Globe raising P20 B for capex

By Louella Desiderio (The Philippine Star)
Updated May 11, 2017 – 12:00am
http://www.philstar.com/business/2017/05/11/1698676/globe-raising-p20-b-capex

Globe chief financial officer Rizza Maniego-Eala said in a briefing yesterday the telco may raise between P10 billion and P20 billion by the end of the year to support its capex requirements this year.

For its fund raising options, she said the telco could either borrow from a bank or issue retail bonds as its board of directors earlier approved the increase to P40 billion from P20 billion the amount of debt securities it could sell over the next three years.

“We will determine by the second-half of the year whether we want to tap retail bonds or tap the banks for bilateral loan,” she said.

Globe has set its capital expenditures guidance at $750 million for this year.

Last April, the telco signed a 10-year term loan facility worth P8 billion with BDO Unibank Inc. to finance this year’s capex.

Earlier this year, it also entered into an eight-year term loan facility worth P7 billion with BDO, as well as a six-year term loan facility amounting to P7 billion with the Development Bank of the Philippines to fund the capex.

For the first quarter, Globe has spent around P8.6 billion to support the growing subscriber base and demand for data.

The telco deployed 445 new Long Term Evolution sites and completed 24,000 lines for the home broadband service for the first three months of the year.

For the first quarter, Globe president and chief executive officer Ernest Cu said the telco’s core net income which excludes the impact of non-recurring charges, and foreign exchange and mark-to-market charges declined 12 percent to P3.7 billion this year from P4.2 billion in the same period last year.

Net income also slid 13 percent to P3.8 billion in the first quarter from the P4.3 billion in the same period a year ago.

Globe attributed the decline in net earnings to higher interest expenses and depreciation charges from network infrastructure investments, as well as equity losses and spectrum amortization related to the purchase of San Miguel Corp.’s telco assets last year.