PLDT Inc. is on track to hit P100 billion in earnings before interest, taxes, depreciation and amortization (EBITDA) this year, saying its balance sheet remains unaffected by the P48 billion capital expenditure (capex) overspend over the past four years.
In a disclosure to the stock exchange, PLDT said its overall business remains healthy and robust even as it continues to address its elevated capex spend and undergoes a comprehensive review process.
Manual Pangilinan, PLDT chairman, said at the recent special stockholders briefing PLDT’s EBITDA for 2022 will remain unaffected by the capex overrun and its telco core net income is expected to reach between P32.6 billion to P33 billion as guided.
According to Pangilinan, PLDT’s ongoing review has uncovered no fraud, no anomalies, no evidence of overpricing and no unrecorded transactions in relation to the overrun.
“The bulk of the P48 billion capex overspend involves the procurement of network equipment necessary to provide stronger connectivity to subscribers, specifically 5G (fifth generation) cell sites for our mobile network and fiber rollout. There will be no write-off of these assets,” Pangilinan said.
PLDT has embarked on a network expansion with an aggregated P397 billion capex, including an estimated P48 billion capex overspend which represents about 12.7 percent of total capex spent over the period.
Alfredo Panlilio, PLDT and Smart Communications Inc. president and chief executive officer, explained at the briefing the context of the capex overspend from 2019 to 2022: “PLDT having to regain network leadership following years of underinvestment in capex; the threat from former President Rodrigo Duterte for telcos to shape up; intense competition in the telco sector with the then anticipated entry of DITO funded by China Tel, as well as the emergence of a competitor in the fiber space, Converge. Finally, the occurrence of the COVID-19 pandemic and the resultant lockdowns and quarantines, which required the installation of speedy fiber connections in millions of households for work and school, pushed network teams to fast-track rollouts.”
Starting 2023, PLDT plans to reduce its capex.
“We expect capex to reduce steadily. 2023 will be a year of consolidation as we continue to strengthen and grow the business. We strive to be better,” said Panlilio.
In addition, PLDT said it is expected to pay the balance of the regular dividend for the full year 2022 estimated at P45 per share, and the remaining special dividend of P42 per share. This would bring total dividends for 2022 to P134 per share or 88 percent of 2022 expected earnings.
PLDT said it will continue to cooperate fully with the Securities and Exchange Commission, Philippine Stock Exchange and the Capital Markets Integrity Corp. in relation to their inquiry into the company’s budget overspend.
