Globe allocates P22.5 billion for capex

MANILA, Philippines - Globe Telecom is spending a total of $500 million (P22.5 billion) on capital expenditure, given the wide range of product portfolio that the company will offer for the year.

Of the $500 million, the bulk will be allocated to build network capacity for consistent and quality customer experience.

About $185 million or 37 percent of its total expenditure will go to upgrading its broadband networks and related transmission facilities while around $160 million or 32 percent will be spent for mobile networks to ensure its ability to meet the new traffic profile, improve indoor and outdoor coverage, and increase its robustness.

“Our efforts are starting to gain traction, and the challenge is to make the gains deeper. With all our brands showing significant improvements over the last two quarters, we are poised to sustain the momentum and drive continued growth across our businesses,” Globe president and CEI Ernest Cu said.

Cu pointed out that for 2011, their focus remains on making a differentiated customer experience by going the extra mile to understand what customers truly need. “Globe will continue to innovate and create offers that are relevant and affordable, allowing our customers to truly enjoy Globe their way,” he added.

Cu earlier announced that one of the company’s key priorities for the year is growing its mobile data business with its unique offering of content, devices, and mobile internet packages for its mobile internet users.

The company partnered with GetJar to provide users with some of the latest mobile apps that will make mobile browsing more exciting and with some of the leading smartphone producers to offer up-to-date handsets, gadgets and devices.

Globe noted that it was able to sustain growth after its core businesses yielded encouraging results in the second half of 2010.

The company’s consolidated fourth quarter revenues amounted to P16.7-billion, one of the highest in the company’s history, which includes a one-time upward adjustment of P526 million representing prepaid load credits that have either expired or have already been used up.

The mobile business also achieved quarterly revenues amounting to P13.5-billion, a 13 percent increase versus the previous quarter on the back of strong and innovative offers that enriched and revolutionized the way customers communicate.

The outstanding performance of the company’s mobile segment was attributed to higher postpaid plan subscriptions driven by the pioneering launch of the personalized postpaid plans My Super Plan and My Fully Loaded Plan. Globe Postpaid reached a record high net acquisition in the fourth period with over 83,000 new subscribers, even higher than the previous record of over 73,000 set the previous quarter.

Meanwhile, Globe Prepaid posted strong quarter growth as of end-2010 by bringing in over 480,000 net acquisitions while TM sustained momentum with fourth quarter net additions of over 500,000, posting a combined 13 percrnt year-on-year increase in the number of subscribers.

Company officials said the comeback of the prepaid segment was a result of the game-changing prepaid offers in the form of affordable unlimited inter and intra-network call and text services in Super Unli, Super All Txt, AstigCombo and Unlicombo offers, and higher fourth quarter average revenue per user (ARPU) and usage due to the innovative subscriber rewards programs My Globe, My Rewards and TM Astig Rewards, strengthening customer loyalty and retention, which also significantly reduced churn rates of all brands.

Meanwhile, its fixed line and broadband business grew at a fast pace, with service revenues rising 32 percent year-on-year, driven by the sustained robust performances of the broadband and fixed data line segments.

The broadband business increased its revenues by 75 percent against last year’s numbers on the back of strong subscriber take-up of its product portfolio that changed the face of broadband services. On the other hand, its fixed line data business continued to be fueled by the strong demand from the BPO, trade, retail, and services sectors.

“On top of this, Globe also launched its innovative set of mobile data packages, the surf-all-you-want Globe Supersurf and consumable mobile internet offer Globe Powersurf to aggressively push mobile internet usage,” Cu said.

As of end-2010, Globe expanded its cellsite coverage nationwide to provide better and quality coverage to its 26.5-million subscribers. Total cell sites were at 6,698 from 6,226 the previous year. In terms of base stations, Globe ended the year with 11,660, from the previous year’s 10,333.

Globe declared the first semi-annual cash dividend of P31 per common share, in line with the company’s dividend policy. On an annualized basis, the first semi-annual cash divided payment of P4.1-billion represents 84 percent of 2010 net income, similar to last year’s pay-out rate, and translates to an attractive dividend yield of 7.8 percent.