PLDT to enhance Capex focusing on network and IT projects

PLDT has revealed that its Capex (capital expenditure) has enabled the company to grow business during 2019.
The annual Capex of PLDT at P72.9 billion in 2029 has enabled PLDT to significantly enhance its service quality levels, particularly in data and digital services, and consequently boosted service revenues to their highest level ever.

Globe Telecom, the main rival of PLDT, has spent P51 billion or $989 million towards Capex in 2019.

PLDT spent P61.0 billion in 2029 towards Capex related investment on telecom network and IT expansion and transformation programs and the balance of P11.9 billion for installation of broadband connections across the Philippines.

PLDT has allocated a Capex budget of P83 billion for 2020 in order to raise service quality standards and achieve better customer experience.

For comparison, Globe Telecom will be spending P63 billion in 2020.

PLDT will be spending P64.6 billion on network and IT projects, mainly to support the growth in data traffic. PLDT will also be spending P18.5 billion, inclusive of P5.5 billion carried over from 2019, for broadband installations.

“This sustained level of investments in the country’s telecommunications infrastructure now totals P257.7 billion in the last five years,” said Manuel V. Pangilinan, chairman, president and chief executive officer of PLDT.

PLDT’s service revenues rose 8 percent to P157.7 billion. This is the highest revenue PLDT has attained, surpassing the previous peak of P153.5 billion in 2014.

PLDT’s EBITDA grew 22 percent to P83.1 billion, excluding MRP (Manpower Reduction Program) expenses of P3.3 billion, driven by higher service revenues and lower cash operating expenses.

The EBITDA margin improved from 45 percent in 2018 to 52 percent in 2019. PLDT’s Telco Core Income rose 13 percent to P27.1 billion, while Reported Net Income jumped 19 percent to P22.5 billion.

PLDT generated annual revenue of P72.1 billion (+20 percent) from Consumer Wireless Group, P39.2 billion (+5 percent) from Enterprise Group and P37.2 billion (+3 percent) from PLDT Home.

PLDT’s data and broadband services revenue rose 20 percent to P105.2 billion and accounts for 67 percent of total revenues.

PLDT expanded its fixed network rollout by 15 percent, reaching 7.2 million homes passed by end 2019. The total capacity increased 34 percent to 3.5 million ports, of which about 1.8 million fiber/VVDSL ports were available for new customers. The footprint of PLDT’s fiber optic network grew 32 percent to 322,400 kilometers.

Smart’s mobile network increased the number of its LTE or 4G base stations by 51 percent to about 24,600 and augmented the number of 3G base stations by 19 percent to 13,800. Smart’s mobile coverage expanded to 94 percent of the population.

Smart conducted several pilot deployments of 5G with various equipment suppliers. It fired up 5G base stations for pilots in various settings: at PLDT’s office in the Makati business district, in an academic setting (within the Ateneo Campus), in a lifestyle hub (at the Araneta City in Quezon City), and in a smart city setting (Clark City, Pampanga).

PLDT has partnered with Cisco to transform its transport network into a fully automated, all IP, software-defined 5G-ready infrastructure.

Globe Telecom

Globe Telecom spent a record Capex of P51 billion or around $989 million, 18 percent higher than a year ago and represents 34 percent of gross service revenues and 67 percent of EBITDA.

Globe Telecom spent 79 percent of Capex towards data-related projects. Globe Telecom put up 139 percent more sites versus 2018 and added more 3G and 4G base stations, putting up 28 percent more than last year.

Globe’s LTE download and upload speeds, and latency in the 4th quarter of 2019 improved nearly 16 percent, 6 percent, and 9 percent respectively, compared to the same period last year. These improvements were achieved despite a 58 percent growth in mobile data traffic.