BUSINESS PROFILE Cebu Holdings, Inc. (CHI) is engaged in real property ownership, marketing, management and development.

It was registered with the Securities and Exchange Commission on December 9, 1988 and listed at the Philippine Stock Exchange on February 14, 1994. CHI is an affiliate company of Ayala Land, Inc. CHI's operations consist of rental of retail space, commercial land sales, office and residential condominium sales, sale of proprietary sports club shares, sale of residential subdivisions, lease of office space (e-office) via Cebu Property Ventures & Development Corporation, and hotel development/operations via Cebu Insular Hotel Co., Inc. CHI owns and manages the Cebu Business Park, a 50-hectare business and commercial subdivision in Cebu City. So far CHI has developed two office condominiums in Cebu - the Cebu Holdings Center and Ayala Life-FGU Center Cebu, and two residential condominiums - Park Towers I and II. CHI has also developed the City Sports Club Cebu in partnership with Ayala Land, Inc. In 2005, CHI launched its seaside residential development community, Amara, in partnership with Cebu Coastal Highpoint Ventures, Inc. The Companys operations consist of seven types of activities:

Commercial land sales Office and residential condominium sales Sale of residential subdivisions

Rental of retail space Sale of proprietary sports club shares Lease of office space via a subsidiary Cebu Property Ventures & Development Corporation

Vision/Mission Statement We shall be the premier real estate company in Cebu creating and providing marketdriven products of enduring value through a customer focused and highly-motivated team of professionals. We ensure the trust and confidence of our shareholders with sustainable and profitable growth while improving the quality of life of the communities in the markets, which we serve with honor and integrity. Core Values Focus on Customer We believe in giving our customers products with enduring value and services that are always aimed at attaining their ultimate satisfaction. We understand customer needs and requirements, and in creating our products and delivering services we strive to exceed customer expectation. Bias for Results We deliver results that will earn the trust and confidence of our Companys

shareholders. Our performance speaks of how we actively respond to problems and opportunities. Entrepreneurial Drive We are a team of professionals dedicated to practice the highest ethical standards by conducting our business with honor and integrity. With a mindset for innovation and creativity, we aim for expansion in new markets, products and techniques. Teamwork We are a team of professionals whose coordinated efforts and collective competencies can lead to the attainment of greater results. By working together with our colleagues, our customers, our suppliers and the communities with whom we do business, we can accomplish more. Concern for People We acknowledge every persons dignity and self-worth. We place emphasis on our employees personal and professional growth and development. Equally concerned for the welfare of others, we commit to enhance a persons effectiveness through training and other development opportunities. Empowerment of People Respecting each persons role in the Companys success, we provide our employees with the means to fulfill their responsibilities with authority and accountability. By doing so, they feel a sense of ownership of their jobs and projects, and are responsible for their own success.

Pursuit of Excellence By striving to be the best in everything we do, we please our customers, our employees, our shareholders, our suppliers, and our business associates and alliances. This effort may require working beyond what we are asked to do. Responsibility to the Community We are catalysts in the community. We help break new grounds for development and enterprise. The projects that we initiate bring the community at par with others in the world. Our interactions with the community spell our commitment to be a responsible corporate citizen. Love of God We acknowledge God as Sovereign Lord above self, family, work and career. This orientation leads us to putting ourselves completely in His love and care and to practices that are according to His will.

Enhancement of the Quality of Life We belong to a community of persons, sharing common aspirations and dreams of a better life for all. By the nature of our business, we commit to helping improve the quality of life of communities in the markets that we serve

Management Systems Cebu Holdings Inc.s (CHI) Integrated Management Systems (IMS) framework organizes the Companys performance metrics. Defining CHI as a company, the framework is reflected in their vision, core values and the manner of doing business. This framework aligns the Quality, Environment, Health and Safety Management Systems (QEHS MS) with the Balanced Scorecard (BSC). The broader scope is to document, monitor and evaluate sustainability practices based on the triple bottom line approach which encompasses economic, social and environment parameters.

Balance Scorecard Since first applying the strategic management tool in 2000, CHI continues to use the BSC to integrate performance drivers, based on the QEHS Management Systems. With the system in place, the BSC, being an open framework, has started to incorporate key sustainability-related indicators that form part of the overall corporate objectives, targets and programs. In 2008, CHI moved towards BSC automation. The system enables employees to upload their scorecards, monitor the achievement of targets on a monthly basis and align their scorecards with other departments. Part of the future enhancement is to eventually link the system with the performance appraisal, which connects the key performance indicators in the BSC with actual results. The system was rolled out initially to the senior personnel and to select teams who carried out a test run. The corporate scorecard shows CHIs performance in four interconnected aspects: financial, customer, internal business process and learning and growth.

Value Delivery Chain CHI regards the value delivery chain as the basic element of strategic management, the means by which the organization at various stages in its operations, determines, creates, communicates, delivers and sustains customer value. Efficient and effective management of the Companys value delivery chain relies on the use of the Balanced Scorecard and QEHS MS. These systems serve as tools and standards by which each link in the value delivery chain is reviewed and optimized. The primary activities in the chain are supported by the organizations infrastructure: its human resources, organizational structure, finance and control systems, corporate culture, technology development, audit and communication processes.

Total Customer Satisfaction Management System (TCS MS) The Total Customer Satisfaction Management System (TCS-MS) implemented since 2003 has continually evolved to aid users in the recording, deployment, monitoring and archiving of customer complaints. Feature enhancements include deployment tracking and case acceptance by persons responsible to address complaints, with the data to specify dates the complaints were deployed, received and responded to. Case updating in the current improved system

includes visuals or images attached to the text updates. Other enhancements were done on the reports generation system, further segregating complaints according to project or period.

The continuing implementation of the text feedback system, which is linked to the TCSMS, has generated faster and better customer response, especially in the mall where customer traffic is highest.

1. User creates case. Note that anyone with TCSMS account can create case. 2. System emails the coordinator that a new case was created. 3. Coordinator accesses the case and assigns Person Responsible for the case. 4. Person Responsible receives email notifications and text notifications on selected personnel who he has been assigned to handle the case. He then accesses the case and adds his remarks on the status of the case. If case is solved, he can recommend to the coordinator to close the issue. If Person Responsible fails to close the issue on the given due date, system will execute notifications below.

5. 1 day before case due date, system notifies the Person Responsible that the case is about to due. 6. On the due date, system notifies the Person Responsible and Coordinator that the case is due. 7. On every succeeding day, system notifies the managers that the case is over due. Board Structure & Process Key Role and Responsibilities Overall stewardship of the Company rests on the Board of Directors, the highest governing authority within CHI's management structure. Collectively, the Board of Directors is responsible for the success of the Company and ensures that CHI's obligations to its stakeholders are met. Composition The Board brings to the organization a balanced mix of business, legal, and finance competencies, with each director capable of adding value and rendering independent judgment in relation to the formulation of sound corporate policies, on issues of strategy, resources, standards and performance related to corporate social responsibility, environmental and economic sustainability.

Decision-making at the Board level adheres to an objective process that does not undermine the independence and integrity of judgment of each individual director.

None of the members of the Companys directors and management own two percent or more of the outstanding capital stock of the Company.

Milestone Cebu Holdings, 5th place at the MAP Best Annual Report Awards The company acquired an International Organization for Standardization (ISO) 9001:2000 certificate for its quality management system ISO 14001:2004 certificate for its environment management system Occupational Health and Safety Advisory Services (OHSAS) 18001:2007 certificate for its occupational health and safety management system. In 2007, the company adopted a triple-bottom-line approach to performance reporting using GRI Third Generation (GRI G3) reporting standards. Cebu Holdings Inc. (CHI) developed a customized worksheet- the first of its kinds in the Philippines- that would allow CHI employees to keep track of their monthly carbon footprint. A carbon footprint is the total set of greenhouse gas (GHG) emissions resulting from an organizations use of machines or implementation of a task or an activity.

Real Estate Company Cebu Holdings Inc. (CHI) landed in the silver category during the recent annual survey of corporate governance conducted by the Institute of Corporate Directors (ICD).

CHI is among the top 15 best governed companies along with the other Ayala firms such as Ayala Land Inc., Ayala Corporation, Bank of the Philippine Islands,

Globe Telecom, Manila Water and CHI subsidiary Cebu Property Ventures Corporation. Cebu Holdings Incorporated was ranked eighth in the Top 10 Asian cities of the Future by the Finance Direct Investment (fDi) magazine of the Financial Times Group Ownership Structure The Company has a transparent ownership structure. It annually discloses the top 20 holders of the common equity securities of the Company. In addition, disclosure of the security ownership of certain record and beneficial owners owning more than five percent as well as of directors and management is made annually. This information is also contained in the Definitive Information Statement sent to shareholders. II. FINANCIAL STATEMENT CEBU HOLDINGS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (Amounts in Thousands, except Earnings Per Share) Years Ended December 31 2009 2008 REVENUE Real estate Rental income Theater income Equity in net earnings of associates Interest and other income COSTS AND EXPENSES Real estate, rental and theater expenses General and administrative Interest and other charges P 413,945 697,950 72,747 19,687 83,955 1,288,284 671,029 161,732 22,060 854,821 P 378,357 594,802 66,542 14,909 85,421 1,500,031 713,951 161,582 11,164 886,697

INCOME BEFORE INCOME TAX PROVISION FOR INCOME TAX NET INCOME Basic/Diluted Earnings Per Share

433,463 103,920 P 329,543 P 0.16

613,334 172,041 P 441,293 P 0.21

CEBU HOLDINGS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (Amounts in Thousands, except for Par Value, Authorized and Issued Shares) December 31 2009 2008 ASSETS Current Assets Cash and cash equivalents Short-term cash investments Receivables - net Subdivision land for sale and development - at cost Sports club shares for sale - at cost Other current assets Total Current Assets Noncurrent Assets Noncurrent portion of receivables - net Deferred tax assets Land and improvements - at cost Property and equipment - net Investments in associates Investment properties - net Other noncurrent assets Total Noncurrent Assets LIABILITIES AND EQUITY Current Liabilities Accounts and other payables Customers deposits Income tax payable Current portion of long-term debt Total Current Liabilities Noncurrent Liabilities Customers deposits and deferred credits Deferred tax liabilities - net Long-term debt - net of current portion Total Noncurrent Liabilities Total Liabilities P667,583 237,510 230,275 321,447 357,864 24,852 1,839,531 158,384 9,540 656,579 34,065 278,107 2,708,218 88,792 3,933,685 P 5,773,216 P738,025 221,999 25,853 110,000 1,095,877 48,075 23,733 165,000 236,808 1,332,685 P750,589 84,163 203,534 141,335 357,864 30,108 1,567,593 66,813 7,910 888,868 46,594 293,962 2,642,628 144,215 4,090,990 P 5,658,583 P 777,898 197,839 8,785 55,000 1,039,522 53,521 22,808 275,000 351,329 1,390,851

December 31 2009 2008 Equity Equity attributable to equity holders of Cebu Holdings, Inc. Capital stock P 1 par value Authorized - 3,000,000,000 shares Issued and outstanding - 1,920,073,623 shares P 1,920,073 P 1,920,073 Additional paid-in capital 856,685 856,685 Retained earnings 1,366,590 1,198,804 4,143,348 3,975,562 Non-controlling interests 297,183 292,170 Total Equity 4,440,531 4,267,732 P 5,773,216 P 5,658,583 Financial Statement analysis In 2007, the Company's earnings from operations improved to all-time high performance with revenues of 1.28 billion pesos, 24 percent higher than that of the previous year's. Consolidated net income, also exceeded the 2006 figure by 22 percent, reaching 251.8 million pesos, the highest bottom line since the Company's inception. Robust sales of commercial and residential lots, as well as increased in retail and leasing operations resulted in impressive bottom lines for the Company's core businesses. 2008 has been a year of challenges as global economic troubles are shaking various markets and forced everyone to be extremely cautious about their investments. Despite the onset of a challenging market, the Company with its highest-ever consolidated revenues at P1.5 billion. Net income was also at an all-time high of P399.5 million, 59 percent higher versus that of the previous years. Total revenue was a good mix of real estate development income and recurring leasing revenues. Real estate revenues from commercial and residential lot sales account 49 percent of total consolidated revenues,

while leasing revenues account for 44 percent. The remaining revenues represent equity earnings in associates, interest and other income. In 2009, CHI registered consolidated revenues of P 1.28 billion and a net income after tax of P 329 million, lower than the previous year levels. After-tax margin was at 23 percent compared to the previous years 27 percent. Net income in 2009 has decreased from 2008 due to the effect of global financial crisis. In 2009 its income from real estate has declined in great value however, other income was merely unaffected. Revenue from real estate declined a lot because buyers in this particular moment were cautious on the present scenario of the world. Their costs and expenses didnt increase that much except for interest and other charges. Usually when there is recession, the tendency of interests and other charges is to go up. This is part of the companys risk that is unavoidable. However, some of its expenses even declined particularly the real estate, rental and theater expenses. It declined in 2009 because the company didnt invest so much on this particular property anticipating the negative impact of the recession in this type of business. Therefore the main reason of decline in net income in 2009 was the decrease sale in real estate. This makes a good impression to the company that even in unexpected adversities the company has remained stable.

III. INVESTMENT PROFILE

Company History In 1988, the provincial government of Cebu offered to sell via public bidding a 44.6 hectare piece of prime land previously leased to Club Filipino. The proceeds from the auction would be used as a counterpart funding by the provincial government for infrastructure and development projects. The floor price for the property was pegged at P220 million or approximately P493 per square meter. A consortium of investors consisting of Ayala Land, Inc., Bank of the Philippine Islands, Kuok Philippines Properties, Inc., A. Soriano Corporation and the Philippine Long Term Equity Fund submitted the highest bid of P551 million or approximately P1,235 per square meter for the property. Soon after winning the bid, Cebu Holdings, Inc. (CHI) was formed to act as the holding company of the consortium. On December 9, 1988, CHI was registered with the Securities and Exchange Commission with the primary purpose of engaging in the real estate business. In 1990, CHI increased its total land holdings to approximately 50 hectares with the acquisition of a 5-hectare property adjacent to the Club Filipino property. Pursuant to project management agreement dated January 10, 1989, CHI appointed Ayala Land, Inc. ("ALI") as project manager for the development of the property of CHI in Cebu City of approximately 50 hectares, for a fee based on certain percentage of gross proceeds or revenues derived from the sale or lease of any portion of the developed property. The agreement provides that Ayala Land, Inc. shall undertake, among other things, the necessary functions and activities to develop the property into a multi-use complex consisting of office areas, shopping and entertainment centers, hotels and high density residential areas. In its development of CBP, the Company transformed raw land into a masterplanned fully-integrated community by

constructing roads and facilities required for the installation of water, drainage, sewerage, telecommunications and power systems. Certain areas in CBP are reserved as open spaces for parks and common uses. In addition, the Company imposes certain restrictions on the construction of buildings on office lots it sells to ensure that the general character and value that it seeks to create for the property's development are maintained. Management Management stands as the locus of decision-making for the day-to-day affairs of the Corporation. It determines the Companys activities by putting the Companys targets in concrete terms and by formulating the basic strategies for achieving these targets. It also puts in place the infrastructure for the Companys success by establishing the following mechanisms in its organization: 1) purposeful legal and organizational structures that work effectively and efficiently in attaining the goals of the Company; 2) useful planning, control, and risk management systems that assess risks on an integrated cross-functional approach; 3) information systems that are defined and aligned with IT strategy and the business goals of the Company; 4) a plan of succession that formalizes the process of identifying, training and selection of successors in key positions in the Company.

Management is primarily accountable to the Board for the operations of the Company. As part of its accountability, it is also obligated to provide the Board with complete, adequate information on the operations and affairs of the Company in a timely manner. Accountability and Audit The Audit and Risk Committee provides oversight to external and internal auditors. The internal audit function of the Audit and Risk Committee is governed by a separate Internal Audit Charter. The Audit and Risk Committee is empowered to independently review the integrity of the Companys financial reporting and oversees the independence of the external auditors. The Audit and Risk Committee is responsible for checking all financial reports for compliance with the internal financial management handbook and pertinent accounting standards, including regulatory requirements. It also recommends to the Board and stockholders the appointment of the external auditors and the setting of appropriate audit fees. Risk-Based Audit Approach The Internal Audit Department executed its audit activities for 2009 in accordance with the risk-based audit approach in conformity with the International Standards for the Professional Practice of Internal Auditing (ISPPIA) and, at the same time, complies with the Securities and Exchange Commissions Code of Corporate Governance (SEC Memorandum Circular No. 6: Series of 2009).

Disclosure and Transparency CHI is committed to high standards of disclosure and transparency to enable the investment community to understand the true financial condition of the Company and the quality of its corporate governance.. Content and Timing of Disclosures CHI updates the investing public with strategic, operational and financial information through adequate and timely disclosures filed with the SEC and PSE. In addition to compliance with periodic reportorial requirements, the Company punctually discloses major and market-sensitive information such as dividend declarations, joint ventures and acquisitions, sale and disposition of significant assets, as well as other material information that may affect the investment decision of the investing public. In 2009, unstructured disclosures were filed involving matters such as the declaration of P0.07 cash dividend to common shareholders. Consolidated audited financial statements for the latest financial year are submitted to the SEC on April 15, as required. The audited annual report is submitted at least 15 working days before the Annual General Meeting. In 2009 the audited Annual Report as contained in the Definitive Information Statement was submitted to the SEC and the PSE on March 18, 2009, more than three weeks before the April 29, 2009 Annual General Meeting. Interim (i.e., quarterly financial statements) are released between 30 and 45 days from the end of the financial period. The results are disclosed to the SEC and PSE within 24

hours from the time the Board meets to accept the results. The results are also sent to financial and stock market analysts via the internet immediately upon confirmation by the SEC of its receipt of disclosure, and made available on the Companys corporate web site. Financial Reporting The Companys financial statements comply with the Philippine Accounting Standards and the Philippine Financial Reporting Standards which are in compliance with International Accounting Standards. The annual consolidated financial statements provide a breakdown of total assets, total liabilities and equity, revenues, costs and expenses, income before income tax, net income attributable to equity holders of CHI and minority interests and earnings per share. A more extensive, transparent disclosure of segment results such as assets, liabilities and revenues is provided to enable shareholders to appreciate various businesses and their impact on overall value enhancement. The following are disclosed in the Note on Business Segments:

total revenue operating profit net income segment assets investments in associates and jointly controlled entities

segment liabilities depreciation and amortization

Transactions entered into with associates and other related parties in their conduct of business are on an arms-length basis. Sales and purchases of goods and services to and from related parties are made at normal market prices. Related party transactions are discussed and quantified in the Notes to the Consolidated Financial Statements. Information on the Companys financial instruments is accompanied by a presentation of the Companys risk management objectives and policies to allow for a better assessment of financial performance and cash flows. Significant accounting judgments and estimates are also disclosed.

Dealings in Securities CHI continues to adopt a uniform policy on securities transactions to reinforce and formalize existing government regulations against insider trading. Reporting of Transactions CHI is compliant with the requirement of the PSE for directors and principal officers to report any acquisition, disposal or change in their shareholdings of the Company to the SEC and to report changes in ownership of Company shares within five trading days.

The Company expanded coverage of this reporting requirement to include members of the management committee. All other officers are required to submit a quarterly report on their trades of Company shares to the Office of the Compliance Officer. Trading Blackouts The Company continues to adopt a policy on insider trading. Under this policy, directors, officers and employees who are considered to have knowledge of material facts or changes in the affairs of CHI which have not been disclosed to the public, including any information likely to affect the market price of the securities of the Company are prohibited from buying or selling the Companys securities during trading blackout periods. The policy covers the Companys shares of stock, options to purchase stocks, bonds, and other evidence of indebtedness. All members of the Board of Directors, all key officers, consultants and advisers and all other employees of the Company who are made aware of undisclosed material information, including members of the immediate families of key officers are covered in this policy. During the year, notices of trading blackouts for structured disclosures were issued for a period covering ten (10) trading days before and three (3) trading days after the disclosure of quarterly and annual financial results. Compliance with these trading blackout periods is strictly enforced. There have been no cases of violation of the Companys policy on insider trading. Stakeholder Relations

CHI seeks to adhere to a high level of moral conduct and fair dealings with all its stakeholders. The Company believes this is the basis and foundation for building longterm, mutuallybeneficial relationships. Shareholder and Investor Relations The Company believes that open and transparent communications are requisite for sustained growth and building investor confidence. Our investor communications program seeks to promote greater understanding of the Companys longterm value creation proposition. The Company, through its Finance Division reporting directly to the President, addresses the various information requirements of the investing public and communicates with minority shareholders through timely and full disclosures to the PSE, Annual General Meetings, one-on-one meetings, conference calls, investor visits and tours, web site and emails or telephone calls. The Company has updated the Investor Relations section of its website to include the organization structure, performance, ownership and governance of the Company. The section is updated promptly when and as disclosures to the regulatory agencies are made. Proceedings of analysts briefings by way of presentations are immediately made available on the web. Shareholder Meeting and Voting Procedures Stockholders are informed at least 15 business days in advance of the scheduled date of the general meetings. Notice of regular or special meetings contain, in addition to the

date, the hour and place of the meeting, and a statement of the matters to be transacted at the meeting. The notice to stockholders also set the date, time and place of the validation of proxies which is prescribed to be no less than five business days prior to the annual stockholders meeting. Each common share of stock entitles the person in whose name it is registered in the books of the Corporation to one vote, provided the conditions as regards payment have been complied with. Employee Relations CHI is committed to promoting the safety and welfare of its employees. It believes in inspiring its employees, developing their talents, and recognizing their needs as business partners. Strong and open lines of communication are maintained to relay the Companys concern for their welfare and safety, and deepen their understanding of the Companys value creating proposition. These are all articulated in the Companys strategic management system, the Balanced Scorecard specifically under the Learning and Growth perspective and also in the Health and Safety Management System certified to OHSAS 18001: 2007 standard. Code of Ethical Behavior The Code of Ethical Behavior outlines the general expectations and set standards for employee behavior and ethical conduct. It covers all CHI employees, its subsidiaries and affiliate. The Company and its employees commit to adhere to the Companys core values in conducting personal and business affairs. The Code of Ethical Behavior is

intended to be read in conjunction with the Companys Human Resources Manual of Personnel Policies which includes the Code of Conduct governing acceptable office conduct for the orderly operation of the Company as well as for the protection of the rights, safety, and benefit of the total employee force. Company employees are required to annually disclose any business and family-related transactions to the Company by accomplishing the conflict of interest disclosure statement submitted to the Human Resources and Admin Department that monitors compliance of this policy. Enterprise Risk Management Amidst the rapidly changing external environmentunstable economy and climate change issues, Cebu Holdings, Inc. (CHI) aims to put in place robust risk management capabilities to protect and enhance stakeholders value. Hence, the Enterprise-wide Risk Management (ERM) initiative was launched in March 2009 to elevate the current risk management of the Company from operational to the strategic level. Investor Relations We believe in building strong relations with stockholders through transparent, timely and open communication of strategic, operating and financial information. By providing easy access to such information, we seek to enable our stockholders to arrive at a better understanding of the Company's long-term prospects and a fair valuation of its shares.

Our Subsidiaries and Affiliate

Cebu Leisure Company, Inc. (CLCI) Cebu Leisure Company, Inc. was formed in 1994. It started as a joint venture company between Fun Corporation and Cebu Holdings, Inc. In 1997, the former sold its shares to the latter. It is now a wholly-owned subsidiary of CHI.

Cebu Property Ventures & Development Corporation (CPVDC) CPVDC was registered with the Securities and Exchange Commission on August 2, 1990 and started commercial operations on September 1, 1996. The company started as a joint venture corporation between the Province of Cebu and Ayala Land, Inc. CPVDC is now 76 percent owned by Cebu Holdings, Inc. after a successful tender offering undertaken in 1995. The companys operations consist of three types of activities: commercial land sales, residential subdivision sales and office space leasing. CPVDC is the owner and developer of Asiatown I.T. Park, a 24-hectare prime property for mixed-use development located in the former Lahug Airport.

Cebu Insular Hotel Company, Inc. (CIHCI) The company was incorporated on April 6, 1995 with the primary purpose of hotel development and management. In September 1996, the company began work on the 303-room businessmans hotel called the Cebu City Marriott Hotel. The project is owned by Cebu Insular Hotel Company, Inc., a 63 percent - 37 percent joint venture between Ayala Hotels, Inc. and the Company.

Dividend History Stock Dividend (per share) Record Date Payment Date August 5, 1994 August 31, 1994 October 2, 1997 November 12, 1997 Cash Dividend (per share) Peso Amount Declaration Date Record Date 0.05 September 20, 2006 October 13, 2006 0.05 November 19, 2007 December 4, 2007 0.07 October 8, 2008 November 6, 2008 0.07 November 16, 2009 December 1, 2009 Percent 50% 25%

Payment Date October 27, 2006 December 18, 2007 November 28, 2008 December 22, 2009

Dividend Restriction There are no restrictions that limit the ability to pay dividends except those provided under Section 43 of the Corporation Code and other existing laws. To the extent feasible, it is the policy of the Company to declare periodically a portion of its unrestricted retained earnings as dividends to shareholders, either in the form of stock or cash, or both. The payment of dividends in the future will depend on the Company's earnings, cash flow, investment program and other factors. ANALYSIS OF INVESTMENT To ensure the Company's sustained success, CHI continue to strengthen the organization by optimizing the use of human capital, streamlining processes and empowering their people to achieve the goals they have set. A basic tool in CHIs operations is the Balanced Scorecard (BSC), a strategic management system, which translates strategy into action, with each member of the organization connecting to the value delivery chain and contributing to the attainment of the Company's corporate goals across four perspectives-financial, customer, internal business process and learning and growth. In the financial side, this is reflected in the company's sustained revenue growth, which then translates to strong stock fundamentals for their shareholders. The growth across their various business lines is translated in a Total Shareholder Return (TSR). Stock price increased from a closing of 3.20 pesos per share in 2006, to 3.60 pesos per share in 2007. This is 10 times its value five years ago.

In the customer side, CHI performance is reflected in above average satisfaction ratings from both their internal and external customers, as well as continued patronage and repeat purchases of their projects. Since customer is always first, the company has set up various feedback mechanisms, such as the Total Customer Satisfaction Management System, to ensure that customer needs are heard and addressed at the soonest possible opportunity. The company also regularly conducts External Customer Surveys to gauge customer perception. To improve the companys internal business processes, they have acquired and maintained conformity with the three international standards on Quality, Environment and Occupational Health and Safety, making CHI the first full-line real estate company in the Philippines to attain such distinction. This ensures the efficiency and effectiveness of their systems and products as the Company takes its place among globally competitive organizations. Furthermore, their modern technology infrastructure that is in place brings their internal business process up to speed. The Company puts the human resources in its priority list, being the underlying strategic factor of success in business. Behavioral and competency programs were drawn up to ensure that every member of the team is qualified and properly equipped to achieve set goals. To promote a work-life balance, employee volunteerism is encouraged and wellness programs, which include sports, cultural and social activities, are sponsored by the Company.

IV. NEWS BRIEFS Fete marks 20 years of Cebu Holdings Philippine Daily Inquirer A THREE-IN-ONE event tool place at Cebu Business Park presided by Fernando Zobel de Ayala, chair of Ayala Land, Inc. This is an area that was once the sprawling golf course of Cebus Club Filipino. Now it is a little Makati, thanks to Cebu Holdings, Inc. (CHI), an affiliate of Ayala Land. Size can be relative when you have 50 hectares or so in the midst of a dense city like Cebu turned into a sophisticated urban area with tree-lined wide avenues, skyscrapers, a mall with underground parking, and an international hotel. Construction is going at such a pace one wonders what the crisis is all about. The triple celebration marked 20 years of CHI, the relaunch of the renovated Marriott Hotel, and the grand inaugural of The Terraces at Ayala Center. A ribbon-cutting ceremony took place at the plush Palm Lounge of the Marriott with Zobel de Ayala offering those gilt scissors to Cebu Gov. Gwendolyn Garcia. Clustered about them were Undersecretary of Tourism Phineas Alburo, Geoff Garside and John Northen of Marriott International, CHI chair Jim Ayala, CHI president Francis Monera, his predecessor Rene Almendras, and Marivic Aonuevo who heads the Ayala Land Business Scapes.

V. CONCLUSION AND RECOMMENDATION Cebu Holdings Corporation was living up to their mission of being the premier real estate company in Cebu, in creating and providing market-driven products of enduring value through a customer-focused and highly-motivated team of professionals. The companys efforts resulted in a very significant profits and unprecedented market appreciation which they hope will ensure continued trust and confidence as they strive to improve the quality of life of the communities in the markets which they serve. Cebu Holdings Corporation attributed their performance in the past years to achievements of the key result areas across the four perspectives of their strategic management system, the Balanced Score Card, the central focus of which is the strategic planning and execution- financial, customer, internal business process and learning and growth perspectives. To achieve the companys vision, they concentrated on developing a highly-talented team committed to learning and innovation. CHI had recognized the value of maximizing the potential of each employee in the company. In CHI, talent is their most important resource. With the right training and clear-cut strategic guidelines, here lies an essential key in achieving success. CHI also encourages teamwork and fresh ideas in arriving at the solution. Everyone is able to connect to their value delivery chain which starts from identifying customer needs to delivery or satisfying the need. While focusing on their human resources, they also strengthened their internal business processes and systems to meet global standards and meet the excellence requirements

by being the first full-line real estate company in the country to be certified to the three ISO standards for quality, environment and health and safety. While enhancing their team and processes, they also maximized operational efficiencies thus attaining their financial objectives, without sacrificing customer satisfaction. Because of its impressive performance, CHIs share price value appreciated. This significantly higher increase in income versus revenue indicates the companys efficiency in operation as well as in implementing cost-saving measures. CHIs expertise in building master-planned communities is balanced by its commitment to build enduring and beneficial relationships with its stakeholders. By continuing to build projects, systems, communities and relationships, CHI is better able to adapt to changing business realities, gain customer loyalty, bottomline success and investor confidence, as they create value for their stakeholders. RECOMMENDATION In today's increasingly competitive global market, it is a company's quick, yet calculated ability to adapt to change and take advantage of opportunities that spells out success. In recent years, tourism and information technology have emerged as opportunities which present enormous potential for economic growth in the region. With the growing interest in the area, developers see a boom cycle in the real estate industry. With the present CHIs efficient management system that serves as a good foundation for the successful implementation of the business operation, the company only has to

stay uphold on those systems, evaluate it from time to time and to stay updated on the latest trends of management systems in the industry. With the continuing robust high market demand of this real estate, CHI has to carry on with its current projects and aimed at capitalizing on growth possibilities in Cebu especially in the areas of information technology (IT) and leisure facilities and services. CHI has to take robust effort in constructing high quality and safety malls and other commercial buildings as well as the redevelopment of some tourist attractions in the district that would likely increase investors interest in the company. Confident on the companys culture, policies and financial stability, the company may embark on the trail-blazing growth of their current project and expand its operations in other geographical areas that are considered an emerging district due to upcoming businesses in the area like Cagayan de Oro City. In the coming years, CHI shall continue to invest in the twin-win industries of Cebu tourism and business as well as the potential expansion of the company to other regions. With strong financial and operating results it is worthwhile to invest in this particular company.