PLDT revenues up 4.5% to P142B in 9 months

PLDT reported Thursday, Nov. 3, 2022, that its telco core income grew 10 percent or P2.3 billion to P25.4 billion in the first nine months.

Reported income jumped by 45 percent, or P8.5 billion, to P27.4 billion, which includes P22.3 billion in pre-tax gains from its towers’ sale up to the third closing.

“Enterprise seems to be our bright spot as we continue to empower businesses in their digital transformation and help promote the Philippines to be the next major Asean digital hub,” said Alfredo Panlilio, PLDT and Smart Communications president and chief executive officer.

PLDT Enterprise logged its highest quarter ever in the third quarter of 2022, as it continues to support the digital transformation needs of a wide array of businesses, from micro, small and medium enterprises, to large conglomerates, even spanning global companies.

PLDT Enterprise posted record-high revenues of P12 billion in the third quarter, up eight percent or P0.9 billion from the same period last year, bringing revenues in the first nine months of the year to P35.2 billion, up nine percent or P2.8 billion, year-on-year.

“PLDT Enterprise’s all-time high revenues are on the back of the resurgence of business activity post-Covid lockdowns, the strong support for the government’s digitalization agenda, and the expected growth in demand for data centers from hyper scalers, with the exponential increase in data generated within the Philippines, and regional transit traffic,” the company said.

Panlilio said the firm’s 11th and, by far, the largest data center is also on track to be completed in late 2023.

Even as consumers tighten their purse strings in response to the rising prices of commodities, the company reported that its individual wireless segment hit P20.4 billion in revenues in the third quarter, pushing the nine-month revenues higher than pre-pandemic levels to P61.7 billion, showing sequential quarterly improvements in 2022.

Francis Flores, senior vice president, and business head for Smart Communications, during the hybrid media briefing Thursday said that even with the rising inflation the browsing habit of consumers has not stopped, which means consumers still allot resources for their social media surfing, although regulated.

The company said Smart postpaid is showing growth due to the “Power of Smart” network campaign and other new offers, while the prepaid business has also shown improving trends in the third quarter, compared to the same period last year.

“The individual wireless business is seen to benefit from higher mobility and upcoming holiday spending,” the company said.

Flores said they expect one of the merriest Christmas celebrations this year coming off the pandemic. “We see Christmas revenge spending and we are going to launch new offerings to take advantage of this spending mood,” he said.

Consolidated service revenues

PLDT’s consolidated service revenues (net of interconnection costs) grew by 4.5 percent, or P6.1 billion, to a nine-month all-time high of P141.9 billion in the first nine months of 2022, as consumers thrived on their digital lifestyles in the new normal.

In the third quarter, PLDT Group’s service revenues grew by four percent, or P1.7 billion, to P47.7 billion, compared with the same period last year.

Data and broadband, which grew by nine percent or P9.3 billion to P113.2 billion in the first nine months, continues to drive growth, contributing 80 percent of consolidated service revenues.

Panlilio said PLDT Home continues to grow despite increasing challenges to people’s wallets due to continuing high inflation and the prolonged impact of Typhoon Odette.

PLDT Home posted service revenues of P14.6 billion in the third quarter, bringing service revenues for the first nine months to an all-time high of P42.7 billion, up 21 percent or P7.3 billion year-on-year.

Fiber-only service revenues grew 52 percent, or P12.2 billion, to P35.7 billion in the first nine months, on the back of increased gross additions of 286,000 customers in the third quarter, partially offset by higher churn due to the continuing clean-up of customers affected by Typhoon Odette as well as rising economic challenges impacting customer wallets.

PLDT Home’s fiber subscribers stood at 2.9 million, after adding 489,000 net new fiber subscribers in the first nine months of the year. Total fixed broadband subscribers as of end-September stood at 3.24 million.

“This supports our view that there is still growth in what remains to be an underpenetrated market, albeit future revenues will likely come from regional areas where the rollout is needed and from lower market segments. As we reach deeper into the market, we are exploring lower denomination plans to address affordability,” Panlilio said.

Capex review

Looking forward, PLDT said it is in the process of reviewing its consolidated capital expenditures (capex) for 2022, which could exceed the initial capex guidance of P85 billion against the backdrop of toughening economic headwinds.

“We are also watching our capex levels, especially the impact of the weakening peso on our dollar-denominated debts and imported capex, even capex committed in previous years and current ones. With the disciplined effort led by our Transformation Office, we are trying to manage some softness in our topline, as well as tightly control our costs,” said Panlilio.

Amid a cautious outlook, PLDT chairman Manny V. Pangilinan said the company is keen to continue its investments in technology to pump prime the economy.

“At this time that the consumer wallet is diminished—when consumer income is under threat and government finances are challenged—investments will emerge as a primary recovery tool. Hence, investments are needed, both by the government and the private sector to drive the economy forward,” said Pangilinan.