Key officials’ departure seen hurting PLDT

MANILA  -PLDT Inc. is expected to encounter some “operational challenges” after key officials—especially those who had served the telco giant for a long time—voluntarily left their posts this week amid the multibillion peso budget mess, according to CreditSights.

The Fitch Group unit, in a research note on Thursday, said the “sudden loss” of the senior officers could “induce short-to-medium term operational challenges.”

“We think day-to-day operations of the company could be hampered, strategic directions could be less clear, and execution risks of ongoing projects could be higher,” it explained.

Separate PLDT disclosures noted that a number of key officials voluntarily separated from the company through early retirement, resignation and availment of the manpower reduction program. The telco player, however, did not expressly say that the changes in management was due to the budget overrun issue.

https://business.inquirer.net/396271/pldt-cfo-svp-take-early-retirement-amid-p48-billion-budget-mess

“Given the seniority of the departed officers and their relatively long tenors with the company … we think it could be more challenging for the company to fill in the gaps,” CreditSights explained.

For example, the Fitch Group unit noted that chief procurement officer Mary Rose dela Paz had been with PLDT for six to seven years while chief financial officer Anabelle Chua had served for over 20 years.

The telco player, however, has already designated officers in charge to supervise the departments.

PLDT group controller Danny Yu will handle finance; first vice president Bernadette Salinas, supply chain management; and first vice president and deputy network head Roderick Santiago, network.

CreditSights said the departures could mean that PLDT was committed toward improving its corporate governance, which had been questioned after the company revealed that it had incurred a P48-billion capital expenditure (capex) overspending last December.

https://business.inquirer.net/378236/pldt-uncovers-p-48-b-budget-overrun-revamps-management

Negotiations

The figure was brought down to P33 billion after concluding negotiations with major suppliers.

CreditSights said it saw “a possibility” that officers were let go after “substantially completed external investigations found negligence or bad decision-making.”

CreditSights added that given the resigned officers’ titles and positions, it was “inclined to think these cannot be random, unconnected departures.”

PLDT had stressed, however, that “no evidence of fraud, intentional concealment or bad faith conduct on the part of any employee of the company” were uncovered from the forensic review.

https://business.inquirer.net/378983/no-fraud-in-budget-debacle-pldt-execs-assure-investors

The Fitch Group unit also believes that the capex overspending was due to “management missteps and not intentional fraud.”

Inquirer reached out to the telco giant for a comment but has yet to receive a reply.

The Pangilinan-led telco player saw its net income plunge by 60 percent to P10.49 billion last year amid the financial fiasco. With the projected weakening of its credit position, S&P Global Ratings downgraded PLDT’s investment grade by a notch to “BBB” from “BBB+” this month.