PLDT nets 111.8 B from consolidated revenues of 172.5 B

PLDT Inc. (PLDT) hauled in 172.5 billion in Consolidated Service Revenues for the first half of this year, a 2% increase versus the same period in 2017, following the new accounting standard PFRS 15 (which affects the computation of revenues) adopted this January.

Reported net income stood at 111.8 billion, 29% less than the previous year mainly due to a higher gain from asset sales in the first semester of last year.

Core income from telco operations (excluding Voyager) grew 6% year-onyear to 113.0 billion. With Voyager, core income would be 111.7 billion, slightly lower by 1%.

Based on the previous accounting standard, PAS 18, service revenues amounted to 174.2 billion, a 4% rise from the previous year.

Excluding international long distance and national long distance (ILD/NLD) revenues, service revenues were actually higher by 6% year-on-year.

Consolidated EBITDA (earnings before income taxes, depreciation and amortization) reached 133.2 billion (based on PFRS 15) or 133.3 billion (based on PAS 18), a 4% increase . EBITDA margin improved slightly to 43% from 42% in the previous year.

The telco's Board of Directors yesterday declared an interim dividend of 136 per share in line with the company’s dividend policy of a 60% payout of the underlying core income of 111.7 billion and 60% of the gain from asset sale of 11.4 billion.

The dividend is payable on September 11, 2018 to stockholders on record as of August 28, 2018.

As of end-June 2018, PLDT's Consolidated Net Debt and Net Debt to EBITDA stood at US$2.4 billion and 1.89x, respectively.

Gross Debt totaled US$3.5 billion, of which only US$0.2 billion or 7% is unhedged. Fixed rate loans made up 89%, while floating rate loans accounted for 11%.

On a pro-forma basis (using PAS 18), Consolidated Service Revenues (net of interconnection costs) rose 4% to 174.2 billion.

Revenues in the second quarter of 2018 reached 137.5 billion, the highest level attained on a quarterly basis since 2nd quarter 2016.

It marks the fifth consecutive quarter of steady sequential improvements in service revenues, during which service revenues increased over 11.8 billion.

This follows a period covering 5 consecutive quarters starting 2nd quarterc2016 during which service revenues declined by 12 billion – a turnaround of about 13.8 billion.

Consolidated EBITDA grew 4% to 133.3 billion in 1H 2018. Excluding Voyager, EBITDA increased by 7% to 134.6 billion while EBITDA margin improved to 45% from 43% in 1H 2017.

Focusing on the contributions of the major business segments, PLDT Home set the pace for growth once more, increasing revenues in 1H 2018 by 14% year-on-year to 118 billion, an improvement of the 12% growth in the comparative period.

The Enterprise Group posted revenues of 118.7 billion, raising its growth rate to 9% year-on-year in 1H 2018 from 7% year-on-year for 1Q 2018. Growth continued to be driven by increasing wireless data and cloud and other ICT services.

Combined, Home and Enterprise accounted for 50% of total service revenues and rose by 11% or 13.8 billion year-on-year.

Continuing its turnaround, the Individual Wireless business group posted revenues of 129.9 billion, a 2% increase year-on-year, driven chiefly by growing mobile data revenues.

Data/broadband and digital services continued to be the main growth drivers for all three business segments.

Combined, these services accounted for 139.6 billion in revenues, 54% of first half 2018 total service revenues, up from 46% in 1st semester 2017.

Fixed Home broadband revenues jumped 58% to 113.2 billion, while mobile internet revenues surged 29% to 112.3 billion.

Corporate data and data center revenues increased 13% to 10.9 billion. As a result, data/broadband and digital services increased their share of revenues to 75%, 64% and 45% for the Home, Enterprise and Individual business segments, respectively.

“We have crossed an important threshold now that our data and digital services generate more than half of our total service revenues,” noted Ernesto R. Alberto, Executive Vice President and Chief Revenue Officer.

“Moving forward, our task is to accelerate our digital pivot by pursuing whenever possible converged digital initiatives across our business segments – Home, Enterprise and Individual Wireless.”

Notably, in the first half of 2018, PLDT and Smart accelerated the roll out of the group’s fixed and mobile networks, providing a stronger lift for revenue growth.

As of end-June 2018, PLDT increased the coverage of its fiberpower fixed broadband network to 5.1 million homes passed, up from 4 million homes passed as of end-2017.

This is nearly 100% of its fullyear 2018 target. PLDT boosted its capacity by almost 86% to 1.86 million ports, or, nearly 85% of its full-year target of 2.2 million ports.

Meantime, Smart installed over 3,900 new LTE bases stations, boosting its total count by 45% to over 12,600.

This has enabled Smart not only to improve its LTE coverage but also to activate LTE-Advanced (LTE-A), which offers even higher data speeds, in more areas of the country.

To complement its LTE roll out, Smart also added over 500 3G base stations, raising the total to over 10,400.

The stepped-up roll-out of LTE and 3G base stations will enable Smart to meet its commitment to the government to provide highspeed wireless data services in over 90% of the country’s cities and municipalities earlier than end-2018.