Globe Q4 profit nearly doubles to P4.17B on data business

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DESPITE heightened industry competition, Ayala-led Globe Telecom said its net income in the fourth quarter of 2016 nearly doubled as its data business drove revenues to a record.

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In a briefing at the company’s headquarters in Taguig City, Globe President and CEO Ernest Cu said the carrier posted net income after tax of P4.17 billion in the fourth quarter of last year compared to P2.34 billion during the same period in 2015.

Consolidated service revenues reached nearly P120 billion at the end of 2016, up 6 percent from P113.7 billion in 2015, pushing core net profit to reach a record P16 billion, up 6 percent on year from P15.1 billion previously.

The revenue increase was driven by solid growth in data-related products and robust subscriber growth for both mobile and broadband, it said.

“Our sustained growth momentum is evidence of the underlying strengths of our superior products and services and our conscious effort to create wonderful experiences for our customers,” Cu said.

“As we move forward in 2017, we are optimistic that we will maintain our growth trajectory as we continue to strengthen our leadership in the digital space, through the use of innovation and partnerships with global content providers,” Cu added.

Mobile revenues slightly grew year-on-year to P91.9 billion in 2016 from P91.2 billion in 2015 the year before driven by the continued shift from core voice and SMS in favor of data as more Globe customers adopt the digital lifestyle.

TM, the company’s mass-market brand, registered 3 percent revenue growth from last year, while Globe Postpaid revenues inched up 1 percent from 2015, while Globe Prepaid revenues declined 1 percent.

At the end of December 2016, Globe Telecom’s mobile subscriber base reached 62.8 million, up 12 percent from the 56.2 million subscribers reported in 2015.

It said mobile data was now the biggest contributor to total mobile revenues (38 percent), outpacing voice (37 percent).

Mobile data service revenues reached P34.6 billion in 2016, an increase of 25 percent from the P27.7 billion reported in 2015. Mobile data traffic grew 44 percent from 252 petabytes (PB) to 361 PB in 2016 as smartphone penetration reached 61 percent.

The Globe home broadband business posted revenue of P14.5 billion in 2016, up 28 percent year-on-year, with total subscriber base now reaching 1.13 million.

Its corporate data business likewise improved to P9.9 billion as of end 2016, 28 percent higher from the previous year, on brisk demand for data connectivity, internet and domestic leased lines, and cloud computing solutions.

Traditional fixed line voice revenues grew 11 percent year-on-year to P3.8 billion as of end 2016 due to the continued popularity of the new home broadband bundled plans.

Consolidated EBITDA at end-2016 was close to P50 billion, up a robust 9 percent from the previous year, while total operating expenses and subsidy grew 3 percent to P70 billion from P67.7 billion in 2015.

EBITDA margin was at 42 percent higher than the previous year’s margin of 40 percent.

Globe spent around P36.7 billion ($772 million) in capital expenditures as of end-December of 2016 to support the growing subscriber base and demand for data. Of the total capital expenditures spent, about 65 percent was for the data service needs of its customers.

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