Liberty Telecom Holdings’ reports widening first-half loss

14 Sep 2012

Liberty Telecoms Holdings, which operates Wi-Tribe branded wireless broadband internet services in the Philippines, has reported widening losses for the first six months of this year, despite an increase in revenue. Liberty Telecom, a joint venture between San Miguel Corp (SMC), Qatar Telecoms Group and Skyphone Logistics Inc, booked a net loss of PHP762.96 million (USD18.35 million) in H1 2012, 6% higher than for the corresponding period of 2011, on turnover that increased to PHP295 million from PHP240.95 million previously. Operating expenses increased to over PHP1 billion in the first six months of the year, up from PHP949.93 million in H1 2011, attributed to higher depreciation and amortisation costs, as well as increased rental and utilities, personal costs and selling expenses, it said.

Despite the weak financial performance, Liberty Telecom and its owners remain committed to further expanding Wi-Tribe’s operations in the Philippines. The shareholders are mindful that as a consequence of its WiMAX rollout, it has incurred losses from operations, but notes: ‘The group and its major shareholders fully understands that these losses should be expected, considering that its business operations are essentially still in the start-up stage.’

In May this year, SMC president and COO Ramon Ang confirmed that Liberty Telecoms intends to invest PHP1.1 billion in its networks and services this year, including CAPEX for new base transceiver stations (BTS) in Northern and Southern Luzon as well as in Cebu for its ‘pure 4G’ Wi-Tribe broadband service. The unit currently has 500 BTS in operation in Mega Manila, Bulacan, Cavite, Laguna and Rizal, and hopes that network expansion and continued subscriber growth – particularly in the mass consumer segment – will help it reach its goal of entering the black by 2014. This year, the WiMAX unit received additional interest-bearing advances from its main shareholders of PHP686.4 million to help cover funding requirements for working capital, CAPEX and operational expenses. Wi-tribe has around 70,000 subscribers.

Philippines