GMA Network Inc. is earmarking “a little less than P2 billion” for its capital expenditures (capex) for 2022, which is roughly 66 percent more than the outlays it allotted for this year.
GMA Chairman Felipe L. Gozon said the group’s higher capex for next year will help the company further expand its reach, create new content, and improve its operations. This year, GMA allocated P1.21 billion for its capital outlays.
“For next year, the capex earmarked is a little less than P2 billion which will be for the expansion of our digital transmission network, upgrading of our post production and content layout facilities, and expansion of our regional network etc. We have not yet started the construction of our new building and studios. That includes investment in content and other investments,” he said during a special stockholders meeting on Thursday.
Gozon added that for 2022, the television giant remains “optimistic” given the elections.
“The situation about the pandemic is improving that’s why we expect the momentum in the latter part of the fourth quarter this year to continue up to next year. And next year being a presidential election year, we have reason to be optimistic. However, it still depends how far and fast our recovery will be and also whether the pandemic will surge or not next year,” he said.
He noted, however, that campaign ads will only account for a small portion of GMA’s revenues, as its top line is still driven by recurring advertisers.
“In the last 2019 elections, political ad sales only contributed 5 percent of our total consolidated sales. With the pandemic and the Comelec-imposed increase 40 percent to 50 percent discounts on published rates for political ads, we don’t think that the share of political ads will significantly change from prior elections. Our main source of revenues will still come from recurring advertisers,” Gozon said.
GMA, he said, will continue to produce more content and will “invest heavily in talent management and development,” while building more digital stations “to remain number 1.”
The broadcaster is also diversifying its revenue streams. On Thursday, stockholders approved the subscription to increase the authorized capital stock of its wholly-owned subsidiary GMA Ventures Inc. (GVI) to P1 billion from P50 million. Subscription shall initially be in the amount of P250 million. Payment for the said subscription is pegged at P100 million.
GVI is GMA’s corporate vehicle for investments in startups.
“We have already made small investments in one or two so-called startup companies but at this point we prefer not to identify them,” Gozon said. “Our diversification efforts to invest in businesses that are not related to our core business of broadcasting will be carried out by GVI.”