PLDT exceeds 2007 profit target

4 Mar 2008

The Philippines’ dominant telecoms company, Philippine Long Distance Telephone (PLDT), today posted 2007 core net profit, excluding exceptional items, of PHP35.2 billion (USD861.17 million), beating its own forecast of PHP34.5 billion to PHP35 billion, driven by continued strong growth at its wireless business. The telco said net profit, excluding exceptional items, grew 2.7% year-on-year from PHP35.1 billion to PHP36 billion. PLDT said its results for the fiscal year ending 31 December 2007 were boosted by a reduction in depreciation charges as well as higher FOREX currency gains, which lessened the impact of higher tax fees and asset impairment charges. In the fourth quarter of the year, PLDT’s net profit increased one percentage point on an annualised basis to PHP9.5 billion, bolstered by increased consumer spending in the pre-Christmas run-up. The group posted consolidated revenues of PHP135.5 billion, up 8% year-on-year, with its wireless arm growing quickly to offset reductions resulting from the adverse impact of a strong peso on the firm’s dollar-denominated revenue. By the start of 2008 PLDT’s mobile arm Smart Communications (including Pilipino Telephone Corp, or Piltel) reported 30 million cellular customers, up 5.9 million in a year; in January-February Smart said it added a further one million users.

Commenting on the strong financials, PLDT chairman Manuel Pangilinan said ’We are extremely pleased that our record earnings and robust cash flows allow us to declare both a final dividend of 68 pesos per share as well as a special dividend of 56 pesos per share … We expect to sustain our strong performance through 2008, [with] our core net income this year being guided at PHP37 billion’. The operator has set aside PHP25 billion for CAPEX in 2008 to expand and upgrade its wireless, broadband and fixed line networks, as well as improving international bandwidth capacity. PLDT is also planning to ramp up its business process outsourcing business in the coming year.