Philippines telecoms operator PLDT is considered boosting its 2018 capex to a higher level than its original guidance of PHP46 billion ($900 million) for 2017 in “response to increasing expectations and criticisms being leveled against the industry about network quality”.
The company said in a statement it believes it can support the PHP46 billion level through its operating cash flow. “However, as we need to be mindful of our debt levels, [any] higher amount of capex would have to be funded from other than additional debt, possibly through a sale of assets”.
The statement went on to say: “One option is to consider PHP46 billion as the normative capex level to support our various network initiatives to further expand the reach of PLDT’s home broadband network as well as enhance the coverage and capacity of our 3G/LTE network across the country”.
Manuel Pangilinan, chairman and CEO of PLDT and Smart (pictured, centre), the company’s mobile unit, said its 2017 capex guidance remains at PHP38 billion, with about another PHP15 billion committed already this year, “but which we forecast will be finished in 2018. We will continue to ramp up our capital investments in the near-term as we are determined to have the best network”.
The company noted its budget for next year has not been finalised and the numbers are preliminary indications. It will provide guidance for 2018 capex when it announces full-year results in March 2018.
PLDT reported a 58 per cent year-on-year increase in its Q3 net profit to PHP5.36 billion, with total revenue flat at PHP40 billion. The profit was boosted by equity gains of PHP1.68 billion during the quarter.
Although service revenue dipped 1.8 per cent to PHP37.6 billion from a year ago and wireless turnover was again down in the quarter, falling 9.3 per cent to PHP22 billion, the operator said quarter-on quarter comparison of other indicators “provide further indications that the overall business is stabilising”.
Fixed-line, which includes home broadband, and enterprise revenues were up by low double-digit figures.
Mobile subscribers fell by 7.2 million over the past year to end September with 58.2 million. Prepaid subs dropped by 6.65 million to 55.7 million, while post paid users dropped by 560,000 to 2.56 million. Smart’s market share in Q3 was just under 50 per cent, a similar level to rival Globe Telecom’s, according to GMSA Intelligence.
Smart prepaid ARPU increased 5.8 per cent to PHP108 ($2.11) from Q3 2016, while Smart post paid ARPU rose 3 per cent to PHP975.