PLDT Reports Q3

Consolidated core net income for the first nine months of 2009 was P31.0 billion, an increase of 11%

November 12, 2009

3 Min Read

MANILA, Philippines -- Philippine Long Distance Telephone Company(“PLDT”) (PSE: TEL) (NYSE: PHI) today announced its financial results for the first nine months of2009 with Core Net Income, net of exceptional items, rising 11% to P31.0 billion, from P27.8billion in the same period in 2008. Consolidated Reported Net Income of P30 billion increased by15% from P26.2 billion in the same period last year. This period’s results reflect the higherrecurring net income, lower net losses from the foreign exchange revaluation of our financialassets and liabilities and derivatives, and the lower statutory tax rate. This period’s results alsorecognize the equity share of Pilipino Telephone Corporation (“Piltel”) in the earnings of theManila Electric Company (“Meralco”). Consolidated service revenues increased by 3% to P108.3billion, fueled mainly by the 4% growth in data and broadband revenues. Consolidated EBITDAremained stable at P65.7 billion while EBITDA margin was 61%.

Consolidated free cash flow remained strong at P43.3 billion in the first nine months of 2009.Consolidated capital expenditures stood at P18.1 billion for the period. Capital expenditures for2009 are estimated to reach P27.0 billion.

The Group’s consolidated gross debt balance as at 30th September 2009 stood at US$2.1 billion,with net debt at approximately US$1.5 billion. Net debt to EBITDA increased moderately to 0.8x.The Company’s debt maturities continue to be well spread out, with more than 50% due in andafter 2013. The percentage of U. S. dollar-denominated debt to the Group’s total debt portfoliodeclined further to 55%, down from 79% at the end of 2008. Taking into account our pesoborrowings, our hedges and our U. S. dollar cash holdings, only 24% of total debt remainsunhedged. Of the Group’s P38 billion planned gross borrowings for 2009, P34 billion havealready been drawn. This year’s additional debt, mainly denominated in Pesos, has been used tofund capital expenditures and support various investments, including the 20% stake in Meralco.The Group’s cash and short-term securities are invested primarily in bank placements andGovernment securities.

Wireless: Pushing Ahead

Wireless service revenues rose to P71.2 billion for the first nine months of 2009, 3% higher thanthe P68.8 billion recognized in the same period last year. Cellular subsidiary SmartCommunications, Inc. continues to lead the industry in terms of both revenues and subscribers.Wireless EBITDA was steady at P44.5 billion in the first nine months of this year. As expected,EBITDA margin decreased slightly to 63% due primarily to higher selling and promotions expenseas well as rent expenses for international leased circuits associated with the growth of thewireless broadband business.

The PLDT Group’s total cellular subscriber base for the first nine months of 2009 grew to 39.1million subscribers, a 15% growth year-on-year. For the first nine months of 2009, Smart added3.9 million subscribers, compared with 4.1 million in the same period of 2008. Smart recorded netadditions of over 1.6 million subscribers to end the period with 22.5 million subscribers while Talk‘N Text added 2.2 million subscribers to end the period with 16.6 million subscribers.

Cellular voice revenues improved by 4% to P28.5 billion while cellular data revenues were flat atP35.5 billion. Wireless broadband revenues grew 26% to P4.1 billion, a significant improvementover the P3.2 billion recorded in the first nine months of 2008.

SmartBro, Smart’s wireless broadband service – through its wholly-owned subsidiary SmartBroadband, Inc. - continued to expand as its wireless broadband subscriber base grew 70% toreach approximately 802,000 as at end-September 2009, 372,500 of which were on SmartBro’sprepaid service.

“We are determined to propagate broadband usage by facilitating the availability and wideradoption of access devices and riding the social networking wave. We recognize that socialnetworking has changed the rules of the communications game and we are adapting our serviceto take advantage of that,” added Orlando B. Vea, Chief Wireless Adviser of Smart.

Philippine Long Distance Telephone Co. (PLDT)

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