PLDT, Inc. · PSE:TEL
PLDT — 9M 2015 Earnings Presentation
39 slides from PLDT's earnings presentation, Nov 3, 2015
Slide 1: Nine Months 2015 Financial and Operating Results
Philippine Long Distance Telephone Company (PLDT) Nine Months 2015 Financial and Operating Results 3 November 2015
Slide 2: 3Q15 vs 3Q14 Financial Highlights
PLDT Group: 3Q15 vs 3Q14 Financial Highlights Revenues Wireless Fixed Line Revenues Revenues P42.7bn +2% P28.7bn P17.2bn P0.8bn -1% +5% (P0.3bn) P0.8bn Service Revenues Wireless Fixed Line Service Revenues Service Revenues P40.8bn +1% P27.6bn P16.4bn P0.4bn -1% +3% (P0.4bn) P0.5bn Service Revenues (
Slide 3: 9M15 vs 9M14 Financial Highlights
PLDT Group: 9M15 vs 9M14 Financial Highlights Revenues Wireless Fixed Line Revenues Revenues P127.9bn 0% P86.8bn P50.9bn P0.6bn -2% +4% (P2.1bn) P1.8bn Service Revenues Wireless Fixed Line Service Revenues Service Revenues P122.0bn -1% P83.2bn P48.6bn (P1.0bn) -3% +2% (P2.9bn) P1.0bn Service Revenue
Slide 4: Snapshot at 9M15
PLDT Group: Snapshot at 9M15 In 1H15, we said that data would be the main growth engine for PLDT and the major focus of the efforts of our Consumer and Enterprise businesses We outlined our strategy of how we would become the consumer’s preferred digital services provider Offer the consumer a
Slide 5: Positive Trends: Service Revenues (ex-ILD/NLD)
Positive Trends: Service Revenues (ex-ILD/NLD) Quarter-on-Quarter Wireless +1% +3% Fixed Line* +2% +1% +2% -2% - +1% +4% 25.5 -3% 25.5 +2% +1% 13.2 25.1 12.6 12.9 25.0 12.5 24.9 24.9 11.9 12.1 24.7 11.8 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 Year-on-Year +9% +1% 2014 +
Slide 6: On track in executing on the strategy: network build-out
PLDT Group: On track in executing on the strategy Build out of network capacity, coverage, resiliency on-going PhP in billions P203.0bn Wireless Fixed Up to 43.0 36.4 +46% 28.8 31.2 34.8 23.3 28.8 13.0 16.0 5.6 13.7 11.7 11.3 13.7 11.7 7.1 30.0 17.7 17.0 17.2 22.1 17.1 23.0 8.9 2010 2011 2012 2013
Slide 7: On track in executing on the strategy: consumer offers
PLDT Group: On track in executing on the strategy Continuous expansion of our fixed and wireless offers to the consumer Blink 7
Slide 8: Consumer Group: 3Q15 Highlights
Consumer Group: 3Q15 Highlights • PLDT Home strengthens leadership in Connected Home with digital services. • SMART posts all-time high in broadband and mobile internet growth. HOME • PLDT-SMART leads digital innovation with strategic partnerships to deliver entertainment, peace of mind, and urban c
Slide 9: On track in executing on the strategy: Enterprise Group
PLDT Group: On track in executing on the strategy Enterprise Group accelerating market leadership by digitally-enabling businesses 9
Slide 10: On track in executing on the strategy: new revenue sources
PLDT Group: On track in executing on the strategy Future sources of additional revenues, and platforms to enhance PLDT’s value proposition continue to be pursued via innovations at Voyager… … and investments in adjacent spaces by PLDT Capital Phunwhare (mobile delivery platform that creates, mar
Slide 11: Outlook
Outlook Realities Drag from toll businesses: ILD/NLD (P3.4bn in 9M15; P4-5bn annualized) Partly exacerbated by our efforts to grow our data businesses Impact likely to moderate once data contributes at least 40% to total revenues Competition PLDT Group to continue to focus on engaging th
Slide 12: Group Guidance for 2015
PLDT Group Guidance for 2015 P35.0bn Core Net Income (P2.4bn or 6.4% lower than 2014) Up to P43bn CAPEX (approx. up to 27% of service revenues) Capital Dividend Pay-out Policy: Management 75% of Core EPS + “look-back” approach 12
Slide 13: Details
Details &/PLDT SMART ‘sun
Slide 14: Service Revenues and EBITDA
PLDT Group: Service Revenues and EBITDA EBITDA EBITDA andEBITDA and EBITDAMarginmargin Consolidated Service Revenues (Php in millions) P122.0bn a -1% P54.1bn -5% (P1.0bn) (P2.9bn) Excluding ILD/NLD revenues, up by 2% or P2.4bn at P107.0bn EBITDA Margin: 44% Growing Mature Declining P2.9bn decline in
Slide 15: Core and Reported Net Income
PLDT Group: Core and Reported Net Income Core Net Income EBITDA andNet Reported EBITDA margin Income (Php in millions) P27.1bn a -5% P25.3bn -9% (P1.5bn) (P2.6bn) 2015 Core Income Guidance: P35.0bn Includes impact of forex and derivative losses of P1.3bn -17% -5% -7% -9% -29% -16% 9M14 9M15 3Q14 2Q1
Slide 16: Debt Profile
PLDT Group: Debt Profile Debt Balance Debt Maturities (US$ in billions) (US$ in millions, as of September 30, 2015) Total: US$3,228mn 2015 2016 2017 2018 2019 2020 to 2024 Net Debt/EBITDA Debt maturities to total debt 0.9x 1.05x 0.9x 1.35x 1.57x 2% 11% 21% 9% 12% 45% Net debt and net debt to EBITD
Slide 17: Free Cash Flow and Capex
PLDT Group: Free Cash Flow and Capex Free Cash Flow Capex P23.9bn 0% P23.3bn a +46% (P0.1bn) P7.3bn FCF affected by the following changes: 2015 Revised Capex Guidance: Up to P43bn from P39bn (Php in billions) Investments focused on improving network quality and customer experience, provisioning of
Slide 18: Data and broadband
PLDT Group: Data and broadband Revenues Subscribers P35.7bn a +15% 5.0mn +33% P4.6bn 1.3mn Represents 29% of consolidated service revenues +23% or over 922,000 from YE14 (Php in billions) (in thousands) +23% +19% +15% 5,014 vs YE14 4,092 31.0 35.7 Y-o-Y +7% 3,263 3,433 +32% Y-o-Y 2,928 +14% 10.6 11.
Slide 19: Fixed line segment
PLDT Group: Fixed line segment Service Revenues Subscribers P43.7bn* 5% 2.3mn +5% P2.2bn 0.1mn * net of interconnection costs Excluding ILD/NLD revenues, up by P3.0bn or 8% at P38.7bn +4% or net adds of over 78,000 from YE14 (Php in billions) Growing Mature Declining Over 1.2mn or 54% of fixed lin
Slide 20: Wireless segment
PLDT Group: Wireless segment Service Revenues Subscribers P83.2bn a -3% 70.8mn -1% (P2.9bn) (933K) Excluding ILD revenues, lower by 1% or P0.5bn at P74.8bn Lower by 3% vs YE14 (Php in billions) Mature Declining Cellular Revenues and Subscribers Growing Revenues % Y-o-Y Subscribers % Y-o-Y Voyager Ce
Slide 21: Appendix
PLDT Group: Appendix Spor starr sun 21
Slide 22: Subscriber Data: Cellular
Subscriber Data: Cellular Cellular Subscribers by category: 9M15 vs 9M14 9M15 vs FY14 Net Adds Sept-15 Jun-15 Mar-15 Dec-14 Sept-14 Jun-14 Net Adds % Net Adds % 1Q15 % 2Q15 % 3Q15 % CELLULAR Prepaid 64,082,775 65,843,593 66,721,243 67,091,612 66,374,421 66,339,954 (2,291,646) -3% (3,008,837) -4% (37
Slide 23: Subscriber Data: Broadband
Subscriber Data: Broadband 9M15 vs 9M14 9M15 vs FY14 Net Adds Sept-15 Jun-15 Mar-15 Dec-14 Sept-14 Jun-14 Net Adds % Net Adds % 1Q15 % 2Q15 % 3Q15 % BROADBAND Wireless Broadband 3,789,654 3,676,164 3,391,440 2,986,146 2,694,840 2,598,920 1,094,814 41% 803,508 27% 405,294 14% 284,724 8% 113,490 3% Sm
Slide 24: 9M2015: Consolidated Financial Highlights
9M2015: Consolidated Financial Highlights 9M2015 9M2014 Consolidated Consolidated % Change Wireless Fixed Line Others (Php in millions) (unaudited) (unaudited) Service Revenues 83,234 48,571 - 122,001 122,961 (1%) Cash operating expenses 39,918 30,260 52 59,434 58,617 1% Depreciation and amortizatio
Slide 25: Reconciliation of Core and Reported Net Income
Reconciliation of Core and Reported Net Income 9M2015 9M2014 Consolidated Consolidated % Change Wireless Fixed Line Others (Php in millions) (unaudited) (unaudited) Net Income attributable to equity holder of PLDT 15,822 4,350 5,167 25,339 27,957 (9%) Add (deduct): Foreign exchange losses (gains), n
Slide 26: Consolidated Service Revenues
Consolidated Service Revenues 2015 2014 % Change 9M15 vs 3Q15 vs 1Q 2Q 3Q 9M 1Q 2Q 3Q 9M 4Q FY (Php in billions) 9M14 3Q14 SMS and VAS 10.2 9.8 9.9 29.9 10.7 10.5 9.9 31.2 10.3 41.4 (4%) (1%) Voice - Domestic 13.9 13.8 13.5 41.2 13.9 14.3 14.1 42.3 14.5 56.9 (3%) (4%) Voice - International 4.3 4.1 3
Slide 27: Expenses
Expenses 9M2015 9M2014 Consolidated Consolidated % Change Wireless Fixed Line Others (Php in millions) (unaudited) (unaudited) Operating expenses Compensation and employee benefits 5,513 10,877 - 16,376 15,777 4% Repairs and maintenance 6,549 5,149 - 11,271 10,952 3% Selling and promotions 5,880 1,5
Slide 28: Other Income (Expenses)
Other Income (Expenses) 9M2015 9M2014 Consolidated Consolidated % Change Wireless Fixed Line Others (Php in millions) (unaudited) (unaudited) Equity share in net earnings (losses) of associates and joint ventures (47) (131) 2,846 2,668 2,687 (1%) Interest income 239 448 72 590 567 4% Gains on deriva
Slide 29: Cellular and Broadband Net ARPU
Cellular and Broadband Net ARPU Cellular Net ARPU 2015 2014 1Q 2Q 3Q 1Q 2Q 3Q 4Q Smart Postpaid 1,039 1,065 1,021 1,086 1,074 1,068 1,084 Smart Prepaid 118 114 115 132 134 124 125 Talk 'N Text 85 83 82 87 89 87 89 Sun Cellular Prepaid 63 64 65 67 66 64 65 Sun Cellular Postpaid 449 419 436 476 467 46
Slide 30: Historical Consolidated: Service Revenues and EBITDA
Historical Consolidated: Service Revenues and EBITDA 2015 2014 (Php in millions) 1Q 2Q 3Q 9M 1Q 2Q 3Q 9M 4Q FY Fixed line 13,034 13,302 13,589 39,925 12,720 12,635 12,773 38,128 13,360 51,488 Local exchange 4,172 4,226 4,280 12,678 4,087 4,107 4,104 12,298 4,189 16,487 International long distance 1,
Slide 31: Historical Wireless: Service Revenues & EBITDA
Historical Wireless: Service Revenues & EBITDA 2015 2014 (Php in millions) 1Q 2Q 3Q 9M 1Q 2Q 3Q 9M 4Q FY Wireless Gross Service Revenues Cellular services 24,878 24,478 24,238 73,594 26,024 26,012 24,966 77,002 25,778 102,780 Cellular voice 11,915 11,599 10,995 34,509 12,811 12,946 12,382 38,139 12,
Slide 32: Historical Fixed Line: Service Revenues and EBITDA
Historical Fixed Line: Service Revenues and EBITDA 2015 2014 (Php in millions) 1Q 2Q 3Q 9M 1Q 2Q 3Q 9M 4Q FY Fixed Line Gross Service Revenues Local exchange 4,196 4,250 4,304 12,750 4,111 4,132 4,131 12,374 4,213 16,587 International long distance 2,255 2,335 2,233 6,823 2,859 2,843 2,696 8,398 3,0
Slide 33: Earnings Per Share
Earnings Per Share 9M2015 9M2014 (unaudited) (unaudited) Basic Diluted Basic Diluted Net income attributable to equity holders of PLDT 25,339 25,339 27,957 27,957 Dividends on preferred shares (45) (45) (44) (44) Net income for the period attributable to common equity holders of PLDT 25,294 25,294 2
Slide 34: Cash Flows
Cash Flows 9M2015 9M2014 Consolidated Consolidated % Change Wireless Fixed Line Others (Php in millions) (unaudited) (unaudited) Net cash from operations 33,867 13,366 (86) 47,796 46,573 3% Add(Deduct): Capital expenditures (17,650) (5,647) - (23,297) (15,981) 46% Interest, net (751) (3,092) 28 (3,5
Slide 35: Balance Sheet
Balance Sheet Consolidated September 30, 2015 December 31, 2014 (Php in millions) (unaudited) (audited) Total Assets 433,709 436,295 Nominal Value of Total Long-term Debt 151,177 130,634 in US$ $3,228 $2,920 Less: Unamortized Debt Discount 642 511 Total Long-term Debt 150,535 130,123 Cash and short-
Slide 36: Debt Profile
Debt Profile (US$ in millions) 2011 2012 2013 2014 9M2015 Debt Balance 2,719 2,851 2,353 2,920 3,228 Cash and short-term investments 1,061 919 735 610 749 Net Debt 1,658 1,932 1,618 2,310 2,479 Interest-bearing Liabilities September 30, 2015 December 31, (unaudited) 2014 Unamortized Debt Change Carr
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