Converge ICT Solutions Inc. has doubled its capital expenditure this year to P19 billion from last year to finance the construction of international cable and data center.
“Due to upcoming international subsea cable payments, the inclusion of capital outlays for data centers, and delays in supplier invoices earmarked for 2023 payment, the company now looks to spend P 17 to P19 billion in cash capex this 2024.” Converge said.
Converge’s consolidated revenues hit P35.4 billion, up by five percent year-on-year in 2023, versus same period in 2022, while net income rose by 22 percent to reach P9 billion on the back of strong demand for its fiber internet services.
Converge registered net additional residential subscribers of 284,000 for its fiber plans last year, the biggest fiber net adds in the industry during the period. This is also 32 percent higher compared to its year-ago level. In terms of consolidated net adds, Converge was the only major operator which registered positive growth at 13. percent year-on-year.
By end-December 2023, Converge had captured more than 2.1 million subscribers, consisting of more than two million postpaid and over 114,000 prepaid subscribers.
The fiber broadband provider’s enterprise business also boasted a robust year, growing from P4.3 billion to P5.1 billion, up by 20 percent year-on-year.
All its enterprise segments saw double-digit growth, led by the small and medium enterprise (SME) segment with 34.9 percent. Enterprises and corporate saw a 13 percent growth, while the Wholesale segment increased by 14 percent.
In terms of profit margins, Converge registered an earnings before interests, taxes, depreciation, and amortization (EBITDA) of P21.5 billion, up 11.2 percent year-on-year while its consolidated EBITDA margin ended at 61 percent. With prudent cost management, the company was able to meet its EBITDA targets for 2023.
At 16.3 percent, the company’s return on invested capital remains the highest in the industry and is expected to continuously improve as it builds on its flanker brands.
