3Q07 Investors Briefing

Transcription

1 3Q07 Investors Briefing 07 November 2007 Sustained value creation through strong results REVENUES % +8% M05 9M05 9M05 9M05 NIAT CORE NIAT +4% +20% M05 9M05 1

2 Sustained growth for our wireless business Wireless Revenues (In Php Bn) + 12% Wireless (In Php Bn) + 10% m05 9M05! Growth in revenues YoY remains strong at 12%, double last year s s level of 6%! growth remains at double digits at 10% YoY Buoyant economy and strong sales efforts driving wireless growth in excess of 2006 levels Quarterly Net Additions ( 000) ( Gross and Net Additions In Mn SIMs 1,192 1,263 1,204 1, m07 has already topped FY06 level % Q06 2Q06 3Q06 4Q06 1Q07 2Q07 3Q07 Gross Adds Net Adds! Net additions above 1 million for fourth consecutive quarter! Narrowing gap between gross and net adds reflects improvements in churn Gross adds up 34% while net adds up a stronger 73% YoY 2

3 Good momentum across all brands SIM Base by Brand (Mn ( Mn) Net Additions by Brand +10% % % % TM 54% Globe Postpaid 2% Globe 44% Prepaid Postpaid Postpaid GHP Prepaid Prepaid TM TM TOTAL Total SIMs SIMs! Globe Postpaid breaks through the 700K mark! TM continues to grow at a fast pace, comprising 54% of cumulative net adds Broadband driving wireline revenue growth Wireline and Broadband Revenues Cumulative Broadband Subs ( 000) 4, Double vs 9M 06 level 5, Q07 1Q07 3Q06 1Q06 3Q ' % YoY Wireline Broadband! Wireline revenues grew 6% YoY,, within which broadband revenues doubled vs last year s s level! Broadband subs up 150% YoY to 109k with average monthly ARPU of Php 1,171 3

4 Giving back to the community Globe Bridging Communities! Text2Teach program enabled teachers in 210 public elementary schools to gain access to more information via SMS, while GILAS connected 710 public high schools to the internet! Entrepreneurship programs participated in by 3,500 micro-entrepreneurs from 500 barangays! More than 1,200 employee volunteers invested at least 10,000 hours in Gawad Kalinga and GT Eskwela Further enhancing shareholder returns with special dividend Cash Dividends In Php per Share % Return on Equity based on Core Net Income 24% 22% 16% F** Regular Dividend Special Dividend ** Annualized based on YTD Sept results! Shareholder return at 28%, with the special dividend and 19% rise in share prices since beginning of year up to the end of the 3 rd quarter 4

5 Financial Performance Consolidated Financial Highlights: YoY comparisons Service Revenues EBIT 47,153 30,451 17,717 42,517 28,192 16,097 YoY Growth 11% 8% 10% " Wireless and wireline revenues grew 12% and 6% respectively, leading to higher " margin fell slightly to 65% as increases in marketing, staff costs, and services tempered revenue growth Non-Operating Charges 3,147 2,348 34% " Net income grew 4% even with a 10% increase in income tax NIAT Core NIAT Margin 9,692 10,537 65% 9,309 8,812 66% 4% 20% " Core income (which excludes one-time impact of early bond redemption, forex and MTM gains/losses) up 20% YoY 5

6 Consolidated Financial Highlights: QoQ Comparisons Service Revenues 3Q07 15,532 3Q06 14,070 Growth 10% 2Q07 16,012 QoQ Growth -3% EBIT 9,509 5,160 9,248 5,154-3% 10,519 6,250-10% -17% Non-Operating Charges % % NIAT 3,267 3,550-8% 3,838-15% Core NIAT 3,159 2,669 18% 3,705-15% Margin 61% 66% 66% ARPU dilution managed with controlled SAC 6,788 1,649 Globe Postpaid 5,208 5,390 5,136 1,686 1,654 1,598 6,178 1,529 3Q '06 4Q '06 1Q '07 2Q '07 3Q'07 Net ARPU SAC Q '06 4Q '06 1Q '07 2Q '07 3Q'07 Net ARPU SAC Globe Prepaid TM Blended Subscriber Acquisition Cost and Net ARPU (In Php) " Blended ARPU down 10% QoQ with continued multi- SIM usage, and with new subscribers coming in at lower ARPUs " Blended SAC up 7% QoQ due to increased loyalty programs in the postpaid segment, and continuation of aggressive acquisition campaign for TM Q '06 4Q '06 1Q '07 2Q '07 3Q'07 Net ARPU SAC 137 3Q '06 4Q '06 1Q '07 2Q '07 3Q'07 Net ARPU SAC 6

7 Operating Expenses: YoY Comparison YoY Subsidy & Marketing 3,926 3,642 8% Staff Costs 3,156 2,578 22% Utilities, Supplies 1,762 1,510 17% and Other Admin Rent 1,724 1,563 10% Repairs and Maintenance 1,639 1,651-1% Provisions and Others % 52% Services and Others 3,848 2,956 30% Operating Expenses 16,702 14,32517% 17% Depreciation and Amortization 12,734 12,0955% 5% Total 29,436 26,420 11% Increased loyalty programs and advertising efforts for wireless and broadband businesses Higher headcount of 7% coupled with increases in base pay and related benefits Increase in electricity consumption following additional on-air sites, as well as higher per kilowatt-hour rates Higher provisions for bad debts, inventory obsolescence with more stringent provisioning policies Higher contracted and security services, as well as spectrum fees for the expanded 2G and broadband network Operating Expenses: QoQ comparisons 3Q07 2Q07 QoQ Subsidy & Marketing 1,418 1,332 6% Staff Costs 1,142 1,032 11% Utilities, Supplies and Other Admin % Rent % Repairs and Maintenance % Provisions and Others % Services and Others 1,385 1,213 14% Operating Expenses 6,023 5,493 10% Additional headcount and increase in base pay and related benefits Higher electricity and power generation charges, as well as electricity consumption Higher rental charges from additional cell sites Higher security, professional and contracted services due to additional cell sites and expanded broadband network Depreciation and Amortization 4,349 4,269 2% Total 10,372 9,762 6% 7

8 Strong financial position In Php Mn 3Q 07 3Q 06 Cash Balance Debt 11,653 13,686 31,929 41,336 15% 23% Gross Debt to Equity YTD Free Cash Flow YTD Capex Capex as % of sales ,200 19,365 9,1158,658 19% 20% 16% 5% Superior shareholder returns, with high dividend yield and strong share price appreciation Debt to Equity Ratios 3Q 07 Actual and Adjusted for Special Dividend ,827 Market Capitalization (In US$ Mn) +30% 3,326 4, Q06A 3Q07 Actual 3Q07 Adjusted Target Gross D/E Net D/E ! Globe share price growth in excess of Phisix growth Market cap up 30% since beginning of the year! Total of Php 6.6 billion in dividends to be paid in December Represents about 56% of 2006 net income, in addition to regular pay-out of 75% 8

9 Thank You 9