GMA allots P1 billion for capex, eyes much better earnings

MANILA, Philippines - Broadcast giant GMA Network Inc. is spending close to P1 billion for its capital expenditures in time for May elections next year as it expects to book at least a double-digit growth in earnings.

GMA chairman and chief executive officer Felipe L. Gozon said in an interview with reporters on the sidelines of the company’s first digital trade launch yesterday that next year’s budget for capital expenditures would be the same level as in 2012.

Data showed that the company is scheduled to spend P972 million this year.

Of the total amount, Gozon revealed that GMA would spend more than P100 million for the acquisition of equipment for the coverage of 2013 elections.

The equipment, according to him, could be used for news coverage even after the elections.

“We are spending it now in preparation for next year.  We can use that equipment even after the elections,” he added.

Gozon pointed out that GMA-7 expects to book a double-digit growth in earnings next year primarily due to higher advertising revenues brought about by the senatorial and local elections next year.

Earlier, Gozon disclosed that political advertisements would boost the company’s revenues by at least P2 billion just like what happened during the presidential elections in 2010.

He said politicians have realized that television exposure is critical during elections as the TV penetration rate stood at 94 percent.

According to him, GMA7 expects next year’s income to be “much better” than this year in light of additional revenues brought about by the scheduled elections.

“I cannot say yet but it will be much greater than 2012. Whatever income we will generate in 2012, in 2013 it will be much better,” the official stressed.

The broadcast giant is confident that it would be able to deliver if not exceed its projected net income of P2.3 billion this year or 35.3 percent higher than last year’s P1.7 billion.

The company’s consolidated revenues went up by five percent to P10.61 billion from January to September this year from P10.109 billion in the same period last year.

As a result, the company’s net income inched up by 0.4 percent to P1.587 billion in the first nine months of the year from P1.58 billion in the same period last year.

The company through GMA Marketing and Productions Inc. (GMPI) has embraced transmedia as it incorporated several digital elements in presenting new advertising platforms during the event yesterday.

The company presented its offerings for the first quarter of next year including its coverage of the forthcoming election period dubbed as “Eleksyon 2013.”

“Digital technology has changed the way viewers consume media. This 2013, we are all about charting new grounds as we introduce new and innovative ways to deliver the desired results of our advertisers, from the digital to classical media platforms,” GMPI president Lizelle Marilag said.