Globe to spend record P63 billion for capex this year

Richmond Mercurio (The Philippine Star) - February 5, 2020 - 12:00am

MANILA, Philippines — Ayala-led Globe Telecom Inc. is earmarking another record high capital spending this year to support continued network expansion and enhancement.

With its massive spending last year resulting in significant gains and faster network rollout, Globe said yesterday it is committed to spend approximately $1.2 billion or P63 billion in capital expenditures for 2020, which includes spill over of capex commitments from 2019.

Globe also earmarked P63 billion for capex in 2019, but was able to end the year with a total cash capex of about P51 billion, still the highest in the company’s history.

Globe said the bulk of the all-time high spending last year went to data-related requirements, enabling it to put up more sites and more 3G and 4G base stations nationwide.

“These gains benefitted customers as evidenced in the latest results of third party network quality test providers, which showed that Globe’s LTE download and upload speeds, and latency in the 4th quarter of 2019 improved nearly 16 percent, six percent, and nine percent respectively, compared to the same period last year,” Globe said.

“Moreover, these improvements were achieved despite a 58 percent growth

in mobile data traffic over the same time period,” it said.

Aside from significant gains on the network front, the Ayala-led telco also ended 2019 with a positive set of financial results.

Globe reported yesterday a total consolidated net income of P22.3 billion for 2019, a 20 percent jump from the previous year’s P18.6 billion behind gains in EBITDA, offsetting depreciation charges and non operating expenses booked for the year.

Core net income, which excludes the impact of non-recurring charges, one-time gain, foreign exchange gains and mark-to-market charges, likewise grew by 20 percent year-on-year to P22.5 billion.

Globe also saw its consolidated service revenues rise by 12 percent to P149 billion due to the sustained data revenue growth across the mobile, home broadband, and corporate data businesses.

“2019 proved to be another good year for Globe despite the changing industry environment. These results serve as a springboard for the opportunities and challenges that lay ahead, and will help us better serve our expanded mobile and broadband customer base of over 96 million,” Globe president and CEO Ernest Cu said.

“We will continue this momentum through 2020 as we remain committed to our goal of delivering first-world internet connectivity to the Philippines,” he said.

This year, Globe is expecting the market to remain competitive, citing the continued shift in the customer’s lifestyles and usage in a digital world.

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