Philippine Long Distance Telephone Co. (PLDT) said it is allocating a record P39 billion for capital expenditure in 2015 to strengthen its 3G, 4G and LTE networks.
“The way we sized up this year 2015, it would be marked by three major influences,” PLDT chairman Manuel Pangilinan said during a press briefing.
“First, we foresee continuous intense competitive pressure in the drive to gain market share. We have responded to those pressures in respect of new product offerings, principally in the internet space,” he said.
He said the second major influence will be the influence of over-the-top (OTT) content players on the business. OTT content refers to delivery of audio, video, and other media over the internet without the involvement of a multiple-system operator in the control or distribution of the content.
“And third is we’re accelerating the buildup of our 3G and 4G network, which means an elevated capital expenditure for 2015,” Pangilinan said.
The company said it will finance its capex program through a combination of internal financing and loan financing.
A PLDT official said they are looking at $200 million from the Bank of Tokyo Mitsubishi UFJ Ltd. and $200 million to $300 million from Mizuho Bank for Smart Inc.
PLDT on Tuesday reported its audited financial and operating results for 2014 with a consolidated core net income amounting to P37.4 billion, 3 percent or P1.3 billion lower than the P38.7 billion recorded in 2013.
“Our 2014 performance reflects the combined effect of the intense domestic competitive situation and the changing global landscape–where OTT players are disintermediating the traditional telcos, and data services and social media are overtaking legacy services,” Pangilinan said.
PLDT’s net income, after reflecting exceptional transactions for the period, declined 4 percent to P34.1 billion, from P35.4 billion in 2013, mainly due to the dip in core net income.