SEAFRONTRESOURCESCORPORATION
NOTESTOFINANCIALSTATEMENTS
1. CorporateInformation
Seafront Resources Corporation (the Company or SRC) was registered with the Securities and Exchange Commission (SEC) on April 16, 1970 as an oil exploration and production company. On October 18, 1996,theCompanyamendeditsArticlesofIncorporationwhichprovidesfortherevision of its primary purpose from engaging in the business of oilexploration and production into a holding companyandtoincludeoilexplorationandproductionbusinessasoneofitssecondarypurposes.The Company’ssharesofstockwerelistedonMay7,1974andarecurrentlytradedatthePhilippineStock Exchange.
The registered office address of the Company is 7th Floor, JMT Building, ADB Avenue, OrtigasCenter,PasigCity.
The accompanying financial statements were approved and authorized for issue by the Board of Directors(BOD).
2. BasisofPreparation
BasisofPreparation
The accompanyingfinancial statements of the Company have been prepared under the historical cost basis, except forthe financial assets atfair value through profit orloss (FVPL) and financial assets at fairvaluethroughothercomprehensiveincome(FVOCI),whichhavebeenmeasuredatfairvalue. The Company’s financial statements are presented in Philippine Peso (P=), which is also the Company’s functionalandpresentationcurrency.
The Company has investment in trust funds. The transactions and balances of the Company’s trust funds are consolidated on a line by line basis with the Company (Note 7). The trust fund reports are prepared for the same reporting year as the Company, using consistent accounting policies in accordancewithPFRSAccountingStandards.
StatementofCompliance
The financial statements of the Company have been prepared in accordance with PFRS Accounting Standards.
3. ChangesinAccountingPolicies
NewStandards,InterpretationsandAmendments
Theaccountingpoliciesadoptedareconsistentwiththoseofthepreviousfinancialyear,exceptforthe adoption of amendments effective in 2026. The Company has not early adopted any standard, interpretationoramendmentthathasbeenissuedbutisnotyeteffective.
Unless otherwise indicated, adoption of these new standards did not have any impact on the financial statementsoftheCompany.
AmendmentstoPAS21, Lack of exchangeability
Theamendmentsspecifyhowanentityshouldassesswhetheracurrencyisexchangeableand howitshoulddeterminea spotexchangeratewhenexchangeabilityislacking.
StandardsIssuedButNotYetEffective Pronouncementsissuedbutnotyeteffectivearelistedbelow. Unlessotherwiseindicated,theCompany doesnot expect that the future adoption of the said pronouncements will have a significant impact on its financial statements. The Company intends to adopt the following pronouncements when they become effective.
Effective beginning on or after January 1, 2026
AmendmentstoIllustrativeExamplesonPFRS7,PFRS18,PAS1,PAS8,PAS26andPAS37, Disclosures about Uncertainties in the Financial Statements
AmendmentstoPFRS9andPFRS7, Classification and Measurement of Financial Instruments
AmendmentstoPFRS9andPFRS7, Contracts Referencing Nature-dependent Electricity
AnnualImprovementstoPFRSAccountingStandards—Volume11
AmendmentstoPFRS1, Hedge Accounting by a First-time Adopter
AmendmentstoPFRS7, Gain or Loss on Derecognition
AmendmentstoPFRS9, Lessee Derecognition of Lease Liabilities and Transaction Price
AmendmentstoPFRS10, Determination of a ‘De Facto Agent’
AmendmentstoPAS7, Cost Method
Effective beginning on or after January 1, 2027
PFRS17, Insurance Contracts
PFRS18, Presentation and Disclosure in Financial Statements
ThestandardreplacesPAS1, Presentation of Financial Statements andrespondstoinvestors’ demandforbetterinformationaboutcompanies’financialperformance. Thenewrequirements include:
o Requiredtotals,subtotalsandnewcategoriesinthestatementofprofitorloss
o Disclosureofmanagement-definedperformancemeasures
o Guidanceonaggregationanddisaggregation
TheCompanyiscurrentlyassessingtheimpactofthisnewstandard.
PFRS19, Subsidiaries without Public Accountability
AmendmentstoPAS21, Translation to a Hyperinflationary Presentation Currency
Deferred effectivity
AmendmentstoPFRS10, Consolidated Financial Statements,andPAS28, Sale or Contribution of Assets between an Investor and its Associate or Joint Venture
4. SummaryofSignificantAccountingPolicies
FinancialInstruments
Initial recognition and subsequent measurement
A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liabilityor equityinstrumentofanotherentity.
Financial assets - Initial recognition and measurement
Financial assets are classified, at initial recognition, as subsequently measured at amortized cost, FVOCIandFVPL.
The classification of financial assets at initial recognition depends on the financial asset’s contractual cash flow characteristics and the Company’s business model for managing them. The Company initiallymeasuresafinancialassetatitsfairvalueplus,inthecaseofafinancialassetnotatfairvalue throughprofitorloss,transactioncosts.
InorderforafinancialassettobeclassifiedandmeasuredatamortizedcostorfairvaluethroughOCI, it needs to give rise to cash flow that are ‘solely payments of principal and interest (SPPI)’ on the principal amount outstanding. This assessment is referred to as the SPPI test and is performed at an instrumentlevel.
The Company’s business model for managing financial assets refers to how it manages its financial assets to generate cash flows. The business model determines whether cash flows will result from collectingcontractualcashflows,sellingthefinancialassets,orboth.
Subsequent measurement
Forpurposesofsubsequentmeasurement,financialassetsareclassifiedinfourcategories:
Financialassetsatamortizedcost(debtinstruments)
FinancialassetsatFVOCIwithrecyclingofcumulativegainsandlosses(debtinstruments)
Financial assets designated at FVOCI with no recycling of cumulative gains and losses upon derecognition(equityinstruments)
FinancialassetsatFVPL
Financial assets at amortized cost (debt instruments)
TheCompanymeasuresfinancialassetsatamortizedcostifbothofthefollowingconditionsaremet:
The financial asset is held within a business model with the objective to hold financial assets in ordertocollectcontractualcashflows;and
Thecontractualtermsofthefinancialassetgiveriseonspecifieddatestocashflowsthataresolely paymentsofprincipalandinterestontheprincipalamountoutstanding.
Financialassetsatamortizedcostaresubsequentlymeasuredusingtheeffectiveinterest(EIR)method and are subject to impairment. Gains and losses are recognized in profit or loss when the asset is derecognized,modifiedorimpaired.
The Company’s financial assets at amortized cost includes Cash and cash equivalents, Receivables, Notesreceivable,andNoncurrentreceivables.
Financial assets at FVPL
Financial assets at fair value through profit or loss include financial assets held for trading, financial assets designated upon initial recognition at fair value through profit or loss, or financial assets mandatorilyrequired tobemeasuredatfairvalue. Financialassetsareclassifiedasheld fortradingif they are acquired for the purpose of selling or repurchasing in the near term. Derivatives, including separated embedded derivatives, are also classified as held for trading unless they are designated as effectivehedginginstruments. Financialassetswithcashflowsthatarenotsolelypaymentsofprincipal andinterestareclassifiedandmeasuredatfairvaluethroughprofitorloss,irrespectiveofthebusiness model. Notwithstanding the criteria for debt instruments to be classified at amortized cost or at fair value through OCI, as described above, debt instruments may be designated as at FVPL on initial recognitionifdoingsoeliminates,orsignificantlyreduces,anaccountingmismatch.
FinancialassetsatFVPLarecarriedinthestatementoffinancialpositionatfairvaluewithnetchanges infairvaluerecognizedinprofitorloss.
This category includes derivative instruments andquoted equity investments which the Companyhad notirrevocablyelectedtoclassifyatfair value throughOCI. Dividendson quotedequityinvestments arealsorecognizedasotherincomeinprofitorlosswhenthe rightofpaymenthasbeenestablished.
The Company’s financial assets at FVPL consists of investments in quoted equity securities held for trading.
Financial assets designated at FVOCI (equity instruments)
Uponinitialrecognition,theCompanycanelecttoclassifyirrevocablyitsequityinvestmentsasequity instruments designated at FVOCI when they meet the definition of equity under PAS 32, Financial Instruments: Presentation and Disclosure, andarenotheldfortrading. Theclassificationisdetermined onaninstrument-by-instrumentbasis.
Gainsandlossesonthesefinancialassetsareneverrecycledtoprofitorloss. Dividendsarerecognized as other income in profit or loss when the right of payment has been established, except when the Companybenefitsfromsuchproceedsasarecovery ofpartofthecostof thefinancialasset,inwhich case, such gains are recorded in OCI. Equity instruments designated at FVOCI are not subject to impairmentassessment.
The Company’s financial assets at FVOCI include quoted and unquoted equity securities and debt governmentsecurities.
Impairment of financial assets
TheCompanyrecognizesanallowanceforexpectedcreditloss(ECLs)foralldebtinstrumentsnotheld atFVPL. ECLsarebasedonthedifferencebetweenthecontractualcashflowsdueinaccordancewith thecontractandallthecashflowsthattheCompanyexpectstoreceive,discountedatanapproximation oftheoriginaleffectiveinterestrate. Theexpectedcashflowswillincludecashflowsfromthesaleof collateralheldorothercreditenhancementsthatareintegraltothecontractualterms.
ECLs are recognized in two stages. For credit exposures for which there has not been a significant increase in credit risk since initial recognition, ECLs are provided for credit losses that result from defaulteventsthatarepossiblewithinthenext12months(a12-monthECL). Forthosecreditexposures for whichtherehasbeenasignificant increasein credit risksinceinitialrecognition, a lossallowance isrequiredforcreditlossesexpectedovertheremaininglifeoftheexposure,irrespectiveofthetiming ofthedefault(alifetimeECL).
The Company may consider a financial asset to be in default when internal or external information indicates that the Company is unlikely to receive the outstanding contractual amounts in full before taking into account any credit enhancements held by the Company. A financial asset is written off whenthereisnoreasonableexpectationofrecoveringthecontractualcashflows.
Financial liabilities - Initial recognition and measurement
The Company’s financial liabilities consist of Accounts payables and accrued expenses classified, at initialrecognition,asloansandborrowingsrecognizedatfairvalue.
Afterinitialrecognition,interest-bearingloansandborrowingsaresubsequentlymeasuredatamortized costusingtheEIRmethod.
Derecognition of financial assets and financial liabilities
Financial assets
Afinancialasset(orwhereapplicable,a partofafinancial asset orpart of agroupof similarfinancial assets)isderecognizedwhen:
therightstoreceivecashflowsfromtheassethaveexpired;
theCompanyretainstherightstoreceivecashflowsfromtheasset,buthasassumedanobligation topaytheminfullwithoutmaterialdelaytoathirdpartyundera“pass-through”arrangement;or
the Company has transferred its right to receive cash flows from the asset and either; (a) has transferred substantially all the risks and rewards of the asset; or (b) has neither transferred nor retainedsubstantiallyalltherisksandrewardsoftheasset,buthastransferredcontroloftheasset.
Financial liabilities
Afinancialliabilityisderecognized whentheobligationundertheliabilityisdischarged,cancelledor hasexpired.
FairValueMeasurement
Fairvalueisthepricethatwouldbe receivedtosellanassetorpaidtotransferaliabilityinanorderly transactionbetweenmarketparticipantsatthemeasurementdate. Thefairvaluemeasurementisbased onthepresumptionthatthetransactiontoselltheassetortransfertheliabilitytakesplaceeither:
Intheprincipalmarketfortheassetorliability,or
Intheabsenceofaprincipalmarket,inthemostadvantageousmarketfortheassetor liability.
The principalorthemostadvantageousmarketmust be accessibletobytheCompany. Thefairvalue of an asset or a liability is measured using the assumptions that market participants would use when pricingtheassetorliability,assumingthatmarketparticipantsactintheireconomicbestinterest.
The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximizing the use of relevant observable inputs andminimizingtheuseofunobservableinputs.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorizedwithinthefairvaluehierarchy,describedasfollows,basedonthelowestlevelinputthatis significanttothefair valuemeasurementasawhole:
Level1-Quoted(unadjusted)marketpricesinactivemarketsforidenticalassetsor liabilities
Level 2 - Valuation techniques for which the lowest level input that is significant to the fair valuemeasurementisdirectlyorindirectlyobservable
Level 3 - Valuation techniques for which the lowest level input that is significant to the fair valuemeasurementisunobservable
For assets and liabilities that are recognized in the financial statements on a recurring basis, the CompanydetermineswhethertransfershaveoccurredbetweenLevelsinthe hierarchybyre-assessing categorization (based on the lowest level input that is significant to the fair value measurement as a whole)attheendofeachreportingperiod.
CapitalStock
Capital stock is measured at par value for all shares issued. Incremental costs incurred directly attributabletotheissuanceofnewsharesareshowninequityasadeductionfromproceeds,netoftax. WhentheCompanypurchasesitsowncapitalstock(treasuryshares),theconsiderationpaid,including any attributable incremental costs, is deducted from equity until the shares are cancelled, reissued or disposed of. Where such shares are subsequently sold or reissued, any consideration received, net of anydirectlyattributableincrementaltransactioncostsandtherelatedtaxeffectsisincludedinequity.
RetainedEarnings
Retained earnings represent accumulated earnings of the Company less dividends declared and with consideration of any changes in accounting policies and other adjustments applied retroactively. Retained earnings also includes transfer of cumulative gain or loss on equity securities at FVOCI realizedthroughdisposal.TheretainedearningsoftheCompanyareavailablefordividendsonlyupon approvalanddeclarationoftheBOD.
EarningsPerShare(EPS)
Basic earnings per share are computed on the basis of the weighted average number of shares outstandingduringtheyearaftergivingretroactiveeffectforanystockdividendsdeclaredinthecurrent year.
RevenueRecognition
Interest income
Interestincomeisrecognizedastheinterestaccruestakingintoaccounttheeffectiveyieldontheasset.
Dividend income
DividendincomeisrecognizedwhentheCompany’srighttoreceivethepaymentisestablished,which isgenerallywhentheBODapprovesthedividenddeclaration.
Rental income
Rental income under non-cancellable leases is recognized in the statement of comprehensive income onastraight-linebasisovertheleaseterms,asprovidedunderthe termsoftheleasecontract.
Management income
Management income from contracts with customers is recognized when control of the services is transferredtothecustomeratanamountthatreflectstheconsiderationtowhichtheCompanyexpects to be entitled in exchange for those goods. The Company has concluded that it is the principal in its revenue arrangement since it is the primary obligor in all revenue arrangements, has pricing latitude andisalsoexposedtocreditrisk. Managementincomeisrecognizedovertime,usinganinputmethod tomeasureprogresstowardscompletesatisfactionoftheservice,becausethecustomersimultaneously receivesandconsumesthebenefitsprovidedbytheCompany.
GeneralandAdministrativeExpenses
Expenses are recorded when incurred. General and administrative expenses constitute costs of administeringthebusiness.
IncomeTax
Current tax
Currenttaxassetsandliabilitiesforthecurrent andpriorperiodsaremeasuredatthe amountexpected toberecoveredfromorpaidtothetaxationauthorities. Thetaxratesandtaxlawsusedtocomputethe amountarethosethatareenactedorsubstantiallyenactedbythereportingdate.
Deferred tax
Deferred tax is provided on all temporary differences at the reporting date between the tax bases of assetsandliabilitiesandtheircarryingamountsforfinancialreportingpurposes.
Deferred tax liabilities are recognized for all taxable temporary differences. Deferred tax assets are recognized for all deductible temporary differences, carryforward of unused tax credits from excess minimum corporate income tax (MCIT) over regular corporate income tax and unused net operating loss carryover (NOLCO), to the extent that it is probable that taxable profit will be available against
which the deductible temporary differences, and the carryforward of unused tax credits from excess MCITandunexpiredNOLCOcanbeutilized.
Thecarryingamountofdeferredtaxassetsisreviewedateachreportingdateandreducedtotheextent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferredtaxassettobeutilized. Unrecognizeddeferredtaxassetsarereassessedateachreportingdate and are recognized to the extent that it has become probable that future taxable profit will allow the deferredtaxassettoberecovered.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is realized or the liability is settled, based on tax rates (and tax laws) that have been enactedorsubstantiallyenactedatthereportingdate.
EventsAfterthe ReportingDate
Post year-end events up to the date of auditors’ report that provide additional information about the Company’ssituationatthereportingdate(adjustingevents)arereflectedinthefinancialstatements,if any. Postyear-endeventsthatarenotadjustingeventsaredisclosedinthenoteswhenmaterial.
5. SignificantAccountingJudgments,EstimatesandAssumptions
The preparation of the accompanying financial statements requires management to make judgments, estimates and assumptions that affect amounts reported in the financial statements and related notes. The judgments, estimates and assumptions used in the financial statements are based upon management’sevaluationofrelevantfactsandcircumstancesasofthedateoftheCompany’sfinancial statements. Actualresultscoulddifferfromsuchestimates.
Judgments andestimates are contractually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.
Judgment
In the process of applying the Company’s accounting policies, management has made the following judgments,apartfromthoseinvolvingestimations,whichhasthemostsignificanteffectontheamounts recognizedinthefinancialstatements:
Determining the classification of investments in equity securities
The Company applies significant judgment in determining the appropriate classification of its investmentsinequitysecuritiesinaccordancewithPFRS9, Financial Instruments. Equityinvestments are measured at fair value through profit or loss (FVPL) by default unless the Company, at initial recognition, irrevocably elects to classifysuchinvestments atfair value through other comprehensive income(FVOCI).
In making this assessment, the Company considers the purpose for which the equity investments are held, including whether they are acquired principally for short-term trading or held for long-term strategicobjectives. Otherfactorsconsideredincludeexpectedholdingperiod,theCompany’sintent, historical trading activity, risk management strategy, and how the performance of the investments is evaluatedandreportedtokeymanagementpersonnel.
Equity investments that are not held for trading and are intended to be held for long-term value appreciation and dividend income are designated at FVOCI, whereas investments held for trading purposesormanagedonafair-value-through-profit-or-lossbasisareclassifiedatFVPL.
The Company’s financial assets at FVPL consists of investments in quoted equity securities held for tradingwhiletheCompany’sfinancialassetsatFVOCIincludequotedandunquotedequitysecurities anddebtgovernmentsecurities.
EstimatesandAssumptions
The key assumptions concerning the future and other key sources of estimation uncertainty at the statementsoffinancialpositiondate,thathaveasignificantriskofcausingamaterialadjustmenttothe carryingamountsofassetsandliabilitieswithinthenextfinancialyeararediscussedbelow.
Estimation of fair value of unquoted equity securities classified as financial assets at FVOCI
The Company uses its judgment to select the most appropriate valuation methodology to value its unquotedequityinvestmentsandmakeassumptionsthataremainlybasedonmarketconditionsexisting ateachreportingperiod. AsofDecember31,2025and2024,theCompanyvaluedtheunquotedequity securities classified as financial assets at FVOCI using the adjusted net asset method which is a combinationofthemarketandincomeapproaches. Itinvolvesdirectlymeasuringthefairvalueofthe assets and liabilities of the investee company, as mainly determined by the Company’s external appraiser. Assets of theinvestee companyconsistmainly ofparcelsof landforsale whichisadjusted to its fair value. The fair value adjustments arising from changes in fair value of unquoted equity securitiesarefullydisclosedinNote8.
Recognition of deferred tax assets
The Company’s deferred tax assets pertain to the carryforward benefits of NOLCO and excess MCIT overRCIT. Judgmentisrequiredtodeterminetheamountofdeferredtaxassetsthatcanberecognized, based upon the likely timing and level of future taxable profits together with future tax planning strategies.
The Company did not recognize deferred tax assets amounting to P =5.07 million and P =4.33 million as of December 31, 2025 and 2024, respectively (Note 13). Management believes that it may not be probablethatsufficienttaxableincome will be available against whichtheincome tax benefitscanbe realizedpriortotheirexpiration.
6. CashandCashEquivalents
31-Mar-26 31-Dec-25 (Unaudited) (Audited)
Cashinbanks P=7,612,404 P =8,538,774 Cashequivalents(Note7) 295,324,181 376,429,064 P=302,936,585 P =384,967,838
Cash in banks earn interest at the prevailing bank deposit rates. Cash equivalents are short-term investmentsthataremadefor varying periodsofuptothree monthsdependingontheimmediatecash requirementsoftheCompanyandearninterestattheprevailingshort-termplacementrates.
Interest income earned on cash in banks and cash equivalents amounted to P =3.14 million and P =1.57 millionforthe1stquarterof2026and2025,respectively.
7. InvestmentinTrustFunds
The Company established trust funds (the Trust) which are being administered by a local bank under two trust agreements. The details of the trust funds based on the financial statements issued by the trusteebankareasfollows: 31-Mar-26 31-Dec-25 (Unaudited) (Audited)
The assets, liabilities and performance of the funds are consolidated in the applicable accounts of the Companyforfinancialstatementpresentationpurposes.
31-Mar-26 31-Dec-25 (Unaudited) (Audited)
Short-term investments are made for varying periods of up to three months and earn interest at the prevailing short-term placement rates ranging from 4.45% to 4.65% per annum for the current period comparedto4.55%to5.65%perannumforthepreviousyear.
8. FinancialAssets
TheCompany’sfinancialassetsaresummarizedbymeasurementcategoriesasfollows: 31-Mar-26 31-Dec-25 (Unaudited) (Audited) Cashandcashequivalents(Note6) P=302,936,585 P =384,967,838 Receivables(Note9) 1,670,468 1,992,423 FinancialassetsatFVTPL(Note7) 29,867,277 30,767,948
FinancialassetsatFVOCI(Note13) 20,075,542 20,576,463
FinancialAssetsatFVTPL
DetailsoffinancialassetsatFVTPLconsistingofquotedequitysecuritiesareasfollows:
31-Mar-26 31-Dec-25 (Unaudited) (Audited)
ThenetlossonfairvaluechangesonfinancialassetsatFVTPLamountedtoP =0.90millionandnetgain P =1.03millionforMarch31,2026andDecember31,2025,respectively.
ThemovementsinfinancialassetsatFVTPLforthe1stquarterendedMarch31,2026andyearended December31,2025areasfollows:
31-Mar-26 31-Dec-25 (Unaudited) (Audited)
Balanceatbeginningofyear P =30,767,948 P =29,738,681
FinancialAssetsatFVOCI
FinancialassetsatFVOCIconsistofquotedandunquotedsharesofstockheldforlong-terminvestment purposesandarecarriedatfairvalue. Thecarryingvaluesoftheseinvestmentsareasfollows:
31-Mar-26 31-Dec-25 (Unaudited) (Audited)
Quotedequitysecurities: PetroEnergyResourcesCorporation(PERC) (Note 13) P=13,132,471 P =13,479,075
Unquotedequitysecurity: Investmentsingovernmentsecurities (Note7and13) 6,943,071 7,097,388 P=20,075,542 P =20,576,463
ThemovementsinfinancialassetsatFVOCIforthe1stquarterendedMarch31,2026andyearended December31,2025areasfollows:
31-Mar-26 31-Dec-25 (Unaudited) (Audited)
Balanceatbeginningofyear P=20,576,463 P =620,911,020
Fairvalue gain(loss) (500,921) (37,388,599)
DisposalofHEDCequitysecurities - (565,945,958)
Movementof governmentsecurities - 3,000,000
Balanceatendofyear P=20,075,542 P =20,576,463
Movementsinthenetunrealizedgains(losses)onfinancialassetsatFVOCIinequityareasfollows: 31-Mar-26 31-Dec-25 (Unaudited) (Audited)
Balanceatbeginningofyear P =(246,775) P =428,417,775
Unrealizedgain(loss)recognizedinother comprehensiveincome (500,921) (31,820,362)
Cumulativegainondisposedfinancialassettransferred toretainedearnings - (396,844,188)
Balanceatendofyear (P=747,696) (P=246,775)
DividendincomeearnedonitsinvestmentsamountedtoP =0.04millionandP =0.06millionfor1st quarter of2026and2025.
Investment in HEDC
OnJanuary31,1997,theCompanyenteredintoaProjectShareholders’Agreementwithfive(5)other companies led by Investment and Capital Corporation of the Philippines (ICCP) and Penta Capital Investment Corporation(PCIC) to develop500to600hectaresofrawlandin Hermosa,Bataanintoa new township consisting of industrial estates, residential communities, a golf and country club and a commercialcenter.
ThefairvalueofinvestmentinHEDCisdeterminedusingtheadjustednetassetvaluemethodwherein the assets of HEDC consisting mainly of parcels of land are adjusted from cost to its fair value. The valuation of the parcels of land was performed by Cuervo Appraisers, Inc., an SEC-accredited independent valuer as at December 31, 2025 and 2024. This measurement falls under Level 3 in the fair valuehierarchy.
Fair value measurement disclosures for the determination of fair value of unquoted equity securities areprovidedinNote13.
OnJuly8,2025,theCompany soldits 11.33% equityinterestwithoutrecycling,equivalentto one (1) million common shares. The shares were sold to Science Park of the Philippines, Inc., Regatta Holdings,Inc.andAssetGrowthInc.
The agreed purchase price amounted to P =325 million, consisting of P =300 million payable in cash upfront and an additional P =25 million which was recorded as a noninterest-bearing noncurrent receivables,tobereceivedthrough anearnout arrangementbasedonfuturedividends. Proceedsfrom the sale amounted to P =266.25 million, net of capital gains tax paid. The fair value of the unquoted equity securities at time of sale is P =565.95 million. Cumulative gain on equity securities at FVOCI realizedthroughdisposalamountedtoP =396.84millionandrealizedgainonthesaleofinvestment,net of P =33.75 million capital gains tax, amounted to P =191.25 million is recognized directly in retained earnings.
9. Receivables
31-Mar-26 31-Dec-25 (Unaudited) (Audited)
10.
NotesReceivable
OnFebruary1,2024,theCompanyplacedP =100.00millionina362-daytenorpromissorynotethrough RCBC Capital Corporation, subject to quarterly interest payment of 8% per annum. This was paid uponmaturityandlater placedona91-daystenorpromissorynote,subjecttointerest payment of7%.
OnApril29,2025,theCompanyreceivedP=100.00millionaspaymentuponmaturityofthepromissory note.
Interest income earned on notes receivable amounted to nil and P =1.10 million for 1st quarter of 2026 and2025,respectively.
11. OtherIncome
31-Mar-26 31-Mar-25 31-Dec-25 (Unaudited) (Unaudited) (Audited)
(Note12)
Management income pertains to accounting, legal and administrative services rendered by the CompanytoHEDC(seeNote12).
Rental income pertains to rentals earned from a parking slot owned by the Company which are classified as investment property. As of March 31, 2026 and December 31, 2025,the cost of the fully depreciatedparkingslotsamountedtoP =207,598.
The fair value of the investment property ranges from P =800,000 to P =1,735,000 per slot as of March31,2026andDecember31,2025,respectively. Thishasbeendeterminedonthebasisofrecent sales of similar properties in the same area as the investment property and taking into account the economicconditionsprevailingatthetimethevaluationwasmade.Thesignificantunobservableinputs used in determining the fair value include the location, size, shape, and highest and best use (Level 3 - Significant unobservable inputs). There are no related costs for the operation of the investment property.
12. RelatedPartyTransactions
Relatedpartyrelationshipexistswhenonepartyhastheabilitytocontrol,directly,orindirectlythrough one or more intermediaries, the other party or exercise significant influence over the other party in makingfinancialandoperatingdecisions. Suchrelationshipalsoexistsbetweenand/oramongentities,
which are under common control with the reporting enterprises and its key management personnel, directors,oritsshareholders. Inconsideringeachrelatedpartyrelationship,attentionisdirectedtothe substanceoftherelationship,andnotmerelythelegalform.
TheCompanyinitsregularconductofbusinesshasenteredintothefollowingtransactionswithrelated partiesconsistingofreimbursementofexpensesandmanagementandaccountingservicesagreements.
The Company’s financial statements include the following amounts resulting from transactions with relatedparties:
31-Mar-26 (Unaudited)
Managementincome (Notes9and11)
* included as part of accounts payable and accrued expenses
Affiliate:
(Notes9and 11)
31-Dec-25 (Audited)
impairment
no impairment
=832,456 (P=40,370)
* included as part of accounts payable and accrued expenses
OnApril1,2022,theCompanyenteredintoamanagementagreementwithPERC,underwhichPERC provides management and technical services includingcompliance, administration and supervision of operations,finance,accounting,treasury,andgeneral services.This agreement tookeffect onthedate ofexecutionandmaybeterminatedbyeitherpartyupon30daysofpriorwrittennotice. TheCompany paysamonthlyservicefeeamountingtoP =35,000,exclusiveofVAT. Furthermore,PERCalsocharges directcostsasanincidenceoftheperformanceofservicessuchasrentofofficespaceandotherofficerelatedcosts.
TheCompanyalsoenteredintoanagreementwithHEDC,underwhichtheCompany,throughPERC, provides management services particularly the supervision of finance, accounting and treasury functions.HEDCpaysamonthlyfeeamountingtoP=25,000. TheagreementwasterminatedonJuly8, 2025aftertheexecutionofthesaleofHEDCshares.
TheCompanyhasnoemployeesandPERCprovidesadministrativesupporttotheCompany.
Terms and conditions of transactions with related parties
Thetransactionsfromrelatedpartiesaremadeontermsequivalenttothosethatprevailinarm’slength transactions. Outstandingbalancesatyear-endaretounsecuredandinterestfreeandsettlementoccurs in cash. There have been no guarantees provided or received for any related party receivables or payables.
13. FinancialInstruments
CategoriesandFairValuesofFinancialInstruments
The methods and assumptions used by the Company in estimating the fair values of the financial instrumentsare:
Cash and cash equivalents, Receivables and Notes receivable
Due to the short-term nature of the instruments, carrying amounts approximate fair values as of the reportingdate.
Government securities
Fairvaluesaregenerallybasedonquotedmarketpricesatreportingdate. ThisisunderLevel1category ofthefairvaluehierarchy.
Quoted equity securities
For quoted equity securities, fair values are based on published quoted prices. This is under Level 1 categoryofthefairvaluehierarchy.
Unquoted equity securities
For unquoted equity securities, fair values are determined using the adjusted net asset value method which involves directly measuring the fair value of the assets and liabilities of the investee company. ThismeasurementfallsunderLevel3inthefairvaluehierarchy.
Noncurrent receivables
Carryingamountofnoncurrentreceivableapproximatesitsfairvalueasofthereportingdate.
Accounts payable and accrued expenses
Carryingvaluesapproximatefairvaluesduetotheirshort-termnaturewhichconsistsmainlyofaccruals forgeneralandadministrative expensessuchasmanagementfee,rentexpenseandotherofficerelated costs.
Descriptionofsignificantunobservableinputstovaluation:
The significant unobservable inputs used in the fair value measurement categorized within Level 3 of the fair value hierarchy together with a quantitative sensitivity analysis as at March 31, 2026 and December31,2025areshownbelow:
Valuationtechnique Significant unobservableinputs Range
Unquotedequity sharesatFVOCI Adjustednetasset valuemethod Price persquaremeter P =910-P =8,500
The appraised value of the land was determined using the market approach which is a valuation technique that uses prices and other relevant information generated by market transactions involving identical or comparable assets. Net adjustment factors arising from external and internal factors (i.e.
location, size/shape/terrain, and development) affecting the subject properties as compared to the marketlistingofcomparablepropertiesrangesfrom-20%to-10%.Significantfavorable(unfavorable) adjustments to the aforementioned factors based on the professional judgment of the independent appraisers would increase (decrease) the fair value of land, in return the fair value of the unquoted financialasset.
FinancialRiskManagementObjectivesandPolicies
The Company’s financial instruments comprise cash and cash equivalents, receivables, noncurrent receivables, financial assets and accounts payable and accrued expenses. The main purpose of these financial instruments is to fund its own operations and capital expenditures. The BOD reviews and approves policies for managing these risks. Also, the Audit Committee of the BOD meets regularly andexercisesoversightroleinmanagingtheserisks.
Financial Risks
The main financial risks arising from the Company’s financial instruments are market risk and credit risk.
Thetablesbelowsummarize thematurityprofileoftheCompany’sfinancialassetsandliabilitiesas ofMarch31,2026andDecember31,2025basedoncontractualundiscountedpayments. 31-Mar-26 (Unaudited)
31-Dec-25 (Audited)
Liquidity risk
Liquidity risk is the risk that the Company is unable to meet its financial obligation when due. The Company has substantial investments in shares of stock which are not listed in the Philippine Stock Exchangeandmaynotbereadilyconvertibletoliquidassetsnecessarytomeetanypotentialadditional liquidityrequirementsoftheCompany.
The Company monitors its cash position and overall liquidity position in assessing its exposure to liquidityrisk. TheCompanymaintainsalevelofcashandcashequivalentsdeemedsufficienttofinance operationsandtomitigatetheeffectsoffluctuationincashflows.
Market risk
Marketriskistheriskoflossonfutureearnings,onfairvaluesoronfuture cashflowsthatmayresult fromchangesinmarketprices. The valueof afinancialinstrumentmaychangeasa resultofchanges in interest rates, foreign currency exchanges rates, commodity prices, equity prices and other market changes. TheCompany’smarketriskemanatesfromitsholdingsindebtandequitysecurities.
The Company closely monitors the prices of its debt and equity securities as well as macroeconomic and entity-specific factorswhichcould directly or indirectly affectthe prices of theseinstruments. In case of an expected declineinits portfolio of equitysecurities,theCompanyreadilydisposesortrades thesecuritiesforreplacementwithmoreviableandlessriskyinvestments.
Credit risk
Credit risk is the risk that one party to a financial instrument will fail to discharge an obligation and cause the other party to incur a financial loss. With respect to credit risk arising from cash and cash equivalents, receivables, financial assets at FVPL and financial assets at FVOCI, the Company’s exposure to credit risk is equal to the carrying amount of these instruments. The Company limits its creditriskontheseassetsbydealingonlywithreputablecounterparties.
For Cash and cash equivalents and quoted governmentsecurities, the Company applies the low credit risksimplificationwheretheCompanymeasurestheECLsona12-monthbasisbasedontheprobability of defaultandlossgivendefaultwhichare publicly available. TheCompanyalsoevaluates the credit rating of the bank and other financial institutions to determine whether the debt instrument has significantlyincreasedincredit riskandtoestimateECLs.
The Companyconsidersitscashand cashequivalentsandquotedgovernment securitiesashighgrade since these are placed in financial institutions of high credit standing. Accordingly, ECLs relating to thesedebtinstrumentsroundstonil.
The Company’s receivables are aged current as of March 31, 2026 and December 31, 2025. No receivablesareconsideredcredit-impaired.
As of March 31, 2026 and December 31, 2025, the carrying values of the Company’s financial instrumentsrepresentmaximumexposure asofreportingdate.
The table below shows the comparative summary of maximum credit risk exposures on financial instrumentsasofMarch31,2026andDecember31,2025:
31-Mar-26 (Unaudited) 31-Dec-25 (Audited) FinancialassetsatFVTPL:
atamortized
The following tables show financial instruments recognized at fair value as of March 31, 2026 and December31,2025,analyzedbetweenthose whosefairvaluesare basedon:
1. quotedpricesinactivemarketsforidenticalassetsorliabilities(Level1);
2. thoseinvolvinginputsotherthanquotedpricesincludedinLevel1thatareobservablefortheasset orliability,eitherdirectlyorindirectly(Level2);and
3. those with inputs for the asset or liability that are not based on observable market data (unobservable inputs)(Level3).
31-Mar-26 (Unaudited)
31-Dec-25 (Audited)
TherewerenotransfersbetweenLevel1andLevel2fairvaluemeasurementsandnotransfersintoand outofLevel3fairvaluemeasurementsinMarch31,2026andDecember31,2025.
14. CapitalManagement
The primary objective of the Company’s capital management is to ensure that it maintains a strong creditratingandhealthycapitalratiosinordertosupportitsbusinessandmaximizeshareholders’value.
TheCompanymanagesitscapitalstructureandmakesadjustmentstoit,inlightofchangesineconomic conditions. Tomaintainoradjustthecapitalstructure,theCompanymayadjustthedividendpayment toshareholdersorissuenewshares.
TheCompanymonitorscapitalusingadebt-to-equityratio,whichistotaldebtdividedbytotalequity. The Company includes within total debt its accounts payable and accrued expenses. Total equity includescapitalstock,netunrealizedgainsonfinancialassetsatFVOCIandretainedearnings.
TheCompanyhasnoexternallyimposedcapitalrequirementsasofMarch31,2026andDecember31, 2025.
The table below demonstrates the debt-to-equity ratios of the Company as of March 31, 2026 and December31,2025:
unrealized gains (losses) on financial assets at
Therewerenochangesintheobjectives,policiesorprocessesforthe1st quarterof2026andyearended December31,2025.
TheCompanyhasretainedearningsavailablefordividenddeclarationamountingtoP =205.109million asofMarch31,2026.
TheCompany’strackrecordofcapitalstockisasfollows:
Listingdate-May7,1974
November5,1973 Add(deduct):
November27,1981
October31,1990
1992
February8,1994 15%stockdividend
0.01/share January 20,1997 Changeinparvaluefrom P =0.01/sharetoP =1.00/share (56,925,000,000) August14,1997
15. BasicandDilutedEarningsPerShare
ThecomputationsoftheCompany’sbasic earningspershareareasfollows:
The Company has no potentially dilutive common stock as of March 31, 2026, March 31, 2025, and December31,2025.
16. TreasuryShares
Treasury shares represent the Company’s own shares that have been repurchased and are held by the Company. These shares are recognized at acquisition cost and presented as a deduction from total shareholders’ equity in the statement of financial position. Treasury shares do not carry voting rights and arenot entitledtodividends.
17. Others
a) The Interim Financial Report as of March 31, 2026 is in compliance with generally accepted accountingprinciples(alleffectivestandardsandinterpretationsunderPFRS).
b) The same policies and methods of computation were followed in the preparation of the interim financialreportcomparedtotheDecember31,2025AuditedFinancialStatements.
c) Therearenounusualitemoritemsthataffectedtheassets,liabilities,equityandcashflowsofthe March31,2026FinancialStatements.
d) Thereare no material events happened subsequent tothe endof March 31, 2026 that might affect theresultofsaidfinancialstatements.
e) Earnings (loss) per share is presented in the face of the unaudited statements of income for the periodendedMarch31,2026andMarch31,2025.
f) Other thanthe buyback of shares,there are nosignificant events thathappened duringthe quarter thatwill affecttheMarch31,2026UnauditedFinancialStatements.
g) There are no seasonal aspects that have a material effect on the financial position or results of operationof theCompany.
h) There is no foreseeable event that will trigger direct or contingent financial obligation that is materialtotheCompany,includinganydefaultofacceleratedobligation.
i) There are no material off-balance sheet transactions, arrangements, obligations and other relationshipsoftheCompanywithotherentitiesorpersonsthatwerecreatedduringtheperiod.
j) Therearenochangesinestimatesofamountsreportedinpriorperiodsofthecurrentfinancialyear orchangesinestimatesofamountsreportedinpriorfinancialyearsthatcouldhavematerialeffect inthecurrentperiod.
k) Therearenoissuances,repaymentsofdebtandequitysecurities.
l) Therearenochangesinthecompositionoftheissuerduringtheinterimperiod,includingbusiness combinations,acquisitionor disposal of subsidiariesandlong-term investments,restructuring and discountingoperationsduringtheperiod.
ITEM 2. MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL POSITION AND RESULTSOFOPERATIONS
1.FinancialPosition(AsofMarch31,2026andMarch31,2025)
LIABILITIESANDEQUITY
TotalassetsamountedtoP=381.937millionandP=771.401millionasofMarch31,2026andMarch31,2025, respectively.
TheCompany’scashandcashequivalentsamountedtoP=302.937millionasofMarch31,2026andP=15.583 million as of March 31, 2025. The 1844.03% net increase was due to the cash received from the sale of investment inHEDC.
FinancialassetsatFVTPLamountedtoP =29.867millionandP =29.075millionasofMarch31,2026andas of March 31, 2025, respectively. The 2.72% increase is due to upward movement of market values of investmentsinstockstradedatPSE.
Receivables account as of March 31, 2026 amounted to P =1.670 million compared toP =1.855 million as of March 31, 2025. The 9.96% net decrease mainly refers to collection of dividendreceivables from various stockinvestmentsandmoneymarketplacements(MMPs)duringtheperiod.
Notes receivable as of March 31, 2025 amounted to P =100 million refers to the 362-day tenor promissory notethroughRCBCCapitalCorporation. ThematurityofthisinvestmentoccurredonApril29,2025.
Othercurrentassetsconsistofprepaymentsandprepaidtaxes.ThisamountedtoP =0.602millionandP =0.594 millionasofMarch31,2026andMarch31,2025,respectively.The1.39%netincreasemainlyrepresents additionalprepaidexpenserecordedduringtheperiod.
Financialassets atFVOCIasofMarch31,2026amountedtoP =20.076millionand P =622.903millionas of March31,2025. The96.78%netdecreaseisduetothedisposaloftheinvestmentinHEDCinJuly2025.
Othernoncurrentassetsamountedto₱25.000millionasofDecember31,2025representingtheremaining balanceofthepurchasepricefromtheCompany’ssaleofitsinvestmentinHEDC.
Input VAT amounted to P =1.785 million and P =1.391 million as of March 31, 2026 and March 31, 2025, respectively.The28.34%netincreasemainlyrepresentsadditionalinputtaxesrecordedduringthe period.
Accounts payable and accrued expenses amounted to P =0.375 million and P=0.480 million as of March 31, 2026 and March 31, 2025, respectively. The 21.99% net decrease is due to settlement of payables during theperiod.
Totalstockholders’equityasofasofMarch31,2026amountedtoP =381.562millionorP =2.341bookvalue pershareandP =696.251millionorP =4.271bookvaluepershareasofMarch31,2025.
2.ResultsofOperations(FortheQuarterendedMarch31,2026andMarch31,2025)
EXPENSESANDCHARGES
The Company posted a net income of P =1.104 million or P =0.007 earnings per share as of March 31, 2026 comparedtonetincomeofP =0.408millionorP =0.003earningspershareasofMarch31,2025.
InterestincomeamountedtoP =3.141millionandP =1.570millionasofMarch31,2026andMarch31,2025, respectively.Higherinterestincomeisduetosignificantincreaseincashbalancesduringtheyear,asresult ofsaleofinvestmentinHEDC.
Dividend income amounted to ₱0.040 million and ₱0.065 million as of March 31, 2026 and March 31, 2025,respectively.Thedecreasereferstolowerdividendsreceivedfromvariousstockinvestments.
Otherincome amountedtonilandP =0.080millionas ofMarch 31,2026andMarch31, 2025respectively. ThedecreaseisattributedtotheterminationoftheleaseagreementinMay2025andthediscontinuationof managementservicesinJuly2025,followingthesaleof theinvestmentinHEDC.
GeneralandadministrativeexpensesamountedtoP =1.177millionandP =0.643millionasofMarch31,2026 and March 31, 2025, respectively. The 83.13% increase is attributable to higher expenses related to stockholders’meeting.
The Company’s net loss on fair value changes on financial assets at FVTPL amounted to P =0.901 million andP =0.663millionasofMarch31,2026andMarch31,2025,respectively.The35.76%increaseisdueto thedownwardmovementofinvestmentsinstocksduringtheperiod.
Provision for income tax as of March 31, 2026 and 2025 refers to the Minimum Corporate Income Tax (MCIT) of 2% set-up. The Company set-up MCIT rather than the 25% regular tax because most of its incomearefromunrealizedmarketchangesofinvestmentsandpassiveincomesubjecttofinaltax.
3.FinancialPosition(AsofMarch31,2026andDecember31,2025)
LIABILITIESANDEQUITY
Total assets amounted to P =381.937 million as of March 31, 2026 compared to P =465.452 million as of December31,2025,respectively.
The Company’scashandcashequivalentsamountedtoP =302.937millionasofMarch31,2026compared toP =384.968millionasofDecember31,2025.The21.31%decreasewasduetothepaymentsmadeforthe repurchaseofsharesfromstockholders.
FinancialassetsatFVTPLamountedtoP =29.867millioncomparedtoP =30.768millionasofMarch31,2026 and December 31, 2025. The 2.93% decrease refers to downward movement of market values of investmentsinstockstradedatPSEduringtheperiod.
Receivables account as of March 31, 2026 amounted to P =1.670 million compared toP =1.992 million as of December 31, 2025. The 16.16% decrease mainly refers to shorter tenor of investments in MMPs and dividendreceivablefromvariousstockinvestmentsduringtheperiod.
Decrease of 2.43% in financial assets at FVOCI refers to the downward movement of market values in governmentsecuritiesinvestmentsfromRCBCtrustaccount.
Input VAT account as of March 31, 2026 amounted to P =1.785 million compared to P =1.535 million as of December31,2025.The16.28%increasemainlyreferstotheinputtaxesduringtheperiod.
Accounts payable and accrued expenses amounted to P =0.375 million and P=0.774 million as of March 31, 2026 and December 31, 2025, respectively. The 51.60% net decrease accounts for the settlement of payablesandaccrualsduringtheperiod.
Total stockholders’ equity as of March31, 2026 amounted toP =381.562 million or P2.341 book value per share compared to P =464.678 million or P2.851 book value as of December 31, 2025. The 17.89% net decreaseisduetotherecognitionofTreasurySharesduringthe period.
Exceptforitemsdiscussedabove,there arenomorechangesinthefinancialstatementsthatwillreachthe materialitythresholdof5%.
KEYPERFORMANCEINDICATORS(KPI):
The following liquidity and profitability ratios indicate acceptable levels of financial position and performanceofthecompany:
0.0022:10.0102:1Revenue/TotalAssets Earnings/(loss)pershare0.0070.0030.038NetIncome(Loss)/Issued&Outstanding Shares
ThechangesintheCompany’scurrentratioanddebt-equityratioasofMarch31,2026comparedtoMarch 31,2025,wereprimarilyduetothedisposalofitsinvestmentinHEDCinJuly2025.
Asset turnover for the 1st quarter of 2026 is higher compared to the 1st quarter of 2025 due to increase in revenuesduringtheperiod.
Please refer to Financial Soundness Indicators for additional KPIs.
DiscussionofindicatorsoftheCompany’slevelofperformance
ReceivableManagement
TheCompany’sreceivablesreportedintheStatementsofFinancialPositionincludethefollowing:
1. CashDividendsfromvariousstockinvestments.
2. Accrued Interest Receivable fromtheCompany’sshortterminvestmentsasofMarch31,2026of whichtheCompanywillreceiveuponmaturity.
Furthermore, the Company manages its receivables by monitoring on a regular basis to ensure timely executionofnecessaryinterventionsefforts.
LiquidityManagement
The Company has substantial investments in shares of stock which are not listed in the Philippine Stock Exchange and may not be readily convertible to liquid assets necessary to meet any potential additional liquidityrequirementsoftheCompany.
As of December 31, 2024, the Company’s investment in unquoted securities, classified under financial assetsatFVOCI,amountedto₱603.068million.AsofDecember31,2025,theCompanyhadfullydisposed ofitsinvestmentsinsharesofstocknotlistedonthePhilippineStockExchange.
Managementof liquidity requires aflow andstockperspective. Constraint such as political environment, taxation,foreignexchange,interestratesandotherenvironmentalfactorscanimposesignificantrestrictions onfirmsinmanagementoftheirfinancialliquidity.
Seafront has considered the above factors and paid special attention to its cash flow management. The Companyidentifiesallitscashrequirementsforacertainperiodandinvestsunrestrictedfundstomaximize interestearnings, i.e.moneymarketplacementsand placementin promissorynote.
RateofReturnofEachStockholder
The Companyhasnoexistingdividend policy. However,theCompanyintendstodeclaredividendsinthe futureoutofitsunrestrictedretainedearningsinaccordancewiththeCorporationCodeofthePhilippines.
CostReductionEffort
In order to minimize expenses, the Company has engaged the services of PetroEnergy Resources Corporationtohandleitslegal,administrative,accountingandtreasuryfunctions.
Financialdisclosuresinviewofthecurrentfinancialposition
The Company is still on wait-and-see attitude with respect to investing in other businesses. It has no intentionofincreasingitscapitalstock. Thecurrentmarketdoesnotwarrantanaggressivestancetowards investments. The Company is generating its funds from interest earnings on money market placements.
Therearenoknowntrends,demands,commitments,eventsoruncertaintiesthatwillhave materialimpact ontheCompany’sliquidity.
The Company assesses itsexposure to financialrisksparticularlyoncurrency,interest, credit,market and liquidity risks. Should any changes in these risk exposures materially affect the Company’s financial positionandresultsofoperations,adiscussionisprovidedinthereportoutliningthequantitativeimpactof such risks. This includes a description of enhancements to the Company’s risk management policies implementedtoaddresstheseexposures.
The Company’s principalfinancialinstrumentsinclude cashandcash equivalents,tradingand investment securities (financial assets at FVTPL) andreceivables.The main purpose of these financial instruments is tofundtheCompany’sworkingcapitalrequirements.
FinancialRiskManagementObjectivesandPolicies
Please refertoNote13.
PlanofOperations
A. InvestmentinFinancialAssetsatFVOCInottradedinthemarket(InvestmentinHEDC)
OnMay8,2025,theBODapprovedthesaleoftheCompany’sentire11.33%equityinterestinHEDC.
TheCompanysoldthesameforatotalconsiderationofP =325milliontoexistingstockholdersofHEDCon July8,2025.
B. InvestmentinFinancialAssetsatFVTPLandFVOCItradedinthemarket
The Company will continue to closely monitor the prices of its securities as well as those specific factors which could directly or indirectly affect the prices of these instruments. Because such investments are subject to price risk due tochanges in market values, an expected decline inthe portfolio will prompt the Companytodispose ortrade thesecurities for replacementwithmore viableandlessriskyinvestmentsin thefuture.
Withthe Company’scurrentcashposition,itcansustainitsneedsforitsoperatingexpenses.Thus,itdoes notintendtoraiseadditionalfunds.
Other than the investments previously disclosed, the Company is exploring potential investments in the energysector,whichmaypresentadifferentsetofrisksandopportunities.
PARTII-OtherInformation
The Company has no other information that need to be disclosed other than disclosures made under SEC Form17-C(ifany).
SEAFRONTRESOURCESCORPORATION
SUPPLEMENTARYINFORMATIONANDDISCLOSURESREQUIREDONSRC RULE68ASAMENDED MARCH31,2026
Philippine Securities and Exchange Commission (SEC) issued the amended Securities Regulation Code RuleSRCRule68whichconsolidatesthetwoseparate rulesandlabeledintheamendmentas“PartI”and “Part II”,respectively. Italsoprescribedthe additionalinformationand schedulerequirements forissuers ofsecuritiestothepublic.
BelowaretheadditionalinformationandschedulesrequiredbyRevisedSRCRuleNo.68,thatarerelevant totheCompany. ThisinformationispresentedforpurposesoffilingwiththeSECandisnotrequiredpart ofthebasicfinancialstatements.
ScheduleA.FinancialAssets
BelowisthedetailedscheduleoftheCompany’sfinancialassetsasofMarch31,2026:
NameofIssuingEntityandAssociationof EachIssue
atFVTPL Equity
Numberof Sharesor Principal Amountof BondsandNotes AmountShown inthe Statementof
NameofIssuingEntityandAssociationof EachIssue Numberof Sharesor Principal Amountof Bondsand Notes AmountShown inthe Statementof
FinancialassetsatFVOCI Debtequities
Quoted:
Thefairvalueforfinancialinstrumentstradedinactivemarketsatthereportingdateisbasedontheirquoted market price without any deduction for transaction costs. For securities in which current bid and asking pricesarenotavailable,thepriceofthemostrecenttransactionprovidesevidenceofthecurrentfairvalue as long as there has not been a significant change in economic circumstances since the time of the transaction.
For unquotedfinancial securities, the Company uses its judgment to select the most appropriate valuation methodology to value its unquoted equity investments and make assumptions that are mainly based on market conditions existing at each reporting period. It involves directly measuring the fair value of the assets andliabilitiesofthe investee company,asmainly determinedbythe Company’s external appraiser. Assetsoftheinvesteecompanyconsistmainlyofparcelsoflandforsalewhichisadjustedtoitsfairvalue.
Schedule B. Amounts Receivable from Directors, Officers, Employees and Principal Stockholders (Other thanRelatedParties)
The Company has no outstanding receivables from its directors, officers, employees and principal stockholdersasofMarch31,2026andDecember31,2025.
Schedule C. Amounts Receivable from/Payable to Related Parties which are Eliminated during the ConsolidationofFinancialStatements
Notapplicable.
Schedule D.Long-termDebt
TheCompanyhasnooutstandinglong-termdebtasofMarch31,2026andDecember31,2025.
Schedule E.IndebtednesstoRelatedParties(LongTermLoansfromRelatedCompanies)
The Company has no long-term indebtedness to related parties as of March 31, 2026 and December 31, 2025.
Schedule F.GuaranteesofSecuritiesofOtherIssuers
The Company doesnothaveguaranteesofsecuritiesofotherissuers as of March31, 2026and December 31,2025.
ScheduleH.CapitalStock
