ABS-CBN allots P1.4B for 2005 capex

ABS-CBN Broadcasting Corp. is setting aside P1.4 billion for its capital expenditures this year to include the launch of new shows and acquisition of film rights.

ABS-CBN chief financial officer Randolph Estrellado said the programmed capital budget is roughly the same amount spent by the company last year.

Estrellado said the network is set to launch new shows within the second semester in hopes of regaining the number one position in the ratings game in the Mega-Manila area now occupied by rival GMA Network Inc.

"This year is very challenging given the market share situation. Things would depend on how we are able to improve market share. In the meantime, we’re keeping or maintaining what we have," Estrellado said.

ABS-CBN president Luis Alejandro said the firm is doing its best to topple its biggest competitor. "We’re in for the fight. We have to make sure that we have a competitive product before we market our product."

Estrellado said he is optimistic that the company’s offshore unit ABS-Global Ltd. will continue to perform well given the increasing demand for Philippine-made TV programs by overseas Filipino workers (OFWs).

ABS-CBN Global is embarking on a major regional expansion program this year. It recently launched its direct-to-home (DTH) cable operations in Hongkong via a partnership with Hong Kong Cable TV Network’s Cable TV, the biggest pay-TV operator in the former Crown Colony, to launch its own DTH service in Hong Kong.

The move is part of ABS-CBN’s efforts to expand its reach in Asia Pacific and address the continuing clamor of OFWs for Phillipine-made TV programs.

ABS-CBN said Hong Kong is a very lucrative market since there are over 150,000 Filipinos living and working in the area.

Apart from Hong Kong, ABS-Global is also looking at penetrating Taipei, Malaysia and Indonesia.

ABS-Global earlier launched The Filipino Channel (TFC) on Singapore’s StarHub cable TV service, aimed at tapping over 130,000 OFWs there.

ABS-Global is also expected to launch operations in Canada in the second quarter of the year after Canada’s Supreme Court allowed the Philippine media conglomerate to operate even without partnering with a third party.

ABS-CBN’s international operations account for 30 percent of total revenues although the broadcast giant expects it to increase significantly in the next three years.

To date, ABS Global has 1.6 million Filipino viewers overseas, and intends to bring TFC to three million viewers in the next five years. The market of overseas Filipino viewers is currently placed at seven million.

ABS-CBN reported a 25-percent drop in its 2004 net income due to higher costs, particularly talent fees owing to an increase in station-produced shows in place of canned programs.

Consolidated revenues went up seven percent to P15.6 billion, largely driven by higher net sales and services. ABS-Global continues to be the biggest contributor, accounting for P3.05 billion or seven percent of the total.

ABS-CBN Films contributed nine percent to total sales and services, registering a 33 percent growth year-on-year to P390 million.