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Telco core income up 10% to ₱25.4B, on track to reach full year guidance of ₱33B

Despite increasing economic headwinds, PLDT Inc. grew Consolidated Service Revenues (net of interconnection costs) by 4.5%, or ₱6.1 billion, to a nine-month all-time high of ₱141.9 billion in the first nine months of 2022, as consumers thrived on their digital lifestyles in the new normal.

In the third quarter, PLDT Group’s Service Revenues grew by 4%, or ₱1.7 billion, to ₱47.7 billion, compared with the same period last year.

Data and broadband, which grew by 9% or ₱9.3 billion to ₱113.2 billion in the first nine months, continues to drive growth, contributing 80% of Consolidated Service Revenues.

For the first nine months, Consolidated EBITDA increased by 6% or ₱4.3 billion to ₱75.4 billion, also an all-time high. EBITDA margin was at 51%. In the third quarter, EBITDA grew 2% or ₱0.5 billion to ₱25.0 billion, compared with same period last year. Consolidated EBITDA is trending to cross ₱100 billion for the full year despite the stressful economic conditions.

Telco Core Income, excluding the impact of asset sales and Voyager Innovations, grew 10% or ₱ 2.3 billion to ₱25.4 billion in the first nine months. Reported Income jumped by 45%, or ₱8.5 billion, to ₱27.4 billion, which includes ₱22.3 billion in pre-tax gains from the towers sale up to the third closing.

“Enterprise seems to be our bright spot as we continue to empower businesses in their digital transformation and help promote the Philippines to be the next major ASEAN digital hub. Our 11th and, by far, largest data center is also on-track to be completed in late 2023,” said Alfredo S. Panlilio, PLDT and Smart Communications President and CEO.

“Meanwhile, PLDT Home continues to grow despite increasing challenges to people’s wallets due to continuing high inflation and the prolonged impact of Typhoon Odette.” “Our goals are pretty bold, as we aim for big targets, even knowing it is not going to be easy,” Panlilio added.

“We are aware of the headwinds that we face, and certainly, this will not be the last time we will encounter challenges,” he said. “What is key here is that while we continue to drive revenues by responding to our customers’ needs, we are trying to put discipline in place by focusing on strong efforts to control our operational expenses and improve operating efficiencies.”

Consolidated Net Debt as of the first nine months amounted to US$4.038 billion while net-debt-to-EBITDA stood at 2.36x. Gross Debt was at US$4.414 billion, with maturities well spread out. Only 18% of Gross Debt are denominated in US dollars with 5% or US$0.24 billion of total debt unhedged. PLDT maintained its credit ratings from Moody’s and S&P Global at investment grade. In connection with its pioneering sale of telecom towers and related passive telecom infrastructure, PLDT said that as of October 3, ownership of a total of 4,435 towers or 75% of the 5,907 towers covered by the sale and leaseback transaction had been transferred to the tower companies and a total cash consideration of ₱57.7 billion has been received by the Group. Proceeds from the sale of the towers will support operating and capital expenditures. The transaction is timely as it allows PLDT to avoid additional debt against a backdrop of a rising interest rate environment. PLDT expects additional closings before the end of the year, with final closing anticipated to be completed by the first quarter of 2023. In addition to the 5,907 towers sold, or committed to be sold, the sale of additional telecom towers is currently under evaluation.