PLDT(PHI) - 2023 Q4 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Consolidated service revenue for 2023 rose by 1% to PHP 191.4 billion compared to the previous year, with gross service revenue growing by 3% year-on-year [22] - Operating expenses decreased by 2% or PHP 1.5 billion to PHP 87.1 billion, leading to a 4% increase in EBITDA to PHP 104.3 billion, achieving a record high with an EBITDA margin of 52% [22][18] - Telco core income, excluding asset sales impact, increased by PHP 1 billion to PHP 34.3 billion, reflecting a 3% year-on-year growth [51] Business Line Data and Key Metrics Changes - Individual revenues accounted for 43% of total revenues, growing by 2% to PHP 81.8 billion, while home revenues increased by 1% to PHP 60.4 billion, with fiber-only revenues rising by 9% to PHP 53 billion [15][24] - The enterprise segment saw a 1% revenue growth to PHP 47.1 billion, with corporate data and ICT advancing by 6% [23][50] - Mobile data revenues grew by 6% to PHP 71.1 billion, with active data users increasing to 39 million and usage growing by 19% [16] Market Data and Key Metrics Changes - The wireless network population coverage stands at 97%, with 82% of total handsets on the network being LTE [20] - PLDT leads in 5G coverage and availability in the Philippines, with mobile data traffic hitting 4,900 petabytes in 2023, an 11% increase from the previous year [49] Company Strategy and Development Direction - The company plans to bifurcate its data center business, focusing on hyperscaler data centers to meet robust demand and digital transformation initiatives for SMEs and government [25][4] - Aiming for a CapEx intensity of 75% to 78% for 2024, the company is focused on reducing CapEx while increasing free cash flow [27][32] - The company is targeting mid-single-digit growth in consolidated service revenue for 2024, driven by increases in data broadband revenues [31] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving a net debt-to-EBITDA target of 2x, supported by anticipated EBITDA increases and reductions in CapEx [19][32] - The company is optimistic about the recovery in individual revenues and plans to accelerate fiber network deployment in 2024 [61][93] Other Important Information - The Board declared a final dividend of PHP 0.46 per share, bringing the total dividend for 2023 to PHP 0.95, representing a 60% payout [26] - The company reported a significant increase in loan disbursements, with PHP 22 billion in loans disbursed, marking a 6.9x year-on-year leap [28] Q&A Session Summary Question: What is the status of the PHP 13.9 billion in asset write-offs in Q4? - Management acknowledged the write-offs were related to amortized subscriber acquisition costs for churned customers [41][99] Question: Can you provide an update on Maya's fundraising efforts? - Maya is on track to breakeven by Q4 2024, with significant improvements in financial metrics observed in the first two months of the year [42][86] Question: What are the expectations for the new data center's capacity? - The first phase of the Sta. Rosa data center, with 10 megawatts, is expected to be substantially contracted before opening, with ongoing discussions for additional capacity [95][73] Question: How is the company addressing competition in the mobile segment? - The company is enhancing its offerings and improving customer experience to remain competitive, especially with the entry of new players in the market [97]