EXECUTIVE SUMMARY

INTRODUCTION

The Batangas Land Company, Inc. (BLCI), a subsidiary of the National Development
Company, is a domestic corporation duly organized and existing under the laws of the
Philippines since 1971. Its principal purpose is to administer the real properties of Caltex
Philippines, Inc. (Caltex), now Chevron Philippines, Inc. (Chevron).

The major objectives and principal programs of the Corporation are as follows:

(a) to acquire, own, hold, improve, develop, lease and dispose of any land or interest in land,
buildings, facilities and structures as maybe permitted by law;

(b) to invest in, hold, buy, sell and acquire and dispose of stocks, bonds and properties and
assume obligations of other corporations subject to the provisions of the applicable laws;
and

(c) to engage in the general mercantile and commercial business of buying, selling,
importing, exporting, bartering or otherwise dealing in general merchandise.

In line with this mandate, BLCI disposed through public bidding three properties in 2012 and
one property each in 2013 and 2014, and which were fully paid in January 2013, July 2014
and November 2015, respectively.

In its meeting on January 3, 2020, the BLCI Board of Directors approved to retain the original
corporate term of the Corporation, pursuant to its Article of Incorporation of 50 years, which is
until July 15, 2021.

The Corporation is governed and its activities are directed, controlled and managed by a
Board of Directors, composed of eight Directors and a Chairman.

As of December 31, 2019, BLCI has two permanent employees.

FINANCIAL HIGHLIGHTS

Comparative Financial Position

Increase
2019 2018 (Decrease)
Assets 69,434,721 65,777,837 3,656,884
Liabilities 22,027,798 21,021,536 1,006,262
Equity 47,406,923 44,756,301 2,650,622

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Comparative Results of Operations

Increase
2019 2018 (Decrease)
Income 42,452,611 41,756,804 695,807
Expenses 33,179,332 30,293,333 2,885,999
Income before tax 9,273,279 11,463,471 (2,190,192)
Income tax expense 2,556,006 3,330,170 (774,164)
Net income 6,717,273 8,133,301 (1,416,028)

SCOPE AND OBJECTIVES OF AUDIT

Our audit covered the examination, on a test basis, of the accounts and transactions of BLCI
for the period January 1 to December 31, 2019 in accordance with International Standards
of Supreme Audit Institutions (ISSAIs) to enable us to express an opinion on the fairness of
presentation of the financial statements for the years ended December 31, 2019 and 2018.
Also, we conducted our audits to assess compliance with pertinent laws, rules and
regulations, as well as adherence to prescribed policies and procedures.

INDEPENDENT AUDITOR’S OPINION ON THE FINANCIAL STATEMENTS

We rendered an unmodified opinion on the fairness of presentation of the financial

statements of the Corporation for the years 2019 and 2018.

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