Globe lowers capex by 30% in 2023

AYALA-BACKED Globe has lowered its cash capital expenditures (capex) by 30 percent to US$1.3 billion for 2023 from an expected peak of $1.9 billion in 2022, the company told the local bourse Friday, Dec. 9, 2022.

The new capex was approved by the board on Dec. 7.

“Given the headway made towards future-proofing the network, Globe now has the flexibility to make targeted investments for better capital efficiency, which will allow capex intensity to ease beginning 2023,” the company said.

This move, according to Globe aims to optimize capex spending in the next few years by focusing on maximizing utilization of existing fiber assets and taking advantage of the arrangements made with towercos to maximize tower builds.

“Our aim to deliver first world connectivity to the Philippines, combined with the accelerated digitalization brought about by the pandemic have driven the company to invest significant capex into both the mobile and broadband network for the past few years. After investing heavily on our builds and rollouts, we now have a significant backbone for our network, which allows us to shift our focus towards capital efficiency and optimization, beginning with 2023’s $1.3 billion guidance, with the target of eventually bringing this down to $1 billion by 2024,” Globe president and chief executive officer Ernest Cu said.

Globe said “it sees its capex investments peaking this year given the ramped up spending to take full advantage of the streamlined permitting process for the mobile network rollout in the country.”

As of end-September this year, Globe has deployed close to 1.4 million fiber-to-the-home lines, built 1,064 new cell sites, upgraded over 10.6 thousand mobile sites to LTE, and installed 1,887 new 5G sites nationwide.

Globe said its rollout momentum continues and remains on track to surpass last year’s new cell site builds of 1,407.

The company’s significant capex investments also fortified the network, allowing for resilient performance during the pandemic and sustained revenue growth in 2022 despite challenging market conditions.

Consolidated service revenue for the first nine months of the year are at a record high P118 billion, led by mobile data and corporate data services and supplemented by growth from non-telco services. (KOC WITH PR)