Philippine integrated network provider PLDT is set to cut down on spending having posted a record Service Revenues of P182.1 billion in 2021. The company also announced the sale of its towers to boost profitability and improve free cash flow.
According to PLDT, it expects to raise over P50 billion from the sale of the towers. PLDT said the sale and leaseback agreement it is presenting to the bidders will allow PLDT to rent their cell sites from the new owners.
“This transaction will augment our operating cashflows and allow us to reduce debt,” said Manuel V Pangilinan, chair, PLDT. “We anticipate completing the tower arrangements by the end of the second quarter and could set the stage for a special dividend thereafter.”
PLDT’s consolidated service revenues rose 6% to P182.1 billion, considered to be an all-time high having surpassed 2020’s P171.5 billion. The company attributes this to the performance of its data or broadband business which grew by 12% to P139.7 billion. Add to this is a best-performing fourth quarter posting consolidated service revenues, also considered a “historic high,” of P46.2 billion, up 3% or P1.3 billion from a year ago.
“Since 2016, we have seen our revenues and profits increase steadily to the point that 2021 revenues were an all-time high and core income has returned to the P30 billion mark — something we have not seen since 2015,” Pangilinan said.
On spending, Pangilinan said PLDT will throttle down on operating expenses while strengthening its financial standing.
“After years of massive spending on infrastructure, we are transitioning to a more deliberate approach to our capital expenditures, having built the country’s most extensive networks,” Pangilinan said.
As reported earlier this year, its broadband (Home) business is driving growth for the company. Its Home revenues rose by 24% or P47.8 billion.
“For 2022, we anticipate that Home will continue to lead the way at a sustained, double-digit pace, alleviating the pressure on our Individual business,” said Alfredo S. Panlilio, president and CEO, PLDT and Smart.
PLDt’s enterprise business rose by 4% to P42.2 billion. Enterprise revenues in the fourth quarter of 2021 surpassed P11 billion for the first time, up P0.9 billion or 94% from the same quarter in 2020. For the year, Enterprise revenues rose 4% to P42.2 billion. Within data/broadband revenues, ICT and corporate data increased by 14% and 6%, respectively, year-on-year.
“Enterprise revenues should grow on the back of the gradual reopening of businesses and opportunities to serve the needs of global hyperscalers with our expanded data centers,” Panlilio said.
PLDT announced the construction of a data center last year which is expected to service hyperscalers from other countries. The Philippines is posed to become a data center hub in the Asia Pacific with recent openings from companies like Alibaba Cloud and SpaceDC as well as the locally managed BeeInfotech PH.