Bogo-Medellin Milling Co., Inc.

August 17, 1999 PSE CIRCULAR FOR BROKERS NO. 2040-99 SUBJECT : Bogo-Medellin Milling Co . , Inc . Attached herewith is a copy of Bogo-Medellin Milling Co., Inc.'s ("BMM") Amendment to SEC Form 11-Q/Quarterly Report for the quarter ended March 31, 1999 amending the Management Discussion and Analysis of Financial Condition and Results of Operations of the three-month period January to March 31, 1999. aisadc For Your information. (SGD.) JOSE LUIS U. YULO, JR. President & CEO SECURITIES AND EXCHANGE COMMISSION AMENDMENT TO SEC FORM 11-Q (For the Quarter ending March 31, 1999) OF BOGO-MEDELLIN MILLING CO., INC. QUARTERLY REPORT PURSUANT TO SECTION 11 OF THE REVISED SECURITIES ACT AND SECTION 41 OF THE CORPORATION CODE OF THE PHILIPPINES A. Part I Item 1 Financial Statements Disclosures are included in the Management Discussion. No adjustments needed in the Financial Statements. Item 2. Management Discussion and Analysis of Financial Condition and Results of Operations of For the three-month Period January to March 3, 1999 Results of Operations The Company suffered a net loss of PHP 12.6 million during the three-month period, compared with a net income of PHP 1.0 million for the same period last year. This was due to lower volume of sugar available for sale resulting from lower production and was partly offset by higher average sugar price and lower operating costs and expenses mainly those which vary directly with production. Year to date loss of PHP12.4 million was higher by PHP8.9 than last year's due mainly to lower cane supply and consequently lower production. Financial Condition The Company's current ratio has dropped from 30 September 1998's 3.5 to 1.58 which reflects the cyclical nature of the sugar business and the adverse operating results thus far. As at 31 March 1998 the ratio stood at 1.62. Under normal industry cycle, sugar inventory is high during this period while at year end, most if not all sugar produced is usually already sold. The Company was resorted to borrowings from banks and affiliated company on a short term basis to fund its operational requirements. cdta Other Matters Asian currency crisis Many, Asia-Pacific countries, including the Philippines, are experiencing economic difficulties and slowdown on growth characterized by currency devaluation, volatile stock market and high interest rates. Uncertainties remain as to whether the country will continue to be affected by regional trends. The accompanying financial statements do not include any adjustment that might result from these uncertainties. The related effects will be reported in the financial statements as they become known and estimable. El Nio and La Nia Phenomena Many companies, especially in the agricultural sector, suffered economic difficulties and heavy losses brought about by the El Nio Phenomenon which afflicted the country with severe dry weather in the first 3 quarters of the Company's fiscal year. As a consequence, planting of the 1998-99 crop was delayed, and growth of the crop was adversely affected by lack of fertilization. Harvesting of the crop was thus delayed. This was further aggravated by the onset of La Nia. The very wet weather further delayed harvesting and cane purity deteriorated resulting to very low sugar production. BOGO-MEDELLIN MILLING CO., INC. By: (SGD.) P. B. TORRES For: D.C. CLYMO Treasurer