earnings reports

Globe nets P34.6 billion in 2022, to reduce capex in 2023

Ralf Rivas
Globe nets P34.6 billion in 2022, to reduce capex in 2023
After spending P101.4 billion in 2022, Globe is slashing its capex by 30% in 2023 to bring free cash flow back to more sustainable levels

MANILA, Philippines – Globe Telecom on Tuesday, February 7, reported that its net income grew 46% to P34.6 billion in 2022, reflecting the gains from its sale and leaseback of telco towers and service revenues reaching a new high.

Globe said that consolidated service revenues reached P158 billion, a 4% increase, as corporate data and mobile services drove topline expansion.

The Ayala-led company’s revenues mostly came from mobile, which raked in P107.5 billion. Mobile revenues comprised 68% of the total service revenues, which came from its 86.7 million subscribers.

Non-telco revenues, which include its businesses in fintech and entertainment, doubled to P4.2 billion. The substantial revenue contributions from ECPay, Yondu, and Asticom led the growth.

Globe said it is focusing on prepaid fiber as the postpaid fiber segment has reached saturation, and legacy home broadband business continues to decline. Revenues from this segment dipped to P27.1 billion from P29.4 billion the previous year.

“Public clamor for reliable and more importantly, affordable internet connectivity continues,” the company said. In response to this need, Globe said it now has TMBayan Fiber WiFi, a public WiFi service.  

“With this service, sari-sari stores, town plazas, community centers and other neighborhood convergence areas can become WiFi hotspots,” the telco said. 

As of January 31, 2023, Globe said it has activated 652 TMBayan Fiber WiFi hubs in parts of Luzon, Visyas, and Mindanao. It plans to launch more pre-paid fiber products by the 2nd quarter of 2023. 

Lower capex

Globe’s non-operating income stood at P10.7 billion, due to the one-time net gain of P8.4 billion on the partial sale of its data center business and the sale and leaseback of its tower assets. Excluding one-time gains, normalized net income is at P20 billion, up by 13%.

Core net income, which excludes non-recurring charges and foreign exchange gains, stood at P19.2 billion, a 9.4% decrease from a year ago.

Capital expenditures in 2022 closed at P101.4 billion, a 9% increase, marking the highest investment ever in its mobile and fixed network. Majority or 86% of cash capex was allocated for data requirements.

For 2023, Globe said it will reduce capex by 30%, as it aims to “bring free cash flow back to more sustainable levels.”

“Despite 2022 being a challenging year marked by inflationary pressures, high interest rates and weakened consumer confidence, Globe once again showed resilience,” said Globe president and CEO Ernest Cu. –Rappler.com

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Ralf Rivas

A sociologist by heart, a journalist by profession. Ralf is Rappler's business reporter, covering macroeconomy, government finance, companies, and agriculture.