TELECOM giant Philippine Long Distance Telephone Co. chalked up P9.4 billion in net profit in the first three months, flat from the same period last year, as the digital boom gnawed at text (SMS) and voice call revenues.
Taking out non-recurring items, consolidated core net income fell by 5 percent year-on-year to P9.3 billion, seen in line with the company’s core income guidance of P35 billion for full-year 2015.
The decline in core earnings was attributed mainly to lower cash flow as measured by earnings before interest, taxes, depreciation and amortization (EBITDA) alongside higher financing costs.
Consolidated service revenues for the period declined by 2 percent to P40.5 billion, as the declines in SMS (short message service) revenues and the international and national long distance streams offset increases in revenues from the data and broadband businesses. Consolidated revenues for the quarter were stable at P42.6 billion.
“While our core revenue sources undergo this transition phase where the erosion of our high- margin legacy businesses still outpaces the growth of our newer initiatives for now, we are taking significant steps to ensure that we are ready and prepared for the digital future. This future will require looking at our customers from a different set of lenses, as both individuals and enterprises embrace a digital life,” PLDT chair Manuel V. Pangilinan said in a press statement on Tuesday.
On the enterprise side, Pangilinan said PLDT was looking towards data center infrastructure, big data and cloud as its digital enablers while for the individual, the group seeks to unlock fresh revenue stream from digital commerce, mobile money and entertainment.
“In both instances – enterprise and individuals – our major task is to deliver and ensure that the digital experience is enriching,” Pangilinan said.
“To achieve this, we need to invest in a transformative infrastructure that will provide the ‘digital spine’ for our networks, engage in strategic partnerships with the Internet community that will bring value beyond connectivity, invest in ventures that will transform our local verticals into global horizontals of which Rocket Internet is a clear investment case, and develop our own applications and initiatives – of which LockbyMobile represents an outstanding example,” Pangilinan said.
LockbyMobile is a security solution developed by a unit of PLDT’s wireless arm Smart.
Also announced on Tuesday was the appointment of two new senior management people as part of the need to “refresh” PLDT’s leadership team.
PLDT hired Winston Damarillo, a Filipino-American technopreneur in Silicon Valley, as its new chief strategy officer. Also appointed was Joachim Horn as its new chief technology and integration advisor.