AYALA-LED Globe Telecom Inc. is planning to raise its capital expenditure (capex) this year to $800 million from $750 million to invest more in data expansion projects as short messaging service (SMS) weakens, Globe President and Chief Executive Officer Ernest Cu said.
Cu said that on top of the company’s $250 million investment in the Southeast Asia-US underwater cable system, which was recently launched, Globe is looking at expanding its capex to $800 million this year.
“Our capex for the year is $750 million. We will formalize our capex in the third quarter. But if you look at our earnings report, we also did our earnings call, I think we are already tracking more than $500 million spending in the first six months of the year. So there’s really the possibility of raising the capex for this year,” Cu told reporters over the weekend on the sidelines of an event in Taguig City.
“We will invest our 34 percent of revenues back to our network, which is really high for this year,” he said.
Globe’s spending will be focused on developing and improving its data-related projects, such as for the deployment of its LTE (Long Term Evolution) mobile and LTE @Home, as well as for increased network capacities and coverage of fixed-line data.
“Everything we do right now is geared towards data. That’s the growing part. As you know, SMS is declining,” Cu said.
Earlier, Globe reported that its net income for the first half of 2017 fell 10 percent to P8.1 billion from P9 billion in the same period in 2016 due to costs related to its purchase of San Miguel Corp.’s telecom assets. Revenues in the period jumped by 5 percent to P62.9 billion from last year’s P59.9 billion.