Philippine Long Distance Telephone Company (PLDT) posted an 11 percent fall in net profit during the second quarter of 2012 as a nearly saturated mobile phone market crimped revenue growth and rising competition ate into margins.
PLDT said its net income in April to June 2012 was P9.4 billion compared with P10.6 billion in the same period last year.
Analysts had expected a net profit of P10.1 billion for PLDT in the second quarter, based on consensus estimates of Thomson Reuters I/B/E/S.
Core net profit, which excludes currency and derivatives-related items, also fell 11 percent to almost P9.4 billion. PLDT said it was maintaining its core profit guidance of P37 billions for the full year.
The stock market was shut on Tuesday due to heavy monsoon rains and flooding in the capital. PLDT has risen only 8 percent this year, lower than the market’s nearly 21 percent rise.
PLDT Chairman Manuel V. Pangilinan said earlier that the decline in earnings is due to the continued pressure on average revenue per user and margins on the legacy cellular phone, the decline in traffic and pricing for international and national direct dial services, and increased depreciation and capital.
Pangilinan said in a statement the company will pay an interim dividend of 60 pesos per share, in line with its plan to pay out at least 70 percent of core earnings.
Service revenues in the second quarter rose 11 percent to 42 billion pesos. The wireless phone business now accounts for more than two-thirds of total service revenues.
However, PLDT expects its earnings to grow again in 2013, as a result of heavy investments for network upgrade and expansion since 2010.
By 2014, PLDT expects to match its 2010 record profit of P42 billion. “That was our highest core net income in the history of PLDT. We want to match that in 2014 . We are on track,” Pangilinan said.
The three-year core profit guidance has factored in the impact of PLDT’s acquisition of Digital Telecommunications Philippines Inc. (Digitel) from the Gokongwei group.
PLDT posted P9.3 billion in consolidated core net income in the first quarter of 2012. This was 12 percent lower year on year and was attributed to higher operating expenses, lower equity share in earnings of Manila Electric Co. (through Beacon Holdings) and a higher provision for income taxes.
Digitel contributed P200 million in core earnings during the first three months.
PLDT’s mobile phone subscriber base expanded to 67.4 million at the end of June from 66.1 million at the end of March.
source: mb.com.ph
Theimahe 