Globe Telecom Inc. remains bullish on its 2021 capital expenditures) capex, boosting spending to P70 billion (P10 billion more than last year), despite last year's losses, single digit 2021 revenue growth prospects - "more of the same tail end of 2020," with the economic scenario not improving till 2022.
The COVID-19 pandemic pulled down the telco's revenues across all its businesses, except for Home broadband, which sustained double digit growth as locked down Filipinos worked, studied, shopped and entertained themselves at home.
Globe's 2020 consolidated service revenues dipped 2 percent to P146.4 billion with net earnings of P18.6 billion, down 16 percent due to the drop in EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization), higher depreciation charges and non-operating expenses.
Excluding the impact of extra ordinary items booked for the year, normalized net income would have been P20.4 billion, or 8 percent lower. Core net income declined 13 percent to P19.5 billion.
Still, Globe’s balance sheet remained strong and gearing comfortably within bank covenants despite the increase in debt from P136.3 billion in 2019 to P167.7 billion in 2020.
Consolidated EBITDA stood at P73.5 billion, 3 percent lower than 2019 due to the 2 percent contraction in service revenues. EBITDA margin also slightly weakened at 50 percent from last year’s 51 percent.
Excluding the one-time additional provisions for doubtful accounts booked in the first half of the year amounting to P1.9 billion and the P0.7 million other income on long outstanding payables, normalized EBITDA would have been P74.8 billion or 2% lower versus last year.
This would have translated to a 51% normalized EBITDA margin which is at par with 2019.
Indeed, “2020 was a challenging year for Globe but we pulled through despite the COVID-19 pandemic and adverse economic environment," summed up President and CEO Ernest L. Cu.
"Our prudent financial management in these turbulent times allowed us to maintain strong cash flows, giving us the flexibility to continue to invest back into our network " he elaborated.
"We are proud of what we achieved in 2020, particularly the significant gains in the network front."
Last year, the telco spent over P60 billion and more than P265 billion in the last five years to improve its services.
With increased data consumption in the country, Globe's total data revenues across mobile, broadband and corporate data accounted for 76% of total service revenues from 71% in 2019.
Mobile business revenues as of end-December of 2020 slid by 7% to P103.1 billion mainly due to the negative effects of the ECQ/MECQ period.
Mobile revenues improved in the second half of the year with higher prepaid top-up levels and postpaid subscriber acquisitions, as the country reopened business activities, bringing back jobs and increasing the mobility of Filipinos, though still below full capacities under quarantine.
Globe ended the year with a total mobile subscriber base of 76.6 million.
Its mobile data revenues increased to P72 billion from P71.4 billion in 2019.
Mobile data now accounts for 70% of mobile revenues from 64% a year ago.
Mobile data traffic soared to 2,517 petabytes in 2020 from 1,699 petabytes in 2019, which translates to a 48% growth year-on-year.
Meanwhile, mobile voice and mobile SMS revenues ended at P20.0 billion and P11.0 billion, lower year-on-year by 16% and 29%, respectively.
Its Home Broadband business enjoyed a banner year with double-digit growth, posting a 23% year-on-year increase to P26.8 billion.
Total home broadband subscriber base stood at 3.8 million, up 88% from 2019 as fixed wireless broadband users grew 122%
However, Corporate Data declined 3 percent to P12.5 billion due to the slowdown in revenues from domestic and international services.
Higher information and communication technology (ICT) revenues partly cushioned the decline.
ICT revenues grew as more enterprises focused on their digital transformation to adapt, and thrive in the next normal.
Meanwhile, total operating expenses, including subsidy, were flat at P72.9 billion as declines from interconnection fees, services, and utilities muted increases in provisions, subsidy costs, repairs & maintenance, rent and staff costs.
Despite the continuing impact of the (COVID-19) pandemic, Globe was able to build close to 1,300 new cell sites or cell towers, up from 1,100 the previous year.
Its aggressive modernization resulted to a total of 11,529 site upgrades to 4G/LTE in 2020, higher than the 10,135 in 2019.
Globe deployed 5G sites in Metro Manila, as well as certain cities in Visayas and Mindanao making 5G available in 1,045 areas in the country.