PLDT eyes higher capex for 2019
PLDT, Inc. is looking to increase its capital expenditure (capex) for 2019, a significant amount of which will be used to fund its wireless business and its fifth generation (5G) network rollout.
PLDT Chairman, CEO and President Manuel V. Pangilinan told reporters on Wednesday the PLDT board is set to discuss this coming Tuesday their plans for next year, and is targeting a bigger capex than this year’s P58 billion.
“We’re just focusing on our numbers. Capex elevated, higher again next year,” he said.
Mr. Pangilinan refused to give details, but said it will be bigger than rival Globe Telecom, Inc.’s capex.
Globe has not officially announced its targeted capex for 2019 yet, but Mr. Pangilinan said he knows it to be “a billion US dollars,” and PLDT’s would be “much bigger.”
“Wireless is still a significant portion, especially now that we’re going to spend. So we’re expanding some 3G, a lot of 4G sites and then beginning to build out the 5G,” he said of the allocation for next year’s budget.
The PLDT chief also said he expects the performance next year to be “quite good.”
“I think the wireless looks… the numbers are good. Definitely Home, the numbers are very good. Enterprise is also good,” he said, referring to its Home and Enterprise business segments.
Fitch Ratings said last month PLDT and Globe are expected to take a hit in revenues and raise their capex in 2019 as they brace for a new entrant in the telco industry: the winner from the government’s new major player auction, Mislatel Consortium.
The Mislatel group is formed by China Telecommunications Corp., Dennis A. Uy’s Udenna Corp. and its subsidiary Chelsea Logistics Holdings Corp., with franchiseholder Mindanao Islamic Telephone Company, Inc. It has committed a capex of P150 billion in its first year of operations, which is expected to start mid-2019.
Globe President Ernest L. Cu previously told reporters while the company hasn’t finalized its capex yet, the figure is likely to remain close to its budget this year, which was at $950 million (about P49.8 billion).
Should there be increases in Globe’s capex, Mr. Cu said it will not be due to pressure from the new player, but rather from the rising demand for its services.
“We keep increasing our capex because our demand is increasing,” Mr. Cu said in a Nov. 13 interview.
Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has a majority stake in BusinessWorld through the Philippine Star Group, which it controls.