PLDT focuses on cutting debt, continued growth

Following the successful completion of its liability management exercise involving $1.3 billion in debts, telecommunications giant Philippine Long Distance Telephone Co. (PLDT) will continue to focus on reducing its debts, building a better and more competitive company, and pushing for continued growth riding on the strong performance of its wireless subsidiary, Smart Communications, according to PLDT president and chief executive officer Manuel V. Pangilinan.

Pangilinan made this comment after PLDT gained the commendation of the international banking community as a result of the successful implementation of its liability management initiatives in 2002.

In the Asset Asian Awards 2002 of The Asset magazine, PLDT was named "best in liability management", citing the work done by PLDT in terms of easing the pressure on the company out of its bunching foreign debts in the coming years.

"We are proud of the recognition by the international financial market of PLDT’s commitment towards strengthening the company and pro-actively addressing the challenges of our fixed line business – challenges that have no easy solutions and that would require difficult and tough decisions," Pangilinan said.

The prestigious Asset Asian Awards is given out yearly by The Asset magazine, one of Asia’s leading finance publications. Winners of these awards are based on the findings of the magazine’s Asset Publishing and Research group, which provides proprietary market information to CEOs, finance directors, chief finance officers, chief technology officers, and treasurers of some of the leading companies in and outside of Asia.

Pangilinan added: "We are very honored to have received this recognition by The Asset. It is a testament to the efforts of our PLDT team, together with our creditor partners, to come up with a total corporate finance solution to address a short-term debt overhang, while positioning the company to be on a stronger footing going forward."

The Asset commended PLDT for completing a series of initiatives that covered the export credit agencies, the public debt capital market as well as the syndicated bank loan market.

The initiatives included putting in place a $149-million loan facility from KfW of Germany in January 2002, launching a two-tranche $350-million global bond offering in late April 2002, and signing of a $145-million equivalent syndicated term loan facility in September 2002.

With these successful steps, PLDT was able to surmount the challenge posed by debts falling due between 2002 and 2004 amounting to around $1.3 billion, while at the same time demonstrating to the investor community that the company’s cash flows supplemented by dividends from Smart continue to be solid in the coming years, company officials emphasized.