PLDT enterprise revenue grows 13% to P8.5 B in Q1

MANILA, Philippines - PLDT Inc. continued to lead in the enterprise segment as it posted a 13-percent growth in revenue in the first quarter from a year ago.

In a statement, PLDT said revenue generated from the enterprise segment reached P8.5 billion in the first three months, up from P7.5 billion in the same period last year.

“We are growing double-digit across all business pillars of the enterprise as PLDT remained the preferred expert partner of companies given our relevant digital and cloud-based business solutions that run on our robust fixed and wireless networks,” Eric Alberto, PLDT executive vice president and chief revenue officer said.

For his part, Jovy Hernandez, PLDT senior vice president and head of Enterprise Business said the company is seeing the growing use of enterprise customers of cloud-based solutions, disaster recovery and digital services.

“PLDT is well positioned to meet this need because of the expertise we have assembled through partnerships with leading tech companies and the unmatched capacity and resilience of ePLDT’s data center network,” he said.

Earlier this year, PLDT launched several partnerships with IT industry leaders to provide products targeted for enterprise customers.

Among the partnerships forged are with Microsoft and Cisco.

PLDT through digital arm ePLDT Inc. also launched two new data center facilities to cater to enterprises in need of a secure place to house their data.

PLDT which now has nine data centers, expects to end the year with a total of 10 facilities.

“PLDT has been expanding its digital infrastructure in line with the roadmaps of key industries to fully serve the growing ICT needs of enterprises and government agencies for disaster recovery, cloud-based digital solutions, and a resilient network that these solutions will leverage on,” Alberto said.

For this year, PLDT has set a capital expenditures guidance of P46 billion to be used to further expand its network infrastructure, including fiber optic backbone to address the growing data use of both fixed and wireless customers.

PLDT’s fiber network now reaches over 150,000 kilometers.

It also operates four cable landing stations that serve as gateways for a variety of voice, data, and content traffic that run through a global network, to and from the country.

 Meanwhile, International rating agency S&P Global Ratings is keeping the BBB+ long-term corporate credit rating of PLDT Inc. despite higher country risk.

In a statement, S&P said it affirmed PLDT’s  BBB+ long-term corporate credit rating as well as the “axA+” long-term ASEAN regional scale rating.

“We affirmed the ratings on PLDT because (we) expect the company to maintain its business fundamentals over the next 12 to 24 months despite our assessment of an increase in country risk in the Philippines,” S&P said.

Earlier this week, S&P lowered the country risk score of the Philippines from  moderately high risk to high risk to show the diminished predictability of future policies following pronouncements on foreign policy and national security.

Apart from affirming the ratings on PLDT, S&P also expects the company to continue making strategic investments to protect market share and achieve higher data revenues.

“We expect PLDT to sustain its dominant foothold in the Philippines telecommunications (telecom) market,” it said.

This, as the telco and digital services provider maintained its strong market position despite intense competition in the market.

S&P said last year’s acquisition by PLDT of half of San Miguel Corp.’s telco business means greater capacity for growing data services.

“We believe that the move will dampen the near-term likelihood of a third player entering the Philippines telecommunication market, cementing PLDT’s already strong market position,” it said.

S&P’s credit assessment of PLDT includes a one-notch positive adjustment to reflect the view the company would be able to keep its ratio of debt to EBITDA (Earnings Before Interest, Tax, Depreciation and Amortization) below 2.5x on a sustainable basis, a ratio at the stronger end of an intermediate financial risk profile range.

“We also expect the company to continue to rebalance its dividend payments and capital outlays while maintaining its robust competitive position,” S&P said.

The credit rater could lower the rating for PLDT should the company’s capital structure weaken, such that the ratio of debt to EBITDA be above 2.5x on a sustainable basis.

S&P anticipates such situation to happen when PLDT’s capital spending comes in higher than initially set or the company’s position in the market deteriorate due to competition.