On the mend, PLDT reports core earnings at P17.4B in H1

Telco giant PLDT Inc. saw further signs of recovery in the first half of 2017 as it maintained the growth of its fixed-line internet business segments, but concerns remained on the decline of traditional mobile services.

PLDT announced Thursday that core profit during the first semester was down 2 percent to P17.4 billion, with a big boost coming from the sale of its remaining stake in Manila Electric Co. last June to an affiliate.

At the start of 2017, PLDT began reporting what it called recurring core profit, which removes one-off items such as asset sales and expenses related to its manpower reduction program. This was to isolate other factors and provide a better picture of the company’s telco business prospects.

PLDT’s recurring core profit in the first half stood at P11.9 billion, up 1 percent, and it announced it was on track to end the year at P21.5 billion, up from P20.2 billion in 2016.

PLDT chair and CEO Manuel V. Pangilinan said in a briefing Thursday that recovery was “taking root” with the help of its home and enterprise segments, driven by growing demand for fixed-line internet.

Home revenues during the period were up 12 percent to P15.8 billion while enterprise revenues were up 11 percent to P16.8 billion.

Those provided 46 percent of all service revenues, albeit down 6 percent to P71.2 billion in the January to June period.

Growth slowed as wireless consumer revenues, led by Smart Communications, fell 16 percent to P29.6 billion.

Subscribers continued to send less text messages and made fewer traditional long distance calls and switched to lower-yielding data services despite the latter’s explosive growth.

“There is still a huge effort needed to monetize the incremental growth in data traffic,” Pangilinan said. “The task is a significant one.”

Earlier this year, officials unveiled big plans to cut costs and shore up earnings, including a plan to outsource most of its IT requirements to United States-based IBM. On Thursday, Pangilinan said talks with IBM have been “postponed indefinitely.”