Mabuhay Satellite reports P4-M profit in Q1

Mabuhay Philippines Satellite Corp. has finally made a financial turnaround after incurring a P250-million loss in 1999, making its parent firm, Philippine Long Distance Telephone Co. (PLDT) confident that its satellite business will provide significant contribution to the group's overall revenues.

PLDT president and chief executive officer Manuel V. Pangilinan said over the weekend that Mabuhay has already registered a profit of P4 million during the first three months of the year, an amount which jumped by another P10 million in April.

According to Pangilinan, the company has leased out half of the satellite's 48 transponder space and is expected to think a deal with a several parties in the next few months as the demand for satellite services continues to grow.

He added that certain groups are also interested in injecting equity in Mabuhay but he refused to provide further details.

"We want to see new money coming in and enhance the profitability of Mabuhay. Satellite has become a very important medium in transmitting data traffic aside from voice and video so many companies are turning to satellites for their communication requirements," he said.

Such surge in demand, Pangilinan said, augurs well for Mabuhay which in the past has suffered from lack of takers.

Mabuhay launched its $232-million Agila II satellite into space in August 1997 and started commercial operations in January the following year. However, it has not generated any profit and even accumulated about P6 billion in debt.

Mabuhay is negotiating with a syndicate of seven local banks since last year for a debt restructuring agreement and is expected to sign a deal within the year.

Earlier, PLDT increased its stake in Mabuhay from 61 percent to 67 percent by buying the shares of Pilipino Telephone Corp., another PLDT subsidiary, in the satellite firm. Other partners in the project are GMA 7 and Pasifik Satelit Nusantara.

Mabuhay Satellite is one of two local satellite operators in the country, the other being Philippine Agila Satellite Inc. (Pasi) although the latter has yet to operate commercially due to financial constraints.