PLDT’s Q1 net income and revenues flat line; announces management reshuffle

6 May 2015

Philippine Long Distance Telephone Company (PLDT) has published its financial results for the first quarter of 2015, reporting that net profits flat-lined at PHP9.398 billion (USD210.9 million) compared to PHP9.392 billion in Q1 2014, as revenues stalled at PHP42.553 billion (1Q14: PHP42.564 billion) and operating expenses were ‘stable’ at PHP30.435 billion (1Q14: PHP30.333 billion). PLDT, the country’s dominant telecoms company in terms of revenue and subscribers, also reported first-quarter core net income of PHP9.280 billion which, though down 5% year-on-year from PHP9.762 billion, was reportedly ‘on track’ in terms of PLDT’s guidance for full year core income of PHP35 billion. EBITDA of PHP19.282 billion was also below the PHP19.722 billion recorded a year earlier, while the EBITDA margin stood at 48%, unchanged y-o-y. CAPEX in Q1 2015 amounted to PHP2.954 billion, PHP733 million higher than its spending in the same period in 2014, which was largely used to expand the group’s 3G and 4G networks, increase its fibre-optic coverage and capacity, and unify its cellular bands (Smart and Sun Cellular) to improve operational efficiencies.

Operationally, PLDT closed out March 2015 with a total of 69.622 million mobile subscribers, down 1% on an annualised basis, while the number of fixed line telephony users increased 6% to 2.234 million. However, fixed broadband connections reported the strongest gains, up 27% to 4.529 million, broken down as 1.137 million fixed (PLDT HOME) and 3.391 million fixed wireless.

The company has announced a major shake-up in its management structure as it prepares to undergo what PLDT chairman Manuel V Pangilinan calls a transition phase: ‘While our core revenue sources undergo this transition phase where the erosion of our high-margin legacy businesses still outpaces the growth of our newer initiatives for now, we are taking significant steps to ensure that we are ready and prepared for the digital future,’ he said. Under the reorganisation, PLDT welcomed two new senior executives: Joachim Horn as its new chief technology and integration advisor, and Winston Damarillo as its new chief strategy officer. A number of other high-profile management changes are also being enforced, of which Pangilinan commented: ‘These changes will enable the various business units of PLDT and its subsidiaries to be more customer-focused as well as to more effectively harness the resources of the entire Group to develop and deliver relevant, innovative services to its customers’.