WHAT used to be the Philippine Long Distance Telephone Co.’s (PLDT) strongest advantage has turned into a strain on its bottom line, dragging the telecommunications giant’s earnings in the first three quarters of the year.
“What used to be the strength of PLDT is now its main weakness—the international long distance call,” PLDT chairman Manuel Pangilinan told reporters at the sidelines of the briefing on nine-month financial and operational results of the company in Makati on Tuesday.
As of end-September, the telco posted a core net income of P8.1 billion—down 7 percent year-on-year.
Pangilinan said that revenue from international calls left a “gaping hole” in the company’s top line.
“We have to recognize some of the realities we face. Our toll call business continues to be a drag . . .” Napoleon Nazareno, PLDT’s president and CEO said during the briefing.
Pangilinan said the gaping hole from international calls continue to influence the growth of PLDT’s other businesses.
Take out international long distance calls and the company would have posted a 4-percent growth for wireless services and 9 percent for fixed line in the first nine month of the year.
“The decline will continue in the next two years.” Pangilinan said.
Further expanding the company’s data business will counter the weight of weak revenue from international toll calls.
Until such time when 40 percent of PLDT’s revenue is generated from data businesses, international calls will continue to bear down on the company’s income, Nazareno said.
“We will need to better compete by providing the consumer and enterprise customers with superior value and consistent and reliable quality experience. We make a superior network possible,” he added.
PLDT posted revenue of P42.7 billion in the third quarter, up 2 percent year-on-year. Service revenues grew by 1 percent at P40.8 billion.
This brought the nine-month core income at P27.1 billion, down 5 percent. PLDT’s nine-month revenue totaled P127 billion, unchanged from a year earlier. Service revenues reached P122 billion, down 1 percent.