ENCOURAGED by its financial performance during the first half of 2018, mobile services provider Globe Telecom Inc. has decided to increase its capital-expenditures (capex) program for the year by more than a tenth.
As it “moves forward with upgrading its network to provide first-world Internet connectivity in the Philippines,” the company is spending an additional $100 million in capital for the remaining half of the year.
With the fresh capital coming in, the group’s spending program is now at $950 million (P50.388 billion), more than a tenth from its $850-million outlay announced earlier.
So far, the telco has spent P22.9 billion of its capital expenditures for 2018. These were invested in the development of its network’s coverage and capacity, marked by the “rapidly changing and rising demand for data.”
Roughly 77 percent was injected in the expansion of its data services, leading to a total of 36,614 base stations across all connections.
Globe President Ernest L. Cu said his group decided to add more money into the group’s capital program due to the rising demand for data services in the Philippines.
“Our efforts to modernize further our network play a critical role in our company’s performance. We believe we are well positioned to compete in this highly challenging market going forward,” he said.
Tuesday also saw the company reporting to the local bourse that its profits widened by 21 percent to P9.8 billion in the first half of 2018 from P8.1 billion the year prior.
This was due to higher earnings, despite elevated depreciation charges as it expands its network for both broadband and mobile.
Its core net income—which strips off one-time gains and losses—also stood at P10.3 billion. Consolidated service revenues of Globe reached P68.3 billion during the period under review, from P62.9 billion, buoyed by higher earnings from its mobile data, home and corporate businesses.
Mobile data service revenues reached P24.7 billion, a 9-percent increase from its year-ago print, as content consumption through its mobile network posted a 39-percent increase in utilization to 390 petabytes.
Its home broadband business posted P8.7 billion in revenues, 12 percent higher than the P7.7 billion it booked the year prior, thanks to a 22-percent increase in subscriber base to 1.5 million.
Earnings from its corporate data, likewise, grew by 9 percent to P5.5 billion during the period, fueled by the increasing demand for digital solutions.
Expenses of the company reached P41.1 billion, 5 percent higher than the P39.3 billion it spent last year, as operating costs inched up by 2 percent.
“We are encouraged by the positive business momentum in the first half of 2018. These results validate our strategy in driving the digital lifestyle of our customers, and reaffirm our status as the country’s leader in mobile,” Cu said.
As this developed, the board of Globe announced the declaration of its third-quarter cash dividends for common shares. Payable on September 6, each share on record as of August 25 will be paid P22.75 totaling about P3 billion in dividends.
Shares in Globe rose by 8.64 percent to close at P2,024 apiece on Wednesday.