Fresh from record revenues, PLDT sees modest earnings boost this year

MANILA, Philippines — Telco giant PLDT Inc. is expecting a respectable increase in earnings this year, staying cautiously optimistic despite its impressive financial performance last year as the pandemic drags on.

The Manuel V. Pangilinan-led service provider sees telco core income hitting P29-30 billion this year that, if realized, would be a slight improvement from P28 billion core income booked in 2020, company officials announced in a press conference on Thursday.

This, after last year's telco core income, which strips off the impact of asset sales, climbed 4% annually, financial results showed. Including exceptional costs, net income jumped by a bigger 8% year-on-year in 2020 to P24.3 billion.

Shares in PLDT closed down 0.08% at P1,290 each on Thursday.

With no end in sight for the health crisis yet, Pangilinan said PLDT is being "modest" with its outlook. "Is that (P29-30 billion target) sufficient? Is that satisfying? Probably not because PLDT had reached profits heights that are higher than P30 billion before," he told reporters.

"So are we capable of reaching that? We should," he added.

As it is, PLDT emerged as one of the biggest winners of a dramatic shift to remote working and schooling that increased the need for broadband services. Consolidated service revenues rose 9% annually to P171.5 billion, the highest ever in PLDT's history, and the company forecast to stilll growth a "high single digit" this year.

Broken down, home broadband revenues surged 11% year-on-year to P41.4 billion driven by strong demand from work-from-home arrangements. Revenues from PLDT's wireless business, on the other hand, rose 15% annually to P10.6 billion after telco giant attracted more mobile data customers by "several millions." To compare, PLDT's main rival, Globe Telecom Inc., saw mobile revenues slide 7% last year.

Moving forward, Pangilinan said a sluggish economic rebound and the impending entry of Dito Telecommunity would test PLDT this year, although the company does not see the nascent operations of the third telco player as a big threat for now. Dito will pilot its services in 15 areas in Visayas and Mindanao on March 8.

"They will take a long time to catch up," the company said.

That said, PLDT is targeting a capital expenditure of P88-99 billion this year, higher than P71.9 billion actually spent which fell behind the original P80-billion goal in 2020. "If we are able maintain our momentum and deliver results as expected, we are prepared to consider paying out a 5% special dividend for 2021, on top of our regular dividend payout of 60%,” Pangilinan said.

Editor's Note: Manuel V. Pangilinan is the CEO of PLDT. A unit under PLDT's media conglomerate has a majority stake in Philstar Global Corp., which runs Philstar.com. This article was independently produced following editorial guidelines.