Cosmos shares banned from trade

Corporate regulators have banned the trading of Cosmos Bottling Corp. shares for failure to submit financial reports on time, junking an appeal from the soft drinks maker. Trading in Cosmos shares has been suspended since May 8, 2007. The company appealed the suspension after submitting its 2005 and 2006 financial reports last Oct. 31, but the Securities and Exchange Commission (SEC) pointed out that the deadline was July 9. The SEC not only denied the appeal, it also proceeded to revoke Cosmos’ registration and permit to sell securities. "The revocation order, however, shall not exempt the company from complying with its reportorial and other obligations under the Securities Regulation Code and its implementing rules and regulations," SEC corporate finance department director Justina F. Callangan said in a two-page order dated March 13. Cosmos disclosure officers Amormio C. Santiago and Nimfa L. Perez said the company received the order of revocation on Wednesday. Ms. Callangan said Cosmos "committed subsequent violations when it belatedly filed" its first, second and third quarterly reports for 2006 (SEC Form 17-Q) as well as its 2007 current report (SEC Form 17-C). "The company paid the additional penalties assessed against it for the late filing of its 2006 annual report (SEC Form 17-A) � as well as for the late filing of its second and third quarterly reports for 2006 on Jan. 28, 2008," she noted. Cosmos shares were suspended on May 23, 2006, when the stock closed at P3 apiece. It was among 30 listed firms which had failed to submit audited financial statements compliant with new accounting standards. Amid a tough beverage market, Cosmos incurred a P277.13-million net loss in 2006, after cutting its 2005 profit by half to P106.39 million from P211.67 million the previous year. Cosmos is 98.21% owned by Philippine Bottlers, Inc., a wholly owned subsidiary of Coca-Cola Bottlers Philippines, Inc. (CCBPI) whose ultimate parent is The Coca-Cola Company. In 2006, Cosmos had five manufacturing plants, three in Luzon and one each in Iloilo and Cebu. On Sept. 3, 2007, Cosmos stopped production in the five plants and transferred production requirements to Coca-Cola plants under a toll manufacturing agreement. Early this month, The Coca-Cola Company Chief Operating Officer Muhtar Kent visited the country. Mr. Kent described Cosmos as a "great brand." Cosmos sells soft drinks under the Pop Cola, Sarsi, Cheers Lemon, Jaz Cola and Sparkle brands. Sarsi and Sarsi Light are aimed at class A and B markets. Pop, Jaz, Sparkle, and Cheers are primarily marketed to the Class C and D segments. — Ruby Anne M. Rubio, BusinessWorld