PLDT, Inc. · PSE:TEL
PLDT — Q1 2015 Earnings Presentation
39 slides from PLDT's earnings presentation, May 5, 2015
Slide 1: First Quarter 2015 Financial and Operating Results
First Quarter 2015 Financial and Operating Results Philippine Long Distance Telephone Company (PLDT) 5 May 2015
Slide 2: PLDT Group: 1Q 2015 Financial Highlights
PLDT Group: 1Q 2015 Financial Highlights Revenues Wireless Fixed Line Revenues Revenues P42.6bn 0% P29.2bn P16.7bn P0.0bn -2% +3% (P0.6bn) P0.4bn Service Revenues Wireless Fixed Line Service Revenues Service Revenues P40.5bn -2% P27.9bn P15.9bn -4% +1% P0.7bn (P1.1bn) P0.2bn EBITDA EBITDA Margin P19
Slide 3: PLDT Group: Service Revenues and EBITDA
PLDT Group: Service Revenues and EBITDA EBITDA EBITDA and and EBITDAMargin EBITDA margin Consolidated Service Revenues (Php in millions) P40.5bn a -2% P19.3bn a -2% (P0.7bn) (P0.4bn) due to declines in legacy and traditional businesses EBITDA Margin: 48% Growing Mature Declining P0.4bn decline in EB
Slide 4: PLDT Group: Reported and Core Net Income
PLDT Group: Reported and Core Net Income EBITDA andNet Reported EBITDA margin Income Core Net Income (Php in millions) P9.3bn a -5% P9.4bn 0% (P0.5bn) P0.0bn 2015 Core Income Guidance: P35.0bn -5% 9.8 9.3 1Q14 1Q15 1Q14 1Q15 Core net income for 1Q15 of P9.3bn was lower by Reported net income for
Slide 5: PLDT Group: Fixed line segment
PLDT Group: Fixed line segment Service Revenues Subscribers P14.3bn* a +4% 2.2mn a 6% P0.5bn 0.1mn * net of interconnection costs due to higher data/broadband and domestic voice revenues +1% or net adds of over 26,000 from YE14 (Php in billions) Growing Mature Declining 1.1mn have broadband subscr
Slide 6: PLDT Group: Wireless segment
PLDT Group: Wireless segment Service Revenues Subscribers P27.9bn a -4% 73.0mn 0% P1.1bn due to declines in SMS, voice, and legacy revenues stable vs FY14 (Php in billions) Growing Mature Declining Cellular Revenues and Subscribers Mobile Internet Others Cellular Voice - International Revenues % Y-o
Slide 7: PLDT Group: Data and broadband
PLDT Group: Data and broadband Revenues Subscribers P11.2bn a +11% 4.5mn a +27% P1.1bn 1.0mn Representing 27% of consolidated service revenues +11% or over 438,000 from YE14 (Php in billions) (in thousands) Sun Broadband Smart Broadband Fixed Broadband +11% +11% +3% 4,529 Y-o-Y Q-o-Q 4,090 10.6 10.9
Slide 8: PLDT Group: Debt Profile
PLDT Group: Debt Profile Debt Balance Debt Maturities (US$ in billions) (as of March 31, 2015, US$ in millions) Total: US$3,036mn 2015 2016 2017 2018 2019 2020 to 2024 Net Debt/EBITDA Debt maturities to total debt 0.9x 1.05x 0.9x 1.35x 1.16x 9% 11% 22% 6% 12% 40% Net debt and net debt to EBITDA at
Slide 9: PLDT Group: Free Cash Flow and Capex
PLDT Group: Free Cash Flow and Capex Free Cash Flow Capex P14.6bn a +36% P3.0bn a +33% P3.8bn P0.9bn due to changes in: 2015 Capex Guidance: P39.0bn (Php in millions) Expansion of 3G and 4G access networks All IP 3G and extension of total fiber assets* to 114,000 +5,139 +909 14,614 kms by YE15 1
Slide 10: PLDT's digital building blocks: Preparing for the future
PLDT’s digital building blocks: Preparing for the future Customer-centric changes Evolution of the telco subscriber into a digital consumer requires viewing the customer through a different lens in order to identify new ways of serving the customer With these changes come new opportunities for t
Slide 11: Strategic enabler for digital enterprise transformation
Strategic enabler for digital enterprise transformation Pioneer in Big Data Platform Leadership in Enabling Infrastructure and Enterprise Insight Solutions SCALABLE COMPUTE MODEL Big Data Platform as a Service Big Data Insight Solutions • Location-Based Insights such as route planning and site s
Slide 12: Voyager, Smart e-money: Traction in local and global markets
Voyager, Smart e-money: Traction in local and global markets • P250bn throughput • Smart e-Money gateway used by • Biggest domestic remittance Zalora to process credit card purchases using Mastercard • Product allows customers to access platform • 70% of mobile Internet users • Major partnership wit
Slide 13: Focused digital effort on the consumer
Focused digital effort on the consumer PLDT uniquely positioned to offer a unified customer experience: CONNECTED Individual and CONNECTED HOME Free Data as Hook Data Bundling FMCG Partnerships Data bundling and FMCG partnerships to deepen customer engagement by Cignal on Telpad: select BEST T
Slide 14: Shaping the digital multi-media landscape
Shaping the digital multi-media landscape Cignal TV: the Philippines’ premier and largest pay TV provider in the country At the end of 1Q15, Cignal TV had over 868,000 subscribers, maintaining lead over the 20-year incumbent 28% increase in subscribers vis-à-vis 1Q14 and a 3% rise in subscribe
Slide 15: Investments in adjacent digital spaces
Investments in adjacent digital spaces • €333mn (€33/share, pre-IPO) in August 2014 • IPO price of €42.50/share in October 2014 • PLDT ownership stake: 6.1% • Rocket‟s mission is to become the world's largest Internet platform outside of the US and China, with on-line businesses in over 100 countrie
Slide 16: PLDT's digital building blocks: Preparing for the future
PLDT’s digital building blocks: Preparing for the future People In order to provide the digital consumer with a unified experience, leadership for the entire Consumer business to be assumed by: Ariel Fermin, who spearheaded the growth of the PLDT HOME business through an aggressive broadband campa
Slide 17: PLDT Group Guidance for 2015
PLDT Group Guidance for 2015 Core Net Income P35.0bn (P2.4bn or 6.4% lower than 2014) CAPEX P39.0bn (approx. 23% of service revenues) Dividend Pay-out Policy: Capital Management 75% of Core EPS + “look-back” approach 17
Slide 18: Other Details
Other Details CSPLoT sMarr sun
Slide 19: PLDT Group: 76.4mn combined subscriber base
PLDT Group: 76.4mn combined subscriber base Cellular Subscribers Broadband Subscribers 69.6mn a -1% 4.5mn a +27% (0.9mn) 1.0mn stable vs. YE14 +11% or net adds of over 438,000 from YE14 Postpaid Prepaid vs FY14 vs 1Q14 2.9mn 66.7mn Wireless broadband +14% +33% vs FY14 +5% -1% 3.4mn +18% -2% Fixed vs
Slide 20: MERALCO
MERALCO MERALCO’s consolidated revenues grew by P7.5bn or 14% to P62.6bn in 1Q15 mainly Energy Sales Volumes and Revenues due to: (in „000 GWh and Php in billions) Higher electricity sales by 2% P9.3bn downward adjustment on MERALCO‟s purchases from the WESM billed by Energy Sales Volumes Reve
Slide 21: PLDT Group: Appendix
PLDT Group: Appendix Spor starr sun 21
Slide 22: Subscriber Data: Cellular
Subscriber Data: Cellular Cellular Subscribers by category: 1Q15 vs 1Q14 Net Adds Mar- 14 Dec- 14 Sept-14 Jun-14 Mar-14 Net Adds % 1Q15 % CELLULAR Prepaid 66,721,243 67,091,612 66,374,421 66,339,954 68,030,812 (1,309,569) -2% (370,369) -1% Smart Prepaid 24,819,813 24,877,144 24,735,917 24,610,726 24
Slide 23: Subscriber Data: Broadband
Subscriber Data: Broadband 1Q15 vs 1Q14 Net Adds Mar-15 Dec-14 Sept-14 Jun-14 Mar-14 Net Adds % 1Q15 % BROADBAND Wireless Broadband 3,391,440 2,986,146 2,694,840 2,598,920 2,551,882 839,558 33% 405,294 14% Smart Broadband 2,613,672 2,309,366 2,103,587 2,052,107 2,003,433 610,239 30% 304,306 13% Prep
Slide 24: 1Q2015: Consolidated Financial Highlights
1Q2015: Consolidated Financial Highlights 1Q2015 1Q2014 Consolidated Consolidated % Change Wireless Fixed Line Others (Php in millions) (unaudited) (unaudited) Service Revenues 27,886 15,936 - 40,548 41,238 -2% Cash operating expenses 12,775 9,590 2 18,701 18,756 - Depreciation and amortization 3,73
Slide 25: Reconciliation of Core and Reported Net Income
Reconciliation of Core and Reported Net Income 1Q2015 1Q2014 Consolidated Consolidated % Change Wireless Fixed Line Others (in million pesos) (unaudited) (unaudited) Net Income attributable to equity holder of PLDT 6,652 1,794 941 9,387 9,379 - Add (deduct): Foreign exchange losses (gains), net (49)
Slide 26: Consolidated Service Revenues
Consolidated Service Revenues 2015 2014 % Change 1Q15 vs 1Q 1Q 2Q 3Q 4Q FY (Php in billions) 1Q14 SMS and VAS 10.2 10.7 10.5 9.9 10.3 41.4 -5% Voice - Domestic 13.9 13.9 14.3 14.1 14.5 56.9 - Voice - International 4.3 5.5 5.2 4.8 5.2 20.6 -22% Non-SMS data 11.2 10.1 10.3 10.6 10.9 41.9 11% Others 1.
Slide 27: Expenses
Expenses 1Q2015 1Q2014 Consolidated Consolidated % Change Wireless Fixed Line Others (Php in millions) (unaudited) (unaudited) Operating expenses Compensation and employee benefits 1,781 3,204 - 4,981 5,160 -3% Repairs and maintenance 2,194 1,617 - 3,667 3,484 5% Selling and promotions 1,550 467 - 2
Slide 28: Other Income (Expenses)
Other Income (Expenses) 1Q2015 1Q2014 Consolidated Consolidated % Change Wireless Fixed Line Others (Php in millions) (unaudited) (unaudited) Equity share in net earnings of associates and joint ventures (9) (2) 664 653 716 -9% Interest income 89 127 23 184 192 -4% Gains (losses) on derivative finan
Slide 29: Cellular and Broadband Net ARPU
Cellular and Broadband Net ARPU Cellular Net ARPU 2015 2014 1Q 1Q 2Q 3Q 4Q Smart Postpaid 1,039 1,086 1,074 1,068 1,084 Smart Prepaid 118 132 134 124 125 Talk 'N Text 85 87 89 87 89 Sun Cellular Prepaid 63 67 66 64 65 Sun Cellular Postpaid 449 476 467 469 497 Cellular Prepaid and Postpaid blended Ne
Slide 30: Historical Consolidated: Service Revenues and EBITDA
Historical Consolidated: Service Revenues and EBITDA 2015 2014 (Php in millions) 1Q 1Q 2Q 3Q 4Q FY Fixed line 13,034 12,720 12,635 12,773 13,360 51,488 Local exchange 4,172 4,087 4,107 4,104 4,189 16,487 International long distance 1,311 1,679 1,603 1,483 1,769 6,534 National long distance 923 1,006
Slide 31: Historical Wireless: Service Revenues & EBITDA
Historical Wireless: Service Revenues & EBITDA 2015 2014 (Php in millions) 1Q 1Q 2Q 3Q 4Q FY Wireless Gross Service Revenues Cellular services 25,143 26,171 26,284 25,233 26,148 103,836 Cellular voice 11,914 12,811 12,946 12,382 12,926 51,065 Domestic 8,919 8,968 9,320 9,064 9,528 36,880 Internation
Slide 32: Historical Fixed Line: Service Revenues and EBITDA
Historical Fixed Line: Service Revenues and EBITDA 2015 2014 (Php in millions) 1Q 1Q 2Q 3Q 4Q FY Fixed Line Gross Service Revenues Local exchange 4,196 4,111 4,132 4,131 4,213 16,587 International long distance 2,255 2,859 2,843 2,696 3,006 11,404 National long distance 1,018 1,099 1,100 1,128 1,038
Slide 33: Earnings Per Share
Earnings Per Share 1Q2015 1Q2014 (unaudited) (unaudited) Basic Diluted Basic Diluted Net income attributable to equity holders of PLDT 9,387 9,387 9,379 9,379 Dividends on preferred shares (14) (14) (14) (14) Net income for the period attributable to common equity holders of PLDT 9,373 9,373 9,365 9
Slide 34: Cash Flows
Cash Flows 1Q2015 1Q2014 Consolidated Consolidated % Change Wireless Fixed Line Others (Php in millions) (unaudited) (unaudited) Net cash from operations 11,295 8,964 (3,012) 16,146 17,341 -7% Add(Deduct): Capital expenditures (1,759) (1,195) - (2,954) (2,221) 33% Interest, net (213) (1,119) (1) (1,
Slide 35: Balance Sheet
Balance Sheet Consolidated March 31, 2015 December 31, 2014 (Php in millions) (unaudited) (audited) Total Assets 440,531 436,295 Nominal Value of Total Long-term Debt 135,773 130,634 in US$ $3,036 $2,920 Less: Unamortized Debt Discount 568 511 Total Long-term Debt 135,205 130,123 Cash and short-term
Slide 36: Debt Profile
Debt Profile (US$ in millions) 2011 2012 2013 2014 1Q2015 Debt Balance 2,719 2,851 2,353 2,920 3,036 Cash and short-term investments 1,061 919 735 610 1,051 Net Debt 1,658 1,932 1,618 2,310 1,985 Interest-bearing Liabilities March 31, 2015 December 31, (unaudited) 2014 Unamortized Debt Change Carryi
Slide 37: Foreign Exchange Risk
Foreign Exchange Risk Forex Impact on Core Income Forex Impact of B/S Revaluation Forex Impact on Derivatives Forex sensitivity for every P1 change (in US$ millions) Forex sensitivity for every P1 change on B/S Revaluation (in US$ millions) Conso Conso - net of Elim P1 movement in the Debt (net of L
Slide 38: 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 39: LIVE MORE
LIVE MORE UN . .? ee y PLDT SMART \Z