PLDT, Inc. · PSE:TEL
PLDT — 9M 2017 Earnings Presentation
54 slides from PLDT's earnings presentation, Nov 9, 2017
Slide 1: 2017 Nine Months Results: Financial and Operating Results
2017 Nine Months Results Financial and Operating Results 9th November 2017
Slide 2: PLDT Group: 9M17 vs 9M16 Financial Highlights
PLDT Group: 9M17 vs 9M16 Financial Highlights Home* Enterprise* Individual* International* Voyager* P24.3bn P25.3bn P44.2bn P12.4bn P1.0bn +12% +11% -14% -21% +134% +P2.6bn +P2.6bn (P7.0bn) (P3.2bn) +P0.5bn Conso Service Revenues Wireless Fixed Line (net of interconnection costs: P5.7bn) Service Rev
Slide 3: PLDT Group: Consolidated Financial Highlights
PLDT Group: Consolidated Financial Highlights (Php in billions) Consolidated service revenues showing four Service Revenues, net of interconnection costs quarters of sequential 9M 2017: P107.3bn ex-ILD/NLD improvements 4% ILD/NLD 3Q17 stable year-on-year 9M 2016: P111.8bn (4.5) and 1% higher vs
Slide 4: PLDT Group: Fixed Line Financial Highlights
PLDT Group: Fixed Line Financial Highlights (Php in billions) Fixed Service Revenues (net of interconnection costs) 9M 2017: P51.9bn +11% ILD/NLD 9M 2016: P46.8bn +5.1 +11% Ex-ILD/NLD +1.8 +4% +2% +2% +2% +2% 17.3 +0.3 17.6 Y-o-Y 15.4 +0.1 15.5 +0.4 15.9 +0.4 16.3 +0.7 16.9 +0.4 1.3 1.3 -2% +4% 1.4
Slide 5: PLDT Group: Wireless Financial Highlights
PLDT Group: Wireless Financial Highlights (Php in billions) Wireless Service Revenues (net of interconnection costs) 9M 2017: P62.0bn 13% ILD 9M 2016: P71.0bn (9.0) Ex-ILD 7% -1.7 2% 7% 3% 4% 1% 24.7 -0.6 24.0 -1.8 22.3 -0.7 21.6 -0.8 20.8 -0.1 20.6 2.2 -6% 2.1 -8% 20.6 1.9 -- 1.9 -10% 1.7 Y-o-Y -2%
Slide 6: PLDT Group: Service Revenues (by Business Unit)
PLDT Group: Service Revenues (by Business Unit) (Php in billions) Home * Improvements in Enterprise • Average quarterly quarter-on-quarter revenues of P8.4bn 9M 2017: P24.3bn revenue increases 9M 2017: P25.3bn in 2017 higher than +12% +11% P7.7bn in 2016 starting 1Q17 9M 2016: P21.7bn 9M 2016: P22.7
Slide 7: PLDT Group: Consolidated Service Revenues (by Product Type)
PLDT Group: Consolidated Service Revenues (by Product Type)* (Php in billions) 9M17 vs 9M16 3Q17 vs 3Q16 Lower by P4.5bn or 4% Stable year-on-year LEC, mobile LEC, mobile Data, broadband International domestic Data, broadband domestic International and digital voice and fixed voice and and digital v
Slide 8: PLDT Group: Consolidated Service Revenues (by Business Unit)
PLDT Group: Consolidated Service Revenues (by Business Unit)* (Php in billions) 9M17 vs 9M16 3Q17 vs 3Q16 -3.2 +0.6 * -4.5 -21% +100% -4% +2.6 +11% 12.4 1.1 107.3 +2.6 25.3 +0.9 -0.7 +0.1 Stable +12% +11% -15% +43% Y-o-Y -7.0 +1.0 -14% 24.3 4.1 0.4 36.1 +13% 8.5 -1.2 44.2 -8% 8.5 14.6 Individual Hom
Slide 9: PLDT Group: Consolidated EBITDA
PLDT Group: Consolidated EBITDA (Php in billions) Higher by P5.0bn or 11% Higher by P2.2bn or 15% Higher by P3.4bn or 7% Higher by P2.2bn or 14% Lower Lower provns Higher provns Lower HIgher cost Higher and Higher and Stable svc cost of cash subsidies cash subsidies MRP svc services opex MRP rev* of
Slide 10: PLDT Group: Core Income
PLDT Group: Core Income (Php in billions) Recurring* Higher by P1.5bn or 7% Higher by P0.8bn or 5% Higher Higher Higher Lower Higher Lower Equity Non- Equity Provn non- Fin Lower Lower in Higher cash in for cash Costs Provn Higher Fin. Lower Higher Earn- Misc. Exp Earn- Inc exp – net for Inc EBITDA
Slide 11: PLDT Group: Debt Profile
PLDT Group: Debt Profile Net debt and net debt to EBITDA as of end September 2017 Debt Balance stood at US$2.8bn and 2.19x (US$ in billions) At end September 2017, gross debt amounted to US$3.5bn US$ denominated gross debt now at 21% from 32% at YE16 3.4 3.7 3.5 following the full payment of t
Slide 12: PLDT Group: Network Initiatives
PLDT Group: Network Initiatives Further expanded the reach of PLDT’s home broadband network On-track to achieve approx. 4.0mn fiber homes passed by year-end 2017 Network projects in east and south Metro Manila, Naga added to PLDT’s “Smart Fibr Cities” and Cavite as the first “Smart province”
Slide 13: PLDT Group: Capex
PLDT Group: Capex (Php in billions) Fixed Line Wireless 43.2 42.8 38.1 36.4 34.8 31.2 12.9 10.7 32% (25% in 2016) 28.8 12.0 13.7 11.7 13.7 11.7 30.3 32.1 68% (75% in 2016) 22.1 23.0 26.1 17.2 17.1 2011 2012 2013 2014 2015 2016 2017F % of Capex to total service revenues: 21% 23% 18% 21% 26% 27% < 30%
Slide 14: Business Unit Updates
@PLOT Bsmart Business Unit Updates
Slide 15: Q3 2017 Highlights
Q3 2017 HIGHLIGHTS SERVICE REVENUES In Billions of Pesos ● Contribution of Home and Enterprise, HOME 8.5 our fastest growing segments, comprise 54% of revenues, excluding ENTERPRISE 8.5 International and Voyager. INDIVIDUAL 14.6 ● Combined revenues of Home and INTERNATIONAL 4.1 Enterprise (FIXED: ₱1
Slide 16: Service Revenues Net of Interconnection Cost
Service Revenues Net of Interconnection Cost In Billions of PHP 0.47B 1% 37.99 37.48 35.79 35.45 35.24 35.24 35.71 International Enterprise Home Individual 16
Slide 17: YTD Q3 2017 Highlights: Enterprise Business
YTD Q3 2017 Highlights: Enterprise Business Double-Digit Growth Continuing to Grow Where It Matters Across All Product Lines Service Revenues by Product Category, YTD Sept 2017. (in Billions of Php) 11%, 2.6B DATA & ICT VOICE & SMS 25.3 22.7 15%, 2.05B 6%, 0.52B 16.00 13.95 8.77 9.29 Q3 2016 A Q3 20
Slide 18: YTD Q3 2017 Highlights: Enterprise Business
YTD Q3 2017 Highlights: Enterprise Business Aggressively Covering Our Active Markets The Preferred Innovation Partner PBOAP PLDT Enterprise Launches 1st PLDT, provincial bus operators Cisco Spark to uplift local commute Board in PH Launch of IT-BPM Solutions Suite Paranaque 911 hotline center on Lau
Slide 19: YTD Q3 2017 Highlights: Home Business
YTD Q3 2017 HIGHLIGHTS: HOME Business 12% YTD growth, with both Added 408K Subscriptions Voice and Data growing resulting in 11% YTD growth In Billions of PhP In Millions 24.3B 4.01M 21.7B VOICE 9.2B 3.60M VOICE 6% 12% 11% 8.7B DATA DATA 15.1B 13.0B 16% YTD Q3 YTD Q3 YTD Q3 YTD Q3 2016 2017 2016 201
Slide 20: YTD Q3 2017 Highlights: Home Business – Fiber Infrastructure
YTD Q3 2017 HIGHLIGHTS: HOME Business 1 LEADING IN FIBR INFRASTRUCTURE PLDT Home Rolled out 278K FIBR BROADBAND LINES as of Q3 2017. Now with 165,000 KILOMETERS of Fiber optic cables nationwide. Starting with 2.5M HOMES PASSED YE 2016, we are now well on our way to reach the 4M target by year-end 20
Slide 21: YTD Q3 2017 Highlights: Home Business – Beyond Access Strategy
YTD Q3 2017 HIGHLIGHTS: HOME Business 2 BEYOND ACCESS STRATEGY Kicked off the “Fibrization” program to modernize a total of 1.3M subs on legacy copper network over the next 2 years committing P11B in CAPEX Launched Fibr TV Plan to drive adoption and penetration of Cignal TV among PLDT Home broadband
Slide 22: YTD Q3 2017 Highlights: Home Business – Converged Fixed Wireless
YTD Q3 2017 HIGHLIGHTS: HOME Business 3 CONVERGED FIXED WIRELESS CAPABILITIES OF PLDT AND SMART Now Available in PLDT Stores 22
Slide 23: 2017 Highlights: Individual Business
2017 HIGHLIGHTS: Individual Business 2017 NET SERVICE REVENUE Q3 sustained Q2 levels, net of the impact In Billions of Pesos from one-time deflators -0.25 -2% 14.86 14.61 Q2 Q3 23
Slide 24: YTD 2017 Highlights: Individual Business
YTD 2017 HIGHLIGHTS: Individual Business INCREMENTAL 4,000* BASE STATIONS; IMPROVING 1 CUSTOMER EXPERIENCE September 2017 Update Download Speed: Overall (4G & 3G) Download Speed: 4G 3.39 7.16 Mbps Mbps 4.16 10.55 Mbps Mbps SOURCE: https://opensignal.com/reports/2017/09/philippines/mobile-networks-up
Slide 25: Q3 2017 Highlights: Individual Business – Sunrise LTE
Q3 2017 HIGHLIGHTS: Individual Business SUNRISE: LTE Network, Data Offers and New 2 Campaign 25
Slide 26: Q3 2017 Highlights: Individual Business
Q3 2017 HIGHLIGHTS: Individual Business Aggressive advertising and on-ground campaigning to push 3 enhanced offers, upsell beyond access services and offer latest devices Enhanced Beyond Access New Devices Offers 26
Slide 27: Voyager: Making Payments Accessible for All with PayMaya
Voyager: Making Payments Accessible for All with PayMaya HIGHLIGHTS 68 Enterprise Accounts Leading non-bank payments company in Ph, offering the widest range of payment services from issuance of e-wallet accounts to consumers, payment solutions for merchants, and remittance services PayMaya QR deplo
Slide 28: Voyager: Most extensive digital lending footprint with FINTQ
Voyager: Most extensive digital lending footprint with FINTQ HIGHLIGHTS Leader and pioneer in FinTech, RegTech, InsurTech services, enabling partner banks and other financial institutions expand their reach With Eastwest Bank With Liga ng mga Barangay through digital and mobile technologies. Over 70
Slide 29: PLDT Group: Guidance for 2017
PLDT Group: Guidance for 2017 EBITDA: P68bn Capex: P38bn To grow by P6.8bn from P61.2bn in 2016 Updated from original guidance of P46bn impact of P4.6bn in subsidies and provisions in 2016 Includes carry-over of capex started in 2016 which will not recur in 2017 Additional P15bn of on-goin
Slide 30: Other Details
@PLOT Bsmart Other Details
Slide 31: PLDT Group: Service Revenues (Fixed Line and Wireless)
PLDT Group: Service Revenues (by Product Type)* (Php in billions) Fixed Line* 9M17 vs 9M16 3Q17 vs 3Q16 Higher by P5.1bn or 11% Higher by P1.8bn or 11% Data and LEC and International and Data and LEC and International and Broadband Others domestic voice Broadband Others domestic voice +0.9 -0.6 +1.6
Slide 32: PLDT Group: Home Service Revenues
PLDT Group: Home Service Revenues* Home Service Revenues (Php i n mi l l i ons ) 9M16 9M17 Data/Broadband 12,957 15,048 (Php in billions) Higher by P2.6bn or 12% LEC 8,082 8,671 Domestic Voice 608 562 Fixed Line Others 15 15 Data/ Domestic Total 21,662 24,296 LEC Voice broadband +7% -8% +16% +2.1 +0
Slide 33: PLDT Group: Individual Service Revenues
PLDT Group: Individual Service Revenues* Individual (Php in billions) Lower by P7.0bn or 14% Service Revenues (Php i n mi l l i ons ) 9M16 9M17 Mobile Data 16,969 17,391 Mobile Domestic Voice 16,895 14,129 Mobile SMS 17,128 12,376 Mobile data SMS domestic +2% voice Others 278 328 -28% Others +0.4 -4
Slide 34: PLDT Group: Enterprise Service Revenues
PLDT Group: Enterprise Service Revenues* (Php in billions) Higher by P2.6bn or 11% Fixed Mobile Fixed ILD/NLD Mobile domestic domestic and Mobile Corp. Data Data voice voice ILD SMS Others +17% +1% +51% +2% -2% -3% +30% +2.0 --- +0.4 +0.1 --- --- +0.1 25.3 22.7 Data and broadband Voice revenues high
Slide 35: PLDT Group: Consolidated Data and Broadband
PLDT Group: Consolidated Data and Broadband* (Php in billions) Mobile Data Corp. Data and Data Center Home Broadband 9M17 vs 9M16 +12% +2.0 +4.5 +1.7 +16% +10% +2.0 +16% 14.5 48.7 +3% +3% +3% +2% +4% +0.4 14.9 +0.5 +0.4 +0.5 15.9 +0.3 16.1 +0.5 16.7 +2% 14.9 14.9 15.3 14.4 4.6 4.7 4.9 5.3 19.2 4.1 4
Slide 36: Appendix
@PLOT Bsmart Appendix
Slide 37: Subscriber Base: Mobile
Subscriber Base: Mobile Mobile Subscribers (1) by Category: Sept-17 (2) Jun-17 (2) Mar-17 Dec-16 Sept-16 Jun-16 Mar-16 Mobile Subscriber Base (1) Prepaid (2) 55,651,398 56,083,707 60,421,068 59,952,941 62,259,067 64,701,367 64,651,175 Smart Prepaid 20,537,068 20,587,687 21,933,462 21,643,963 23,560,
Slide 38: Subscriber Base: Broadband and Fixed Line
Subscriber Base: Broadband and Fixed Line Broadband Subscribers Sept-17 Jun-17 Mar-17 Dec-16 Sept-16 Jun-16 Mar-16 BROADBAND Wireless Home Broadband 251,897 257,187 264,227 270,203 271,572 265,473 248,675 Fixed Line Broadband (1) 1,651,515 1,575,914 1,506,578 1,450,550 1,407,122 1,347,422 1,296,402
Slide 39: 9M2017: Consolidated Financial Highlights
9M2017: Consolidated Financial Highlights 9M2017 9M2016 % Change (Unaudited, Php in millions) Wireless Fixed Line Others Consolidated Consolidated Total Revenues 70,271 58,075 8 119,066 125,386 (5%) Service Revenues (1) 66,837 55,466 8 113,029 118,932 (5%) (2) Cash Operating Expenses 36,295 30,950 4
Slide 40: Underlying Core Income
Underlying Core Income 2017 2016 (Unaudited, Php in millions) 1Q 2Q 3Q 9M 1Q 2Q 3Q 9M 4Q FY Core Income 5,329 12,098 5,762 23,189 7,211 10,489 4,036 21,736 6,121 27,857 Core Income Adjustments One-Time Provisions and Subsidies - - - - 1,011 2,034 1,605 4,650 - 4,650 Manpower Reduction Program (MRP)
Slide 41: Reconciliation of Core and Reported net income
Reconciliation of Core and Reported net income 9M2017 9M2016 % Change (Unaudited, Php in millions) Wireless Fixed Line Others Consolidated Consolidated Net Income (Losses) Attributable to Equity Holders of PLDT 4,891 8,188 9,038 21,878 15,865 38% Add (Deduct): Foreign Exchange Losses, Net 468 76 243
Slide 42: Consolidated Service Revenues
Consolidated Service Revenues* 2017 2016 (Unaudited, Php in millions) 1Q 2Q 3Q 9M 1Q 2Q 3Q 9M 4Q FY Fixed Line 15,556 15,620 15,979 47,155 14,287 14,320 14,446 43,053 15,033 58,086 LEC 4,553 4,623 4,695 13,871 4,333 4,384 4,479 13,196 4,499 17,695 Fixed Line Voice - International 970 859 800 2,629 1
Slide 43: Consolidated Service Revenues and EBITDA
Consolidated Service Revenues and EBITDA 2017 2016 (Unaudited, Php in millions) 1Q 2Q 3Q 9M 1Q 2Q 3Q 9M 4Q FY Data/Broadband/Digital Platforms 16,221 16,608 16,948 49,777 14,525 14,975 15,170 44,670 15,748 60,418 Mobile Data 6,235 6,614 6,493 19,342 6,063 6,444 6,375 18,882 6,333 25,215 Mobile Inter
Slide 44: Wireless Service Revenues and EBITDA
Wireless Service Revenues and EBITDA 2017 2016 (Unaudited, Php in millions) 1Q 2Q 3Q 9M 1Q 2Q 3Q 9M 4Q FY Data/Broadband/Digital Platforms 7,281 7,627 7,555 22,463 6,944 7,270 7,375 21,589 7,428 29,017 Mobile Data 6,308 6,691 6,566 19,565 6,127 6,536 6,445 19,108 6,409 25,517 Mobile Internet 4,612 5
Slide 45: Fixed Line Service Revenues and EBITDA
Fixed Line Service Revenues and EBITDA 2017 2016 (Unaudited, Php in millions) 1Q 2Q 3Q 9M 1Q 2Q 3Q 9M 4Q FY Data/Broadband 10,574 10,885 11,111 32,570 9,110 9,216 9,457 27,783 9,928 37,711 Home Broadband 4,134 4,361 4,663 13,158 3,434 3,655 3,835 10,924 3,972 14,896 Corp. Data and Other Network Serv
Slide 46: Expenses
Expenses 9M2017 9M2016 % Change (Unaudited, Php in millions) Wireless Fixed Line Others Consolidated Consolidated Operating Expenses Compensation and Employee Benefits (1) 5,679 12,202 - 17,870 15,078 19% Repairs and Maintenance 6,045 4,027 - 9,555 10,905 (12%) Selling and Promotions 3,364 1,327 - 4
Slide 47: Other Income (expenses)
Other Income (expenses) 9M2017 9M2016 % Change (Unaudited, Php in millions) Wireless Fixed Line Others Consolidated Consolidated Equity Share in Net Earnings (Losses) of Associates and Joint Ventures Beacon - - 887 887 1,829 (52%) Vega - - (246) (246) (540) (54%) Others (102) 145 2,050 2,093 188 1,0
Slide 48: ARPU
ARPU Mobile ARPU, Net(1) : 2017 2016 1Q 2Q 3Q 1Q 2Q 3Q 4Q Smart Postpaid 965 985 975 938 951 946 970 Smart Prepaid (2) 104 109 108 112 110 102 104 TNT (2) 71 77 74 80 77 71 75 Sun Postpaid 413 412 421 475 453 402 418 Sun Prepaid (2) 78 82 82 80 81 84 85 (1) Includes Mobile Broadband subscribers (2)
Slide 49: Earnings Per Share (EPS)
Earnings Per Share (EPS) 9M2017 9M2016 (Unaudited, Php in millions except EPS (in Php) and Shares (in mn)) Basic Diluted Basic Diluted Net Income Attributable to Equity Holders of PLDT 21,878 21,878 15,865 15,865 Dividends on Preferred Shares (44) (44) (45) (45) Net Income for the Period Attributabl
Slide 50: Balance Sheet
Balance Sheet Consolidated September 30, 2017 December 31, 2016 (Php in millions) (unaudited) (audited) Total Assets 452,392 475,119 Nominal Value of Total Long-Term Debt 175,457 185,663 in US$ $3,452 $3,730 Less: Unamortized Debt Discount 575 631 Total Long-Term Debt 174,882 185,032 Cash and Short-
Slide 51: Debt Profile
Debt Profile (US$ in millions) 2012 2013 2014 2015 2016 9M2017 Debt Balance 2,851 2,353 2,920 3,429 3,730 3,452 Cash and Short-Term Investments 919 735 610 1,016 833 670 Net Debt 1,932 1,618 2,310 2,413 2,897 2,782 Interest-Bearing liabilities December 31, September 30, 2017 2016 Unamortized Debt Ch
Slide 52: Foreign Exchange Risk
Foreign Exchange Risk Forex Impact on Core Income Forex Impact of B/S Revaluation Forex sensitivity for every P1 change Forex sensitivity for every P1 change on B/S (in US$ millions) Conso - net of Elim Conso Revaluation (in US$ millions) US$ Revenues* 361.9 Debt (net of LT hedges & ST Forwards/opti
Slide 53: Forward-looking statements
Except for historical financial and operating data and other information in respect of historical matters, the statements contained herein are “forward-looking statements” within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, and Section 21E of the U.S. Securities Exchang
Slide 54: PLDT Smart
A PLDT ASmart