PLDT posts record 9-month revenue, net profit 2% lower at ₱16 B

Published November 7, 2019, 12:00 AM

by manilabulletin_admin

By Emmie V. Abadilla

PLDT, Inc. posted its highest first 9-month revenue level ever, surpassing previous peak in 2014, at ₱116.3 billion, up 8 percentyear-on-year, although reported net income dropped 2.0 percent to ₱16.0 billion after the telco spent a whopping ₱2.4 billion in its manpower rightsizing program (MRP) and took lower gains from the sale of its Rocket Internet shares.

Manuel V. Pangilinan
Manuel V. Pangilinan

“From a financial perspective, it was a misstep, a small misstep,” Manuel V.Pangilinan, PLDT chairman, president and chief executive officer acknowledged. “But it was a giant step in terms of our digital investment. It was not so bad. The losses were not as big as expected. It’s making money now.”

Furthermore, “By posting its highest-ever nine-month revenues, PLDT proves it’s firmly back on the growth path. We have started to make inroads in recovering market share in revenue terms in the mobile business in the last two quarters, indicating we have reached a turning point,” he underscored.

The telco has also recovered market share. “We now have 51.1 percent of total market share in terms of revenues,” according to Alfredo S. Panlilio, Smart Communications, Inc. President and CEO, as well as PLDT Executive Vice President and Chief Revenue Officer. “In terms of data traffic, we’re 50-50 percent with Globe Telecom.”

Overall, the telco’s core income amounted to ₱19.4 billion, up 1 percent from last year, excluding the impact of equity in losses from Voyager, and gains from the sale of Rocket Internet shares.

PLDT’s third quarter service revenues rose 9 percent to ₱39.6 billion versus the same period in 2018, representing four quarter-on-quarter increases from the third quarter of 2018.

Its three major business groups – Consumer Wireless, PLDT Home and PLDT Enterprise – generated ₱109.4 billion in revenues, 11 percent higher year-on-year and making up 94 percent of total service revenues. As in the previous quarter, Consumer Wireless set the pace, climbing 20 percent to ₱52.6 billion.

Data and Broadband, now 66 percent of total service revenues, continued to grow briskly, reaching ₱76.7 billion, up 20 percent in the comparative period.

Consolidated EBITDA sustained its double-digit growth, up 16 percent versus the first nine months of 2018 to ₱60.3 billion, mainly due to the combined impact of higher service revenues and lower cash opex. EBITDA margin rose to 51%. Both EBITDA and the EBITDA margin exclude the costs of the manpower rightsizing program (MRP) and reflect the impact of PFRS16, the new accounting standard for leases which took effect on January 1, 2019.

Consolidated net debt stood at US$2.919 billion while net debt-to-EBITDA was at 2.0x. Gross Debt stood at US$3.451 billion, of which 10% is US dollar-denominated. Only 6% of total debt is unhedged. Post-interest rate swaps, about 89% are fixed-rate loans while 11% are floating-rate loans.

The Consumer Wireless business accelerated its growth momentum, with its third quarter revenues in 2019 reaching ₱18.2 billion, up 21% compared to the same period last year. This resulted in a 20% year-on-year rise in revenues to ₱52.6 billion, of which 68% are from data.

PLDT Home’s revenues, 77% of which were from data/broadband, grew by 2% to ₱27.6 billion in the first nine months of 2019, despite continuing operational challenges due to the ongoing transition to a new installation and repair set-up.

The Enterprise Business Group continued to make steady progress, generating ₱29.2 billion in revenues, a 6% increase in first nine months of 2019 versus last year, with data generating over two-thirds of revenues.

Fixed line revenues continued to grow, up 3% to ₱21.3 billion, on the back of rising demand for fiber-based services (broadband and networking). Wireless revenues grew 11% to ₱4.7 billion, lifted not only by the 6% growth in postpaid but also the rise in revenues generated by mobile platforms (up 49%) and Internet of Things (IoT) applications (up 17%). Total IoT connections reached over 500,000.

The ICT business of PLDT Enterprise grew 20% to ₱3.1 billion, twice the market growth rate. This has been powered by the rise in Cloud and Cybersecurity services which grew year-on-year by 78% and 128%, respectively.