WHILE posting an increased in their subscribers, Globe Telecoms, the country's second largest wireless provider, reported that its consolidated service revenue dipped by two percent to P31.1 billion in the first six months of 2008.
Gerardo Ablaza, president and chief executive officer of Globe Telecoms, attributed the decline in their profit to the intensifying competition, increasing multi-SIM usage, and weaker consumer purchasing power with high inflation.
"Despite the softness in our first semester profits, the business remains fundamentally strong. The rebound in our subscriber net additions this quarter is a good indication of the underlying strength of the Globe and TM brands," Ablaza said.
According to him, Globe Telecom ended the second quarter with record levels of subscriber net additions, closing the period with a SIM base of 22.7 million up by 25 percent than last year's level.
Net additions in the second quarter alone reached an all-time high of 1.5 million, a robust 53 percent improvement from the first quarter, which was challenged by network disruptions in the Visayas and Mindanao areas.
The Globe official similarly reported that the company's wireless revenues were down by two percent while wireline revenues grew by five percent driven by continued growth in the broadband and corporate data business.
Excluding foreign exchange and mark to market gains and losses, as well as the one-time charges related to the early redemption of Globe's US$294 million Senior Notes, the company closed the first half of the year with core net income of P 6.7 billion, down by 10 percent year-on-year.
But Ablaza said: "Our priority in the coming months is to drive usage among our subscribers and generate momentum to put us back on the growth track. We will launch new programs for our priority segments, and intensify our efforts to grow and defend our position in the ABC segments, the mass markets, and the overseas Filipino communities."
The company, Ablaza said, is further strengthening its technology portfolio and is gearing up for a commercial launch of its WiMax wireless broadband service in the fourth quarter of 2008.
"We intend to undertake a major push in broadband, enabled by a suite of stronger wired and wireless solutions. With new DSL capacities coming on stream and with the optimization of our 3G wireless network, we are in a stronger position to accelerate broadband growth starting in the second half of the year. We are also proud to announce that we will soon be at the forefront of new technologies as we deploy WiMax services later this year," Ablaza added.
Meanwhile, Globe announced its recent acquisition of the Entertainment Gateway Group (EGG), one of the leading mobile content providers in the country.
EGG offers a wide variety of value-added services (VAS) covering music, news and info, games, chat, and web-to mobile messaging.
Globe views EGG as a promising platform for VAS in the other Asia-Pacific markets, having already made inroads into various international markets with large Filipino communities, including Japan, US, Hong Kong and the Middle East, added Ablaza.
Likewise, the company's Board of Directors declared a special dividend of P50 per common share, on top of the second semiannual cash dividend of P37.50 per share, payable to shareholders of record as of August 21, 2008.
A total of P11.6 billion in dividends will be paid on September 15, 2008. This would bring total dividends paid out this year to P 16.5 billion, including the regular dividends. (MSN/Sunnex)
