Globe Telecom Inc. expects its revenues to increase by mid-single digit this year driven by the sustained growth of its mobile and corporate data businesses.
Globe Group reported all-time high consolidated service revenues of P158 billion in 2022, up 4 percent year-on-year as corporate data and mobile services, complemented by the continuous growth from non-telco services, mainly drove the topline expansion.
Despite a challenging year, Globe ended 2022 with P34.6 billion consolidated net income, up 46 percent from the reported net income in 2021. This was primarily from the 6 percent increase in earnings before interest, taxes, depreciation and amortization (EBITDA) , and the one-time gains which fully offset the 11 percent increase in depreciation expenses.
However, excluding the impact of the one-time gains, normalized net income would have been P20 billion, up 13 percent from 2021.
“Despite 2022 being a challenging year marked by inflationary pressures, high interest rates, and weakened consumer confidence, Globe once again showed resilience. We are happy that the Globe Group closed the year with strong topline and EBITDA growth. We also achieved momentous milestones in 2022 where we closed the country’s largest-ever tower sale and leaseback agreement,” Ernest Cu Globe president and chief executive officer said in a statement.
Globe’s core net income, which excludes the impact of non-recurring charges, one-time gains, foreign exchange gains, and mark-to-market charges, stood at P19.2 billion, down by 10 percent year-on-year.
Full-year 2022 consolidated EBITDA stood at a record P79 billion or 6 percent higher from 2021 with the topline expansion of 4 percent offsetting the growth in operating expenses (including subsidy). This enabled the overall EBITDA margin to increase to 50 percent from last year’s 49 percent, in line with full-year guidance.
Globe said EBITDA margin is expected to remain in the low 50s in 2023, as margins will be continuously impacted by the increasing contribution of lower-margin data-related products, but offset with efforts in managing costs.
For 2023, Globe said it will reduce its capital expenditure by 30 percent to approximately $1.3 billion from 2022 levels as the company shifts its focus to optimizing capital deployment and bringing free cash flow to more sustainable levels. The company also targets to drop its capex spending to $1 billion by 2024.
As of the end of 2022, Globe spent P101.4 billion, higher by 4 percent from last year’s level of P92.8 billion. It closed the year with a total mobile subscriber base of 86.7 million, or slightly lower than last year due to lower acquisitions and an increase in churn.
Globe said the SIM Registration is expected to result in a lower subscriber base for the company, as non-active SIMs are churned out of the system but will have no impact on 2023 revenues.
Globe’s total home broadband subscriber base now stands at 2.6 million, a 30 percent dip from the year-earlier with the 47 percent decline from fixed wireless.
Despite the performance of the fiber business, the addressable postpaid fiber market has reached saturation levels with the wider market remaining underserved. Globe has shifted its focus to prepaid fiber, which it believes will open the industry to a new segment that could potentially drive the next phase of growth for the Home Broadband industry. One such prepaid offering is TMBayan Fiber WiFi, a public WiFi service where subscribers can connect their devices and have access to the internet.
Globe expects to launch even more prepaid fiber products into the market by the second quarter of 2023, to complement its current fiber offering. – Myla Iglesias
