Globe Telecom Inc. (Globe) on Wednesday said it is setting aside $650 million (P29 billion) for 2015 capital expenditure (capex), the same amount it earmarked for this year.
“I figured more than half next year’s (capex) would be for data [services], like I said we’re still at the process of finalizing the budget, so I don’t have any concrete numbers for you yet, but at least 50 percent of our spending next year would be for data,” said Albert de Larrazabal, Globe chief financial officer, at the sidelines of the third quarter financial results briefing.
“In 2014 the budget was $650 million. Depending on the timing some of that may slide so you may actually get slightly higher amount for next year, but that would effectively include the amount that was supposed to be spent this year. I think more than half for next year will be for data already,” De Larrazabal said.
On Tuesday, Fitch Ratings projected that the country’s two telecommunication giants would increase their capital expenditure (capex) in 2015 as they pursue investments in fast-growing data services and expand their fiber networks.
Fitch noted in a special report that profitability at Globe and the Philippine Long Distance Telephone Co. (PLDT) is likely to decline amid an increase in capex in 2015.
It also expects free cash flows for both PLDT and Globe to be negative in 2015 due to their increased capex.
Industry capex for 2015, meanwhile, is pegged at around P60 billion from P58 billion in 2014.
Earlier, Globe said it will spend up to P9 billion of the P10 billion it raised from the issuance of non-voting preferred shares for the rollout of its Long-Term Evolution (LTE) network in the country.
The Ayala-led telco listed 20 million non-voting preferred shares on the Philippine Stock Exchange in August.