PLDT Q4 net result turns red as Duterte pushes third operator plan

9 Mar 2018

The Philippines’ largest telecoms operator by subscribers and revenue PLDT Inc. swung to a PHP8.48 billion (USD163.1 million) net loss in the fourth quarter of 2017, reversing a PHP4.14 billion profit in the corresponding year-earlier period, as higher network upgrade costs dragged down the company’s bottom line. Full-year net income, meanwhile, slumped 33% to PHP13.466 billion, while core income (which excludes one-off items and where the company based its earnings guidance) slipped 1% to PHP27.67 billion from PHP27.86 billion in FY 2016. Consolidated service revenues, meanwhile, dropped 4% to PHP151.17 billion in FY 2017, down from PHP157.21 billion, amid a general weakness in the telco’s legacy voice calling and text services. Full-year EBITDA, however, climbed 8% year-on-year to PHP66.17 billion from PHP61.16 billion; EBITDA margin improved by five percentage points to 44%. CAPEX was PHP39.95 billion, compared to PHP42.83 billion.

Despite the disappointing results, the telco’s CEO Manuel Pangilinan remains bullish about PLDT’s fortunes and expects its finances to improve in 2018. The carrier is currently modernising its network infrastructure in the face of a loss in market share to rival Globe. PLDT lost headway as demand for data intensified and returns from traditional voice services started to weaken, and last year, Pangilinan said the company would seek to regain lost ground as competition turns to fixed line broadband services, where PLDT has deployed sizeable resources. Indeed, PLDT has set aside up to PHP58 billion in capital expenditure in FY 2018 even as the country’s sometimes controversial president, Rodrigo Duterte, moves swiftly to rush into being a third player to end the PLDT/Globe duopoly. PLDT plans to deploy around 33,000km of fibre-optic cable in the coming twelve months, bringing the total to about 210,000km by the end of 2018, with Pangilinan recently quoted as saying the company will blanket six million homes with ultra-fast broadband by 2020. PLDT closed out 2017 with a total of four million homes passed with fibre – up 43% year-on-year – and increased the capacity of its fixed broadband network to over one million ports, double the number it reported at end-2015.