Saturday, November 08, 2008 Globe posts drop in 3rd quarter income
AYALA-owned Globe Telecoms admitted that its consolidated net income in the first nine months of 2008 went down by nine percent or P8.8 billion this year from P9.7 billion in 2007 during the same period.
Gerardo Ablaza, president and CEO of Globe, attributed the drop in their income to "tougher economic competition."
"We are encouraged by this quarter's strong subscriber growth and steady revenues despite a tougher economic and competitive environment," Ablaza said.
However, he noted that despite the decline in their revenues, they were able to post a million net additional subscribers from January to September bringing to 23.7 million total subscribers for Globe or an increase of 24 percent from last year's record.
The revitalized campaign for the Touch Mobile (TM) brand brought in more than 800,000 new SIMs in the third quarter, its highest ever quarterly performance, Ablaza added.
Postpaid subscribers meanwhile are tracking closer to the 750,000 mark, with net subscriber additions this quarter growing four-fold from first quarter results and over 20 percent from second quarter levels.
Ablaza further pointed out cumulative revenues of P46.6 billion for the nine months was only one percent lower year-on-year, narrowing the two percent revenue gap posted in the first half of this year.
Wireless revenues were soft, decreasing two percent year-on-year, but this was partly cushioned by the five percent revenue growth posted by the wireline business given the robust performances of its broadband and corporate data segments.
Despite the revenue drop, Ablaza said: "We remain committed to improving further our executional capabilities to make our business more resilient and better place to meet the challenges that lie ahead."
During the period, Globe initiated various programs to improve its market position and increase its share of mobile spends on its key customer segments.
Ablaza said for the mass markets, they implemented a series of aggressive sales campaigns in the rural markets, focused on the unique value proposition of the TM brand.
For their postpaid segment, Globe Telecoms introduced new time plans to provide subscribers unlimited texting and lower call rates during nights and weekends.
For the mid to high-end markets, Globe introduced the Apple iPhone 3G last August 22.
Sales have exceeded expectations, providing further lift to this quarter's subscriber net additions, as well as notable increases in the company's browsing and VAS (value-added services) revenues, explained Ablaza.
On the broadband front, as part of its major push to build momentum in broadband, the company announced that its WiMax network roll-out is on track and that the service is now on-air in selected areas in Metro Manila. The network and service systems are being fine-tuned for commercial launch shortly.
Total subscribers for its fixed and fully mobile service reached 175,000, 51 percent higher than last year and 20 percent versus last quarter.
"We are particularly pleased with the significant progress we have made in the broadband space. We remain committed to continuously improving the quality of our service and relevance of our product offerings," Ablaza concluded. (MSN/Sunnex)
