircumstances relevant to the PLDT Group, the functional and presentationcurrency of the PLDT Group (except for Mabuhay Satellite, PLDT Global, DigitalParadise Thailand and SPi and certain of its subsidiaries) is the Philippinepeso.  Transactions in foreign currencies are initially recorded in thefunctional currency rate prevailing at the date of the transaction.  Monetaryassets and liabilities denominated in foreign currencies are translated at thefunctional currency rate of exchange prevailing at the balance sheet date.  Alldifferences are taken to the consolidated statement of income except forforeign exchange losses that qualify as capitalizable borrowing costs duringthe construction period.  For income tax purposes, exchange gains or losses aretreated as taxable income or deductible expenses in the period such gains orlosses are realized.

 

The functional currency of Mabuhay Satellite, PLDTGlobal, SPi and certain of its subsidiaries is the U.S. dollar and DigitalParadise Thailand is the Thai baht.  As at the reporting date, the assets andliabilities of these subsidiaries are translated into the presentation currencyof the PLDT Group at the rate of exchange prevailing at the balance sheet dateand its income and expenses are translated at the weighted average exchangerate for the period.  The exchange differences arising on translation are takendirectly to a separate component of equity as cumulative translationadjustments.  On disposal of these subsidiaries, the amount of deferredcumulative translation adjustments recognized in equity relating tosubsidiaries is recognized in the consolidated statement of income. 

 

The functional currencies of the Group are the currencyof the primary economic environment in which each entity operates.  It is thecurrency that mainly influences the revenue from and cost of renderingservices.  

 

 

 

**4.   Segment Information**

 

Operatingsegments are components of PLDT that engage in business activities from whichthey may earn revenues and incur expenses (including revenues and expensesrelating to transactions with other components of PLDT), whose operatingresults are regularly reviewed by the enterprise’s chief operating decision-makerto make decisions about how resources are to be allocated to the segment andassess their performances, and for which discrete financial information isavailable.  The accounting policies of the reportable segments are the same asthose described in *Note 2 – Summary of Significant Accounting Policies andPractices*.

 

We have organized our business into three mainsegments:

 

•        Wireless — wireless telecommunications services provided through our cellularservice providers namely, Smart and Piltel; Smart Broadband, our wirelessbroadband provider; Wolfpac, our wireless content operator and our satelliteand very small aperture terminal, or VSAT operators, namely PLDT’s subsidiariesMabuhay Satellite, ACeS Philippines and Telesat;

 

•        Fixed Line — fixed line telecommunications services are primarily provided throughPLDT.  We also provide fixed line services through PLDT’s subsidiaries; ClarkTel,SubicTel, Maratel, Piltel, BCC, PLDT Global and SNMI, which together accountfor approximately 3% of our consolidated fixed line subscribers; and

 

•        Information and CommunicationsTechnology — information and communications infrastructure andservices for internet applications, internet protocol-based solutions andmultimedia content delivery provided by PLDT’s subsidiary ePLDT; call centerservices provided under one umbrella brand name Ventus, include Parlance andVocativ; BPO services provided by SPi (consolidated on July 11, 2006) and itssubsidiaries; internet access and gaming services provided by ePLDT’ssubsidiaries Infocom, Digital Paradise, Digital Paradise Thailand, netGames,Airborne Access and Level Up!; and e-commerce and IT-related services providedby other investees of ePLDT, as described in *Note 9 – Investments inAssociates*.

 

Transferprices between business segments are set on an arm’s length-basis in a mannersimilar to transactions with third parties.  Segment revenue, segment expenseand segment result include transfers between business segments.  Thesetransfers are eliminated in consolidation.

 

Thesegment assets as at March 31, 2007 and December 31, 2006 and results ofoperations of our reportable segments for the three months ended March 31, 2007and 2006 are as follows:

 

** **

**Wireless**

**Fixed Line**

**Information and Communications Technology**

**Inter-segment Transactions**

** **

** **

**Total**

 

(in million pesos)

* *

* *

 

 

 

 

*As at and for the three months ended March 31, 2007 (Unaudited)*

**Income**

 

 

 

 

 

Service revenues

20,811

11,828

2,425

(2,052)

33,012

Non-service revenues

576

15

33

(11)

 613

Other income

63

164

8

(24)

 211

Segment income

21,450

12,007

2,466

(2,087)

33,836

 

 

 

 

 

 

**Result**

 

 

 

 

 

Income before income tax

10,584

2,577

150

–

13,311

Provision for (benefit from) income tax

3,690

899

(9)

–

4,580

Net income for the period

6,894

1,678

 159

–

8,731

** **

 

 

 

 

 

Assets and liabilities

 

 

 

 

 

Segment assets

93,884

187,559

17,339

(64,317)

234,465

Deferred income tax assets

3,546

13,527

59

–

17,132

Total assets

97,430

201,086

17,398

(64,317)

251,597

 

 

 

 

 

 

Segment liabilities

69,873

93,857

3,322

(20,079)

146,973

Deferred income tax liabilities

–

–

379

–

 379

Total liabilities

69,873

93,857

3,701

(20,079)

147,352

 

 

** **

** **

** **

** **

Other segment information

 

** **

** **

** **

** **

Capital expenditures

1,981

3,846

110

–

5,937

Depreciation and amortization

2,925

2,289

234

–

5,448

Provisions

109

123

1

–

 233

Interest on loans and related items -  net of capitalized interest

359

1,378

7

–

1,744

Interest income

275

55

3

–

 333

* *

 

* *

* *

* *

* *

*As at December 31, 2006 (Audited) and for the three months ended March 31, 2007 (Unaudited)*

* *

**Income**

 

 

 

 

 

Service revenues

18,944

12,151

813

(1,931)

29,977

Non-service revenues

679

13

53

(3) 

 742

Equity share in net income of associates

–

–

2

–

   2

Other income

47

105

4

(25)

 131

Segment income

19,670

12,269

 872

(1,959)

30,852

 

 

 

 

 

 

**Result**

 

 

 

 

 

Income before income tax

10,125

1,133

14

–

11,272

Provision for (benefit from) income tax

2,234

291

(15)

–

2,510

Net income for the period

7,891

 842

  29

–

8,762

** **

 

 

 

 

 

**Assets and liabilities**

 

 

 

 

 

Segment assets

86,905

184,096

17,431

(66,198)

222,234

Deferred income tax assets

4,991

14,608

59

–

19,658

Total assets

91,896

198,704

17,490

(66,198)

241,892

 

 

 

 

 

 

Segment liabilities

48,751

91,192

3,396

(6,372)

136,967

Deferred income tax liabilities

6

–

396

–

 402

Total liabilities

48,757

91,192

3,792

(6,372)

137,369

** **

** **

 

** **

** **

** **

** **

**Other segment information**

 

** **

** **

** **

** **

Capital expenditures

2,563

2,014

331

–

4,908

Depreciation and amortization

2,576

4,971

120

–

7,667

Provisions

158

79

1

–

 238

Interest on loans and related items -  net of capitalized interest

344

1,650

4

–

1,998

Interest income

370

108

4

–

 482

 

 

 

**5.   Income and Expenses**

 

*Non-service Revenues*

 

 

**Three Months Ended March 31,**

 

**2007**

 

2006

 

(Unaudited)

 

(in million pesos)

Sale of computers, cellular handsets and SIM-packs

**591**

 

692

Point product sales

**22**

 

50

 

**613**

 

742

* *

*Compensation and Benefits*

* *

** **

**Three Months Ended March 31,**

 

**2007**

 

2006

 

(Unaudited)

 

(in million pesos)

Salaries and benefits

**4,111**

 

3,041

Pension (Note 21)

**398**

 

248

Incentive plan (Notes 3 and 21)

**260**

 

321

Manpower rightsizing program

**12**

 

34

 

**4,781**

 

3,644

* *

*FinancingCosts*

* *

 

**Three Months Ended March 31,**

 

**2007**

** **

2006

 

(Unaudited)

 

(in million pesos)

Interest on loans and related items

**1,858**

 

2,127

Hedge costs (Note 24)

**354**

 

341

Loss on derivative transactions - net (Notes 2 and 24)

**311**

 

22

Accretion on financial liabilities - net (Notes 2, 17 and 24)

**269**

 

614

Financing charges

**35**

 

36

Dividends on preferred stock subject to mandatory redemption (Note 7)

**5**

 

49

Capitalized interest (Notes 2 and 8)

**(114)**

 

(129)

Interest income

**(333)**

 

(482)

Foreign exchange gains - net (Notes 17 and 24)

**(588)**

 

(1,578)

 

**1,797**

 

1,000

* *

Interestexpense for short-term borrowing for the three months ended March 31, 2007 and2006 amounted to Php8 million and Php3million, respectively.

* *

*Cost of Sales*

* *

 

**Three Months Ended March 31,**

 

**2007**

 

2006

 

(Unaudited)

 

(in million pesos)

Cost of computers, cellular handsets and SIM-packs sold

**1,152**

 

1,187

Cost of satellite air time and terminal units (Notes 20 and 22)

**44**

 

47

Cost of point product sales

**24**

 

45

 

**1,220**

 

1,279

* *

*Professional and Other ContractedService Fees*

* *

 

**Three Months Ended March 31,**

 

**2007**

 

2006

 

(Unaudited)

 

(in million pesos)

Technical and consultancy fees (Note 20)

**716**

 

370

Contracted services

**479**

 

128

Legal and audit fees

**45**

 

70

Others

**39**

 

16

 

**1,279**

 

584

* *

*Provisions*

* *

 

**Three Months Ended March 31,**

 

**2007**

 

2006

 

(Unaudited)

 

(in million pesos)

Doubtful accounts (Note 14)

**163**

 

205

Write-down of inventories to net realizable values (Note 15)

**61**

 

109

Onerous contracts and assessments (Notes 20, 22 and 23)

**9**

 

(76)

 

**233**

 

238

* *

* *

 

**6.   Income Tax**

* *

The netcomponents of deferred income tax recognized in the consolidated balance sheetsare as follows:

* *

 

**March 31,  2007 (Unaudited)**

 

December 31, 2006 (Audited)

 

(in million pesos)

Net assets

**17,132**

** **

19,658

Net liabilities

**379**

** **

402

 

The components of net deferred income tax assets andliabilities are as follows:

 

 

**March 31,  2007 (Unaudited)**

** **

December 31, 2006 (Audited)

 

(in million pesos)

Net assets

 

** **

 

Net operating loss carryover, or NOLCO

**5,254**

** **

4,983

Accumulated provision for doubtful accounts

**4,632**

** **

4,746

Asset impairment

**4,179**

** **

5,432

Pension and other employee benefits

**2,635**

** **

2,568

Unearned revenues

**1,835**

** **

2,076

Derivative financial instruments

**1,812**

** **

1,878

Unrealized foreign exchange losses

**1,220**

** **

2,632

MCIT

**983**

** **

983

Unamortized past service costs

**887**

** **

871

Provision for unrealized assets

**697**

** **

732

Accumulated write-down of inventories to net realizable values

**320**

** **

321

Leases

**316**

** **

304

Asset retirement obligation - net of capitalized asset

**203**

** **

191

Executive stock option plan

**66**

** **

106

Excess of fair value over cost of investment properties

**(76)**

** **

(77)

Preferred stock subject to mandatory redemption

**(92)**

** **

(109)

Intangibles and fair value adjustments on assets acquired

**(376)**

** **

(391)

Capitalized taxes and duties 

**(468)**

** **

(446)

Capitalized foreign exchange differential

**(912)**

** **

(988)

Gain on debt exchange and debt restructuring transactions

**(1,574)**

** **

(1,650)

Undepreciated capitalized interest charges

**(4,507)**

** **

(4,607)

Others

**98**

** **

103

 

**17,132**

** **

19,658

 

 

 

 

Net liabilities

 

** **

 

Excess of fair value over cost of investment properties

**(38)**

** **

(38)

Intangible assets

**(340)**

** **

(357)

Unrealized foreign exchange gains

–

** **

(6)

Others

**(1)**

** **

(1)

 

**(379)**

** **

(402)

 

Provisionfor corporate income tax consists of:

 

 

**Three Months Ended March 31,**

 

**2007**

 

2006

 

(Unaudited)

 

(in million pesos)

Current

**2,263**

 

2,122

Deferred

**2,317**

 

388

 

**4,580**

 

2,510

 

Thereconciliation between the provision for income tax at the applicable statutorytax rates and the actual provision for corporate income tax is as follows:

 

 

**Three Months Ended March 31,**

 

**2007**

 

2006

 

(Unaudited)

 

(in million pesos)

Provision for corporate income tax at the applicable statutory tax rates

**4,659**

 

3,945

Tax effects of:

** **

 

 

Non-deductible expenses

**64**

 

51

Loss (income) subject to lower tax rate

**70**

 

(58)

Equity share in net loss (income) of investees

**2**

 

(1)

Income not subject to tax

**(97)**

 

(21)

Income subject to final tax

**(118)**

 

(141)

Net movement in deferred income tax

**–**

 

(1,265)

Actual provision for corporate income tax

**4,580**

 

2,510

 

MabuhaySatellite and SubicTel are registered as Subic Bay Freeport Enterprises while ClarkTelis registered as a Clark Special Economic Zone Enterprise under Republic Act No.9337, or R.A. 7227, otherwise known as the Bases Conversion and Development Actof 1992.  As registrants, Mabuhay Satellite, SubicTel and ClarkTel are entitledto all the rights, privileges and benefits established thereunder including taxand duty-free importation of capital equipment and a special income tax rate of5% of gross income, as defined in the R.A. 7227.

 

On December 22, 2000, the Philippine Board of Investments, or BOI,approved ePLDT’s registration as a new information technology, or IT, servicefirm in the field of services related to its internet data center on a pioneerstatus.  As such, ePLDT enjoys, among other incentives, a six-year income taxholiday, or ITH, starting January 2001.

 

On January 3, 2007, the BOI approved ePLDT’sapplication for pioneer status for its new data center facility as a new ITservice firm in the field of services related to Internet Data Center.  ePLDT was granted six-year ITH on its new data center facility from January 2007 oractual start of operations, whichever comes first.

 

Parlanceis registered with the BOI as a new IT export service firm in the field ofcustomer interaction center on a pioneer status.  Under this registration,Parlance is entitled to certain tax incentives, including an ITH for six yearsstarting in June 2002.  Parlance is required to comply with specific terms andconditions stated in its BOI registration.

 

iPlusIntelligent Network, Inc., or iPlus, is a wholly-ownedsubsidiary of ePLDT and is registered with the BOI as a new IT service firmin the field of application service provider on a pioneer status.  Under suchregistration, iPlus is entitled to a six-year ITH incentive from the actualstart of commercial operations until January 1, 2009.

 

Vocativ is registered with the Philippine Economic Zone Authority, orPEZA, as an Ecozone Export Enterprise to develop and operate a call centerbusiness that serves overseas clients by providing customer relationshipmanagement services.  As a registered enterprise, Vocativ is entitled tocertain tax and non-tax incentives which include, among other things, tax andduty-free importations, exemption from local tax and an ITH for four years fromstart of commercial operations.  After the ITH period, Vocativ is liable for afinal tax, in lieu of all taxes, of 5% gross income less allowable deductionsas defined under R.A. No. 7916, “The Special Economic Zone Act of 1995”.  The5% final tax must be paid and remitted in accordance with the amendmentscontained in R.A. No. 8748, as follows: (a) 3% to the Philippine Government;and (b) 2% which will be directly remitted by the business establishments tothe treasurer’s office of the municipality or city where the enterprise islocated.

 

OnDecember 5, 2005, Vocativ received approval from PEZA for the adjustment of thestart of its commercial operations, effectively extending the ITH to end ofMarch 2006.  On June 30, 2006, PEZA approved Vocativ’s ITH extension foranother year which extends the ITH until April 2007.

 

mySecureSign,Inc., or mSSI, is a wholly-owned subsidiary of ePLDT and is registered with theBOI as a new IT service firm in the field of services related to public keyinfrastructure on a pioneer status. Under such registration, mSSI enjoys, amongother incentives, a six-year ITH from August 1, 2001 or the actual start ofcommercial operations, whichever comes first.  mSSI started commercialoperations on January 1, 2002.

 

Ventus isregistered with the BOI as a new IT export service firm in the field ofcustomer interaction center on a pioneer status.  Under this registration,Ventus is entitled to certain tax incentives such as an ITH for six yearsstarting March 2005.  In relation to this, Ventus is required to comply withspecific terms and conditions stated in the BOI registration.

 

Two ofVentus’ call center projects are registered with the BOI as a new IT exportservice firm in the field of customer interaction center on a pioneer status.Under this registration, Ventus’ Iloilo and Pasig call center projects are entitledto certain tax incentives such as an ITH for six years starting March 2005 andAugust 2006, respectively.  In relation to this, Ventus is required to complywith specific terms and conditions stated in the BOI registration.

 

Digital Paradise is registered with the BOI as anew IT service firm in the field of community access on a non-pioneer status.Under the provisions of the registration, DigitalParadise’s sales generated from its owncommunity access activity and franchise fees are entitled to an ITH for aperiod of four years beginning December 2002.  In December 2006, the BOIapproved Digital Paradise’s application for a status upgrade from non-pioneerto pioneer, accordingly extending the ITH period for another two years startingJanuary 2007.

 

Level Up! was originally registered with the BOI as anew IT service firm in the field of application service provider on anon-pioneer status.  Under such registration, Level Up! is entitled to certaintax incentives, which includes a four-year ITH from January 2003 and a taxcredit for taxes on duties on materials used in export products for ten yearsstarting January 2003.  In April 2004, the BOI approved Level Up!’s request forupgrading its status from non-pioneer to pioneer in connection with its ITservice activity in the field of application service provider for entertainmentand educational project.  Accordingly, the ITH period was extended from four tosix years.

 

InSeptember 2006, PEZA approved SPi’s application for registration as an ecozoneinformation technology enterprise to provide IT enabled services with emphasison the creation of electronic discovery, presentation of content in electronicinformation formats, data analysis, capture, abstracting and data processing,design, development and implementation of healthcare documentation solutions.  Asa registered enterprise, SPi is entitled to certain tax and non-tax incentiveswhich include, among other things, tax and duty-free importations, exemptionfrom local tax and an ITH for four years.  After the ITH period, SPi is liablefor a final tax, in lieu of all taxes.  The final tax is computed at 5% ofgross income less allowable deductions as defined under R.A. 7916, “The SpecialEconomic Zone Act of 1995,” and will be paid and remitted in accordance withthe amendments contained in R.A. 8748, as follows: (a) 3% to the Philippine Government;and (b) 2% which will be directly remitted by the business establishments tothe treasurer’s office of the municipality or city where the enterprise islocated.

 

Wolfpac isregistered with the BOI as a new operator of service provider applications.Under the terms of its registration, it is entitled to certain tax and non-taxincentives which include, among other things, an ITH for four years startingFebruary 2004.

 

SmartBroadband has three registered activities with the BOI on a pioneer status,namely: (i) a new operator of telecommunications systems (inter-exchangecarrier for data services); (ii) new information technology service firm in thefield of providing internet services; and (iii) a new operator oftelecommunications facilities (nationwide broadband wireless access).  Underthe terms of these registrations, Smart Broadband is entitled to certain taxand non-tax incentives which include, among other things, an ITH for six yearsfrom February 2001, August 2001 and July 2005, respectively.

 

Income derivedfrom non-registered activities with the BOI is subject to the normal income taxrate enacted as at the balance sheet date.

 

Consolidatedtax incentives that we availed for the three months ended March 31, 2007 and2006 amounted to Php201 million and Php57 million, respectively.

 

On May 24, 2005, the president of the Philippines signed into law Republic Act No. 9337, or R.A. 9337, which took effect on November 1,2005.  R.A. 9337, among others, introduced the following changes:

 

a.      The regular corporate income taxrate for domestic corporations and resident/non-resident foreign corporationsincreased to 35% (from 32%) beginning November 1, 2005 and will be reduced to30% beginning January 1, 2009.

 

b.      The VAT rate increased from 10% to12% effective February 1, 2006.

 

c.      The input VAT on capital goodsshould be spread evenly over the useful life or sixty months, whichever isshorter, if the acquisition cost, excluding the VAT component thereof, exceedsone million pesos.

 

 

In2006, the net movement in deferred tax assets primarily pertains to deferredtax assets recognized in relation to the benefit that would be derived from thedisposal of certain Piltel assets with the expected lifting of MTI restrictionsresulting from the full repayment of Pitel’s restructured debt on December 4,2006.  For further discussion, please see *Note 17 – Interest-bearingFinancial Liabilities*.

 

Ourdeferred income tax assets have been recorded to the extent that such deferredtax assets are expected to be utilized against sufficient future taxableprofit.  We had unrecognized deferred tax assets of Php319 million and Php299million largely pertaining to asset impairment as at March 31, 2007 andDecember 31, 2006, respectively.

 

Our unaudited consolidated unutilized NOLCO as at March31, 2007 is as follows:

 

**Year Incurred**

**Year Expiring**

**(in million pesos)**

2004

2007

15

2005

2008

11,220

2006

2009

3,019

2007

2010

774

 

 

15,028

 

 

 

Tax benefit

 

5,260

Unrecognized deferred income tax assets from NOLCO as at  March 31, 2007

 

(6)

 

 

5,254

 

Our unaudited consolidated MCIT as at March 31, 2007is as follows:

 

**Year Incurred**

**Year Expiring**

**(in million pesos)**

2005

2008

484

2006

2009

499

 

 

 983

 

 

 

**7.   EarningsPer Common Share**

 

Thefollowing table presents information necessary to calculate the earnings percommon share:

 

** **

**Three Months Ended March 31,**

 

**2007**

 

2006

 

**Basic**

**Diluted**

 

Basic

Diluted

 

(Unaudited)

 

(in million pesos)

Consolidated net income attributable to equity holders of PLDT

**8,575**

**8,575**

8,581

8,581

Dividends on preferred shares

**(114)**

**(114)**

(114)

(12)

Dividends on preferred stock subject to mandatory redemption charged to interest expense for the period

**–**

**5**

–

49

Accretion of preferred stock subject to mandatory redemption

**–**

**37**

–

294

Foreign exchange gain on preferred stock subject to mandatory redemption

–

**(20)**

–

(413)

Consolidated net income applicable to common shares

**8,461**

**8,483**

8,467

8,499

 

 

 

 

 

(in thousands, except per share amounts)

 

** **

** **

 

 

Outstanding common shares at beginning of period

**188,435**

**188,435**

180,789

180,789

Effect of issuance of common shares during the period

**127**

**127**

381

381

Average incremental number of shares under ESOP during  the period

**–**

**60**

–

21

Common shares equivalent of preferred shares deemed dilutive:

** **

** **

 

 

Preferred Stock Series A to FF (Note 16)

–

–

–

2,530

Preferred Stock Series VI (Note 17)

–

**783**

–

3,943

Preferred Stock Series VII (Note 17)

–

–

–

3,842

Weighted average number of common shares for the period

**188,562**

**189,405**

181,170

191,506

Earnings per common share

**Php44.87**

**Php44.79**

Php46.74

Php44.38

 

Series A to FF, V, VI and VIIConvertible Preferred Stocks weredeemed dilutive based on a calculation of the required dividends on thesepreferred shares divided by the number of equivalent common shares assumingsuch preferred shares are converted into common shares, including the effect ofshares under ESOP, and compared against the basic EPS.  Since the amount of dividendson the Series A to FF and V in 2007 and Series V in 2006 over its equivalentnumber of common shares increased the basic EPS, these Convertible PreferredStocks were anti-dilutive.

** **

**DividendsDeclared For The Three Months Ended March 31, 2007**

 

** **

**Date**

**Amount**

**Class**

**Approved**

**Record**

**Payable**

**Per Share**

**Total**

 

 

 

 

 

(in million pesos)

**Preferred Stock Subject to Mandatory Redemption**

 

 

 

 

 

Series V

March 6, 2007

March 20, 2007

April 15, 2007

Php4.675

–

Series VI

March 6, 2007

March 20, 2007

April 15, 2007

US$0.09925

4

Charged to income

 

 

 

 

   4

 

 

 

 

 

 

**10% Cumulative Convertible  Preferred Stock**

 

 

 

 

 

Series CC

January 30, 2007

February 28, 2007

March 30, 2007

Php1.00

17

Series DD

January 31, 2007

February 15, 2007

February 28, 2007

1.00

2

 

 

 

 

 

  19

 

 

 

 

 

 

**Cumulative Non-Convertible Redeemable Preferred Stock**

 

 

 

 

 

Series IV*

January 30, 2007

February 23, 2007

March 15, 2007

Php–

12

 

 

 

 

 

  12

 

 

 

 

 

 

**Common Stock**

March 6, 2007

March 20, 2007

April 20, 2007

Php50.00

9,429

Charged to retained earnings

 

 

 

 

9,460

 

****Dividends aredeclared based on total amount paid up.*

 

**Dividends Declared After March 31, 2007**

 

** **

**Date**

**Amount**

**Class**

**Approved**

**Record**

**Payable**

**Per Share**

**Total**

 

 

 

 

 

(in million pesos)

**Cumulative Non-Convertible Redeemable Preferred Stock**

 

 

 

 

 

Series IV*

May 8, 2007

May 25, 2007

June 15, 2007

Php–

12

** **

 

 

 

 

  12

 

****Dividendsare declared based on total amount paid up.*

 

 

 

**8.   Property, Plant andEquipment**

 

This account consists of:

 

** **

**Cable and wire facilities**

**Central office equipment**

**Cellular facilities**

**Buildings**

**Vehicles, furniture, and other network equipment**

**Communications satellite**

**Information origination/ termination equipment**

**Land and**

**land improvements**

**Property under construction**

**Total**

** **

(in million pesos)

**At December 31, 2006**

Cost

112,621

84,604

64,423

20,388

31,039

9,834

9,140

2,673

12,686

347,408

Accumulated depreciation and amortization

(46,594)

(58,292)

(32,889)

(6,235)

(25,461)

(7,678)

(5,800)

(269)

–

(183,218)

Net book value

66,027

26,312

31,534

14,153

5,578

2,156

3,340

2,404

12,686

164,190

**Period Ended December 31, 2006**

Net book value at beginning of period

66,027

26,312

31,534

14,153

5,578

2,156

3,340

2,404

12,686

164,190

Additions/Transfers – net

556

893

245

59

536

–

527

–

3,058

5,874

Disposals/Retirements

(2)

(2)

(17)

(5)

(25)

–

 

–

(12)

(63)

Translation differences charged directly to cumulative translation adjustments

–

(3)

–

(1)

1

(58)

–

–

–

(61)

Reclassifications

412

–

484

–

223

–

–

–

(1,119)

–

Depreciation and amortization

(1,300)

(896)

(1,787)

(310)

(846)

(147)

(161)

(1)

–

(5,448)

Net book value at end of period

65,693

26,304

30,459

13,896

5,467

1,951

3,706

2,403

14,613

164,492

**At March 31, 2007**

Cost

113,584

85,487

64,939

20,425

31,470

9,684

9,622

2,673

14,613

352,497

Accumulated depreciation and amortization

(47,891)

(59,183)

(34,480)

(6,529)

(26,003)

(7,733)

(5,916)

(270)

–

(188,005)

Net book value

65,693

26,304

30,459

13,896

5,467

1,951

3,706

2,403

14,613

164,492

 

Substantiallyall our telecommunications equipment is purchased from outside the Philippines.  Our significant sources of financing for such purchases are foreign loansrequiring repayment in currencies other than Philippine pesos, principally inU.S. dollars, see *Note 17 – Interest-bearing Financial Liabilities*.Interest, using an average capitalization rate of 9%, and netforeign exchange losses capitalized to property, plant and equipment qualifiedas borrowing costs for the three months ended March 31, 2007 and 2006 were asfollows:

 

 

**Three Months Ended March 31,**

 

**2007**

 

2006

 

(Unaudited)

 

(in million pesos)

Interest

**114**

 

129

Foreign exchange gains

**78**

 

227

 

As atMarch 31, 2007 and December 31, 2006, the undepreciated capitalized net foreignexchange losses which qualified as borrowing costs amounted to Php2,888 millionand Php2,646 million, respectively.

 

The consolidated useful lives of the assets areestimated as follows:

 

Buildings

25 years

Central office equipment

15 – 20 years

Cable and wire facilities 

10 – 25 years

Communications satellite

15 years

Information origination and termination equipment

5 – 15 years

Land improvements

10 years

Vehicles, furniture and other network equipment

3 – 10 years

Cellular facilities

3 – 10 years

 

Werecognized additional depreciation and amortization charges of Php2,117 millionfor the three months ended March 31, 2006 due to a change in the estimated usefullives of certain of our network assets owing to continuing network upgrade andexpansion in 2005.

 

*AssetImpairment Review*

 

Piltelcarries out annual impairment tests on its fixed line assets based on the netpresent value, or NPV, of future cash flows from the continued use of theseassets.  For the impairment review in 2006, a discount factor of 6.25% on apre-tax basis was used for both E.O. 109 and RTS, applied on cash flowprojections from 2007 until such year when the assets are fully depreciated.Cash flow assumptions for E.O. 109 averaged Php64 million per year from 2007 to2017 and Php271 million per year for RTS from 2007 to 2013.  The resulting NPVof the total cash flow projections was higher than the carrying value of boththe E.O. 109 and RTS assets.

 

Management believes that due to Mabuhay Satellite’sdifficulty in generating cash flows with the satellite nearing its end-of-lifeand other events affecting its business, Mabuhay Satellite’s Agilla IItransponder is considered impaired.  This impairment review is based on the NPVof future cash flows from the continued use of this asset using the discountfactor of 10% as applied on cash flow projections from 2007 until 2010.  Animpairment loss of Php1,391 million was applied to the carrying value of thissatellite as at December 31, 2006 and included in the accumulated depreciationand amortization account in the unaudited consolidated balance sheet as atMarch 31, 2007.

 

Property, plant and equipment include the followingamounts for capitalized leases as at March 31, 2007 and December 31, 2006:

 

** **

**March 31, 2007 (Unaudited)**

December 31, 2006 (Audited)

 

**Central office equipment**

**Vehicles, furniture and other network equipment**

**Total**

Central office equipment

Vehicles, furniture and other network equipment

Total

 

(in million pesos)

Cost

**354**

**1,298**

**1,652**

455

1,082

1,537

Less accumulated depreciation

**316**

**1,096**

**1,412**

352

908

1,260

 

**38**

**202**

**240**

 103

 174

 277

 

Thefollowing table summarizes all changes to the liabilities on asset retirementobligations as at March 31, 2007 and December 31, 2006:

 

 

**March 31,  2007 (Unaudited)**

 

December 31, 2006 (Audited)

 

(in million pesos)

Asset retirement obligations at beginning of period

**831**

 

752

Accretion expenses

**23**

 

87

Additional liability recognized during the period

**3**

 

45

Settlement of obligations

**(3)**

 

(53)

Asset retirement obligations at end of period (Note 18)

**854**

 

 831

 

 

 

**9.   Investmentsin Associates**

 

This account consists of:

 

 

**March 31,  2007 (Unaudited)**

 

December 31, 2006 (Audited)

 

(in million pesos)

ACeS International Limited

**1,614**

 

1,614

Mabuhay Space Holdings Limited

**921**

 

937

Philweb Corporation

**712**

 

712

Stradcom International Holdings, Inc.

**616**

 

616

BayanTrade Dotcom, Inc.

**97**

 

97

ePDS, Inc.

**6**

 

6

 

**3,966**

 

3,982

Less accumulated impairment losses and equity share in  net losses of associates

**3,335**

 

3,346

Total cost and accumulated impairment losses and equity share  in net losses of associates

**631**

 

 636 

 

***Investmentof ACeS Philippines in ACeS International Limited, or AIL***

 

Asat March 31, 2007, ACeS Philippines had a 20% investment in AIL, a companyincorporated under the laws of Bermuda.  AIL owns the Garuda I Satellite andthe related system control equipment in Batam, Indonesia.

 

InDecember 1998, AIL and its 95% owned subsidiary, PT Asia Cellular Satellite,entered into an Amended and Restated Credit Agreement, or Amended Agreement, toamend the original Credit Agreement entered into by PT Asia Cellular Satelliteand its bank creditors in 1997.  Under the Amended Agreement, AIL has, amongother things, assigned to the banks as collateral all of its tangibleproperties, including the Garuda I Satellite, the system control facilities andsystem control equipment.  On September 30, 2002, PT Asia Cellular Satellite,AIL, as guarantor, P.T. Bank Internasional Indonesia, as security agent, andvarious other banks signed a rescheduling agreement, which amended the terms ofthe Amended and Restated Credit Agreement dated December 29, 1998, moving theprincipal repayment dates to agreed periods with the final maturity date onJanuary 31, 2012, see *Note 20 – Related Party Transactions*.

 

AILhas incurred recurring significant operating losses, negative operating cashflows, and significant levels of debt.  The financial condition of AIL waspartly due to the National Service Providers’, or NSPs, inability to generatethe amount of revenues originally expected as the growth in subscriber numbers hasbeen significantly lower than budgeted.  These factors raise substantial doubtabout AIL’s ability to continue as a going concern.  On this basis, werecognized a full impairment provision in respect of our investment in AILamounting to Php1,614 million in 2003.

 

OnSeptember 1, 2006, AIL and PT Asia Cellular Satellite signed a Term Sheet, or BanksTerm Sheet, with a majority of the banks that will be used as the basis forfurther good faith negotiations between the parties thereto with a view toentering into an agreement further amending the Amended and Restated CreditAgreement with AIL’s bank creditors.

 

Under the Banks Term Sheet, a majority of the banksagreed, subject to satisfaction of certain conditions, among other things, toamend the Founder NSP ATPA and to re-denominate AIL debt into non-interest-bearingsubordinated convertible bonds maturing in 2015; to amortize a senior term loanwith a final maturity on August 1, 2013 and a junior term loan with payments onAugust 1, 2014 and 2015.

 

Pursuantto the business collaboration arrangements between AIL and Inmarsat, onSeptember 1, 2006, Inmarsat made the first payment of US$4 million to AIL whichwas used to pay principal and interest payable to the banks in accordance withthe Banks Term Sheet.

 

OnFebruary 1, 2007, PLDT (through ACeS Philippines) signed an agreement topurchase LMGT Holdings (ACeS), Inc., or LMGT, and Martin Marietta OverseasCorporation’s, or MMOC, 50% equity and debt interest in AIL, for US$750,000 inaccordance with a notice of proposed transfer issued by LMGT dated December 22,2006 pursuant to a right of first refusal under the AIL Shareholders’Agreement.

 

***Investmentof Mabuhay Satellite in Mabuhay Satellite Space Holdings Limited, or MSHL***

 

In 1996, MabuhaySatellite entered into a Joint Venture Agreement, or JVA, with SpaceSystems/Loral Inc., or SS/L, to form MSHL for the purpose of providinghigh-power Ku-Band satellite transmission services using the payload which wasadded by SS/L to the Agila II Satellite.  Under the terms of the JVA, SS/L isrequired to convey title to the additional payload service to MSHL inconsideration for SS/L’s 35% equity interest in MSHL, and Mabuhay Satellite isrequired to pay SS/L US$19 million for a 65% equity interest in MSHL.

 

In 2000, SS/L filed a Notice of Default and Termination against MabuhaySatellite arising from the latter’s alleged failure to amicably resolve itsunpaid obligation to SS/L under the JVA.  In 2002, the arbitration panel handeddown its decision and provided for payment by Mabuhay Satellite to SS/L of theprincipal amount of US$10 million plus accrued interest at 9% per annum.  OnJune 30, 2003, Mabuhay Satellite and SS/L concluded a US$15 million settlementagreement under which Mabuhay Satellite leased two transponders under atransponder agreement on a life-term basis to SS/L and offset the lease chargesdue from SS/L and its receivables from Loral Skynet Network Services, Inc.(formerly known as the Loral Cyberstar, Inc.), among other things, for a fulland final settlement of the arbitration decision.  The agreement wassubsequently approved by Mabuhay Satellite’s creditors in March 2004.

 

Inaccordance with the settlement agreement, Mabuhay Satellite and SS/L shallproceed to dissolve the joint venture under a separate agreement, for whicheach of the parties will receive title over a number of transponders owned bythe joint venture in proportion to their respective interests.  On the basis ofthe joint venture dissolution, we recognized an impairment provision in respectof our investment in MSHL of Php431 million in 2004.

 

***Investmentof ePLDT in Philweb Corporation, or Philweb***

 

InMay 2006, ePLDT subscribed newly issued common shares of Philweb, aninternet-based gaming company, equivalent to 20% of the total outstandingcapital stock of Philweb at a price of Php0.020 per share or an aggregateamount of Php502 million.  Of the total subscription price, Php427 million waspaid by ePLDT on the closing date.  The portion of the unpaid subscriptionprice amounting to Php25 million will be paid by ePLDT at the same time as thePhilweb majority stockholders pay the remaining unpaid portion of thesubscription pursuant to a general call on subscription to be made by Philweb’sboard of directors.  The balance of Php50 million will be paid upon the lapseof certain post-closing price adjustment periods.  The unpaid subscription ofPhp75 million was recorded as part of accruedexpenses and other current liabilities in the balance sheet.

 

In October 2006, ePLDT acquired an additional8,037,692,308 shares of Philweb at a price of Php0.026 per share or anaggregate amount of Php209 million.  This represents an additional 6.2% of theoutstanding shares of Philweb, raising ePLDT’s total equity stake to 25.5% asat December 31, 2006.

 

Philwebis primarily engaged in internet-based gaming, through its appointment asPrincipal Technology Service Provider under the Marketing Consultancy Agreementfor Internet Sports Betting and Internet Casino with the Philippine Amusementand Gaming Corporation, or PAGCOR.  As of the end of December 2006, Philweboffers Internet Sports Betting in over 230 PAGCOR Internet Sports BettingStations and over 40 Internet Casino Stations nationwide.

 

***Investmentof ePLDT in Stradcom International Holdings, Inc., or SIHI***

 

ePLDT hasa 22.5% interest in convertible securities of SIHI, the parent company ofStradcom Corporation, which has an existing concession agreement with thePhilippine Government for the modernization of the Philippine LandTransportation Office, including the computerization of driver’s licenseissuance, vehicle registration and traffic adjudication systems.  SIHI has beenincurring losses from the start of operations due to Stradcom Corporation’scontinuous losses and recurring excess of current liabilities over currentassets.  On this basis, we recognized an impairment provision in respect of ourinvestment in SIHI of Php616 million in 2004.

 

StradcomCorporation is currently undertaking the issuance of Asset-Backed Bondsamounting to Php1.6 billion intended for debt refinancing and general corporatepurposes, including working capital and investments.

 

***Investment of ePLDT in BayanTrade Dotcom, Inc., orBayanTrade***

 

BayanTrade was incorporated and registered with the PhilippineSecurities and Exchange Commission, or PSEC, on August 8, 2000 to provide:  (a)a business-to-business electronic purchasing market place to link buyers andsuppliers of goods services over the Internet; (b) electronic cataloguepurchasing facilities over the Internet to buyers and suppliers; (c) link-upwith similar horizontal markets and vertical markets across the Asia-PacificRegion and the world; and (d) facilitating services incidental to thebusiness.  BayanTrade is an e-procurement joint venture established togetherwith six of the Philippines’ leading conglomerates.  ePLDT’s initialshareholding in BayanTrade was 20.5%, which was subsequently diluted to 19.17%in August 2004 due to an equity call to which ePLDT did not subscribe.

 

InSeptember 2005, ePLDT received 4,794,615 bonus warrants from BayanTrade whichentitles ePLDT to purchase 2,794,615 common shares at a price of Php0.50 pershare at any time on or before August 31, 2010.

 

***Investment of ePLDT in ePDS, Inc., or ePDS***

 

On June 30, 2003, ePLDT signed a joint ventureagreement with DataPost Pte Ltd., or DataPost, a subsidiary of Singapore Post,and G3 Worldwide ASPAC, or Spring, pursuant to which the parties formed ePDS, abills printing company which does laser printing and enveloping services forstatements, bills and invoices, and other value-added services for companies inthe Philippines.  ePLDT has a 50% interest in ePDS, while DataPost has a 30%interest.  Spring, the largest international mail services provider, owns theremaining 20%.  ePDS has an initial paid-up capital of Php11 million.

 

In October 2005, ePDS’ Board of Directors approved thedeclaration of a 100% stock dividend on its common stock equivalent to Php11million.  The stock dividends were issued from the increase in authorizedcapital stock of ePDS which was approved by the PSEC in June 2006.

 

***Summarized Financial Information of Equity Investees***

 

Thefollowing table presents summarized financial information in conformity with PFRSfor equity investees for which we have significant influence as at March 31,2007 and December 31, 2006 and for the three months ended March 31, 2007 and2006.

 

 

**March 31,  2007 (Unaudited)**

 

December 31, 2006 (Audited)

 

(in million pesos)

Noncurrent assets

**1,499**

 

1,333

Current assets

**1,769**

 

1,122

Capital deficiency

**(8,707)**

 

(9,618)

Noncurrent liabilities

**9,837**

 

10,029

Current liabilities

**2,138**

 

2,044

 

 

**Three Months Ended March 31,**

 

**2007**

 

2006

 

(Unaudited)

 

(in million pesos)

Revenues

**362**

 

166

Revenues less cost of revenues

**192**

 

129

Expenses

**244**

 

99

Net loss

**(53)**

 

(102)

 

 

 

**10. Investment Properties**

 

 

**March 31,  2007 (Unaudited)**

 

December 31, 2006 (Audited)

 

(in million pesos)

Balance at beginning of period

**587**

 

701

Disposals

**(5)**

 

(112)

Net loss from fair value adjustments

**–**

 

(2)

Balance at end of period

**582**

 

587

 

Investmentproperties are stated at fair values, which have been determined based on thelatest valuations performed by an independent firm of appraisers, which is anindustry specialist in valuing these types of investment properties.  Thevaluation undertaken was based on an open market value, supported by a marketevidence in which assets could be exchanged between a knowledgeable willingbuyer and a knowledgeable willing seller in an arm’s-length transaction at thedate of valuation, in accordance with international valuation standards.

 

 

 

**11. Goodwill and Intangible Assets**

 

Movements in goodwill and intangible assets during theperiods are as follows:

 

 

**March 31, 2007 (Unaudited)**

December 31, 2006 (Audited)

 

**Goodwill**

**Intangible assets**

**Total**

Goodwill

Intangible assets

Total

 

(in million pesos)

Cost:

 

 

 

 

 

 

Balance at beginning of period

**10,137**

**3,456**

**13,593**

1,942

1,991

3,933

Additions during the period

**–**

**–**

**–**

8,498

1,540

10,038

Translation adjustments

**(106)**

**(14)**

**(120)**

(303)

(75)

(378)

Balance at end of period

**10,031**

**3,442**

**13,473**

10,137

3,456

13,593

 

** **

** **

** **

 

 

 

Accumulated amortization and impairment:

** **

** **

** **

 

 

 

Balance at beginning of period

**438**

**941**

**1,379**

438

446

 884

Amortization during the period

**–**

**76**

**76**

–

450

 450

Impairment during the period

**–**

**–**

**–**

–

50

  50

Translation adjustments

**–**

**(1)**

**(1)**

–

(5)

(5)

Balance at end of period

**438**

**1,016**

**1,454**

 438

 941

1,379

Net balance

**9,593**

**2,426**

**12,019**

9,699

2,515

12,214

 

*ePLDT’s Acquisition of Level Up!*

 

On February 16, 2006, ePLDT entered into a sale andpurchase agreement to acquire 60% equity interest of Level Up!, a leadingpublisher of online games in the Philippines, for a total consideration ofPhp383 million.  Post-closing conditions were completed on April 30, 2006.  InAugust 2006, the Shareholders Agreement and Share Purchase Agreement betweenePLDT and Level Up! were amended to reflect the removal of earn-out and priceadjustment provisions thereby fixing the acquisition for 60% of Level Up! atthe aforementioned original purchase price of US$7 million.  As at purchasedate, the net cash outflow on acquisition was Php350 million, representing cashpayments of Php383 million, net of cash acquired from Level Up! of Php35million, and incidental cost of Php2 million.

 

Thepurchase consideration has been allocated to the assets and liabilities on thebasis of fair values at the date of acquisition.  The fair values of theidentifiable acquired assets and liabilities of Level Up! as at April 30, 2006are as follows:

 

 

(in million pesos)

Property, plant and equipment

129

Goodwill

597

Intangible assets

185

Other noncurrent assets

7

Cash and cash equivalents

35

Trade and other receivables

8

Inventories and supplies

1

Prepayments and other current assets

20

 

982

Deferred income tax liabilities

60

Capital lease liabilities

49

Accounts payable

21

Accrued expenses and other current liabilities

66

Unearned revenues

38

Due to related parties

110

 

344

Minority interest

255

Net assets acquired

383

 

Intangibleassets, as determined by an independent appraiser, pertaining to Level Up!’sgame license agreements for Ragnarok, ROSE Online, RF Online and Freestyle amountedto Php185 million with an estimated remaining useful life of 5.67 years.  LevelUp! was accounted for in the consolidated financial statements using thepurchase method of accounting, which resulted in goodwill amounting to Php597million in 2006.  Goodwill pertains to the assembled workforce and otherunidentified intangible assets that did not qualify as intangible assets under*PAS 38, “Intangible Assets”*.  As at December 2006, ePLDT has providedimpairment in value of its intangble assets in Level Up! amounting to Php50million, representing a write-down of such intangible assets to recoverableamounts using the value in use approach.  Value in use was based on thediscounted cash flow projections using the most recent financial forecastapproved by our management.

 

*ePLDT’s Acquisition of SPi*

 

OnJuly 10, 2006, ePLDT entered into a sale and purchase agreement to acquire 100%equity interest of SPi and its direct and indirect Philippine and offshoresubsidiaries for a total cash consideration of US$136 million.  As part of thetransaction, ePLDT also acquired a US$7 million debt owed by SPi to the sellerat face value.  In addition, ePLDT advancedUS$16 million to SPi in order for SPi to fully pay its debt owed to DBS Bank Singapore.  As at December 31, 2006, the net cashoutflow on acquisition was Php7,121 million, representing cash payments of Php7,116million, net of cash acquired from SPi of Php85 million, and incidental cost ofPhp90 million.

 

SPiis the second largest pure-play BPO Company and the ninth largest independentBPO service provider worldwide.  It has operations in 19 locations in NorthAmerica, Europe and Asia.  Its customers include Fortune 100 companies,non-profit organizations and government agencies in the financial services,healthcare, legal and publishing markets.  

 

The purchase consideration has been allocated to theassets and liabilities on the basis of fair values at the date of acquisition.The fair values of the identifiable acquired assets and liabilities of SPi atthe time of acquisition are as follows:

 

 

In U.S. Dollar

In Php Equivalent(1)

 

(in millions)

Property, plant and equipment

19

1,002

Goodwill

130

6,787

Intangible assets

18

956

Other noncurrent assets

1

52

Cash and cash equivalents

2

85

Trade and other receivables

41

2,162

Prepayments and other current assets

2

95

 

213

11,139

Deferred income tax liabilities

7

388

Other noncurrent liabilities

1

44

Accounts payable

58

3,048

Short-term borrowings

3

131

Accrued expenses and other current liabilities

8

412

 

77

4,023

Net assets acquired

136

7,116

 

*(1)**Converted toPhilippine Peso using the exchange rate at the time of purchase.*

 

Intangibleassets, as determined by an independent appraiser, amounted to Php956 million relatingto SPi’s customer relationships and self-developed software with estimated remaininguseful lives of seven and four years, respectively. Intangible assets werefully consolidated to ePLDT.

 

SPi was accounted for in the consolidated financialstatements using the purchase method of accounting, which resulted in goodwillamounting to Php6,787 million.  Goodwill pertains to the assembled workforce ofSPi and other unidentified intangible assets that did not qualify as intangibleassets under PAS 38.

 

*ePLDT’sAcquisition of CyMed*

 

OnAugust 11, 2006, ePLDT, through its direct subsidiary SPi, entered into a saleand purchase agreement to acquire 100% equity interest of CyMed for anaggregate purchase price of US$35 million, inclusive of certain debtobligations.  CyMed is a leading medical transcription company based in Richmond, Virginia, United States of America (USA).  It provides medical transcriptionservices and technology products through proprietary processes based on SixSigma quality management principles. The company currently serves over 400healthcare systems, independent hospitals, and government-affiliated clinicsacross the USA.  CyMed employs 650 U.S.-based staff members and has offices in thestates of Virginia, Tennessee and Ohio.  As at August 15, 2006, the net cashoutflow related on acquisition was Php1,774 million, representing cash paymentsof Php1,831 million, net of cash acquired from CyMed of Php57 million.  Totalcash payments include purchase price consideration of Php1,715 million, workingcapital amounts and other net debt adjustments totaling Php102 million, andincidental cost of Php13 million.

 

The purchase consideration has been allocated to theassets and liabilities on the basis of fair values at the date of acquisition.The fair values of the identifiable acquired assets and liabilities of CyMed atthe time of acquisition, assessed to be equal to their book values are asfollows:

 

 

In U.S. Dollar

In Php Equivalent(1)

 

(in millions)

Property, plant and equipment

1

39

Goodwill

27

1,223

Intangible assets

7

336

Deferred income tax assets

1

30

Notes receivable

2

108

Cash and cash equivalents

1

57

Trade and other receivables

3

148

Prepayments and other current assets

1

20

 

43

1,961

Interest-bearing financial liabilities – net of current portion

4

58

Accounts payable and other current liabilities

2

72

 

6

130

Net assets acquired

37

1,831

* *

*(1)**Converted toPhilippine Peso using the exchange rate at the time of purchase.*

 

CyMed was accounted for in the consolidated financialstatements using the purchase method of accounting, which resulted in goodwillamounting to Php1,223 million.  Goodwill pertains to assembled workforce ofCyMed and other unidentified intangible assets that did not qualify as intangibleassets under PAS 38.

 

Intangibleassets pertaining to CyMed’s customer relationship was determined at Php336million with an estimated useful life of five years.  Intangible assets wasvalued by an independent appraiser.

 

Other intangible assets consist of:

 

 

**March 31, 2007 (Unaudited)**

 

December 31, 2006 (Audited)

 

Gross

Net

 

Gross

Net

 

Carrying Amount

Accumulated Amortization

 

 

Carrying Amount

Accumulated Amortization

 

 

(in million pesos)

Customer list

1,318

(231)

1,087

 

1,332

(195)

1,137

Spectrum

1,205

(207)

 998

 

1,205

(187)

1,018

Technology application

600

(482)

 118

 

601

(471)

 130

Licenses

319

(96)

 223

 

318

(88)

 230

 

3,442

(1,016)

2,426

 

3,456

(941)

2,515

 

Thefuture amortization of other intangible assets as at March 31, 2007 are asfollows: 

 

 

(in million pesos)

2007(1)

293

2008

359

2009

344

2010

306

2011

237

2012 and onwards

887

Balance at end of period

2,426

 

*(1)**April 1, 2007through December 31, 2007*

 

***Impairment Testing of Goodwill***

 

*Goodwill from Smart Broadband Acquisition*

 

The test for recoverability of Smart’s goodwill was appliedto an asset group, representing the lowest level for which identifiable cashflows are largely independent of the cash flows of other groups of assets andliabilities.

 

Althoughrevenue streams may be segregated between Smart and Smart Broadband throughsubscribers availing themselves of their respective cellular and wirelessbroadband services, the cost items and cash flows are difficult to carve out,largely due to the significant portion of shared and common-used networks/platforms.In the case of Smart Broadband, it provides broadband wireless access to itssubscribers using Smart’s cellular base stations, fiber optic and IP backbone.With the common use of wireless assets with Smart in providing wirelessservices, the lowest asset group for Smart Broadband for which cash flows couldbe clearly identified from other groups of assets will be Smart’s wirelessbusiness segment.

 

Ourwireless business segment has been our largest revenue and cash flowcontributor since 2003.  As such, there is no impairment of our wirelessbusiness segment.  As at March 31, 2007, the recoverable amount of this segmentis determined on the basis of value in use calculations using cash flowprojections based on the financial budgets approved by Smart’s Managementcovering a 5-year period from 2007 to 2011.  The pre-tax discount rate appliedto cash flow projections is 10.6% and cash flows beyond the 5-year period aredetermined using a 2.5% growth rate that is the same as the long-term averagegrowth rate for the telecommunications industry.

 

The calculation of value in use for Smart’s wirelessbusiness segment was based on the following assumptions: (a) usage revenues for2007 were based on the annualized actual year-to-date results available at thetime the budget was prepared in 2006; (b) usage revenues were assumed to growat an average rate of 5% per annum from 2007 to 2011; (c) average capitalexpenditures per year were assumed at Php8.6 billion from 2007 to 2011; (d) thediscount rate used was the weighted average cost of capital; and (e) the growthrate used for cash flows beyond the budget period was based on publishedindustry research.

 

*Goodwillfrom SPi Acquisition and its Subsidiary, CyMed*

 

Thegoodwill acquired through the SPi and CyMed transactions was allocated forimpairment testing to each of the cash generating units of those businessesnamely: healthcare, litigation and publishing.

 

Asat March 31, 2007, we determined that there would be no impairment lossrecognized for each of the cash generating units since the recoverable amountexceeded the carrying amount of the individual assets.  The recoverable amount ofgoodwill was determined using the value in use approach. Value in use was basedon the cash flow projections of the most recent financial budgets/forecastsapproved by management, which management believes are reasonable and aremanagement’s best estimate of the range of economic conditions that will existover the remaining useful life of the asset.

 

Indetermining the appropriate discount rate to be applied, our weighted averagecost of capital was used and adjusted for the difference in currency andspecific risks associated with the assets or business of a cash-generating unit.

 

Management assessed the reasonableness of theassumptions by examining the causes of differences between actual 2006 cashflow and budgeted/projected cash flows, with a particular emphasis on the observedtrends towards the last quarter of 2006.

*** ***

*** ***

 

**12. Notes Receivable**

*** ***

***Investment of ePLDT in Debt Securities of TechnologySupport Services, Inc., or TSSI (formerly First Advance Multi-MediaEntertainment Corp., or FAME)***

*** ***

On June 1,2004, ePLDT and FAME entered into an agreement whereby ePLDT granted a seven-yearzero-coupon loan to FAME amounting to US$3.1 million.  Based on agreement, uponmaturity of the loan, which is at the end of seven years from issuance, ePLDTmay require FAME to redeem or pay the loan at a redemption value amounting toUS$6.1 million.  At any time during the life of the outstanding loan, ePLDT mayconvert the loan into 20% of the total outstanding capital stock of FAME.

*** ***

OnAugust 20, 2004, FAME changed its corporate name to TSSI.

*** ***

On September 14, 2004, ePLDT entered into a second agreementwith TSSI whereby ePLDT granted another seven-year zero coupon loan to TSSIamounting to US$3.1 million with the same terms and features as the firstloan.  As at March 31, 2007, the aggregate loans of ePLDT to TSSI amounted to US$346million.

*** ***

TSSIhas been incurring losses from the start of operations due to delays in itsprojects.  On this basis, we recognized a full impairment provision in respectof our notes receivable from TSSI amounting to Php346 million in December 2006.

*** ***

*** ***

 

**13. Cashand Cash Equivalents**

*** ***

This account consists of:

*** ***

 

**March 31,  2007 (Unaudited)**

 

December 31, 2006 (Audited)

 

(in million pesos)

Cash on hand and in banks

**4,082**

 

3,416

Temporary cash investments

**18,227**

 

13,454

 

**22,309**

 

16,870

*** ***

Cash inbanks earns interest at prevailing bank deposit rates.  Temporary cashinvestments are made for varying periods of up to two months depending on ourimmediate cash requirements, and earn interest at the prevailing short-termdeposit rates.  Due to the short-term nature of such transactions, the carryingvalue approximates the fair value of our temporary cash investments.

*** ***

*** ***

 

**14. Tradeand Other Receivables**

*** ***

Thisaccount consists of receivables from:

*** ***

 

**March 31,  2007 (Unaudited)**

 

December 31, 2006 (Audited)

 

(in million pesos)

Customers and carriers

**25,011**

 

25,349

Others (Notes 20, 22 and 23) 

**1,473**

 

1,579

 

**26,484**

 

26,928

Less allowance for doubtful accounts

**16,474**

 

16,770

 

**10,010**

 

10,158

*** ***

Movements in the allowance for doubtful accounts areas follows:

*** ***

 

**March 31,  2007 (Unaudited)**

 

December 31, 2006 (Audited)

 

(in million pesos)

Balance at beginning of period

**16,770**

 

18,525

Provisions for the period (Note 5)

**163**

 

736

Translation adjustments

**(8)**

 

(24)

Write-offs

**(451)**

 

(1,884)

Business combinations

**–**

 

71

Reversals

**–**

 

(654)

Balance at end of period

**16,474**

 

16,770

 

Receivablesfrom carriers represent receivables arising from interconnection agreementswith other telecommunications carriers.  The aforementioned receivable balancesare shown net of related payables to the same telecommunications carriersbecause an established right of offset exists.  

 

On October10, 2002, PLDT entered into a Receivables Purchase Deed, or RPD, with a foreignfinancial institution, or the Purchaser, under which PLDT agreed (1) to sellits receivables from certain eligible foreign carriers for an advance paymentof US$50 million, of which US$2 million remained outstanding as at March 31, 2007,and (2) to service, administer and collect the receivables on behalf of thePurchaser.  Under the RPD, the Purchaser has no recourse against PLDT should aneligible carrier fail or refuse to settle the assigned/purchased receivables,except when PLDT commits a breach of its representations and warranties underthe RPD.

 

Sale of receivables under the RPD amounted to US$1 million (Php61 million) and US$2 million(Php81 million) for the three months ended March 31, 2007 and 2006,respectively.  Loss on sale of receivables under the RPD amounted to US$0.07million (Php3 million) and US$0.31 million (Php16 million) for the three monthsended March 31, 2007 and 2006, respectively.

 

 

 

**15. Inventories and Supplies**

 

This account consists of:

 

 

**March 31,  2007 (Unaudited)**

 

December 31, 2006 (Audited)

 

(in million pesos)

Terminal and cellular phone units:

** **

 

 

At net realizable value

**662**

 

556

At cost

**861**

 

719

Spare parts and supplies:

** **

 

 

At net realizable value

**454**

 

514

At cost

**1,296**

 

1,397

Others:

** **

 

 

At net realizable value

**161**

 

160

At cost

**163**

 

161

At lower of cost or net realizable value

**1,277**

 

1,230

 

 

 

**16. Equity**

 

Themovement of PLDT’s capital accounts as at December 31, 2006 and March 31, 2007are as follows:

 

** **

**Preferred Stock** –  Php10 par value per share

** **

** **

**Series  A to FF**

**III**

**IV**

**Total Preferred Stock**

** **

** **

**Common Stock** –  Php5 par value per share

** **

**No. of Shares**

**Amount**

** **

**No. of Shares**

**Amount**

** **

(in millions)

**Authorized**

 

 

** **

823

Php8,230

234

Php1,170

**Outstanding**

** **

 

** **

** **

** **

 

 

Balance at January 1, 2006

407

–

36

443

Php4,433

181

Php904

Issuance

–

–

–

–

2

–

–

Conversion

(1)

–

–

(1)

(11)

7

38

Balance at December 31, 2006 (Audited)

 406

–

  36

 442

Php4,424

 188

Php942

 

 

 

 

 

 

 

 

Balance at January 1, 2007

 406

–

  36

 442

Php4,424

 188

Php942

Issuance

–

–

–

–

–

1

1

Conversion

–

–

–

–

(3)

–

–

Balance at March 31, 2007 (Unaudited)

 406

–

  36

 442

Php4,421

 189

Php943

 

***PreferredStock***

 

Thepreferred stock is non-voting, except as specifically provided by law, and ispreferred as to liquidation.

 

The Series A to FF 10% Cumulative Convertible Preferred Stocks earncumulative dividends at an annual rate of 10%.  After the lapse of one yearfrom the last day of the year of issuance of a particular series of 10%Cumulative Convertible Preferred Stock, any holder of such series may convertall or any of the shares of 10% Cumulative Convertible Preferred Stock held byhim into fully paid and non-assessable shares of Common Stock of PLDT, at a conversionprice equivalent to 10% below the average of the high and low daily sales priceof a share of Common Stock on the PSE, or if there have been no such sales onthe PSE on any day, the average of the bid and the asked prices of a share ofCommon Stock of PLDT at the end of such day on such Exchange, in each such caseaveraged over a period of 30 consecutive trading days prior to the conversiondate, but in no case shall the conversion price be less than the price set bythe Board of Directors which, as at March 31, 2007, was Php5.00 per share.  Thenumber of shares of Common Stock issuable at any time upon conversion of oneshare of the subscriber investment plan, or SIP, or the 10% CumulativeConvertible Preferred Stock is determined by dividing Php10.00 by the thenapplicable conversion price.

 

In case the shares of Common Stock at anytimeoutstanding are subdivided into a greater or consolidated into a lesser numberof shares, then the minimum conversion price per share of Common Stock will beproportionately decreased or increased, as the case may be, and in the case ofa stock dividend, such price will be proportionately decreased, provided,however, that in every case the minimum conversion price shall not be less thanthe par value per share of Common Stock.  In the event the relevant effectivedate for any such subdivision or consolidation of shares or stock dividendoccurs during the period of 30 trading days preceding the presentation of anyshares of 10% Cumulative Convertible Preferred Stock for conversion, a similaradjustment will be made in the sales prices applicable to the trading daysprior to such effective date utilized in calculating the conversion price ofthe shares presented for conversion.

 

Incase of any other reclassification or change of outstanding shares of CommonStock, or in case of any consolidation or merger of PLDT with or into anothercorporation, the Board of Directors shall make such provisions, if any, foradjustment of the minimum conversion price and the sales price utilized incalculating the conversion price as the Board of Directors, in its solediscretion, shall be deemed appropriate.

 

AtPLDT’s option, the Series A to FF 10% Cumulative Convertible Preferred Stocksare redeemable at par value plus accrued dividends five years after the year ofissuance.

 

OnDecember 6, 2005, the Board of Directors designated 100,000 shares of serialpreferred stock as Series GG 10% Cumulative Convertible Preferred Stock forissuance throughout 2006.

 

OnJanuary 30, 2007, the Board of Directors designated 150,000 shares of serialpreferred stock as Series HH 10% Cumulative Preferred Stock for issuance up toDecember 31, 2009.

 

The issuance of SIP Series FF,GG and HH is an exempt transaction under Section 10.2 of Securities RegulationCode as confirmed by the Philippine SEC on April 2, 2007.

 

On October 24, 2005, PLDTissued to JPMorgan, as depositary, and to the holders of the Series IIIConvertible Preferred Stock a notice of mandatory conversion of all of itsoutstanding 4,616,200 shares of Series III Convertible Preferred Stock intoshares of PLDT Common Stock.  The conditions for mandatory conversion under theterms of the Series III Preferred Stock have been satisfied, including: (i)that the average closing price of PLDT’s ADSs for the 30-day period endingseven days prior to the date in which notice of the mandatory conversion wasgiven was above US$29.19 a share; (ii) that there were no dividends in arrearson any shares of the Series III Convertible Preferred Stock; and (iii) thatPLDT had sufficient distributable reserves to pay the fixed preferentialdividends on the shares of Series III Convertible Preferred Stock, calculateddown to and including the mandatory conversion date.

 

InNovember 2005, PLDT issued 710,891 shares of common stock on account of thevoluntary conversion of 415,023 shares of Series III Convertible PreferredStock.

 

As at December 19, 2005,as a result of PLDT’s issuance of a notice of mandatory conversion, all of theoutstanding shares of Series III Convertible Preferred Stock were voluntarilyand mandatorily converted into shares of PLDT Common Stock wherein each shareof Series III Convertible Preferred Stock was converted into 1.7129 shares ofCommon Stock.  A total of 7,907,032 shares of PLDT’s Common Stock were issuedas a result of the voluntary and mandatory conversions of all of the Series IIIConvertible Preferred Stock.

 

TheSeries IV Cumulative Non-Convertible Redeemable Preferred Stock earnscumulative dividends at an annual rate of 13.5% based on the paid-upsubscription price.  It is redeemable at the option of PLDT at any time oneyear after subscription and at the actual amount paid for such stock, plusaccrued dividends.  On February 26, 2002, the Board of Directors called for thepayment of a portion of the balance of the subscription price of the Series IVCumulative Non-Convertible Redeemable Preferred Stock amounting to Php72million, which was paid on March 5, 2002.  On March 22, 2002, PLDT redeemed 60million shares out of the 360 million subscribed shares of its Series IVCumulative Non-Convertible Preferred Stock and paid Php72 million, representingthe redemption price plus unpaid dividends up to the date of redemption.

 

The provisions of certain subscription agreementsinvolving preferred stock have an effect on the ability of PLDT to, withoutwritten consent, sell certain assets and pay cash dividends unless alldividends for all past quarterly dividend periods have been paid, and provisionhas been made for the currently payable dividends.

 

 

 

**17. Interest-bearingFinancial Liabilities**

 

Thisaccount consists of the following:

 

 

**March 31,  2007 (Unaudited)**

 

December 31, 2006 (Audited)

 

(in million pesos)

**Long-term portion of interest-bearing financial liabilities -  net of current portion:**

** **

 

 

Long-term debt (Note 24)

**64,622**

 

63,769

Obligations under capital lease (Notes 8 and 24)

**57**

 

106

Preferred stock subject to mandatory redemption (Note 24)

**1,247**

 

1,369

 

**65,926**

 

65,244

 

** **

 

 

**Current portion of interest-bearing financial liabilities:**

** **

** **

** **

Notes payable

**198**

** **

201

Long-term debt maturing within one year (Note 24)

**10,093**

 

16,184

Obligations under capital lease maturing within one year (Notes 8 and 24)

**934**

 

924

 

**11,225**

 

17,309

 

Unamortizeddebt discount, representing debt issuance costs and any difference between thefair value of consideration given or received on initial recognition, includedin the financial liabilities are as follows:

 

 

**March 31,  2007 (Unaudited)**

 

December 31, 2006 (Audited)

 

(in million pesos)

Long-term debt

**5,686**

 

5,953

Obligations under capital lease (Notes 8 and 24)

**526**

 

540

Preferred stock subject to mandatory redemption

**190**

 

260

Total unamortized debt discount at end of period

**6,402**

 

6,753

 

Thefollowing table describes all changes to unamortized debt discount as at March31, 2007 and December 31, 2006.

 

 

**March 31,  2007 (Unaudited)**

 

December 31, 2006 (Audited)

 

(in million pesos)

Unamortized debt discount at beginning of period

**6,753**

 

13,347

Additions during the period

**15**

 

48

Settlements and conversions during the period

**(26)**

 

(2,733)

Revaluations during the period

**(71)**

 

(595)

Accretion during the period charged to interest expense (Notes 5 and 24)

**(269)**

 

(3,314)

Unamortized debt discount at end of period

**6,402**

 

6,753

 

**Long-termDebt**

 

Long-term debtconsists of:

 

**Description**

**Interest Rates**

**March 31, 2007 (Unaudited)**

December 31, 2006 (Audited)

 

 

(in millions)

*U.S. Dollar Debt:*

** **

** **

** **

** **

** **

Export Credit Agencies-Supported Loans:

** **

** **

** **

** **

** **

Kreditanstalt für Wiederaufbau, or KfW

5.65% - 7.58% and US$ LIBOR + 0.55% - 2.5% in 2007 and 2006

**US$189**

**Php9,101**

US$201

Php9,877

Finnvera, Plc, or Finnvera

US$ LIBOR + 0.05% in 2007 and 7.53% - 7.75% and US$ LIBOR + 0.05% in 2006

**59**

**2,849**

69

3,381

Nippon Export and Investment Insurance  of Japan, or NEXI

US$ LIBOR + 1% in 2007and  in 2006

**25**

**1,199**

25

1,215

Others

6.60% and US$ LIBOR + 0.15% - 0.65% and GOVCO’s cost + 0.20% in 2007 and5.83% - 6.6% and US$ LIBOR + 0.15% - 1.60% and GOVCO’s Cost + 0.20% in 2006

**9**

**426**

10

508

 

 

**282**

**13,575**

 305

14,981

Fixed Rate Notes

7.85% - 11.375% in 2007 and 2006

**695**

**33,497**

835

40,971

Term Loans:

 

** **

** **

 

 

Debt Exchange Facility

2.25% and US$ LIBOR + 1% in 2007 and 2006

**178**

**8,606**

176

8,615

GSM Network Expansion Facilities

4.49% - 4.70% and US$ LIBOR  + 0.815% in 2007 and 4.49% - 4.7% and US$ LIBOR + 0.815% - 3.25% in 2006

**179**

**8,645**

194

9,509

Others

US$ LIBOR + 0.40% and 6% - 10% in 2007 and US$ LIBOR + 0.40% - 3.625% and 1.75% - 10% in 2006

**6**

**305**

10

487

Satellite Acquisition Loans

5.66% and US$ LIBOR + 1.75% - 2.75% in 2007 and 2006

**37**

**1,796**

42

2,083

 

 

**US$1,377**

**Php****66,42****4**

US$1,562

Php76,646

 

 

** **

** **

 

 

*Philippine Peso Debt:*

 

** **

** **

 

 

Peso Fixed Rate Corporate Notes

5.625% - 15% in 2007 and 15% - 15.816% in 2006

** **

**5,795**

 

808

Term Loans:

 

** **

** **

 

 

Secured Term Loans

7.09% - 15% and 90-day PHIBOR  + 0.3% in 2007 and 2006

** **

**7**

 

11

Other Unsecured Term Loans

3 Month MART + 0.75% in 2007 and 2006

** **

**2,489**

 

2,488

 

 

** **

**8,291**

 

3,307

 

 

** **

**74,715**

 

79,953

Less portion maturing within one year

 

** **

**10,093**

 

16,184

Total long-term debt 

 

** **

**Php****64,****622**

 

Php63,769

 

*Note:Amounts presented are net of unamortized debt discount and debt issuance costs.*

 

The scheduled maturities of our outstandingconsolidated long-term debt at nominal values as at March 31, 2007 are asfollows:

 

*** ***

**U.S. Dollar Loans**

**Php Loans**

**Total**

**Year**

**In U.S. Dollar**

**In Php**

**In Php**

**In Php**

** **

(in millions)

2007(1)

169

8,164

279

8,443

2008

147

7,098

558

7,656

2009

263

12,666

570

13,236

2010

71

3,413

1,378

4,791

2011

15

716

568

1,284

2012 and onwards 

830

40,027

4,964

44,991

 

1,495

72,084

8,317

80,401

 

*(1)**April 1, 2007through December 31, 2007*

 

***U.S.Dollar Debt:***

 

*ExportCredit Agencies-Supported Loans*

 

Inorder to obtain imported components for our network infrastructure inconnection with our expansion and service improvement programs, we obtainedloans extended and/or guaranteed by various export credit agencies.  Thesefinancings account for a significant portion of our indebtedness.

 

*Kreditanstalt für Wiederaufbau, or KfW*

 

KfW,a German state-owned development bank, is PLDT’s largest single creditor.  Asat March 31, 2007, we owed US$189 million aggregate principal amount of debt toKfW, as follows:

 
- US$142 million provided under various export credit agency-backed facilities, of which US$32 million was in connection with our expansion and service improvement programs, and US$110 million in connection with the US$149 million refinancing facility discussed below; and

 
- US$47 million provided for the 15% downpayment portion and credit facilities without guarantee/insurance cover from the export credit agencies, of which US$30 million was in connection with the US$149 million refinancing facility discussed in the following paragraphs.

 

OnJanuary 25, 2002, PLDT signed two loan agreements with KfW, which provided PLDTwith a US$149 million facility to refinance in part the repayment installmentsunder its existing loans from KfW due from January 2002 to December 2004.  Thefacility is composed of a nine-year loan, inclusive of a three-yeardisbursement period and a two-year grace period during which no principal ispayable.  It partly enjoys the guarantee of HERMES, the export credit agency ofthe Federal Republic of Germany.  We have drawn US$140 million (Php6,748million) under this facility as at March 31, 2007.  PLDT waived furtherdisbursements under this refinancing facility effective September 1, 2004.Thus, the undrawn portion of US$9 million was cancelled.

 

Ofthe amounts outstanding under these KfW loans, US$59 million will mature in2007, US$55 million will mature in 2008, US$44 million will mature in 2009 andUS$31 million will mature in 2010.  Principal amortizations on these loans aregenerally payable in equal semi-annual installments.

 

*Finnvera, Plc, or Finnvera*

 

As at March 31, 2007, US$60 million (US$59 net of unamortizeddiscount of US$1 million) or Php2,893 million (Php2,849 million net ofunamortized discount of Php44 million) principal amount of Smart’s debt wasprovided by various banks under an export credit agency-backed facility inconnection with Smart’s GSM expansion program.  This facility is covered by aguaranty from Finnvera, the Finnish Export Credit Agency, for 100% of politicaland commercial risk for the refinancing facility of GSM Phases 5A and 5B.Other Finnvera-guaranteed GSM loan facilities were already fully paid in theaggregate amount of US$16.5 million for GSM Phases 3 and 4 loan facilities onApril 28, 2006.

 

Ofthe amount outstanding under the remaining Finnvera guaranteed loan, US$10million will mature in 2007, US$20 million will mature in 2008, US$20 millionwill mature in 2009 and US$10 million will mature in 2010.  Principalamortization on this loan is payable in equal semi-annual installments.

 

*Nippon Export and Investment Insurance of Japan, or NEXI*

 

On November 28, 2002, Smart signed a US$100 millionterm loan facility supported by NEXI, of which US$60 million was drawn onNovember 28, 2003 and US$40 million on April 5, 2004.  This loan is payablesemi-annually over four years in eight equal installments starting May 28, 2004with final repayment due in November 2007.  The outstanding balance as at March31, 2007 was US$25 million.

 

*OtherExport Credit Agency Supported Loans*

 

PLDThas also obtained loans extended and/or guaranteed by other export creditagencies, including the Export-Import Bank of the United States, and therespective export credit agencies of France and Italy, in the aggregateoutstanding principal amount of US$7 million as at March 31, 2007.  Smart,likewise, obtained loans guaranteed by the export credit agencies of Norway and Italy amounting to US$2 million.  Of the amounts outstanding under these loans, US$8million will mature in 2007 and US$1 million will mature in 2008.

 

*FixedRate Notes*

 

PLDThas the following non-amortizing fixed rate notes outstanding as at March 31,2007 and December 31, 2006:

 

**Principal Amount**

**Interest Rate**

**Maturity Date**

**March 31, 2007 (Unaudited)**

December 31, 2006 (Audited)

** **

** **

** **

(in millions)

US$300,000,000

8.350%

March 6, 2017

**US$296**

**Php14,281**

US$296

Php14,523

US$250,000,000

11.375%

May 15, 2012

**244**

**11,771**

244

11,963

US$135,886,000

10.500%

April 15, 2009

**136**

**6,516**

166

8,148

US$ 19,310,000

10.625%

May 15, 2007

**19**

**929**

19

941

US$110,068,000

7.850%

March 6, 2007

**–**

**–**

110

5,396

 

 

 

**US$****695**

**Php33,497**

US$835

Php40,971

 

*Term**Loans*

* *

*US$283 Million Term Loan Facility, or Debt ExchangeFacility*

* *

On July 2, 2004, Smart acquired from Piltel’screditors approximately US$289 million, or 69.4%, in the aggregate of Piltel’soutstanding restructured debt at that time, in exchange for Smart debt and acash payment by Smart.  In particular, Smart paid an amount in cash of US$1.5million, or Php84 million and issued new debt of US$283.2 million, or Php15,854million, at fair value of Php8,390 million, net of debt discount amounting toPhp7,464 million.  

 

Thebreakdown of the total amount of Smart debt issued to participating Piltelcreditors is as follows:

 

•        2007 Facility in the amount ofUS$0.2 million payable in full in December 2007;

•        2008 Facility in the amount ofUS$2.9 million payable in full in December 2008; and

•        2014 Facility in the amount ofUS$280.1 million payable in full in June 2014.

 

Asat March 31, 2007, outstanding balance of these loans amounted to US$283million (US$178 million net of unamortized discount of US$105 million) orPhp13,658 million (Php8,606 million net of unamortized discount of Php5,052million).

 

Interestfor the above facilities is payable every quarter at a floating rate of threemonths US$ LIBOR plus 1.00% for the 2007 and 2008 facilities, and a fixed rateof 2.25% per annum for the 2014 facility.  Furthermore, a portion of the 2014facility amounting to US$144 million has a variable yield option whereby thecreditors have an option to elect for an early repayment at a discount eitherin December 2007 at 52.5% of the relevant debt amount or in December 2008 at57.5% of the relevant debt amount.

 

*GSM**NetworkExpansion Facilities*

 

OnSeptember 13, 2004, Smart signed a US$104 million 5-year term loan facility tofinance the related Phase 7 GSM Equipment and services.  The facility wasawarded to ABN AMRO Bank, Banque National de Paribas, Calyon, DBS Bank andSumitomo Mitsui Banking Corporation as the Lead Arrangers with Finnish ExportCredit, Plc as the Lender.  The full amount of the facility was drawn onNovember 22, 2004, of which US$62 million remained outstanding as at March 31,2007.  The loan is payable over five years in ten equal semi-annual paymentsstarting May 2005 with final repayment in November 2009.  

 

On August 8, 2005, Smart signed a US$30 millioncommercial facility with NIB to partly finance the related Phase 8 GSMequipment and services contracts.  The facility is a 5-year term loan payablesemi-annually in ten equal installments commencing six months from the firstdrawdown date at a floating rate of US$ LIBOR plus 0.815% margin per annum.The facility was drawn on July 11, 2006 for the full amount of US$30 million ata floating interest of 6.445% (5.63% US$ LIBOR plus 0.815% per annum margin).US$27 million amount remained outstanding as at March 31, 2007.

 

OnAugust 10, 2005, Smart signed a loan facility for its GSM Phase 8 financing inthe amount of US$70 million.  The facility was awarded to the Bank of TokyoMitsubishi Ltd., Mizuho Corporate Bank Ltd., Standard Chartered Bank andSumitomo Mitsui Banking Corporation as the Lead Arrangers, with FEC as theLender.  Smart opted to utilize only a total of US$67 million which was drawnin February 15, 2006 and March 13, 2006 for US$10 million and US$57 million,respectively.  The balance of US$3 million was cancelled.  The facility is a5-year term loan payable in 10 equal semi-annual installments with finalrepayment on September 1, 2010.  Interest is payable semi-annually at a fixedrate of 4.515% per annum.  As at March 31, 2007, US$51 million remainedoutstanding.

 

OnJuly 31, 2006, Smart signed a U.S. Dollar Term Loan Facility for US$44.2 millionto partly finance the related Phase 9 GSM equipment and services contracts.The Lender is FEC with ABN AMRO Bank N.V., Standard Chartered Bank and SumitomoMitsui Banking Corporation and Mizuho Corporate Bank Ltd. as the LeadArrangers.  The facility is a 5-year term loan payable in 10 equal semi-annualinstallments commencing six months from the drawdown date at a CIRR Fixed rateof 4.05% per annum.  The facility was drawn on November 10, 2006 for the fullamount of US$44.2 million.  As at March 31, 2007, the US$40 million loanremains outstanding.

 

Asat March 31, 2007 the aggregate outstanding balance of these loans amounted toUS$180 million (US$179 million, net of unamortized discount of US$1 million) orPhp8,696 million (Php8,645 million, net of unamortized discount of Php51million).

 

*Other Term Loan*

* *

On December 1, 2001, CyMed availed itself of a 6-yearnon-interest-bearing advances from certain officers of the company to fund itsoperating expenses, including salaries and other incidental expenses.  Theoutstanding balance of this loan as at March 31, 2007 amounted to US$0.7 million,which is payable quarterly until December 31, 2009.

 

*UndrawnFacilities*

 

On October 16, 2006, Smart signed a U.S. Dollar TermLoan Facility with Metropolitan Bank and Trust Company to finance the relatedPhase 9 GSM Facility for an amount of US$50 million.  The facility is afive-year loan payable in 18 equal and consecutive quarterly installmentscommencing on the third quarter from the date of the first drawdown.  Interestrate is floating at three-month US$ LIBOR plus 0.75% per annum margin.

 

*RestructuredLoans*

* *

OnJune 5, 2006, Piltel made a partial voluntary prepayment of principal under itsPeso bank facility, US Dollar bank facility, various Trade Creditor facilitiesand Notes Indenture.  The voluntary prepayment was made in lieu of depositing excesscash flow from the operations of Piltel’s business into a Sinking FundAccount.  The aggregate voluntary prepayment amount was Php9,325 million(Php6,393 million to Smart and Php2,932 million to third party creditors) orUS$176 million (US$121 million to Smart and US$55 million to third partycreditors), which was applied proportionally to the various debt facilities asset out in the Intercreditor Agreement dated June 4, 2001 (the “IntercreditorAgreement”).

 

OnDecember 4, 2006, Piltel prepaid the outstanding balance of its principal debtunder its Peso bank facility, US Dollar bank facility, Peso Term Note facility,various Trade Creditor facilities and Notes Indenture in the aggregate amountof Php11,631 million (Php8,061 million to Smart and Php3,570 million to thirdparty creditors) or US$233 million (US$161 million to Smart and US$72 millionto third party creditors).  Piltel obtained approval from the Bangko Sentral ngPilipinas to source dollar payment from authorized agent banks.

 

OnMarch 30, 2007, Piltel paid the remaining convertible bonds with principalamount of US$0.7 million.

* *

*Loan Security*

* *

Piltel’s restructured obligations were secured bysubstantially all present and future assets of Piltel under the MTI dated June4, 2001 between Piltel and JPMorgan Chase Bank, N.A. (Manila Branch) asSecurity Agent for the creditors, which established the security arrangementsrelating to the restructured debts.  The participating creditors (other thanthe participating holders of the Peso Term Note facility) shared equally infirst ranking security, while non-participating creditors and the participatingholders of the Peso Term Note facility shared equally in second rankingsecurity created under the MTI.  Such mortgage was approved by at leasttwo-thirds of Piltel’s stockholders at its annual meeting on April 18, 2001 andby the NTC on May 18, 2001.

 

On July 7, 2006, Piltel, PLDT and JPMorgan Chase Bank,N.A. (Manila Branch), as Security Agent on behalf of the Finance Parties underthe Intercreditor Agreement, agreed to the amendment of Clause 25 thereof toallow the amendment of any term of the MTI and the release and sale of certainproperties or assets from the security interests created by the MTI upon theinstructions of the creditor representatives.  On the same date, and followingthe effectivity of the amendment of the Intercreditor Agreement, Piltel and theSecurity Agent, executed the Amendment to the MTI, pursuant to which Piltel isallowed to sell or dispose of certain categories of assets or properties withthe consent of the Majority Bank Creditors, the Majority Trade Creditors andthe Trustee, provided, however that for as long as Avenue Asia holds majorityof Piltel’s Conversion Notes, the prior consent of Avenue Asia will be requiredfor (i) any sale or disposition of any of the real properties of Piltel, and(ii) any sale or disposition of assets to Smart, PLDT or any of its affiliates.

 

OnApril 18, 2007, Piltel received a Notice of Termination of the MTI from JPMorgan Chase Bank, N.A. (Manila Branch).

 

*Satellite**Acquisition Loans*

 

MabuhaySatellite has an existing Credit Agreement with the Export-Import Bank of the United States, or Ex-Im Bank, to finance a portion of the cost of purchasing the Agila IISatellite.  In 2004, Ex-Im Bank approved, in principle, the re-profiling ofMabuhay Satellite’s US$42 million debt with them by extending the maturity ofthe loan by 11⁄2 years to July 15, 2007 and reducing the interest rate by 1% to5.6%.  The revised repayment terms have been approved by the majority of thelocal creditor banks.  As at March 31, 2007, the remaining outstanding loanamounted to US$5 million (Php251 million).

 

MabuhaySatellite also has an existing Omnibus Agreement with a syndicate of localbanks, or the Banks, which includes issuance of irrevocable standby Letters ofCredit which as at March 31, 2007 had an aggregate stated value not exceedingUS$5 million (Php266 million) in favor of Ex-Im Bank, as security under theCredit Agreement and a term loan to Mabuhay Satellite in the aggregate amountof US$32 million (Php1,545 million), which will mature on various dates from2006 to 2009. 

 

In 2006, the Banks have approved Mabuhay’s request toextend the maturity of the loan under the Omnibus Agreement by two years toOctober 20, 2009, with a 1% increase in the margin on the deferred amount.

 

MabuhaySatellite has constituted in favor of the Banks: (a) a first mortgage on itsleasehold rights under a lease agreement entered into with the Subic BayMetropolitan Authority and the components of the satellite system; (b) anassignment of its rights under its purchase contract for the satellite system;(c) an assignment of its rights under the transponder lease contracts to beentered into with its shareholders and other parties and the revenuestherefrom; and (d) an assignment of the applicable proceeds of insurance to betaken on the satellite system.

 

***Philippine Peso Debt:***

 

*Php2,**770**Million Peso Fixed Rate Corporate Notes*

 

In connection with PLDT’s service improvement andexpansion programs, PLDT has entered into two loan agreements, pursuant to eachof which PLDT issued fixed rate corporate notes in three tranches.  Interest oneach tranche is payable semi-annually.

 

Underthe first loan agreement, PLDT borrowed an aggregate amount of Php1,500 million, of which Php230million matured on November 11, 2002, Php500million matured on November 9, 2004 and Php770million matured on November 9, 2006.

 

Underthe second loan agreement, PLDT borrowed an aggregate amount of Php1,270 million, of which Php360million matured on June 9, 2003, Php100million matured on June 9, 2005 and Php810million will mature on June 9, 2010.

 

*Php5 Billion Peso Fixed Rate Corporate Notes*

 

OnFebruary 15, 2007, Smart issued Php5 billion unsecured fixed rate corporatenotes, made up of Series A notes amounting to Php3.8 billion and Series B notesamounting to Php1.2 billion with five and ten year terms, respectively.  SeriesA notes were priced at 5.625%, while Series B notes were priced at 6.500%.Funds raised from the issuance of these notes will be used primarily forSmart’s capital expenditures for network improvement and expansion.

 

*TermLoans*

 

*Secured**Term Loans*

 

*Php150Million**Term Loan Facility*

 

OnMarch 4, 2002, ePLDT entered into a three-year loan facility with PhilippineBank of Communications amounting to Php150 million.  The loan facility wasfully drawn on December 31, 2002 and payable in seven quarterly installments,with a grace period of one year, beginning in 2003.  The quarterly principalpayments of Php15 million started in June 2003 with a balloon payment of Php45million in March 2005.  Interest on this loan was equivalent to 91-day T-billrate plus 4% per annum payable quarterly in arrears.  The loan was secured byePLDT’s deed of assignment of receivables of a subsidiary from a foreigncustomer and an investment in an associate with an original cost of Php629million.  This loan was fully paid as at March 31, 2005.

 

*Php100Million Term Loan Facility*

 

OnMarch 15, 2004, ePLDT entered into a three-year term loan facility with AsiaUnited Bank amounting to Php100 million for the payment of its outstandingshort-term bank loan facility and for other working capital requirements.  Theloan facility was fully drawn as at December 31, 2004.  The loan is to be repaidin nine equal quarterly installments starting March 2005 with final repaymentin March 2007.  Interest on the loan is equivalent to 90-day PHIBOR plus 3% perannum payable quarterly in arrears.  The loan is secured by a Mortgage TrustIndenture Agreement, or MTIA, dated March 15, 2004, with Asia United Bank –Trust and Investments Group, on a parcel of land with a carrying value ofPhp279 million as at December 31, 2004.  This loan was fully paid as at March31, 2007.

 

*Php149Million Term Loan Facility*

 

InJanuary 2006, Vocativ, a wholly-owned call center subsidiary of ePLDT,partially prepaid Php89 million out of its outstanding five-year term loanfacility of Php109 million with Asia United Bank for the payment of itsadditional capital expenditures and working capital requirements.  Under theterms of the loan, principal payment is to be paid in 14 equal quarterlyinstallments starting April 2006 with final repayment in July 2009.  Intereston the loan is equivalent to 90-day PHIBOR plus 3% per annum payable quarterlyin arrears.  The loan is secured by a Mortgage Participation Certificateagainst the MTIA between ePLDT and Asia United Bank Corporation – Trust andInvestments Group dated March 15, 2004 on a parcel of land, which excludes thebuildings and improvements.  The remaining balance of Php20 million waspre-terminated in April 2006.

 

*Unsecured**Term Loans*

 

*Php2,500 Million**Term Loan Facility*

 

On August 14, 2006, Smart signed a Peso Term LoanFacility with Metropolitan Bank and Trust Company to finance the related Phase9 GSM facility for an amount of Php2,500 million.  The facility is a five-yearloan payable in 18 equal consecutive quarterly installments commencing on thethird quarter from the date of the first drawdown.  Interest rate is floatingat three-month MART plus 0.75% per annum margin.  The facility was drawn onDecember 11, 2006 for the full amount of Php2,500 million at a floatinginterest of 6.0232% (5.2732% three-month MART1 plus 0.75% per annum margin).The first installment will commence on September 11, 2007 with final repaymenton December 9, 2011.  The full amount of Php2,500 million (Php2,489 million netof unamortized discount of Php11 million) was outstanding as at March 31, 2007.

 

*Debt Covenants*

 

Our debt instruments contain restrictive covenants,including covenants that could prohibit us from paying dividends on commonstock under certain circumstances, and require us to comply with specifiedfinancial ratios and other financial tests, calculated in conformity with PFRS,at relevant measurement dates, principally at the end of each quarterlyperiod.  We have complied with all of our maintenance financial ratios asrequired under our loan covenants and other debt instruments.

 

Theprincipal factors that can negatively affect our ability to comply with thesefinancial ratios and other financial tests are depreciation of the Philippinepeso relative to the U.S. dollar, poor operating performance of PLDT and itsconsolidated subsidiaries, impairment or similar charges in respect ofinvestments or other long-lived assets that may be recognized by PLDT and itsconsolidated subsidiaries and increases in our interest expenses.  Interestexpense may increase as a result of various factors including issuance of newdebt, the refinancing of lower cost indebtedness by higher cost indebtedness,depreciation of the Philippine peso, the lowering of PLDT’s credit ratings orthe credit ratings of the Philippines, increase in reference interest rates,and general market conditions.  Since approximately 90% of PLDT’s totalconsolidated debts are denominated in foreign currencies, principally in U.S.dollars, many of these financial ratios and other tests are negatively affectedby any weakening of the peso.

 

PLDT’sdebt instruments contain a number of other negative covenants that, subject tocertain exceptions and qualifications, restrict PLDT’s ability to take certainactions without lenders’ approval, including: (a) incurring additionalindebtedness; (b) prepaying other debt; (c) making investments; (d) extendingloans; (e) extending guarantees or assuming the obligations of other persons;(f) paying dividends or other distributions or redeeming, repurchasing orotherwise acquiring shares of PLDT’s capital stock; (g) disposing of all orsubstantially all of its assets or of assets in excess of specified thresholdsof its tangible net worth; (h) creating any lien or security interest; (i)permitting set-off against amounts owed to PLDT; (j) merging or consolidatingwith any other company; (k) entering into transactions with stockholders andaffiliates; and (l) entering into sale and leaseback transactions. 

 

Further,certain of PLDT’s debt instruments contain provisions wherein PLDT may berequired to repurchase or prepay certain indebtedness in case of change incontrol of PLDT.

 

PLDT’s debt instruments also contain customary andother default provisions that permit the lender to accelerate amounts due orterminate their commitments to extend additional funds under the debtinstruments. These default provisions include: (a) cross-defaults andcross-accelerations that permit a lender to declare a default if PLDT is indefault under another debt instrument; in some cases, the cross-defaultprovision is triggered upon a payment or other default permitting theacceleration of PLDT’s debt, whether or not the defaulted debt is accelerated.In other cases, the cross-default provision requires the defaulted loan to beaccelerated.  In some debt instruments, the cross-default provision will betriggered only if the principal amount of the defaulted indebtedness exceeds athreshold amount specified in these debt instruments; (b) failure by PLDT tomeet certain financial ratio covenants referred to above; (c) the occurrence ofany material adverse change in circumstances that a lender reasonably believesmaterially impairs PLDT’s ability to perform its obligations under its debtinstrument with the lender; (d) the revocation, termination or amendment of anyof the permits or franchises of PLDT in any manner unacceptable to the lender;(e) the abandonment, termination or amendment of the project financed by a loanin a manner unacceptable to the lender; (f) the nationalization or sustaineddiscontinuance of all or a substantial portion of PLDT’s business; and (g)other typical events of default, including the commencement of bankruptcy,insolvency, liquidation or winding up proceedings by PLDT.

 

Smart’sdebt instruments contain certain restrictive covenants that require Smart tocomply with specified financial ratios and other financial tests at semi-annualmeasurement dates.  The financial tests under Smart’s loan agreements includecompliance with a debt to equity ratio of not more than 1.5:10, a debt toEBITDA ratio of not more than 3:1 and a debt service coverage ratio of not lessthan 1.50:1.  Smart has maintained compliance with all of its financialcovenants.  The agreements also contain customary and other default provisionsthat permit the lender to accelerate amounts due under the loans or terminatetheir commitments to extend additional funds under the loans.  These defaultprovisions include: (a) cross-defaults and cross-accelerations that permit alender to declare a default if Smart is in default under another loanagreement.  These cross-default provisions are triggered upon a payment orother default permitting the acceleration of Smart debt, whether or not thedefaulted debt is accelerated; (b) failure by Smart to comply with certainfinancial ratio covenants; (c) any reduction in PLDT’s ownership of Smart’sshares below 51%; (d) any reduction in First Pacific’s and Metro PacificCorporation’s collective direct and/or indirect ownership of PLDT’s commonstock below 17.5% of the total common stock outstanding; and (e) the occurrenceof any material adverse change in circumstances that the lender reasonablybelieves materially impairs Smart’s ability to perform its obligations underits loan agreements.

 

TheCredit and Omnibus Agreements of Mabuhay Satellite impose several negativecovenants which, among other things, restrict material changes in MabuhaySatellite’s nature of business and ownership structure, any lien upon or withrespect to any of its assets or to any right to receive income, acquisition ofcapital stock, declaration and payment of dividends, merger, consolidation andsale with another entity and incurring or guaranteeing additional long-termdebt beyond prescribed amounts.

 

ePLDT’sloan agreement imposes negative covenants which, among other things, restrictePLDT in regard to payment of cash dividends or any other income or any capitaldistribution to PLDT, voluntary suspension of its entire business operationsfor a period of 60 consecutive days, dissolution of its legal existence, andcreation of any encumbrances on the shares pledged.  One of ePLDT’s loanagreements also requires ePLDT to comply with specified financial ratios andother financial tests at quarterly measurement dates.  The agreement alsocontains customary and other default provisions that permit the lender toaccelerate amounts due under the loan or terminate their commitments to extendadditional funds under the loan.  As at December 31, 2006, ePLDT was incompliance with all of its financial covenants.

 

**Obligations Under Capital Lease**

 

Thefuture minimum payments for capitalized leases as at March 31, 2007 are asfollows:

 

**Year**

(in million pesos)

2007

1,462

2008

42

2009

13

Total minimum lease payments

1,517

Less amount representing interest

526

Present value of net minimum lease payments

 991

Less obligations under capital lease maturing within one year (Notes 8 and 24)

57

Long-term portion of obligations under capital lease (Notes 8 and 24)

 934

 

*Municipal Telephone Projects*

 

In 1993,PLDT entered into two lease agreements with the Philippine Department ofTransportation and Communications, or DOTC, covering telecommunicationsfacilities in the province of Bohol and Batangas established under theMunicipal Telephone Act.  Under these agreements, PLDT was granted theexclusive right to provide telecommunications management services, to expandservices, and to promote the use of the DOTC-contracted facilities in certaincovered areas for a period of 15 years.  Title to the properties shall betransferred to PLDT upon expiration of the lease term.  As at March 31, 2007,PLDT’s aggregate remaining obligation under this agreement was approximatelyPhp858 million.  In case of cancellation, PLDT is liable to pay Php100 millionunder each of the two contracts as liquidated damages.

 

On June 1, 2004, PLDT served the DOTC a notice of termination of thelease agreement in respect of the telecommunications system in Bohol whichstate of deterioration, obsolescence and disrepair has made it impossible forPLDT to continue managing, operating, and maintaining the system.  Since 2002,PLDT has been advising the DOTC of the need to review the viability of thesystem as PLDT has infused more than Php200 million for upgrades and maintenanceto keep the system operable.  Further, the enactment of PublicTelecommunications Policy Act, or R.A. No. 7925, which negated the DOTC’swarranty to grant PLDT the exclusive right to provide telecommunicationservices in the areas stipulated, prevented PLDT from achieving the originallyprojected profitability, thereby rendering it impossible for PLDT to continuefulfilling its obligation under the lease agreement.  Although severaldiscussions have been held since then, no mutually acceptable agreement hasbeen reached.  On June 30, 2004, the DOTC advised PLDT that the request fortermination of the lease agreement in Bohol has been referred to the Departmentof Justice, or DOJ, as government agencies are required to refer allinterpretation of contracts and agreements to the DOJ secretary asattorney-general of the national government.  On May 5, 2005, PLDT received a letter from the DOTC stating that PLDT is in default for failure to remit tothe DOTC the quarterly installments under the lease agreement.  Due to thefailure of the parties to amicably settle their dispute, on September 28, 2005, PLDT demanded that the dispute be referred to arbitration and that the partiesagree on the composition of the arbitration committee.  In response, the DOTC,in a letter dated October 17, 2005, informed PLDT that pursuant to ExecutiveOrder No. 269, Series of 2004, dated January 12, 2004, the existingcommunications programs and projects implemented by DOTC were transferred tothe Commission on Information and Communications Technology, or CICT, and thatthe DOTC had forwarded to CICT PLDT’s letter dated September 28, 2005.  In aletter dated March 24, 2006, the CICT informed PLDT that the CICT poses noobjection on PLDT’s stated intentions and preference to refer the unresolvedand outstanding issues to the Philippine Dispute Resolution Center, Inc., orPDRCI, per the arbitration clause of the lease agreement.  On June 27, 2006, aRequest for Arbitration dated June 1, 2006 was filed by PLDT with the PDRCI.  OnNovember 15, 2006, DOTC has filed its Answer to the said Request forArbitration.  As at March 31, 2007, the net book value ofthe telecommunications system in Bohol, including PLDT’s additional capitalexpenditure relating to the telecommunications system, and correspondingcapital lease obligation amounted to Php10 million and Php735 million,respectively.

 

Piltel alsoentered into an agreement for the financial lease of the PalawanTelecommunications System of the MunicipalTelephone Public Office with the DOTC on June 3, 1994.  The MunicipalTelephone Public Office Contract is a 30-year contract for Piltel to leasefacilities for public call office stations in the Palawan area, with revenuesgoing to Piltel.  In consideration, Piltel pays the DOTC an escalating annuallease fee.  The total lease payment for thirty years is Php483 million.  As atMarch 31, 2007, Piltel’s aggregate remaining obligation under this agreementwas approximately Php43 million.

 

*Other Long-term Capital Lease Obligations*

 

The PLDT Group has various long-term lease contractsfor a period of three years covering various office equipment.  In particular, PLDT,Smart and ePLDT have capital lease obligations in the aggregate amount of Php616million as at March 31, 2007 in respect of office equipment.

 

Underthe terms of certain loan agreements and other debt instruments, PLDT may notcreate, incur, assume or permit or suffer to exist any mortgage, pledge, lienor other encumbrance or security interest over the whole or any part of itsassets or revenues or suffer to exist any obligation as lessee for the rentalor hire of real or personal property in connection with any sale and leasebacktransaction.

 

**Preferred Stock Subject to Mandatory Redemption**

 

The movements of PLDT’s preferred stock subject tomandatory redemption as at March 31, 2007 and December 31, 2006 are as follows:

 

 

**March 31, 2007 (Unaudited)**

December 31, 2006 (Audited)

 

**Series V**

**Series VI**

**Total**

Series V

Series VI

Series VII

Total

 

(in million pesos)

Balance at beginning of period

**61**

**1,308**

**1,369**

272

6,321

5,381

11,974

Accretion

**3**

**37**

**40**

13

481

282

776

Conversion

**(3)**

**(139)**

**(142)**

(224)

(5,253)

(5,543)

(11,020)

Revaluation

**–**

**(20)**

**(20)**

–

(241)

(120)

(361)

Balance at end of period

**61**

**1,186**

**1,247**

 61

1,308

–

1,369

 

PLDThad issued 3 million shares of Series V Convertible Preferred Stock, 5 millionshares of Series VI Convertible Preferred Stock and 4 million shares of SeriesVII Convertible Preferred Stock in exchange for a total of 58 million shares ofSeries K Class I Convertible Preferred Stock of Piltel, pursuant to the debtrestructuring plan of Piltel adopted in June 2001.  Shares of Series V, VI andVII Convertible Preferred Stock are entitled to receive annual dividends ofPhp18.70 per share, US$0.397 per share and JP¥40.7189 per share, respectively.Each share of Series V, VI and VII Convertible Preferred Stock is convertibleat any time at the option of the holder into one PLDT common share.  On thedate immediately following the seventh anniversary of the issue date of theSeries V and Series VI Convertible Preferred Stock and on the eighthanniversary of the issue date of the Series VII Convertible Preferred Stock,the remaining outstanding shares under these series will be mandatorilyconverted into PLDT common shares.  Under a put option exercisable for 30 days,holders of common shares received, on mandatory conversion of the Series V, VIand VII Convertible Preferred Stock, will be able to require PLDT to purchasesuch PLDT common shares for Php1,700 per share, US$36.132 per share, and JPY4,071.89per share, respectively.

 

The Series V Convertible Preferred Stock wasdesignated as a compound instrument consisting of liability and equitycomponents.  The fair value of the Convertible Preferred Stock was determinedon the issue date, of which the fair value of the liability component as atdate of issuance is recorded as “Preferred Stock Subject to MandatoryRedemption” and is included under the “Interest-bearing Financial Liabilities”account in the consolidated balance sheets.  The residual amount was assignedas the equity component.

 

The cost of each foreign currency component of theConvertible Preferred Stock Series VI and VII, was designated as a debtinstrument with embedded call options.  The fair value of the ConvertiblePreferred Stock was determined on the issue date, of which the fair value of embeddedcall options was bifurcated and accounted for separately, see *Note 2 –Summary of Significant Accounting Policies and Practices*and*Note 24 –Financial Assets and Liabilities*.  The residual amount was assigned asliability components and recorded as “Preferred Stock Subject to MandatoryRedemption” and is included under the “Interest-bearing Financial Liabilities”account in the consolidated balance sheets.

 

Thedifference between the amount designated as liability components of the SeriesV, VI and VII Convertible Preferred Stock at issue date and the aggregateredemption value is accreted over the period up to the put option date usingthe effective interest rate method.  Accretions added to “Preferred StockSubject to Mandatory Redemption” and charged to interest as at March 31, 2007and 2006 amounted to Php40 million and Php299 million, respectively.

 

“PreferredStock Subject to Mandatory Redemption” amounted to Php1,247 million andPhp1,369 million as at March 31, 2007 and December 31, 2006, respectively,after revaluation of Series VI and VII Convertible Preferred Stock to theexchange rates at balance sheet dates and after giving effect to the aboveaccretions, conversions and additional issuances.  As at March 31, 2007 andDecember 31, 2006, 11,032,094 shares and 10,937,309 shares, respectively, ofthe Convertible Preferred Stock have been voluntarily converted into PLDTcommon shares.  On August 18,2006, all 3,842,000 shares of Series VII Convertible Preferred Stock have beenvoluntarily converted into PLDT common shares.  The outstanding shares ofSeries V and VI Convertible Preferred Stock as at March 31, 2007 were 43,675shares and 782,775 shares, respectively.  The aggregate redemption value of theoutstanding Series V and VI Convertible Preferred Stock amounted to Php1,438million and Php1,629 million as at March 31, 2007 and December 31, 2006,respectively.

 

Thecorresponding dividends on these shares charged as interest expense amounted toPhp5 million and Php49 million for the three months ended March 31, 2007 and2006, respectively.

 

**Notes Payable**

 

In 2006,SPi obtained unsecured dollar-denominated short-term notes payable from variouslocal commercial banks amounting to US$3.7 million.  Interest on the notesrange from 7.4% to 9.2% of the outstanding balance per annum and the notes arepayable within an average of 150 days from the availment date.  The outstandingbalance of Php198 million as at March 31, 2007 will mature in various months in2007.

 

 

 

**18. Other Noncurrent Liabilities**

 

This account consists of:

 

 

**March 31,  2007 (Unaudited)**

 

December 31, 2006 (Audited)

 

(in million pesos)

Accrual of capital expenditures under long-term financing

**5,932**

 

5,646

Asset retirement obligations (Note 8)

**854**

 

831

Prepayments received under receivable purchase facility (Note 14)

**104**

 

205

Unearned revenues

**83**

 

63

Others

**840**

 

836

 

**7,813**

 

7,581

 

 

 

**19. Accrued Expenses and Other CurrentLiabilities**

 

This account consists of:

 

 

**March 31,  2007 (Unaudited)**

 

December 31, 2006 (Audited)

 

(in million pesos)

Accrued utilities and related expenses (Note 20)

**8,661**

 

8,078

Accrued employee benefits (Note 21)

**7,552**

 

7,474

Accrued interest and other related costs (Notes 17 and 20)

**1,995**

 

1,768

Accrued taxes and related expenses (Notes 22 and 23)

**930**

 

756

Others

**837**

 

1,026

 

**19,975**

 

19,102

 

 

 

**20. RelatedParty Transactions**

 

*a.   Air Time Purchase Agreement between PLDT and AILand Related Agreements*

 

PLDTis a party to a Founder NSP ATPA entered into with AIL in March 1997, which wasamended in December 1998, under which PLDT was granted the exclusive right tosell AIL services as NSP in the Philippines.  In exchange, the ATPA requiredPLDT to purchase from AIL a minimum of US$5 million worth of air time annuallyover ten years commencing on January 1, 2002, the purported date of commercialoperations of the Garuda I Satellite.  In the event that AIL’s aggregate billedrevenue is less than US$45 million in any given year, the ATPA also states thatPLDT has to make supplemental air time purchase payments not to exceed US$15million per year during the ten-year term.

 

InMarch 2003, PLDT, together with the other founder NSPs, entered into aStandstill Agreement with AIL.  Under the Standstill Agreement, payments madeto AIL under the ATPA were based on billings of actual usage pending finalagreement on the terms of the proposed amendment to the ATPA.

 

On September 1, 2006, AIL, PT Asia Cellular Satelliteand Inmarsat reached an agreement to pool their resources to develop productand service offerings in the Asian region, founded on their respective mobilesatellite communications networks, with (a) Inmarsat performing the role ofsatellite and network operator and wholesale product and services developer and(b) the AIL performing the role of wholesale and retail distributor of productsand services.

 

PLDT,likewise, signed a Gateway Services Agreement with Inmarsat, whereby PLDTcommitted to provide gateway infrastructure in Subic Bay up to a maximum amountof US$5 million.  In exchange, PLDT will earn US$0.015 per minute forinterconnection services to be provided to Inmarsat distribution partners fortraffic going through the gateway facility in Subic Bay.

 

OnSeptember 1, 2006, AIL and PT Asia Cellular Satellite signed a Term Sheet, or BanksTerm Sheet, with a majority of the banks that will be used as the basis forfurther good faith negotiations between the parties thereto with a view of enterinto an agreement further amending the Amended and Restated Credit Agreementwith AIL’s bank creditors.

 

Underthe Banks Term Sheet, a majority of the banks agreed, subject to satisfactionof certain conditions, among other things, to amend the Founder NSP ATPA and tore-denominate AIL debt into non-interest-bearing subordinated convertible bondsmaturing in 2015; to amortize a senior term loan with a final maturity onAugust 1, 2013 and a junior term loan with bullet payments on August 1, 2014and 2015.

 

Pursuantto the business collaboration arrangements between AIL and Inmarsat, onSeptember 1, 2006, Inmarsat made the first payment of US$4 million to AIL whichwas used to pay principal and interest payable to the banks in accordance withthe Banks Term Sheet.

 

OnFebruary 1, 2007, PLDT (through ACeS Philippines) signed an agreement topurchase LMGT and MMOC’s 50% equity and debt interest in AIL, respectively, forUS$750,000 in accordance with a notice of proposed transfer issued by LMGTdated December 22, 2006 pursuant to a right of first refusal under the AIL Shareholders’Agreement.

 

*b.   Transactions with Major Stockholders, Directorsand Officers*

 

Transactionsto which PLDT or any of its subsidiaries is a party, in which a director, keyofficer or owner of more than 10% of the outstanding common stock of PLDT, orany member of the immediate family of a director, key officer or owner of morethan 10% of the outstanding common stock of PLDT had a direct or indirectmaterial interest, as at March 31, 2007 (unaudited) and December 31, 2006(audited) and for the three months ended March 31, 2007 and 2006 (unaudited) areas follows:

 

*1.   Cooperation Agreement with FirstPacific and certain affiliates, or FP Parties, NTT Communications and DoCoMo*

 

In connection with the transfer by NTT Communicationsof approximately 12.6 million shares of PLDT’s common stock to DoCoMo pursuantto a Stock Sale and Purchase Agreement dated January 31, 2006 between NTTCommunications and DoCoMo, the FP Parties, NTT Communications and DoCoMoentered into a Cooperation Agreement, dated January 31, 2006.  Under theCooperation Agreement, the relevant parties extended certain rights of NTTCommunications under the Stock Purchase and Strategic Investment Agreementdated September 28, 1999, as amended, and the Shareholders Agreement datedMarch 24, 2000, to DoCoMo, including:

 

•        certain contractual veto rightsover a number of major decisions or transactions; and

 

•        rights relating to therepresentation on the board of directors of PLDT and Smart, respectively, andany committees thereof.

 

Moreover, key provisions of the Cooperation Agreementpertain to, among other things:

 

•        *Restriction on Ownership ofShares of PLDT by NTT Communications and DoCoMo.* Each of NTT Communications and DoCoMo has agreed notto beneficially own, directly or indirectly, in the aggregate with theirrespective subsidiaries and affiliates, more than 21% of then issued andoutstanding shares of PLDT’s common stock.  If such event does occur, the FPParties, as long as they own in the aggregate not less than 21% of then issuedand outstanding shares of PLDT’s common stock, have the right to terminatetheir respective rights and obligations under the Cooperation Agreement, theShareholders Agreement and the StockPurchase and Strategic Investment Agreement.

 

•        *Limitation on Competition.*  NTT Communications, DoCoMo and their respectivesubsidiaries are prohibited from investing in excess of certain thresholds in businessescompeting with PLDT in respect of customers principally located in the Philippines and from using their assets in the Philippines in such businesses. Moreover, ifPLDT, Smart or any of Smart’s subsidiaries intends to enter into anycontractual arrangement relating to certain competing businesses, PLDT isrequired to provide, or to use reasonable efforts to procure that Smart or anyof Smart’s subsidiaries provide, NTT Communications and DoCoMo with the sameopportunity to enter into such agreement with PLDT or Smart or Smart’ssubsidiaries, as the case may be.

 

•        *Business Cooperation.*  PLDT and DoCoMo agreed in principle to collaboratewith each other on the business development, roll-out and use of a wireless-codedivision multiple access mobile communication network.  In addition, PLDTagreed, to the extent of the power conferred by its direct or indirect shareholding inSmart, to procure that Smart will (i) become a member of a strategic alliancegroup for international roaming and corporate sales and services and (ii) enterinto a business relationship concerning preferred roaming and inter-operatortariff discounts with DoCoMo.

 

•        *Additional Rights of DoCoMo.* Upon NTT Communications, DoCoMo and theirsubsidiaries owning in the aggregate 20% or more of the shares of PLDT’s commonstock and for as long as NTT Communications, DoCoMo and their subsidiariescontinue to own in the aggregate 17.5% of the shares of PLDT’s common stockthen outstanding, DoCoMo will be entitled to certain additional rights underthe Cooperation Agreement.

 

•        *Change in Control.*  Each of NTTCommunications, DoCoMo and the FP Parties agreed that to the extent permissibleunder applicable laws and regulations of the Philippines and otherjurisdictions, subject to certain conditions, to cast its vote as a shareholderin support of any resolution proposed by the Board of Directors of PLDT for thepurpose of safeguarding PLDT from any Hostile Transferee.  A *“HostileTransferee”* is defined under the Cooperation Agreement to mean any person(other than NTT Communications, DoCoMo, First Pacific or any of theirrespective affiliates) determined to be so by the PLDT Board of Directors andincludes, without limitation, a person who announces an intention to acquire,seeking to acquire or acquires 30% or more of PLDT common shares then issuedand outstanding from time-to-time or having (by itself or together with itself)acquired 30% or more of the PLDT common shares announces an intention toacquire, seeking to acquire or acquires a further 2% of such PLDT common shares:(a) at a price per share which is less than the fair market value as determinedby the board of directors of PLDT as advised by a professional financialadvisor; (b) which is subject to conditions which are subjective or which couldnot reasonably be satisfied; (c) without making an offer for all PLDT commonshares not held by it and/or its affiliates and/or persons who, pursuant to anagreement or understanding (whether formal or informal), actively cooperate toobtain or consolidate control over PLDT; (d) whose offer for the PLDT commonshares is unlikely to succeed or (e) whose intention is otherwise not *bonafide*; provided that, no person will be deemed a Hostile Transferee unlessprior to making such determination, the board of directors of PLDT has usedreasonable efforts to discuss with NTT Communications and DoCoMo in good faithwhether such person should be considered a Hostile Transferee.

 

•        *Termination.*  If NTT Communications, DoCoMo or their respectivesubsidiaries cease to own, in the aggregate, full legal and beneficial title toat least 10% of the shares of PLDT’s common stock then issued and outstanding,their respective rights and obligations under the Cooperation Agreement and theShareholders Agreement will terminate and the Strategic Arrangements (asdefined in the Stock Purchase and Strategic Investment Agreement) willterminate.  If the FP Parties and their respective subsidiaries cease to have,directly or indirectly, effective voting power in respect of shares of PLDT’scommon stock representing at least 18.5% of the shares of PLDT’s common stockthen issued and outstanding, their respective rights and obligations under theCooperation Agreement, the Stock Purchase and Strategic Investment Agreement,and the Shareholders Agreement will terminate.

 

*2.   Integrated i-mode ServicesPackage Agreement between DoCoMo and Smart*

 

An Integrated i-mode Services Package Agreement wasentered into by Smart and DoCoMo on February 15, 2006, under which DoCoMoagreed to grant Smart, on an exclusive basis within the territory of thePhilippines for a period of five years, an integrated i-mode services packageincluding a non-transferable license to use the licensed materials and thei-mode brand, as well as implementation support and assistance andpost-commercial launch support from DoCoMo. Pursuant to this agreement, Smartis required to pay an initial license fee and running royalty fees based on therevenue arising from i-mode subscription fees and data traffic.  Outstandingobligation under this agreement amounted to Php48 million and Php53 million asat March 31, 2007 and December 31, 2006, respectively.

 

*3.   AdvisoryServices Agreement between DoCoMo and PLDT*

 

An Advisory Services Agreement was entered into byDoCoMo and PLDT on June 5, 2006, in accordance with the Cooperation Agreementbetween PLDT and DoCoMo.  Pursuant to the Agreement, DoCoMo will provide theservices of certain key personnel in connection with certain aspects of thebusiness of PLDT and Smart.  Also, the agreement governs the terms andconditions of the appointments and the corresponding fees related thereto.  Totalfees under this agreement for the three months ended March 31, 2007 amounted toPhp19 million.  Outstanding liability under this agreement amounted to Php19million and Php32 million as at March 31, 2007 and December 31, 2006,respectively.

 

*4.   Other Agreements with NTTCommunications and/or its Affiliates*

 

PLDT is a party tothe following agreements with NTT Communications and/or its affiliates:

 

•        *Advisory Services Agreement*.   On March 24, 2000, PLDT entered into an agreementwith NTT Communications, as amended on March 31, 2003, March 31, 2005 and June16,2006, under which NTT Communications provides PLDT with technical, marketingand other consulting services for various business areas of PLDT starting April1, 2000;

 

•        *Arcstar Licensing Agreement andArcstar Service Provider Agreement.*OnMarch 24, 2000, PLDT entered into an agreement with NTT WorldwideTelecommunications Corporation under which PLDT markets managed data and otherservices under NTT Communications’ “Arcstar” brand to its corporate customersin the Philippines.  PLDT also entered into a Trade Name and TrademarkAgreement with NTT Communications under which PLDT has been given the right touse the tradename “Arcstar” and its related trademark, logo and symbols, solelyfor the purpose of PLDT’s marketing, promotional and sales activities for theArcstar services within the Philippines; and

 

•        *Conventional InternationalTelecommunications Services Agreement*.On March 24, 2000, PLDT entered into an agreement with NTT Communications underwhich PLDT and NTT Communications agreed to cooperative arrangements forconventional international telecommunications services to enhance theirrespective international businesses.

 

Total fees under these agreements amounted to Php61million and Php51 million for the three months ended March 31, 2007 and 2006,respectively.  As at March 31, 2007 and December 31, 2006, outstandingobligations of PLDT amounted to Php29 million and Php18 million, respectively.

 

*5.   Agreement between Smart and Asia Link B.V., orALBV.*Smart has an existingTechnical Assistance Agreement with ALBV for the latter to provide technicalsupport services and assistance in the operations and maintenance of cellularbusiness for a period of five years, subject to renewal upon mutual agreementbetween the parties.  The agreement provides for quarterly payments oftechnical service fees equivalent to 2% of the net revenues of Smart.  In January2004, the agreement was amended, reducing the technical service fees to be paidby Smart to ALBV to 1% of net revenues effective January 1, 2004.  On February18, 2004, Smart and ALBV entered into a renewal of the Technical Assistance Agreementextending the effectivity of the terms thereof to February 23, 2008.Furthermore, in view of the acquisition by Smart of Piltel Series K Class IConvertible Preferred Stock held by PLDT, the parties agreed to make theconsolidated net revenues of Smart the basis for the computation of the 1% technicalservice fees payable by Smart to ALBV, effective January 1, 2005.

 

Smart also has an existing Services Agreement withALBV for a period of 25 years starting January 1, 1999, which will automaticallyexpire unless renewed by mutual agreement of both parties.  Under theagreement, ALBV provides advice and assistance to Smart in sourcing capitalequipment and negotiating with international suppliers, arranging internationalfinancing and other services therein consistent with and for the furtherance ofthe objectives of the services.  Service agreement fees were paid for the whole25-year period.

 

ALBVis a subsidiary of the First Pacific Group.

 

Total fees under these agreements amounted to Php165million and Php142 million for the three months ended March 31, 2007 and 2006,respectively.  Outstanding obligations of Smart under these agreements amountedto Php137 million and Php62 million as at March 31, 2007 and 2006,respectively.  Outstanding prepaid management fees as at March 31, 2007 andDecember 31, 2006 amounted to Php856 million and Php869 million, respectively.

 

*6.   Agreements Relating to Insurance Companies.*  Gotuaco del Rosario and Associates, or Gotuaco, acts as the broker for certain insurance companies to cover certain insurableproperties of the PLDT Group.  Insurance premiums are remitted to Gotuaco andthe broker’s fees are settled between Gotuaco and the insurance companies.  Inaddition, PLDT has an insurance policy with Malayan Insurance Co., Inc., orMalayan, wherein premiums are directly paid to Malayan.  Total insuranceexpenses under these agreements amounted to Php119 million and Php105 millionfor the three months ended March 31, 2007 and 2006, respectively.  Twodirectors of PLDT have a direct/indirect interests in or serve as adirector/officer of Gotuaco and Malayan.

 

***Compensationof Key Management Personnel of the PLDT Group***

 

PLDT Group’s compensation of key management personnelby benefit type follows:

 

 

**Three Months Ended March 31,**

 

**2007**

 

2006

 

(Unaudited)

 

(in million pesos)

Short-term employee benefits

**306**

 

240

Share-based payments (Note 21)

**51**

 

105

Post-employment benefits

**19**

 

9

 

**376**

 

 354

 

Each of the directors, including the members of theadvisory board of PLDT, is entitled to a director’s fee in the amount ofPhp125,000 for each meeting of the board attended.  Each of the members oradvisors of the audit, executive compensation, governance and nomination andfinance committees is entitled to a fee in the amount of Php50,000 for eachcommittee meeting attended.

 

There are no agreements between PLDT Group and any ofits key management personnel providing for benefits upon termination ofemployment, except for such benefits to which they may be entitled under PLDTGroup’s retirement and incentive plans.

 

 

 

**21. Employee Benefits**

 

***Executive Stock Option Plan, or ESOP***

 

On April 27, 1999 and December 10, 1999, the Board of Directors and stockholders, respectively,approved the establishment of an ESOP and the amendment of the Seventh Articleof the Articles of Incorporation of PLDT denying the pre-emptive right ofholders of common stock to subscribe for any issue of up to 1,289,745 commonstock pursuant to the ESOP.  The ESOP covers management executives, whichinclude officers with rank of Vice President up to the President, executiveswith the rank of Manager up to Assistant Vice President, andadvisors/consultants engaged by PLDT.  The ESOP seeks to motivate optionholders to achieve PLDT’s goals, reward option holders for the creation ofshareholder value, align the option holders’ interests with those of thestockholders of PLDT, and retain the option holders to serve the long-terminterests of PLDT.  The ESOP is administered by the Executive CompensationCommittee of the Board of Directors.  About 1.3 million shares of common stockof PLDT had been reserved as underlying option shares under the ESOP in 1999.

*** ***

Movements in the number of stock options outstandingunder the ESOP are as follows:

*** ***

 

**March 31,  2007 (Unaudited)**

 

December 31, 2006 (Audited)

Balance at beginning of period

**119,034**

 

197,500

Exercised shares*

**(44,249)**

 

(78,466)

Balance at end of period

**74,785**

 

119,034

 

****Basedon date of payment of exercised shares.*

*** ***

As at March31, 2007, there are 795,065 shares exercised by certain officers and executivesat an exercise price of Php814 per share.

*** ***

The fair value of the ESOP was estimated at the dateof grant using an option pricing model, which considered annual stockvolatility, risk-free interest rate, expected life of the option, exercise priceof Php814 per share, and a weighted average price of Php870 and Php315 pershare for the 1999 and 2002 Grants, respectively, as at valuation date.  Totalfair value of shares granted amounted to Php359 million as at March 31, 2007and December 31, 2006.  No fair value of options were recognized as an expensefor the three months ended March 31, 2007 and 2006.

*** ***

***LTIP***

*** ***

On August 3, 2004, PLDT’s Board of Directors approvedthe establishment of the LTIP for eligible key executive officers and advisorsof PLDT and its subsidiaries, which is administered by the ExecutiveCompensation Committee.  The LTIP was originally a four-year cash-settled sharebased plan covering the period from January 1, 2004 to December 31, 2007.  Thepayment was intended to be made at the end of the plan period (without interimpayments) contingent upon the achievement of an approved target increase inPLDT’s common share price by the end of the plan period and a cumulativeconsolidated net income target for the plan period.  The target increase in thePLDT base share price, which was the average of the closing prices of PLDTshares ten trading days before or after December 31, 2003, was approximately15% per annum compounded for the plan period.  

 

On August 28, 2006,PLDT’s Board of Directors approved, in principle, the broad outline of the PLDTGroup’s strategic plans for 2007 to 2009 focusing on the development of newrevenue streams to drive future growth while protecting the existing corecommunications business.  To ensure the proper execution of the three-yearplan, particularly with respect to the manpower resources being committed tosuch plans, a new LTIP, upon endorsement of the Executive CompensationCommittee, was approved by the Board of Directors to cover the 2007-2009 plan.As a result of the establishment of the new LTIP, the Board of Directors alsoapproved the early vesting of the existing LTIP by the end of 2006, for thoseinvited to the new LTIP.  

 

Total number of shares appreciation rights outstandingunder the existing 2004 to 2006 LTIP as at March 31, 2007 was 3,733,023, ofwhich 3,698,911 will be paid in May 2007 and the balance of 34,112 is expectedto be paid in May 2008. Total number of shares appreciation right awarded underthe new 2007 to 2009 LTIP as at March 31, 2007 was 4,053,256, which will bepaid in 2010.

 

The fairvalue of the LTIP was estimated using an option pricing model, which consideredannual stock volatility, risk-free interest rates, the remaining life ofoptions and the share price capped at Php2,300.00 as at December 31, 2006 for2004 to 2006 LTIP and share price of Php2,525 as at March 31, 2007 for 2007 to2009 LTIP.  Incentive cost per share as at March 31, 2007 for the existing 2004to 2006 LTIP and for the new 2007 to 2009 LTIP amounted to Php1,350.00 andPhp785.95, respectively.  The fair value of the LTIP recognized as an expensefor the three months ended March 31, 2007 (under the 2007 to 2009 LTIP) and2006 (under the 2004 to 2006 LTIP) amounted to Php260 million and Php321million, respectively.  As at March 31, 2007 and December 31, 2006, total LTIPliability amounted to Php5,289 million and Php5,030 million, respectively, see *Note3 – Management’s Use of Estimates and Judgments*.

*** ***

***Pension***

 

*Defined Benefit Pension Plans*

 

We have defined benefit pension plans, coveringsubstantially our permanent and regular employees, excluding those of Smart andits subsidiary, I-Contacts, Inc., which require contributions to be made toseparate administrative funds.

 

Ouractuarial valuation is done on an annual basis.  Based on the latest actuarialvaluation, the actual present value of accrued liabilities, net of pension costand average assumptions used in developing the valuation are as follows:

 

 

(in million pesos)

Benefit obligation as at December 31, 2006

13,314

Fair value of plan assets as at December 31, 2006

5,768

Funded status

7,546

Unrealized net transition obligation

(1)

Unrecognized net actuarial loss

(4,657)

Accrued benefit cost as at December 31, 2006 (Audited)

2,888

Accrual of pension cost during the period

368

Contributions

(326)

Accrued benefit cost as at March 31, 2007 (Unaudited)

2,930

 

Net pension cost was computed as follows:

 

 

**Three Months Ended March 31,**

 

**2007**

 

2006

 

(Unaudited)

 

(in million pesos)

Components of net periodic benefit cost:

** **

 

 

Current service cost

**215**

 

124

Interest cost

**267**

 

223

Expected return on plan assets

**(151)**

 

(135)

Amortizations of unrecognized net transition obligation

**37**

 

12

Net periodic benefit cost

**368**

 

 224

 

The weighted average assumptions used to determinepension benefits as at March 31, 2007 are as follows:

 

Discount rate

** **

8%

Rate of increase in compensation

** **

9%

Expected rate of return on plan assets

** **

10%

 

As at March 31, 2007 and 2006, the assets of thebeneficial trust fund established for the PLDT’s pension plan includeinvestments in shares of stocks of PLDT and Piltel with fair values aggregatingPhp2,203 million and Php1,690 million, which represent about 32% and 27%,respectively, of such beneficial trust fund’s net assets available for planbenefits.

 

TheBoard of Trustees of the beneficial trust fund uses an investment approach ofmixed equity and fixed income investments to maximize the long-term expected returnof plan assets.  The investment portfolio has been structured to achieve theobjective of regular income with capital growth and out-performance ofbenchmarks.  A majority of the investment portfolio consists of fixed incomedebt securities and various equity securities while the remaining portionconsists of multi-currency investments.

 

The allocation of the fair value of the beneficialtrust fund’s assets for the PLDT pension plan follows:

 

 

**March 31,  2007 (Unaudited)**

 

December 31, 2006 (Audited)

Investments in equity securities

**50%**

 

48%

Investments in debt and fixed income securities

**26%**

 

30%

Investments in real estate

**9%**

 

11%

Investments in mutual funds

**9%**

 

8%

Investments in temporary placements

**6%**

 

3%

 

**100%**

 

100%

 

PLDTcurrently expects to make approximately Php509 million of cash contributions toits pension plan in 2007.

 

*DefinedContribution Plan*

 

Contributions to the plan are made based on the employee’syears of tenure and range from 5% to 10% of the employee’s monthly salary.Additionally, employee has an option to make a personal contribution to thefund, at an amount not exceeding 10% of his monthly salary.  The employer thenprovides an additional contribution to the fund ranging from 10% to 50% of theemployee’s contribution based on the latter’s years of tenure.

 

ThePlan’s investment portfolio seeks to achieve regular income and long-termcapital growth and consistent performance over its own portfolio benchmark.  Inorder to attain this objective, the trustee’s mandate is to invest in adiversified portfolio of bonds and equities, both domestic and international.The portfolio mix is kept at 60% to 90% for fixed income securities while 10%to 40% is allotted to equity securities.

 

The allocation of the fair value of plan assets for Smartas at March 31, 2007 (unaudited) and as at December 31, 2006 (audited) follows:

 

Investments in debt securities

** **

 

68%

Investments in equity securities

** **

 

29%

Others

** **

 

3%

 

** **

 

100%

 

Smartcurrently expects to make approximately Php109 million of cash contributions toits pension plan in 2007.

 

*PensionBenefit Cost*

 

Totalpension benefit cost follows:

 

 

**Three Months Ended March 31,**

 

**2007**

 

2006

 

(Unaudited)

 

(in million pesos)

Expense recognized for defined benefit plans

**368**

 

224

Expense recognized for defined contribution plans

**30**

 

24

Total

**398**

 

248

 

 

 

**22. Contractual Obligations and CommercialCommitments**

 

***Contractual Obligations***

 

The following table discloses our unauditedconsolidated contractual obligations outstanding as at March 31, 2007:

 

 

**Payments Due by Period**

 

**Total**

**Within 1 year**

**2****-****3**

**years**

**4****-****5**

**years**

**After 5 years**

 

(in million pesos)

 

 

 

 

 

 

Long-term debt(1)

80,401

10,223

20,505

8,482

41,191

Long-term lease obligations: 

 

 

 

 

 

Capital lease

1,517

1,469

47

1

–

Operating lease

3,230

557

1,112

803

758

Unconditional purchase obligations(2)

 819

30

48

199

542

Other long-term obligations

1,438

–

1,438

–

–

**Total contractual obligations**

**87,405**

**12,279**

**23,150**

**9,485**

**42,491**

 

*(1)**Beforededucting unamortized debt discount and debt issuance costs.*

*(2)**Basedon the Amended ATPA with AIL.*

 

*Long-term Debt*

 

For a discussion of our long-term debt, see *Note 17*– *Interest-bearing Financial Liabilities*.

 

*Long-term Capital Lease Obligations*

 

For the discussion of our long-term capital leaseobligations, see *Note 17 – Interest-bearing Financial Liabilities*.

 

*Long-termOperating Lease Obligations*

 

*DigitalPassage Service Contracts.*  PLDT hasexisting Digital Passage Service Contracts with foreign telecommunicationadministrations for several dedicated circuits to various destinations for 10to 25 years expiring at various dates.  As at March 31, 2007, PLDT’s aggregateremaining obligation under these contracts amounted to approximately Php4million.

 

*License Agreement with Mobius Management Systems (Australia) Pty Ltd., or Mobius.*PLDT enteredinto a license agreement with Mobius pursuant to which Mobius has granted PLDTa non-exclusive, non-assignable and non-transferable license for the use ofcomputer software components.  Under this agreement, Mobius is also required toprovide maintenance services for a period of one year at no additionalmaintenance charge.  PLDT may purchase maintenance services upon expiration ofthe first year for a fee of 15% of the current published license fee.  As at March31, 2007, PLDT’s aggregate remaining obligation under this agreement wasapproximately Php5 million.

 

*Other Long-term Operating Lease Obligations*.   The PLDT Group has various long-term lease contractsfor periods ranging from two to ten years covering certain offices, warehouses,cell sites telecommunication equipment locations and various office equipment.In particular, Smart has lease obligations amounting to Php2,967 million as at March31, 2007 in respect of office and cell site rentals with over 3,000 lessorsnationwide, PLDT has lease obligations amounting to Php85 million as at March31, 2007 in respect of office and lot rentals with over 185 lessors nationwide,ePLDT has lease obligations amounting to Php148 million as at March 31, 2007 inrespect of certain office space rentals and PLDT Global has lease obligations amountingto Php21 million as at March 31, 2007 in respect of certain office spacerentals.

 

*UnconditionalPurchase Obligations*

 

*AirTime Purchase Agreement with AIL.*InMarch 1997 (amended in December 1998), PLDT was a party to a Founder NationalService Provider, or NSP, ATPA entered into with AIL under which PLDT wasgranted the exclusive right to sell AIL services as NSP in the Philippines.  In exchange, the ATPA required PLDT to purchase from AIL a minimum of US$5million worth of air time annually over ten years commencing January 1, 2002,the purported date of commercial operations of Garuda I Satellite.  In theevent that AIL’s aggregate billed revenue is less than US$45 million in anygiven year, the ATPA states that PLDT has to make supplemental air timepurchase payments not to exceed US$15 million per during the ten-year term.

 

InSeptember 2006 (as amended in October 2006, November 2006 and January 2007),after lengthy negotiations including a collaboration arrangement with Inmarsat,AIL and ACeS signed a term sheet (“Banks’ Term Sheet) with the majority ofAIL’s bank creditors.  The Banks’ Term Sheet was aimed to be used as basis forfurther good faith negotiations among the parties with a view to enter into afurther amendment to the Amended and Restated Credit Agreement.  Under theBanks’ Term Sheet, the majority banks, subject to the satisfaction of certain conditions,agreed to, among others: (1) redenominate AIL’s debt, and (2) amend the Founder NSP ATPA payments to:(i) US$500,000 per year for each of the NSPs, including PLDT, PSN and Jasmine,from 2007 to 2010, and (ii) US$3,000,000 per year each for PLDT and PSN from 2011 to 2015.  Forfurther discussion, please see *Note 20 – Related Party Transactions*.

 

Asat March 31,2007, PLDT’s aggregate remaining minimum obligation under theamended ATPA was approximately Php819 million.

 

*OtherLong-term Obligations*

 

*MandatoryConversion and Purchase of Shares*.As discussed in *Note 17 – Interest-bearing Financial Liabilities*, as at December31, 2006, PLDT had issued a total of 3 million shares of Series V ConvertiblePreferred Stock, 5 million shares of Series VI Convertible Preferred Stock and4 million shares of Series VII Convertible Preferred Stock in exchange for atotal of 58 million shares of Series K Class I Convertible Preferred Stock ofPiltel, pursuant to the debt restructuring plan of Piltel adopted in June 2001.

 

Eachshare of Series V, VI and VII Convertible Preferred Stock is convertible at anytime at the option of the holder into one PLDT common share.  On the dateimmediately following the seventh anniversary of the issue date of the Series Vand Series VI Convertible Preferred Stocks and on the eighth anniversary of theissue date of the Series VII Convertible Preferred Stock, the remainingoutstanding shares under these series will be mandatorily converted to PLDTcommon shares.  Under a put option exercisable for 30 days, holders of commonshares received on mandatory conversion of the Series V, VI and VII ConvertiblePreferred Stocks will be able to require PLDT to purchase such PLDT commonshares for Php1,700 per share, US$36.132 per share, and JPY4,071.89 pershare, respectively.  

 

As at March31, 2007, 2,677,765 shares of Series V Convertible Preferred Stock and 4,512,329shares of Series VI Convertible Preferred Stock and all 3,842,000 shares ofSeries VII Convertible Preferred Stock had been voluntarily converted to PLDTcommon shares.  As at March 31, 2007, 43,675 shares of Series V and 782,775shares of Series VI Convertible Preferred Stocks remained outstanding.  Theaggregate value of the put option based on outstanding shares as at March 31,2007 was Php1,438 million which is puttable on June 4, 2008, if all of theoutstanding shares of Series V and VI Convertible Preferred Stocks were mandatorilyconverted and all the common shares were put to PLDT at that time.  The marketvalue of the underlying shares of common stock was Php2,087.00 million, basedon the market price of PLDT common shares of Php2,525 per share as at March 31,2007.

 

***Commercial Commitments***

 

Asat March 31, 2007, our outstanding commercial commitments, in the form ofletters of credit, amounted to Php1,724 million.  These commitments will expirewithin one year.

 

 

 

**23. Provisionsand Contingencies**

 

Asdiscussed below, we currently expect that going forward, we will pay localfranchise taxes on an annual basis and based on the gross receipts received orcollected for services rendered within the jurisdiction of the respectivetaxing authority.  For this reason, we have made the appropriate provisions in ourunaudited consolidated financial statements as at March 31, 2007.

 

*NTCSupervision and Regulation Fees, or SRF*

 

Since1976, PLDT has received assessments from NTC for permit, SRF and other chargespursuant to Section 40 of Commonwealth Act 146, otherwise known as the PublicService Act.  As at December 31, 2006, PLDT had paid, since 1994, a totalamount of Php2,219 million in SRF, of which Php1,956 million was paid underprotest.

 

PLDT is contesting the manner by which theseassessments were calculated and the basis for such calculations.  The case isnow with the Supreme Court and upon the rules and practice of court, stands submitted for decision.

 

*Local Business and Franchise Tax Assessments*

 

PLDTis presently a party to several cases involving the issue of exemption of PLDTfrom local franchise and business taxes.  PLDT believes, based on the opinionof its legal counsel, that it is exempt from payment of local franchise andbusiness taxes. 

 

The LocalGovernment Code of 1991, or Republic Act (R.A.) 7160, which took effect onJanuary 1, 1992, extended to local government units, or LGUs, the power to taxbusinesses within their territorial jurisdiction granted under Batas Pambansa337, and withdrew tax exemptions previously granted to franchise grantees underSection 12 of R.A. 7082. 

 

PLDTbelieves, based on the opinion of its legal counsel, that R.A. 7925 which tookeffect on March 16, 1995, and the grant of local franchise and business taxesexemption privileges to other franchise holders subsequent to the effectivityof R.A. 7160, implicitly restored its local franchise and business taxesexemption privilege under Section 12 of R.A. 7082, or the PLDT Franchisepursuant to Section 23 thereof or the quality of treatment clause. 

 

To confirm this position, PLDT sought and obtained onJune 2, 1998 a ruling from the Bureau of Local Government Finance, or BLGF, ofthe Philippine Department of Finance, which ruled that PLDT is exempt from thepayment of local franchise and business taxes imposable by LGUs under R.A.7160.

 

By virtueof the BLGF Ruling, PLDT stopped paying local franchise and business taxesstarting with the fourth quarter of 1998 and has filed with certain LGUs claimsfor tax refund covering the period from the second quarter of 1995 to the thirdquarter of 1998.  PLDT has received assessments for local franchise andbusiness taxes from several cities and provinces following PLDT’s decision tostop payment of local franchise and business taxes.  

 

Followinga decision of the Supreme Court on March 25, 2003, a judgment in the amount ofPhp4 million against PLDT involving the City of Davao became final andexecutory on April 9, 2003, pursuant to which PLDT was declared not exempt fromthe local franchise tax.  Pursuant to the said decision, PLDT has voluntarilypaid the total amount of Php15 million for the period from the fourth quarterof 1998 until December 31, 2003, which includes the Php4 million subject of thecase.  The said amount constitutes only the basic franchise tax due for thesaid period, excluding surcharges and interest  which PLDT is asking the Cityof Davao, through the local council, to waive.  PLDT believes, based on theopinion of its legal counsel, that PLDT is not liable for surcharges andinterest considering that the legal issue involved was a difficult one andPLDT’s non-payment of the said taxes was made in good faith.  On August 2,2005, the local Sanggunian passed a resolution denying PLDT’s request forabatement of surcharges and penalties and directing the City Treasurer toupdate PLDT’s liability and immediately collect the same.  Accordingly, on August 26, 2005, the city treasurer issued an assessment to PLDT in the amount of Php12million.  In order to maintain and preserve its good standing and relationshipwith the City of Davao, PLDT has paid the surcharges and penalties as at December 31, 2005.

 

Although PLDT believes that it is not liable to pay localfranchise and business taxes, PLDT has entered into compromise settlements withseveral LGUs, including the City of Makati, in order to maintain andpreserve its good standing and relationship with these LGUs.  Under thesecompromise settlements, which have mostly been approved by the relevant courts,PLDT has paid a total amount of Php640 million for local franchise tax coveringprior periods up to the end of 2006 as at March 31, 2007.

 

PLDT nolonger had contested assessments from LGUs for franchise taxes as at December31, 2006.

 

PLDT currently expects that going forward it will pay local franchise andbusiness taxes on an annual basis and based on the gross receipts received orcollected for services rendered within the jurisdiction of the respectivetaxing authority.

 

Smart haspaid local business and franchise tax to certain cities and provinces in theaggregate amount of Php313 million under protest.  The Smart’s legal positionis that it is not liable to pay the local franchise tax by virtue of its legislativefranchise under R.A. 7294 which took effect after the effective date of theLocal Government Code of 1991 or R.A. 7160.

 

TheRegional Trial Court, or RTC, of Makati has declared Smart exempt from paymentof local franchise tax to the City of Makati in a decision entitled *SmartCommunications, Inc. vs. City of Makati*(Civil Cases No. 02-249 and 02-725,August 3, 2004) dated August 3, 2004.  The City of Makati filed a Motion for Extensionto file a Petition for Review with the Court of Appeals.  However, on June 9,2005, the Court of Appeals dismissed the appeal filed by the City of Makati.

 

The RTC ofIloilo has likewise ruled in a decision dated January 19, 2005 that Smart isexempt from payment of local franchise tax to the City of Iloilo.  The City of Iloilo filed an appeal directly with the Supreme Court which remains pending.

 

*Piltel’s Bureau of Internal Revenue, or BIR,Assessment*

 

Piltel received the following assessment noticesfrom the BIR:

 

**Year**

**Tax Assessment Type**

**Basic**

**Interest**

**Total**

 

 

(in million pesos)

1998

VAT

85.8

68.7

 154.5

 

Overseas Communications Tax, or OCT

31.8

25.5

  57.3

 

Income Tax

12.4

9.4

  21.8

 

Administrative Penalties

0.1

–

   0.1

 

 

 

 

 

1999

VAT

94.5

67.8

 162.3

 

Income Tax

22.7

13.8

  36.5

 

 

 

 

 

2001

VAT

56.2

35.1

  91.3

 

Income Tax

13.4

8.9

  22.3

 

OnDecember 12, 2005, Piltel filed a collective application for a compromisesettlement with the BIR for the deficiency tax assessments arising from taxableyears 1998, 1999 and 2001, citing “reasonable doubt as to the validity of thetax assessments” as a basis.  The prescribed minimum percentage of the compromisesettlement for such basis is 40% of the basic assessed tax.

 

OnJanuary 27, 2006, Piltel received the favorable recommendation and approvalfrom the BIR on the said application for a compromise settlement.  On January31, 2006, Piltel settled the total amount of Php114 million, which isequivalent to 40% of the basic taxes per final assessment notices received, toeffect the immediate cancellation of the tax assessments.  On February 24,2006, the BIR accepted Piltel’s application for compromise settlement of incometax and VAT for the years 1998 and 1999, and income taxes and VAT for the year2001, and issued the Certificate of Availment on the said date.

 

*EnhancedVoluntary Assessment Program, or EVAP, Availment*

 

In2005, the BIR launched the EVAP which grants taxpayers, who availed themselves ofthe program and are qualified, the privilege of the last priority in BIR auditand investigation.  The EVAP apply to all internal revenue taxes covering thetaxable year ending December 31, 2004 and all prior years, including one-timetransactions such as estate tax, donor’s tax, capital gains tax, expandedwithholding tax and documentary stamp tax on the transfer, sale, exchange, ordisposition of assets, and shall likewise cover taxpayers enjoying preferentialtax treatment.  A taxpayer who has availed of the EVAP and is qualified toavail shall not be audited except upon prior authorization and approval of theCommissioner of Internal Revenue when there is strong evidence or finding ofunderstatement in the payment of a taxpayer’s correct tax liability by morethan 30% as supported by a written report of the appropriate office stating indetail the facts and the law on which such finding is based: Provided, however,that any EVAP payment should be allowed as tax credit against the deficiencytax due, if any, in case the concerned taxpayer has been subjected to taxaudit. 

 

PLDTavailed itself of the program and paid a total of Php6 million for VAT andincome tax for taxable year 2004, and VAT and withholding tax for taxable year2002.

 

Maratelavailed itself of the EVAP for income tax for the taxable year 2004, SubicTelavailed the program for its income tax, withholding tax and percentage tax fortaxable year 2002 and ClarkTel availed of the program for its income tax for bothtaxable years 2003 and 2004.  The total payment of Maratel, SubicTel and ClarkTelamounted to Php800,000.  Smart’s EVAP availment for which Php53 million waspaid, covered the income tax for the taxable years 2003 and 2004, the VAT forthe taxable year 2002, the OCT for the year 2002, and the withholding taxes forthe taxable years 2002, 2003 and 2004.  Meanwhile, Piltel’s EVAP availment,which involved payment of Php3 million, covered the income tax for the taxableyear 2003 and the expanded withholding tax for the taxable years 2003 and2004.  On August 2, 2006, Smart received its Certificate of Qualification, orCQ, for the EVAP availment for income tax, VAT, OCT and withholding taxes fortaxable year 2002.

 

PLDTreceived its EVAP CQ on January 22, 2007 for income tax and VAT for taxableyear 2004 and on March 28, 2007 for VAT for taxable year 2002 while it receiveda Notice of Disqualification for EVAP on March 30, 2007 for withholding tax fortaxable year 2002.  SubicTel and ClarkTel received their respective EVAP CQ on September13, 2006 and December 10, 2006, respectively, while Maratel is still awaitingthe EVAP CQ to be issued by the BIR.

 

*ImprovedVoluntary Assessment Program, or IVAP, Availment*

 

In2006, the BIR launched the IVAP which similarly grants taxpayers who availed themselvesof the program and are qualified, the privilege of the last priority in BIRaudit and investigation.  The IVAP applies to all internal revenue taxescovering the taxable year ending December 31, 2005 and fiscal year ending onany day not later than June 30 2006 and all prior years, including one-timetransactions such as estate tax, donor’s tax, capital gains tax, expandedwithholding tax and documentary stamp tax on the transfer, sale, exchange, ordisposition of assets, and shall likewise cover taxpayers enjoying preferentialtax treatment.  Unlike the EVAP, however, where the taxpayers only enjoy theprivilege of last priority in audit, with the IVAP, taxpayers who availedthemselves of the same will no longer be subject to tax audit except only inthe case of fraud manifested through understatement of the correct taxliability by more than 30%.

 

Smartavailed itself of the IVAP for the income tax and VAT for the taxable year 2005and paid a total amount of Php40 million to the BIR.

 

Maratelavailed itself of the IVAP for the taxable years 2004 and 2005 for its income,VAT, percentage and withholding taxes, while SubicTel availed itself of theprogram for the taxable year 2004 for its income and value added taxes only andfor the taxable year 2005, for its income, VAT and withholding taxes.  ClarkTelavailed itself of the IVAP for the taxable years 2003, 2004, 2005 for incomeand withholding taxes except for income taxes for taxable years 2003 and 2004where an EVAP CQ covering these taxable periods was already issued.  The totalcollective IVAP payments for Maratel, SubicTel and ClarkTel amounted to Php12million.

 

 

 

**24. Financial Assets and Liabilities**

 

Ourfinancial assets and liabilities are recognized initially at fair value.Transaction costs (debt issuance costs) are included in the initial measurementof all financial assets and liabilities except those classified as financialinstruments measured at fair value through profit and loss.  Subsequent toinitial recognition, assets and liabilities are either valued at amortized costusing the effective interest rate method or at fair value depending on the classification.

 

Thefollowing table sets forth the carrying values and estimated fair values of ourfinancial assets and liabilities recognized as at March 31, 2007 and December31, 2006.  There are no material unrecognized financial assets and liabilitiesas at March 31, 2007 and December 31, 2006.

 

** **

**Carrying Value**

**Fair Value**

** **

**March 31, 2007 (Unaudited)**

December 31, 2006 (Audited)

**March 31, 2007 (Unaudited)**

December 31, 2006 (Audited)

 

(in million pesos)

**Noncurrent Financial Assets**

** **

 

 

 

Investments-available-for-sale

**120**

116

**120**

116

Derivative assets

**158**

434

**158**

434

Total noncurrent financial assets

**278**

 550

**278**

 550

**Current Financial Assets**

** **

 

** **

 

Cash and cash equivalents

**22,309**

16,870

**22,309**

16,870

Short-term investments

**16,164**

8,327

**16,164**

8,327

Trade and other receivables

**10,010**

10,158

**10,010**

10,158

Derivative assets

**43**

47

**43**

47

Total current financial assets

**48,526**

35,402

**48,526**

35,402

**Total Financial Assets**

**48,804**

35,952

**48,804**

35,952

** **

** **

 

** **

 

**Noncurrent Financial Liabilities**

** **

 

** **

 

Long-term debt - net of current portion*

**64,622**

63,769

**70,161**

70,416

Obligations under capital lease*

**57**

106

**57**

106

Preferred stock subject to mandatory redemption*

**1,247**

1,369

**1,369**

1,528

Derivative liabilities

**6,410**

6,872

**6,410**

6,872

Total noncurrent financial liabilities

**72,336**

72,116

**77,997**

78,922

**Current Financial Liabilities**

** **

 

** **

 

Accounts payable

**11,723**

8,634

**11,723**

8,634

Notes payable*

**198**

201

**198**

201

Derivative liabilities

**39**

108

**39**

108

Current portion of long-term debt*

**10,093**

16,184

**12,083**

17,512

Obligations under capital lease*

**934**

924

**934**

924

Total current financial liabilities

**22,987**

26,051

**24,977**

27,379

**Total Financial Liabilities**

**95,323**

98,167

**102,974**

106,301

 

*    *Included under “Interest-bearing Financial Liabilities”in the consolidated balance sheets.*

 

Thefollowing methods and assumptions were used to estimate the fair value of eachclass of financial instrument for which it is practicable to estimate suchvalue:

 

Interest-bearing Financial Liabilities:

 

*Long-term debt:*Fair value is based on the following:

 

**Debt Type**

**Fair Value Assumptions**

Fixed Rate Loans:

U.S. dollar notes/convertible debt

Other loans in all other currencies

 

Quoted market price.

Estimated fair value is based on the discounted value of future cash flows using the applicable LIBOR and MART1 rates for similar types of loans.

Variable Rate Loans

The carrying value approximates fair value because of recent and regular repricing based on market conditions.

 

*Preferred stock subject to mandatory redemption:* The fair values were determined using a discountedcash flow model.

 

Derivative financial instruments:

 

*Forward foreign exchange contracts and bifurcatedforeign currency forwards:* The fairvalues were determined using forward exchange market rates at the balance sheetdate.

 

*Foreigncurrency options:*  The fair valueswere computed using an option pricing model.

 

*Foreign currency and interest rate swaps:*  The fair values werecomputed as the present value of estimated future cash flows.

 

*Bifurcated equity call options:*The fair values were computedusing an option pricing model.

 

Due to the short-term nature of the transactions, the fair value of cashand cash equivalents, short-term investments, trade and other receivables,notes payable and accounts payable approximate the carrying amounts as of thebalance sheet date.

 

*Financial assets and liabilities carried at amortized cost*

 

Unamortized debt discount, representing debt issuance cost and anydifference between the fair value of consideration given or received on initialrecognition, included in following financial liabilities amounted to Php6,402million and Php6,753 million as at March 31, 2007 and December 31, 2006,respectively, see *Note 17 – Interest-bearing Financial Liabilities*.

 

* *

*Financial assets and liabilities carried at fair value*

 

The following financial assets and liabilities werecarried at fair value as at March 31, 2007 and December 31, 2006.

 

 

**March 31,  2007 (Unaudited)**

 

December 31, 2006 (Audited)

 

(in million pesos)

Investments-available-for-sale

**120**

 

116

Derivative financial instruments

**(6,248)**

 

(6,499)

 

**(6,128)**

 

(6,383)

 

*DerivativeFinancial Instruments*

 

Ourderivative financial instruments are accounted for as either cash flow hedgesor transactions not designated as hedges.  Cash flow hedges refer to thosetransactions that hedge our exposure to variability in cash flows attributableto a particular risk associated with a recognized asset or liability. Changesin the fair value of these instruments representing effective hedges arerecognized as cumulative translation adjustments in equity until the hedgeditem is recognized in earnings.  For transactions that are not designated ashedges, any gains or losses arising from the changes in fair value arerecognized directly to income for the period.

 

The tablebelow sets out the information about our derivative financial instruments as atMarch 31, 2007 and December 31, 2006:

 

** **

**March 31, 2007 (Unaudited)**

December 31, 2006 (Audited)

 

** **

 

**Maturity**

**Notional**

**Mark-to-market Gain (Loss)**

Notional

Mark-to-market Gain (Loss)

 

 

(in millions)

***PLDT***

** **

** **

 

 

 

** **

** **

 

 

Cash flow hedges:

** **

** **

 

 

Long-term currency swaps

** **

** **

 

 

 

2017

**US$300**

**(Php2,518)**

US$300

(Php2,716)

 

2012

**250**

**(2,431)**

250

(2,475) 

 

** **

** **

 

 

Long-term foreign currency options

2009

**136**

**(794)**

167

(747)

 

 

** **

** **

 

 

Transactions not designated as hedges:

** **

** **

 

 

Long-term foreign currency options

2009

**136**(1)

**112**

167(1)

138

 

** **

** **

 

 

Short-term currency options

2007

**–**

**–**

7

(6)

 

** **

** **

 

 

Interest rate swap

2012

**63**

**(452)**

63

(423)

 

** **

** **

 

 

Forward foreign exchange contracts

2007

**77**

**(3)**

202

(90)

 

** **

** **

–

–

 

** **

** **

 

 

Bifurcated equity call options

2008

**1 share**

**(198)**

1 share

(224)

 

** **

**(Php6,284)**

 

(Php6,543)

***Smart***

 

** **

 

* *

 

** **

** **

 

 

Transactions not designated as hedges:

** **

** **

 

 

Forward foreign exchange contracts

2007

**US$18**

**(Php2)**

US$–

Php–

Bifurcated embedded derivatives

2007

**14**

**38**

15

44

 

 

** **

**Php36**

 

Php44

Net liabilities

** **

**(Php6,248****)**

 

(Php6,499)

 

*(1)**Non-hedgedportion of 2009 long-term foreign currency options based on the same notionalamount as the hedged portion.*

 

 

**March 31,  2007 (Unaudited)**

 

December 31, 2006 (Audited)

 

(in million pesos)

Presented as:

** **

 

 

Noncurrent assets

**158**

 

434

Current assets

**43**

 

47

Noncurrent liabilities

**(6,410)**

 

(6,872)

Current liabilities

**(39)**

 

(108)

Net liabilities

**(6,248)**

 

(6,499)

 

Cumulativetranslation adjustments as at March 31, 2007 and December 31, 2006 consists of:

 

 

**March 31,  2007 (Unaudited)**

 

December 31, 2006 (Audited)

 

(in million pesos)

Cumulative translation adjustments at beginning of period

**(1,796)**

 

1,253

Movements of cumulative translation adjustments:

** **

 

 

Deferred income tax effects on cash flow hedges

**(190)**

 

1,088

Currency translation differences

**(179)**

 

(535)

Net gain (loss) on available-for-sale financial assets

**8**

 

(5)

Net gain on cash flow hedges removed from cumulative translation adjustments and taken to income

**346**

 

2,855

Net gain (loss) on cash flow hedges

**286**

 

(6,452)

 

**271**

 

(3,049)

Cumulative translation adjustments at end of period

**(1,525)**

 

(1,796)

 

Analysisof loss on derivative transactions for the three months ended March 31, 2007and 2006 are as follows:

 

 

**Three Months Ended March 31,**

 

**2007**

 

2006

 

(Unaudited)

 

(in million pesos)

Net mark-to-market loss at end of period

**(6,248)**

 

(6,379)

Net mark-to-market loss at beginning of period

**(6,499)**

 

(3,284)

Net change

**251**

 

(3,095)

Net (gain) loss charged to cumulative translation adjustments

**(286)**

 

4,446

Settlements, accretion and conversion

**(276)**

 

(1,373)

Net loss on derivative transactions (Note 5)

**(311)**

 

(22)

 

***PLDT***

*** ***

***CashFlow Hedges***

 

*Long-termCurrency Swaps*

*** ***

PLDT entered into long-term principal only currency swap agreements withvarious foreign counterparties to hedge the currency risk on its fixed ratenotes maturing in 2009, 2012 and 2017.  As at March 31, 2007 and December 31,2006, these long-term currency swaps have an aggregate notional amount of US$550million.  Under the swaps, PLDT effectively exchanges the principal of its U.S.dollar-denominated fixed rate notes into Philippine peso-denominated loanexposures at agreed swap exchange rates.  The agreed swap exchange rates arereset to the lowest U.S. dollar/Philippine peso spot exchange rate during theterm of the swaps, subject to a minimum exchange rate.  In March and April2004, PLDT entered into amendments to keep the lowest reset exchange rate andunwind the downward resettable feature of US$550 million of its long-termprincipal only currency swap agreements in order to lower the running hedgingcost of the swaps.  As at March 31, 2007 and December 31, 2006, the outstandingswap contracts have an agreed average swap exchange rate of Php50.76.

 

In orderto manage hedge costs, these swaps included a credit-linkage feature with PLDTas the reference entity.  The specified credit events include bankruptcy,failure to pay, obligation acceleration, moratorium/repudiation, andrestructuring of PLDT bonds or all or substantially all of PLDT’s obligations.Upon the occurrence of any of these credit events, subject to agreed thresholdamounts where applicable, the obligations to both PLDT and its counterpartyunder the swap contracts terminate without further settlements to either party,including any mark-to-market value of the swaps.  As at March 31, 2007 andDecember 31, 2006, US$686 million and US$717 million, respectively, of PLDT’slong-term currency swaps/options have been structured to include credit-linkagewith PLDT as the reference entity.  The semi-annual fixed or floating swap costpayments that PLDT is required to make to its counterparties averaged about 5.11%and 5.18% per annum as at March 31, 2007 and December 31, 2006, respectively.As cash flow hedges, any movements in the fair value of these instruments willbe taken as a cumulative translation adjustment under equity in ourconsolidated balance sheets.

 

*Long-term**Foreign Currency Options*

 

To manage hedging costs, the currency swap agreementrelating to the 2009 fixed rate notes has been structured to include currencyoption contracts.  If the Philippine peso to U.S. dollar spot exchange rate onmaturity date settles beyond Php90.00 to US$1.00, PLDT will have to purchaseU.S. dollar at an exchange rate of Php52.50 to US$1.00 plus the excess abovethe agreed threshold rate.  On the other hand, if on maturity, the Philippinepeso to U.S. dollar spot exchange rate is lower than the exchange rate ofPhp52.50 to US$1.00, PLDT will have the option to purchase at the prevailingPhilippine peso to U.S. dollar spot exchange rate.  In July 2004, PLDT and itscounterparty, agreed to re-document and re-classify the transaction intolong-term currency option contracts.  The net semi-annual floating hedge cost paymentsthat PLDT is required to pay under these transactions was approximately 6.06%and 6.17% per annum as at March 31, 2007 and December 31, 2006, respectively.

 

Theoption currency contract relating to PLDT’s option to purchase U.S. dollar atPhp52.50 to US$1.00 or prevailing spot exchange rate at maturity, whichever islower, qualifies as a cash flow hedge.  The option currency contract relatingto the counterparty’s option to purchase foreign currency from PLDT at Php90.00to US$1.00 is not designated as a hedge.  Please refer to discussion below(under transactions not designated as hedges).

 

InDecember 2006, the currency option agreement was partially terminated, whicheffectively lowered the outstanding currency options notional amount to US$167million.  Total amounts settled for the unwinding is Php40 million.

 

In January2007, the currency option agreement was again partially terminated where theoutstanding currency options notional amount was lowered to US$136 million.Total amounts settled for the unwinding is Php177 million.

 

***TransactionsNot Designated as Hedges***

 

Dueto the amounts of PLDT’s foreign currency hedging requirements and the largeinterest differential between the Philippine peso and the U.S. dollar, thecosts to book long-term hedges can be significant.  In order to manage suchhedging costs, PLDT utilizes structures that include currency option contracts,and fixed-to-floating coupon-only swaps that may not qualify for hedgeaccounting. 

 

*Long-termForeign Currency Options*

 

Withreference to the above-mentioned hedge on PLDT’s 2009 fixed rate notes, PLDTsimultaneously sold a currency option contract with the same notional amount ofUS$175 million with the same maturity that gives the counterparty a right topurchase foreign currency at Php90.00 to US$1.00.  Together with the long-termcurrency option contract classified under cash flow hedges, PLDT has theobligation to purchase U.S. dollars at an exchange rate of Php52.50 to US$1.00plus the excess above the agreed threshold rate.  In exchange for thiscondition, the overall net hedging cost for the transaction is reduced.  InDecember 2006, the currency option agreement was partially terminated, whichlowered the notional amount to US$167 million.  Since charges in fair valuehave already been recognized as profit and loss in prior periods, thecorresponding proceeds from the partial termination of the currency optioncontract amounted to Php7 million.

 

InJanuary 2007, the currency option agreement was again partially terminated whereoutstanding notional amount was lowered to US$136 million.  Proceeds from thetransaction amounted to Php33 million.

* *

*Short-term**Currency Options*

* *

PLDTentered into short-term U.S. dollar subsidized forward contracts to partiallyhedge PLDT’s fixed rate notes due June 2006.  In order to reduce overall nethedging cost for the transactions, these forward contracts have been structuredto include the sale of currency call option contracts that give thecounterparty the right to purchase foreign currency at an agreed exchangerate.  PLDT effectively has the obligation to buy U.S. dollars at a subsidizedforward rate plus any excess above the agreed threshold rate should thePhilippine peso to U.S. dollars spot exchange rate on the maturity date settlebeyond that agreed threshold.  PLDT’s subsidized forward contracts amounting toUS$62 million matured on June 29, 2006.  As at March 31, 2007 and December 31,2006, there were no outstanding subsidized forward contracts.

* *

*Interest**Rate Swap*

* *

A portion of PLDT’s currency swap agreements to hedge its 2017 fixed ratenotes carry fixed rate swap cost payments.  To effectively lower the runningcost of such swap agreements, PLDT, in April 2003, entered into an agreement toswap the coupon on US$125 million of its 2012 fixed rate notes into a floatingrate Japanese yen amount.  Under this agreement, PLDT is entitled to receive afixed coupon rate of 11.375%, provided the Japanese yen to U.S. dollar exchangerate stays above JP¥99.90 to US$1.00.  Below this level, a reduced fixed couponrate of 3% will be due to PLDT.  In order to mitigate the risk of the Japaneseyen strengthening below the agreed threshold, PLDT, in December 2003, enteredinto an overlay swap transaction to effectively lower the portion of the couponindexed to the U.S. dollar to Japanese yen rate to 3% such that the fixedcoupon rate due to PLDT when the Japanese yen strengthens below the agreedthreshold will be 8.375%.  Both swap agreements include a credit-linkagefeature with PLDT as the reference entity.

* *

In March 2006, the interest rate and overlay swapagreements were partially terminated to effectively lower the outstandinginterest rate swap notional amount to US$62.5 million.  Since changes in fairvalues have already been recognized as profit and loss in prior periods, thecorresponding liability settled by PLDT amounted to Php804 million. 

* *

*Forward Foreign**Exchange Contracts*

* *

PLDTentered into short-term U.S. dollar and Japanese yen forward foreign exchangecontracts to hedge short-term foreign currency obligations.  As at March 31,2007 and December 31, 2006, outstanding forward foreign exchange contractsamounted to US$77 million with an average exchange rate of Php48.27 and US$202million with an average exchange rate of Php49.53, respectively.  There were nooutstanding JPY forward foreign exchange contracts as at March 31, 2007and December 31, 2006.

* *

*Bifurcated**Equity Call Options*

* *

Pursuant to Piltel’s debt restructuring plan, PLDT issued its Series VIand VII Convertible Preferred Stock, see *Note 17 – Interest-bearingFinancial Liabilities*.  Each share of Series VI and VII ConvertiblePreferred Stock is convertible at any time at the option of the holder into oneshare of PLDT’s common stock.  On the date immediately following the seventhanniversary of the issue date of the Series VI Convertible Preferred Stock andon the eighth anniversary of the issue date of the Series VII ConvertiblePreferred Stock, the remaining outstanding shares under these series will bemandatorily converted into shares of PLDT common stock.  For 30 daysthereafter, the holders of these mandatorily converted shares of common stockhave the option to sell such shares of common stock back to PLDT for US$36.132per share and JPY4,071.89 per share for Series VI and VII,respectively.  On August 18, 2006, all 3,842,000 shares of Series VII shareswere converted to PLDT common stock.  As at March 31, 2007 and December 31,2006, the negative fair market value of these embedded call options amounted toPhp198 million and Php224 million, respectively.

* *

***Smart***

* *

Smartentered into short-term offshore non-deliverable forward contracts in Januaryand February 2007 to hedge a portion of loan principal payments that will falldue in May 2007 for a total of US$18 million or on 50% of the total expectedloan obligations in May and only 3.3% of the total loans outstanding with an average exchange rate of Php48.37.

 

Smart’sother embedded derivatives were bifurcated from service and purchasecontracts.  As at March 31, 2007 and December 31, 2006, outstanding contractsincluded service contract with foreign equipment suppliers and varioussuppliers covering handset importations denominated in U.S. dollars, which isnot the functional currency of a substantial party to the contract or theroutine currency of the transaction.

 

**Financial Risk Management Objectives and Policies**

 

The mainpurpose of our financial instruments is to fund our operations.  We also enterinto derivative transactions, the purpose of which is to manage the currency risksand interest rate risks arising from our operations and our sources offinancing.  It is, and has been throughout the year under review, our policythat no trading in financial instruments shall be undertaken.

 

Themain risks arising from our financial instruments are liquidity risk, foreignexchange risk, interest rate risk and credit risk.  Our Board reviews andapproves policies for managing each of these risks. These risks are summarizedbelow.  We also monitor the market price risk arising from all financialinstruments.  Our accounting policies in relation to derivatives are set out in*Note 2 – Summary of Significant Accounting Policies and Practices*.

* *

***LiquidityRisk***

* *

We seek tomanage our liquidity profile to be able to finance our capital expenditures andservice our maturing debts.  To cover our financing requirements, we currently intendto use internally generated funds and proceeds from debt and equity issues andsales of certain assets. 

* *

As part ofour liquidity risk management program, we regularly evaluate our projected andactual cash flow information and continuously assess conditions in thefinancial markets for opportunities to pursue fund-raising initiatives.  Theseinitiatives may include bank loans, export credit agency-guaranteed facilities,and debt capital and equity market issues.

* *

***Foreign Exchange Risk***

* *

The following table shows our consolidated foreigncurrency-denominated monetary assets and liabilities and their peso equivalentsas at March 31, 2007 and December 31, 2006:

* *

** **

**March 31, 2007 (Unaudited)**

December 31, 2006 (Audited)

** **

**U.S. Dollar**

**Php Equivalent**(1)

U.S. Dollar

Php Equivalent(2)

 

(in millions)

**Noncurrent Financial Assets**

** **

 

** **

** **

Derivative assets

**US$3**

**Php158**

US$9

Php434

**Current Financial Assets**

** **

** **

 

 

Cash and cash equivalents

**186**

**8,948**

155

7,578

Short-term investments

**98**

**4,705**

92

4,521

Trade and other receivables

**171**

**8,265**

277

13,589

Derivative assets

**1**

**43**

1

47

Total current financial assets

**456**

**21,961**

 525

25,735

**Total Financial Assets**

**US$459**

**Php22,119**

US$534

Php26,169

** **

** **

** **

 

 

**Noncurrent Financial Liabilities**

** **

** **

 

 

Interest-bearing financial liabilities – net of current portion

**US$1,176**

**Php56,719**

US$1,239

Php60,756

Derivative liabilities

**133**

**6,410**

140

6,872

Total noncurrent financial liabilities

**1,309**

**63,129**

1,379

67,628

**Current Financial Liabilities**

** **

** **

 

 

Accounts payable

**505**

**24,343**

268

13,115

Accrued expenses and other current liabilities

**84**

**4,056**

74

3,605

Derivative liabilities

**1**

**39**

2

108

Current portion of interest-bearing financial liabilities

**1,003**

**48,377**

328

16,104

Total current financial liabilities

**1,593**

**76,815**

 672

32,932

**Total Financial Liabilities**

**US$2,902**

**Php139,944**

US$2,051

Php100,560

 

*(1)**Theexchange rate used was Php*48.217*toUS$1.00.*

*(2)**The exchange rate used was Php49.045 to**US$1.00.*

 

Intranslating the foreign currency-denominated monetary assets and liabilitiesinto peso amounts, the exchange rates used were Php48.217 to US$1.00 and Php49.045to US$1.00, the Philippine peso-U.S. dollar exchange rates as at March 31, 2007and December 31, 2006, respectively.

 

As at May8, 2007, the peso-dollar exchange rate was Php47.371 to US$1.00.  Using thisexchange rate, our consolidated net foreign currency-denominated liabilities asat March 31, 2007 would have decreased by Php2,067 million.

 

While acertain percentage of our revenues are either linked to or denominated in U.S.dollars, most of our indebtedness and related interest expense, a substantialportion of our capital expenditures and a portion of our operating expenses aredenominated in foreign currencies, mostly in U.S. dollars.

 

As at March 31, 2007, approximately90% of our total consolidated debts were denominated in foreign currencies,principally in U.S. dollars.  Thus, a strengthening or weakening of thePhilippine peso against the U.S. dollar will decrease or increase both theprincipal amount of our unhedged foreign currency-denominated debts(representing 43% of our consolidated debts, or 28% net of our U.S. dollar cashbalances as at March 31, 2007), and interest expense on our debt in Philippinepeso terms.  In addition, many of our financial ratios and other financialtests are affected by the movements in the Philippine peso to U.S. dollarexchange rate.

 

To manageour foreign exchange risks, stabilize cash flows, and improve investment andcash flow planning, we enter into forward foreign exchange contracts, foreigncurrency swap contracts, currency option contracts and other hedging productsaimed at reducing and/or managing the adverse impact of changes in foreignexchange rates on our operating results and cash flows.  However, these hedgesdo not cover all of our exposure to foreign exchange risks.

 

Specifically,we use forward foreign exchange contracts, foreign currency swap contracts andcurrency option contracts to manage the foreign exchange risks associated withour foreign currency-denominated loans.  In order to manage hedge costs ofthese contracts, we utilize structures that include credit-linkage with PLDT asthe reference entity, a combination of currency option contracts, and fixed tofloating coupon only swap agreements.  Accounted for as either cash flow hedgesor transactions not designated as hedges, changes in the fair value of thesefinancial instruments are recognized as cumulative translation adjustments inequity until the hedged item is recognized directly as income or expense forthe period.

*** ***

***InterestRate Risk***

 

On a limited basis, we enter into interest rate swapagreements in order to manage our exposure to interest rate fluctuations.  Wemake use of hedging instruments and structures solely for reducing or managingfinancial risks associated with our liabilities and not for trading orspeculative purposes.

 

The following tables set out the carrying amount, bymaturity, of our financial instruments that are exposed to interest rate risk:

 

**ThreeMonths Ended March 31, 2007 (Unaudited)**

 

** **

 

 

 

 

 

 

 

**Discount/**

** **

 

** **

** **

 

 

 

 

 

 

 

**Debt**

** **

** **

** **

 

 

 

 

**Over 5**

**In U.S.**

 

**Issuance Cost**

**Carrying Value**

**Fair Value**

**In U.S.**

** **

** **

**Below 1 year**

**1-2 years**

**2 – 3 years**

**3-5 years**

**years**

**Dollar**

**In Php**

**In Php**

**In Php**

**Dollar**

**In Php**

** **

 

 

 

 

 

 

 

**(in millions)**

**Liabilities:**

 

 

 

 

 

 

 

** **

** **

 

** **

Long-term Debt

 

 

 

 

 

 

 

** **

** **

 

 

*Fixed Rate*

 

 

 

 

 

 

 

 

 

 

 

US$ Notes (in millions)

19

–

136

–

550

 705

34,003

506

33,497

818

39,440

Interest rate

10.625%

–

10.50%

–

8.35% to 11.375%

–

–

–

–

–

–

US$ Fixed Loans (in millions)

64

52

45

21

280

 462

22,267

5,093

17,174

383

18,455

Interest rate

4.49% to 8.9%

4.49% to 6.66%

4.49% to 6%

4.515% to 4.70%

2.25%

–

–

–

–

–

–

Philippine Peso (in millions)

–

–

–

96

24

 120

5,817

15

5,802

125

6,035

Interest rate

–

 

 

5.625% to 15%

5.625%

–

–

–

–

–

–

*Variable Rate*

 

 

 

 

 

 

 

 

 

 

 

U.S. Dollar (in millions)

120

88

81

39

–

 328

15,814

61

15,753

328

15,814

Interest rate

GOVCO’s Cost + 0.20%; 0.05% to 2.75% over US$ LIBOR

0.05% to 2.75% over US$ LIBOR

0.05% to 2.75% over US$ LIBOR

0.65% to 2.50% over US$ LIBOR

–

–

–

–

–

–

–

Philippine Peso (in millions)

9

11

12

20

–

  52

2,500

11

2,489

52

2,500

Interest rate

3 Mo MART1 + 0.75%

3 Mo MART1 + 0.75%

3 Mo MART1 + 0.75%

3 Mo MART1 + 0.75%

–

–

–

–

–

–

–

 

 

 

 

 

 

**1,667**

**80,401**

**5,686**

**74,715**

**1,706**

**82,244**

 

 

 

 

 

 

 

 

 

 

 

 

*Interest rate swap (fixed to floating)*

 

 

 

 

 

 

 

 

 

 

 

U.S. Dollar (US$63 million)

–

–

–

–

–

9

452

–

452

9

452

Japanese Yen (JPY7,519 million)

–

–

–

–

–

–

–

–

–

–

–

Fixed Rate on US$ notional 

11.375%

11.375%

11.375%

11.375%

11.375%

–

–

–

–

–

–

Variable Rate on JPY notional

8.11% over LIBOR

8.11% over LIBOR

8.11% over LIBOR

8.11% over LIBOR

8.11% over LIBOR

–

–

–

–

–

–

** **

**Year Ended December 31, 2006 (Audited)**

** **

** **

 

 

 

 

 

 

 

**Discount/**

** **

 

** **

** **

 

 

 

 

 

 

 

**Debt**

** **

** **

** **

 

 

 

 

**Over 5**

**In U.S.**

 

**Issuance Cost**

**Carrying Value**

**Fair Value**

**In U.S.**

** **

** **

**Below 1 year**

**1-2 years**

**2 – 3 years**

**3-5 years**

**years**

**Dollar**

**In Php**

**In Php**

**In Php**

**Dollar**

**In Php**

** **

 

 

 

 

 

 

 

**(in millions)**

**Liabilities:**

 

 

 

 

 

 

 

** **

** **

 

** **

Long-term Debt

 

 

 

 

 

 

 

** **

** **

 

 

*Fixed Rate*

 

 

 

 

 

 

 

 

 

 

 

US$ Notes (in millions)

130

–

167

–

550

 847

41,510

539

40,971

966

47,349

Interest rate

7.85% to  10.625%

–

10.50%

–

8.35% to 11.375%

–

–

–

–

–

–

US$ Fixed Loans (in millions)

69

55

46

33

280

 483

23,683

5,326

18,357

400

19,640

Interest rate

1.75% to 10%

4.49% to 10%

4.49% to 10%

4.515% to 4.70%

2.25%

–

–

–

–

–

–

Philippine Peso (in millions)

–

–

–

17

–

  17

810

2

 808

21

1,035

Interest rate

–

–

–

15%

–

–

–

–

–

–

–

*Variable Rate*

 

 

 

 

 

 

 

 

 

 

 

U.S. Dollar (in millions)

128

92

81

53

–

 354

17,392

74

17,318

355

17,392

Interest rate

GOVCO’s Cost + 0.20%; 0.05% to 2.75% over LIBOR

0.05% to 2.75% over LIBOR

0.05% to 2.75% over LIBOR

0.05% to 2.5% over LIBOR

–

–

–

–

–

–

–

Philippine Peso (in millions)

6

11

11

23

–

  51

2,511

12

2,499

51

2,511

Interest rate

3% over 

90-day PHIBOR, MART1 + 0.75%

MART1 + 0.75%

MART1 + 0.75%

MART1 + 0.75%

–

–

–

–

–

–

–

 

 

 

 

 

 

**1,752**

**85,906**

**5,953**

**79,953**

**1,793**

**87,927**

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

*Interest rate swap (fixed to floating)*

 

 

 

 

 

 

 

 

 

 

 

U.S. Dollar (US$63 million)

–

–

–

–

–

9

423

–

423

9

423

Japanese Yen (JPY7,519 million)

–

–

–

–

–

–

–

–

–

–

–

Fixed Rate on US$ notional 

11.375%

11.375%

11.375%

11.375%

11.375%

–

–

–

–

–

–

Variable Rate on JPY notional

8.11% over LIBOR

8.11% over LIBOR

8.11% over LIBOR

8.11% over LIBOR

8.11% over LIBOR

–

–

–

–

–

–

 

Fixed ratefinancial instruments are subject to fair value interest rate risk whilefloating rate financial instruments are subject to cash flow interest raterisk.  

 
Repricingof floating rate financial instruments is mostly done on intervals of threemonths or six months.  Interest on fixed rate financial instruments is fixeduntil maturity of instrument.  Financial instruments that are not subject tointerest rate risk were not included in the above tables.

 

***Credit Risk***

 

We trade only withrecognized and creditworthy third parties.  It is our policy that all customerswho wish to trade on credit terms are subject to credit verificationprocedures.  In addition, receivable balances are monitored on an on-goingbasis to reduce our exposure to bad debts.

 

With respect to credit risk arising from our financialassets, which comprise cash and cash equivalents, trade and other receivables,notes receivable and certain derivative financial instruments, our exposure tocredit risk arises from default of the counterparty, with a maximum exposureequal to the carrying amount of these financial instruments.

 

We have no significant concentrations of credit risk.

 

 

 

**25. Reclassificationof Accounts**

 

Certainaccounts in December 31, 2006 audited consolidated financial statements werereclassified to conform with the March 31, 2007 unaudited consolidatedfinancial statements presentation.

  |
|------------|---------------|------------|------------------|------------|-------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|