Globe Nets P9.8B In 2011
With its mobile business exceeding market expectations in 2011, Globe Telecom, Inc. hauled in P67.8 billion in service revenues, 9% higher than the normalized level of P62.0 billion in the previous year although its net income inched up 1 percent only to P9.8 billion.
The high service revenues offset its rising operating expenses and depreciation. Hence, Globe’s core net income rose 11 percent from P9.1 billion to P10 billion.
However, the telco’s reported net income only inched up 1 percent to P9.8 billion as prior year's results included P526 million in non-recurring adjustments pertaining to prepaid load credits that have either expired or have been used up.
Globe’s full-year mobile revenues reached P54 billion, up 8% year-on-year on the strength of its subscriber growth due to its customizable post-paid plans, unlimited services and all-network offers plus additional revenues from mobile browsing.
Specifically, its post-paid mobile phone subscribers grew from 1.1 million to 1.5 million during the comparative period. Globe’s pre-paid services closed 2011 with total subscribers of 15.5 million, up 12 percent while Touch Mobile (TM) hauled in 13.1 million subscribers, registering a 13 percent increase.
The brand refresh campaign focusing on the aspirations of the Filipino youth together with innovative local and international services renewed interest for the telco’s pre-paid offerings.
On the other hand, the telco’s broadband revenues rose to P7.5 billion, up 30% from previous year, riding on the rising demand for fast and reliable internet connectivity.
As Globe continued the roll-out of its 4G HSPA+ network and boosted the speed performance of its key broadband products, subscribers increased by 31 percent from 1.1 million to 1.4 million in the comparative period.
Globe’s operating expenses for 2011 included certain professional, advisory, and legal fees associated with the Company's IT and network transformation programs. Results also covered P350 million in accelerated depreciation expenses related to a pilot implementation of the network change-out in Davao City, a key market and focus area.
Excluding these transformation-related expenses, Globe’s consolidated EBITDA would have expanded 7 percent compared to the reported 6% growth. Core net income would have grown 15% as against the reported 11 percent growth.
Overall, the gains which the telco made last year will enable Globe to sustain the growth of its business in 2012, stressed President and CEO Ernest L. Cu.
“The next two years will be a critical period for Globe as we execute on our network modernization programs to make customer experience our key differentiator,” Cu said.
To finance its capital expenditures for 2012, including its network modernization and IT transformation program, the company is undertaking a P15-billion Retail Bond Program
This will enable the Telco to tap the retail market in one or more tranches over the next 12 months.
The bonds will be offered to both institutional and retail investors.
Meanwhile, in line with Globe's amended dividend policy of distributing between 71 to 90% of prior year's core net income, its Board of Directors declared the first semi-annual cash dividend of P32.50 per common share, payable on March 16, 2012 to shareholders on record as of February 24, 2012.
