Globe Telecom Q1 net income soars on mobile data, broadband

7 May 2019

Filipino operator Globe Telecom (including Innove) reported that net profit for the three months ended 31 March 2019 climbed 44% year-on-year to PHP6.73 billion (USD130.1 million) from PHP4.68 billion in the year-ago quarter, driven by the popularity of fixed and mobile broadband services. The Ayala-led group’s consolidated service revenues rose 13% on an annualised basis to PHP36.00 billion, driven by ‘a sustained increase in data usage across all data-related services and products, while core net income (which strips out the impact of non-recurring and forex changes, and mark-to-market charges) surged 40% to PHP6.73 billion in 1Q19, when compared to the same period in 2018. EBITDA, meanwhile, improved by 24% to PHP19.92 billion from PHP16.08 billion in 1Q18; EBITDA margin improved five points to 55%.

Globe said mobile revenues increased 11% y-o-y to PHP26.98 billion, within which mobile data revenues contributed PHP16.49 billion in the first three months of the year aided by a surge in mobile data usage in the consumer segment on the back of popular campaigns that promoted its internet browsing deals. Mobile voice and SMS revenues in the first quarter fell by 15% and 22% to PHP6.26 billion and PHP4.23 billion respectively, although the cellco closed out March 2019 with a total mobile subscriber base of 83.49 million, up 13% from the fourth quarter of 2018 and 7% in a year. Further, the company noted that its Home broadband business generated revenue of PHP5.21 billion in 1Q19, up 21% y-o-y and 3% quarter-on-quarter, as the fixed broadband base climbed 22% on an annualised basis to 1.708 million, including wired (636,782) and fixed-wireless (1.07 million) connections.

Commenting on the results, Globe president and chief executive Ernest Cu said: ‘For 2019, we are confident in our ability to maintain this strong growth momentum with the aggressive investments in the network, coupled with the evolving lifestyle bundles that aim to strongly influence the digital life of Filipinos … We believe this would allow the full-year 2019 revenues to increase by high single-digits from 2018 levels.’

Globe spent around PHP8.8 billion in CAPEX in January-March 2019, equivalent to 24% of top-line revenues, of which about 68% was spent on developing its data-related services. ‘As we continue to invest in our LTE network, we are also excited with the growth opportunities of our 5G commercial pilot launch in June this year,’ Cu said. 5G technology will be initially available to its Home subscribers and will not yet include mobile devices. Globe projects that the 5G technology will have speeds as fast as 1Gbps based on its tests to date.

Philippines, Globe Telecom (incl. Innove)