Bayan suffers slightly higher net loss on forex losses

MANILA, Philippines - Lopez-owned Bayan Telecommunications suffered a net loss of P666 million in the first half of 2010, nine percent more than the P610-million loss recorded in the same period last year, largely due to foreign exchange losses.

Bayan posted core revenues of P3.02 billion during the first six months of this year, or a five percent decrease over the P3.19 billion in core revenues generated in the same period in 2009, due to lower voice revenues that is consistent with the industry performance. Total voice revenues were lower by 13 percent at P1.56 billion compared to P1.8 billion in the first half of 2009.

Company officials explained that the decline in core revenues resulted in a 15 percent lower earnings before interests, taxes, depreciation and amortization (EBITDA) at P865 million compared to P1.01 billion in 2009. However, this is 28 percent better than budget, as management was able to effectively control operating expenses, which is lower by one percent over the previous year, they added.

Bayan’s first half performance in 2009 included non-recurring revenue from a one-time wholesale contract of available capacity.

Officials pointed out that Bayan’s 2010 first half revenue performance was within its target as it anticipated a soft market, particularly given the decline in the voice market and tighter competition in the industry.

For 2010, Bayan has focused its efforts on growing its fixed broadband DSL and corporate data business.

Bayan’s data business, which includes DSL and other corporate data services, grew six percent in the first half of 2010 to P1.43 billion from P1.35 billion in 2009.

Data business revenues account for about half of Bayan’s total revenue.

Bayan’s DSL business grew 19 percent over the same period in the previous year at P678 million, with subscribers close to 120,000 as of end-June this year.

To date, Bayan’s total subscribers have grown to about 550,000 for all its services, or a growth of nine percent over the previous year.

Bayan is projecting to end the year within target due mainly to the contribution from its DSL and corporate and data businesses.