Islacom, a subsidiary of Globe Telecom, also expects its debts to be trimmed down to a very manageable level of only P1 billion by the first half of next year. "At the height of it all in end of 1998 to the beginning of 1999, Islacom’s debts reached $600 million," company chief operating officer Gil Genio said.
Following its acquisition by Globe Telecom principal shareholders Ayala Corp. and Singapore Telecom middle of this year via a share-swap agreement with Islacom shareholder Deutsche Telecom (DT), Islacom now has enough cash, especially after the three principal stockholders infused a total of $155 million. This amount is on top of the $240 million injected by DT.
Genio said that this year, Islacom’s capital expenditures were financed primarily by equity infusion from the principal shareholders.
He added that while capital expenditure levels will be minimal next year, this will be financed internally by Islacom.
"We do not know yet when we will experience a complete turnaround financially. Early part of next year, our EBITDA should be break even. Towards the end of 2002, our cash flow and EBITDA will be positive," Genio is noted.
Telecommunications companies that have international gateway facilities are required to install 400,000 lines while those that were given cellular licenses have to install another 300,000 lines. Since Islacom has both IGF and cellular, it had to put up a total of 700,000 lines.
According to Genio, they hope to have more subscriber via rebranding and introducing new features like caller identification.
He also stressed that Islacom offers one of the lowest monthly service fees (MSF) and also offers affordable installation fees and IDD rates. – Mary Ann Reyes