The year 2017 was marked by trailblazing achievements, unprecedented in the history of Alliance Global Group, Inc (AGI). Our subsidiaries continued to record new performance milestones, surpassing everyone’s expectations.

Overall, we have made further inroads to become a uniquely diversified global conglomerate, a position we have deliberately carved out for ourselves less than a decade ago when we decided to pursue an aggressive expansion program. AGI ended 2017 with a net income of P21.8 billion, reflecting a compounded annual growth rate of 16% for the past 10 years as consolidated revenues reached P141.6 billion. Attributable profit stood at P14.9 billion, also growing at an annual clip of 16% for the same period.

Our property arm, Megaworld Corporation, posted another stellar performance as net income reached P13.2 billion on revenues of P50.1 billion. It attained its target of launching 20 real estate projects during the year and then exceeded expectations with reservation sales of P105 billion, a first in its 28-year history. Megaworld now has 667 residential towers, 57 office buildings and 15 lifestyle malls all over the Philippines, and still has over 4,400 hectares in 30 cities for future development.

Its rental income amounted to P11.8 billion, well on its way to achieving its target of P20 billion in 2020. As of end-2017, Megaworld’s inventory of office and retail spaces totals 1.3 million square meters.

Its world-class and high-tech office buildings are home to a number of multinationals belonging to the Fortune 500 companies. Megaworld’s distinctive lifestyle malls offer a range of unique features and experiences, having established themselves as major retail, dining and entertainment destinations.

AGI continues to gain headway in the tourism industry as our hotel operations raked in P4.2 billion in revenues. The Group currently has a total capacity of 3,200 room keys spread over a diversified portfolio of renowned global hotel brands under Travellers International Hotel Group, Inc. (Travellers) and our own prestigious hotel brands under Megaworld. Our target is to bring this number to 12,000 keys within the next three to five years.

In the near-term, the Group is set to expand its international hotel brands with the addition of the Hilton, Sheraton, Okura and Ritz-Carlton to complement our existing Marriott and Holiday Inn hotels. Our own hotel brands also got a boost with the launch in 2017 of Savoy Hotel in Boracay, allowing us to expand our strategic foothold in one of the country’s prime tourist destinations. Savoy is a welcome addition to our existing hotel brands Richmonde and Belmont.

Our spirits business through Emperador Inc. registered total revenues of P42.7 billion in 2017 as it continued its brandy dominance in the local and international markets, while also expanding its presence in the global whisky segment through Scotland-based Whyte and Mackay (WMG).

WMG has been breaking new records in sales, making its mark as a significant growth driver of Group performance. This was led by its single malt whisky brands, The Dalmore and Jura, which have been enjoying brisk sales in Europe and Asia, mainly in China. In 2017, WMG launched a new blended malt brand, Shackleton, which gained strong market response. It is scheduled for broader distribution in 2018.

Emperador has also strengthened its portfolio of world-renowned brandies through Bodegas Fundador, whose premium brands like FundadorSupremo 18YO won the 2017 “Brandy of the Year” award. To further grow its dominance in the global brandy category, Emperador also acquired the Domecq brandies and wines during the year.

In the Philippines, the “Tama KaDyan” campaign was launched to help improve sales and strengthen the position of our flagship Emperador Light as brand of choice for Filipinos. Our leisure and entertainment business under Travellers saw Resorts World Manila (RWM) continue to set the benchmark for gaming thrills and excitement. In 2017, Travellers, a joint venture between AGI and Genting Hong Kong, recorded P21.1 billion in revenues.

In the coming months, Travellers is set to unveil the Grand Wing, which we believe will raise the bar in the industry.Once fully operational, the 14,000-square meter premium gaming facility under Phase 3 Expansion Program should help regain Travellers’ leading position in the country’s fast-growing gaming sector.

Our quick service restaurant business, Golden Arches Development Corporation (GADC), marked another sterling year as net income reached P1.7 billion on revenues of P25.5 billion. This was attributed to the healthy 5.8% growth in systemwide same-store sales. Also, in 2017, GADC opened 52 McDonald’s restaurants all over the country, bringing its total store count to 566 and making inroads in new territories such as Antique, Sorsogon, Masbate and Agusan del Sur. McDonald’s is set to bring its number of restaurants in the Philippines to 1,000 within the next few years, riding high on its popular brand and growing patronage.

AGI’s unique and diversified business has now come to a whole new level, with its foray into transport infrastructure development through our new wholly-owned subsidiary, Infracorp Development, Inc. (Infracorp). Its first undertaking is a 2-kilometer Skytrain monorail project that will link the MRT Guadalupe Station to our township in Uptown Bonifacio, thereby improving access to and in Fort Bonifacio. The project is expected to be operational by 2021.

Infracorp, through AGI, is also a party to the mega consortium that will rehabilitate the Ninoy Aquino International Airport (NAIA). The project is expected to bring the NAIA annual capacity to 47 million passengers by 2020 and then raise this further to 65 million by 2022.

Through the years, AGI has banked on the unwavering commitment of all our stakeholders to sustain corporate growth while contributing significantly to the country’s economy. I once again rely on this dedication to galvanize our various subsidiaries in being more innovative in developing and implementing strategic initiatives in the pursuit of our business objectives for 2018 and beyond.

Andrew L. Tan
Chairman and Chief Executive Officer
Alliance Global Group, Inc. and Megaworld Corporation

AGI was incorporated in the Philippines on October 12, 1993 and began operations in 1994 as a glass container manufacturer after it acquired a glass manufacturing plant in Canlubang, Laguna. After its listing on the PSE in 1999, the Company obtained approval from the Philippine SEC to broaden its primary business and become a holding company. That same year, the Company began acquiring a diverse group of businesses, primarily in the real estate and food and beverage industries, as set out below:

• In August 2000, the Company's wholly-owned subsidiary, AGB, acquired McKester Pik-Nik International Limited and took over the international trade and distribution business for several branded consumer products.
• In February and October 2001, the Company acquired two Philippine-based real estate companies, Tradewind Estates and First Centro, Inc., respectively.
• In June 2003, the Company bid for and was awarded approximately 25 hectares of the land in Fort Bonifacio, Taguig, Metro Manila, now known as McKinley Hill, that were owned by the Bases Conversion and Development Authority ("BCDA"), a Government agency organized to arrange for the disposal of Government-owned land occupied by military bases. The Company subsequently entered into a joint development agreement with Megaworld in July 2003 to develop this property.
• In March 2005, AGI entered the quick service restaurants industry through the acquisition of 49% of the common shares in GADC, a company owned and controlled by Mr. George Yang, the then-Chairman and President of AGI, from McDonald's Restaurant Operations, Inc. ("MRO").
• In February 2007, AGI acquired EDI, a company that had previously acquired the brandy manufacturing assets and related brands of Consolidated Distillers, which is owned and controlled by the Tan Family.
• In February 2007, AGI acquired an additional 26% of the shares in Megaworld, a company founded by Mr. Andrew Tan in 1989, in which it already owned 21% of the shares through its wholly-owned subsidiary New Town Land Partners, Inc. Megaworld was listed on the PSE on June 15, 1994.
• In February 2007, the Company was reorganized to consolidate various businesses controlled by Mr. Andrew Tan, who had been appointed Chairman and Chief Executive Officer of the Company in September 2006.

We are priming ourselves for international competitiveness in the new century by consistently delivering products and services that meet the quality standards of markets both here and abroad. Through continuing research and innovation, we will enhance the company's ability to gain customer satisfaction and goodwill and build on our market franchise.

As a world-class Filipino conglomerate, we will be an active partner in national economic development through the pursuit of excellence in our core businesses and investment in industries that offer more room for profitability and growth.

As a matter of policy, we will always adapt to the dynamics of the market. Through export development and competitive pricing, we will enhance our competitiveness in an ever-expanding marketplace.

We will constantly strive to enhance shareholder value by making our products and services desirable, accessible and affordable to the target consumers in the Philippines and abroad. Through a continuing reward program, out stockholders will be entitled to an immediate share in the company's gains in the form of stock or cash dividends.

Dina D.R. Inting
First Vice President – Finance

Ms. Inting has served as First Vice President for Finance since January 1996 and at present its Compliance Officer and Corporate Information Officer. She is currently director of ProgreenAgricorp, Inc. and Compliance Officer and Corporate Information Officer of Emperador Inc. She gained an extensive experience in the fields of audit, comptrollership, treasury, finance, branch operations and personnel management from her previous employments. She is a Cum Laude graduate of Bachelor of Science in Commerce major in Accounting, Honors Program, at the Philippine College of Commerce (Polytechnic University of the Philippines), holds a certificate in Organizational Development from the Ateneo de Manila University, and is a Certified Public Accountant.

Dominic V. Isberto
Corporate Secretary

Mr. Isberto has served as the Corporate Secretary since September 14, 2007. He is the Corporate Secretary and Assistant Corporate Information Officer of Global-Estate Resorts, Inc. He is also the Corporate Secretary of Emperador Inc., Twin Lakes Corporation, Eastwood City Estates Association, Inc., Suntrust Properties, Inc. and Fil-Estate Properties, Inc. He also serves as Assistant Corporate Secretary of Adams Properties, Inc. Mr. Isberto has experience in litigation and banking and corporate law. He has a degree in Management Engineering from the Ateneo de Manila University and obtained his Bachelor of Laws degree from the University of the Philippines.

Rolando D. Siatela
Assistant Corporate Secretary

Mr. Siatela has served as Assistant Corporate Secretary since August 30, 2002. He is a Director of Asia Finest Cuisine, Inc. He is the Corporate Secretary of ERA Real Estate Exchange, Inc., ERA Real Estate, Inc., Oceanic Realty Group International, Inc., and Suntrust Home Developers, Inc. He concurrently serves as Asst. Corporate Secretary of Megaworld Corporation, Emperador Inc., Global-Estate Resorts, Inc. (formerly Fil-Estate Land, Inc.), and Suntrust Properties, Inc. He was employed as Administrative and Personnel Officer with Batarasa Consolidated, Inc. and served as Assistant Corporate Secretary and Chief Administrative Officer of The Andresons Group, Inc.

By-Laws