Globe survives turbulent 2022 with double-digit earnings growth

Globe launches hybrid store for its essential products and services
Shop & Pay is a hybrid offering that's a one-stop-shop for all of Globe's essential products and services.
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MANILA, Philippines — Telco giant Globe Telecom Inc. reported higher earnings in 2022 on the back of “significant” increase in data revenues, which helped the company survive a year spoiled by weak consumer confidence amid red-hot inflation and rising interest rates.

In a disclosure to the stock exchange Tuesday, Globe said it netted P34.6 billion in 2022, up 46% year-on-year. In the fourth quarter alone, the company’s bottom-line jumped at an annualized rate of 19% to P8.1 billion.

Ernest Cu, company president, said Globe displayed “resilience” despite a “challenging year”.

Financial results showed that if one would exclude nonrecurring income and expense items, Globe’s core net income sagged 10% year-on-year to P19.2 billion in 2022. Nevertheless, the Ayala-led company said its balance sheet “has remained healthy and gearing comfortably within bank covenants”.

In 2022, Globe’s consolidated service revenues amounted to P150 billion, up 4% compared with a year ago. Figures broken down showed mobile revenues went up 3% year-on-year to P107.5 billion, mainly thanks to growth in Globe’s prepaid service amid “greater public mobility and the resumption of face-to-face classes and work”.

That offset the 8% annual contraction in the home broadband segment, which contributed P27.1 billion to total service revenues. This, as employees that have had worked remotely since the beginning of the pandemic return to their offices, bringing down demand for home internet.

For this year, Globe has earmarked $1.3 billion for capital expenditure after having spent a much bigger P101.4 billion in 2022. The company said it is targeting to bring down its capex to $1 billion by 2024.

“Through this, Globe aims to bring free cash flow back to more sustainable levels moving forward, as it reaps the benefit of the opportunistic investments it made in its infrastructure the past few years,” the company said.

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