Alternative Investment Report

PLDT profit up 11% to P7B on sustained demand

JGSUMMIT.COM.PH

PLDT, Inc. saw its attributable net income for the second quarter grow 10.9% to P7.1 billion, as high demand for data and broadband continued.

“Sustained demand for data and broadband reinforced total service revenues across the company’s three customer segments — Home, Enterprise and Consumer Wireless. Home registered the highest revenue increase in the second quarter,” the fully integrated telecommunications company said in a statement e-mailed to reporters on Thursday.

PLDT’s service revenues for the quarter climbed 10.1% to P45.9 billion from P41.7 billion in the same period in 2020.

As for the first half of the year, the company’s service revenues increased 9.7% to P91.6 billion from P83.5 billion a year ago.

The company’s second-half attributable net income grew 4.8% to P12.9 billion from P12.3 billion previously.

PLDT and its wireless arm Smart Communications, Inc. invested P41.3 billion in network expansion projects in the first six months.

“In line with business demand and in support of revenue growth, the group’s continued rollout of its fiber, 5G and 4G/LTE networks is underpinned by its 2021 capex (capital expenditure) guidance of between P88 billion and P92 billion,” PLDT noted.

PLDT also said it managed to increase its fiber infrastructure by 22% to 524,000 kilometers in the first six months of the year.

“PLDT extended the reach of its fixed broadband service to cover 11.3 million homes passed, while the total number of fiber-powered ports increased to 4.8 million,” it said.

Smart also increased its base stations by 16% to more than 68,500 during the period.

The company expects its PLDT Home business to grow its subscriber base by one million this year.

“PLDT Home’s fast-tracked fiber installation and repair capabilities aim to cover 66% of the country by yearend,” it said.

At an online briefing, Alfredo S. Panlilio, PLDT and Smart president and chief executive officer, said that in the next few years, revenues from the Home segment will be “50% of total wireless revenues.”

The company said its Home segment accelerated its momentum and recorded revenues of P11.8 billion in the second quarter or 27% higher than the amount reported in the same period last year.

Meanwhile, the Consumer Wireless segment’s revenue increased 6% to P21.7 billion compared with the second quarter of 2020.

PLDT Chairman Manuel V. Pangilinan said: “Full year, you’ll see us above P190 billion in terms of service revenues.”

He added that capex is expected to land at around P90 billion, or 25% higher than last year’s.

“We expect a high single-digit increase in consolidated service revenues, and we are on track to hit our telco core income target of P30 billion,” he noted.

PLDT said its telco core income, which excludes the impact of asset sales and Voyager Innovations, climbed 10% year on year to P15.2 billion in the first half of 2021, supported by lower tax rates.

Mr. Panlilio said PLDT expects to generate P1 billion in revenue in the second half of the year from its project with the Education department for the online study of one million public school teachers.

TOWER SALES
PLDT officials also confirmed that the company is considering selling some of its towers.

“We’ve spoken to a number of international banks, and they have enlightened us on the advantages of selling part of our towers,” Mr. Pangilinan said.

“Many of the details have got to be worked up. We’re open to it, whether the number of $800 million is the right number or not at this stage,” he added.

He said the banks managed to persuade PLDT to let go of certain towers that are “not strategic” to “what we want to achieve.”

“The job now is to identify those towers,” Mr. Pangilinan added.

PLDT has contracted with 10 independent tower companies with respect to its requirements for new sites.

“It’s good governance for us to look at strategic options… But, really, we’re at an early part of the process. It has to be not only value additive to us; but, really, in terms of the running of the towers, we have to ensure that those are done well,” Mr. Panlilio said.

PLDT shares closed 2% higher at P1,274 apiece on Thursday.

Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has a majority stake in BusinessWorld through the Philippine Star Group, which it controls. — Arjay L. Balinbin

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