Globe Telecom Inc. · PSE:GLO
Globe Telecom — H1 2006 Earnings Presentation
13 slides from Globe Telecom's earnings presentation, Aug 2, 2006
Slide 1: Globe Telecom 1H 2006 Investors' Briefing; Q2 Highlights
Globe Telecom Inc. 1H 2006 Investors’ Briefing August 2, 2006 Q2 Highlights – Sustained growth despite intensifying competition ! Continued SIM and top-line growth – Q2 net adds of 0.7Mn (+5%), in line with Q1 SIM growth of +6% – Q2 revenues 2nd best quarter ever, following Q4 2005 peak – 1st half r
Slide 2: Upward trajectory in wireless SIM base since Q4 2005
Upward trajectory in wireless SIM base since Q4 2005 Total SIM Base (in ‘000) 16,000 • SIM base rose by 13,627 13,894 5% quarter on quarter 14,000 13,197 12,409 12,404 to 13.9Mn, and 12% 12,000 since the start of the year 10,000 • Year-on-year, SIM base 8,000 grew by 2% from Q2 6,000 2005 level (whi
Slide 3: YoY improvements in ARPU and SAC
YoY improvements in ARPU and SAC Net ARPU (in P) Prepaid Postpaid 500 2,000 • Blended ARPUs up 6% YoY, with data and international 1,722 1,679 1,674 1,550 1,588 400 1,600 services driving revenue growth 348 328 305 293 288 293 311 300 274 1,200 255 250 232 221 216 183 • Blended SAC down 40% YoY as a
Slide 4: Continuing strength in financial performance
Continuing strength in financial performance Consolidated (In Php Million) 1H06 1H05 YoY Growth (As restated) Service Revenues 28, 447 26, 728 6% EBITDA 18,944 15, 432 23% EBIT 10, 943 7, 867 39% Net Income 5, 759 4, 214 37% Net Income before Fx & MTM gains & losses 6, 144 3, 995 54% EBITDA Margin 6
Slide 5: Offers designed for specific customer and usage profiles
… and offers designed for specific customer and usage profiles TM TODO TEXT for heavy SMS users GHP Todo Tipid IDD for calls to various destinations Co-branded IDD Phone Cards Key Q2 initiatives – Lowering consumer entry costs further to reach a broader market Globelines Postpaid Plus with MSF of Ph
Slide 6: Key Q2 initiatives – Continue to develop the broadband market
Key Q2 initiatives – Continue to develop the broadband market either through fixed networks … • Expanded Globelines Broadband coverage • Developed specific offerings for our targeted subscribers, aimed at providing broadband access networks to suit every need and price point … or through wireless br
Slide 7: Key Q2 Initiatives – Embracing new technologies for affordable IDD services
Key Q2 Initiatives – Embracing new technologies to provide even more affordable IDD services … GlobeQuest WebPhone – Another first in the country; allows users to take advantage of Globe1 IDD rate of P2.50 and P4.50 to selected countries. G-WebCall uses VoIP technology to allow Internet users anywhe
Slide 8: Key initiatives – Service innovations for corporate and enterprise markets
Key initiatives – Rich stream of service innovations for the corporate & enterprise markets • First in the country to offer MPLS (multi- protocol label switching) and IP as its core technologies, allowing for scalability, resiliency, quality of service provisioning, and single network management • G
Slide 9: Maintaining a good standing in the financial and business community
Maintaining a good standing in the financial and business community … • Globe awarded as the country’s Mobile Operator of the Year at the Asian Mobile News Awards 2006 held in Singapore • Globe chosen as one of the top 5 companies in the Philippines on Corporate Governance, based on independent surv
Slide 10: Financial Performance
Financial Performance Consolidated Financial Highlights: Strong 1H financial performance … QoQ YoY In Php Mn 2Q06 1Q06 % Change 1H06 1H05 % Change Service Revenues 14,260 14,187 1% 28,447 26,728 6% Operating Expenses & Subsidy (5,018) (4,485) 12% (9,503) (11,296) -16% EBITDA 9,242 9,702 -5% 18,944 1
Slide 11: Growth in wireless and wireline service revenues
Growth in wireless and wireline service revenues Quarterly Service Revenues by Segment – In Php Mn • 1st half wireless service revenues up 7% YoY, Wireline Wireless while wireline sales up 16,000 13,454 14,187 14,260 3%, for a combined 6% 14,000 13,274 growth 12,000 10,000 • Wireless growth driven 8
Slide 12: Total expenses down 7% year-on-year
Total expenses down 7% year-on-year QoQ YoY In Php Mn 2Q06 1Q06 % Change 1H06 1H05 % Change Subsidy 405 376 8% 781 1,483 -47% Selling, Advertising, & Promotions 958 628 53% 1,586 2,236 -29% Staff Costs 878 803 9% 1,681 1,753 -4% Utilities, Supplies, Other Admin 507 492 3% 999 964 4% Rent 563 490 15%
Slide 13: Conservative leverage profile; Thank You
Conservative leverage profile with balance sheet ratios well within debt covenants Gross Debt / EBITDA* (x) Gross Debt / Equity* (x) 2.00 3.0 Maximum = 2:1 Maximum = 3:1 1.60 1.49 0.96 0.96 1.20 0.83 0.0 0.00 2004 2005 1H06 2004 2005 1H06 * Historical ratios were restated THANK YOU 13