The Market Monitor Minding the Nation's Business
By Riza Lozada
Telecommunications giant Globe Telecom Inc. sustained its growth momentum for the first nine months of this year, posting a 34-percent increase in profit to P14.1 billion on a 15-percent jump in revenues to P83.4 billion, compared with last year’s figure.
Revenues from mobile services of P63 billion contributed 76 percent to the total.
Income during the period was higher by 9 percent, attributed mainly to the growth in mobile-data use by 48 percent and to Globe’s mobile-subscriber base hitting 50.1 million, or a 17-percent increase from the 42.9 million posted a year ago.
“We are pleased that Globe sustained the growth momentum for the first nine months of 2015, despite the renewed challenges in the industry,” said Ernest L. Cu, president and CEO of Globe. “We have maintained our aggressive stance as we continue fortifying our leadership in the digital space.”
Cu said Globe’s sustained growth was driven by the company’s stronger Ebitda—or earnings before interest, taxes, depreciation and amortization—as well as lower non-operating charges, the combined impact of the one-off gains from the sale of 51 percent of Yondu Inc. to Xurpas Inc., and the acquisition of 99-percent ownership stake in Bayan Telecommunications.
Globe said it has spent P22.9 billion in capital expenditures during the current given period, allowing it to be equipped with 27,583 base stations to date, with over 17,600 for 4G1 to support mobile-data services, which contributed revenues of P15.1 billion during the nine-month period.
“This was also complemented by the continued growth in mobile voice (up 8 percent), partially mitigating the 7-percent decline in SMS revenues. The combined effects of the successful monetization of data traffic through the company’s GoSurf promos and the provision of social-networking sites, premium applications and content, and top mobile games without the data charges, further cement Globe’s reputation as the mobile-data SIM of choice for the Filipino digital lifestyle,” Globe said in a statement.
Globe’s postpaid revenues for three quarters expanded by 7 percent, year-on-year, with significant share from the company’s myLifestyle Plans.
With Globe’s mass-market brand TM, the company’s mass market rose by 15 percent year-on-year, while Globe Prepaid posted a solid growth of 8 percent.
“Broadband services, with a customer base of 4 million, as of end-September, registering 57-percent increase, reported P12.4 billion in revenues (inclusive of Bayan) as of the given period, or 37 percent higher than its record in the same period last year,” the statement said.
Both the wireless-broadband (up 58 percent) and fixed-broadband (up 49 percent) solutions showed sustained growth, boosted by the various offerings of complete on-the-go and home broadband packages, with access to premium content, such as Spotify, NBA League Pass, and HOOQ. This was likewise supported by the increase in Bayan’s broadband subscriber base.
Likewise, Globe’s fixed-line data business increased by 37 percent to P5.5 billion for the first nine months of the year, from P4.0 billion during the same period last year, due mainly to the expansion in circuit count and increased usage, coupled with the impact of Bayan’s consolidation in the third quarter of 2015.
The strong demand for data connectivity and cloud solutions also contributed to the revenue growth. Traditional fixed-line voice (including Bayan) likewise posted a 20-percent increase year-on-year at P2.5 billion during this period, due to the continued popularity of the broadband bundled plans. Even excluding Bayan’s revenues, fixed-line data and fixed-line voice improved year-on-year by 21 percent and 10 percent, respectively.
The company’s core net income likewise reached P12.7 billion as of the first nine months of 2015, or 10 percent higher than the P11.6 billion reported in same period last year. Globe’s core net income excludes the impact of the non-recurring items, one-time gains, foreign exchange and mark-to-market charges. Excluding Bayan’s third-quarter results, Globe’s net income and core net income as of end-September still grew by 31 percent and 9 percent, respectively, from the same period in 2014.
“We remain focused in our efforts to create a wonderful experience for our customers by providing relevant products and services that cater to the growing demand for connectivity and quality digital content. It is imperative for us to continue to keep our foot on the pedal in introducing quality products and content, and enhancing our data network to deliver the premium customer service to our over 54 million subscribers,” Cu said.