MANILA, Philippines – Ayala-led Globe Telecom Inc. said it expects lower revenues in the fourth quarter of the year due to the extensive devastation in the Visayas region brought about by Super Typhoon Yolanda.
Globe president and chief executive officer Ernest Cu said in a statement that the damage caused by the typhoon that battered the Visayas last Nov. 8 likely dampened the company’s revenue growth in the last quarter of the year.
Cu said Globe expects lower revenues amid the expected surge in voice calls and short messaging system (SMS) during the holiday season as the extensive damage caused by the typhoon likely affected domestic spending in the last quarter.
“Notwithstanding the usual seasonal increase in both SMS and voice traffic during the holiday season, fourth quarter revenues may not be as strong as in prior years due to softer demand for telco services in the affected areas and possible cutbacks in telco-related spending on the part of subscribers as they donate these instead to the relief and rebuilding efforts of the government and private sector,” he stressed.
Cu also emphasized that the typhoon damage on the network is not expected to have long-term negative impact on revenues.
According to him, the company’s restoration effort in the Visayas region is almost complete.
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“As a utility company, we have made it our priority to restore mobile services in typhoon-affected areas as soon as possible,” he added.
The company’s net income plunged 48 percent to P3.5 billion in the first nine months of the year as revenue growth and decline in interest expense were fully offset by higher foreign exchange losses and increased accelerated depreciation costs related to the transformation projects.
On the other hand, the consolidated revenues of Globe grew 10 percent to P67.26 billion from January to September this year. Mobile revenues rose eight percent, followed by broadband revenues that jumped 22 percent while fixed line data revenues climbed 12 percent.
Globe’s subscriber base increased 14 percent to 36.5 million as of end-September consisting of 34.53 million Globe and TM prepaid subscribers and 1.98 million postpaid subscribers.
The company’s core net income rose nine percent to P9.5 billion in the first nine months of the year despite the complexity of an ongoing network and information technology (IT) modernization initiative amid a highly competitive environment.
Despite the slower revenues in the fourth quarter, Cu said Globe is bullish on the prospects of the telecommunications industry next year.
