PLDT, Inc. · PSE:TEL
PLDT — 1H 2020 Earnings Presentation
63 slides from PLDT's earnings presentation, Aug 6, 2020
Slide 1: First Half 2020 Financial and Operating Results Presentation
First Half 2020 Financial and Operating Results Presentation 6th August 2020
Slide 2: It's been a challenging 1H for the country
It’s been a challenging 1H for the country 2
Slide 3: We will keep you connected
We will keep you connected 3
Slide 4: The Philippines' only integrated telco
T H E P H I L I P P I N E S ' O N LY INTEGRATED TELCO 4
Slide 5: To serve the broadband needs of all Filipinos
TO SERVE THE BROADBAND NEEDS OF ALL FILIPINOS MOBILE INTERNET MOBILE BROADBAND FIXED WIRELESS FIXED WIRED (LTE & 5G) (LTE & 5G) (LTE & 5G) (VVDSL & FTTH) AFFORDABLE HOME SUPERIORITY: FASTEST CONNECTING EVERY MOBILE PRODUCTIVITY INTERNET UNLI FILPINO 1.1 M INDIVIDUALS 466K HOMES • 40K 2M HOMES • 124K
Slide 6: Q2 2020 revenue performance
Q2 2020 REVENUE PERFORMANCE +7% +2.6 B P41.3B Q2 2020 delivered strong and sustained momentum despite the pandemic 6
Slide 7: Q2 2020 revenue performance by segment
Q2 2020 REVENUE PERFORMANCE Individual Home Enterprise zz +12% +2.1B 19.6B zz +8% +0.8 B 10.0B zz +7% +0.6 B 10.2B 7
Slide 8: 1H 2020 revenue performance
1H 2020 REVENUE PERFORMANCE +8% +6.2 B P82.8B With our Q2 Performance, we are ending 1H strong 8
Slide 9: 1H 2020 revenue performance by segment
1H 2020 REVENUE PERFORMANCE Individual Home Enterprise zz +16% +5.4 B 39.8B zz +7% +1.2 B 19.6B zz +5% +0.9 B 20.3B 9
Slide 10: Fastest mobile & fixed network
FASTEST MOBILE &FIXED NETWORK 10
Slide 11: Commercial launch
OMMERCIAL LAUNCH a: 2G
Slide 12: We are leveling up our network
We are leveling up our Network 12
Slide 13: Nationwide fiber migration
NATIONWIDE FIBER MIGRATION 13
Slide 14: 14
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Slide 15: Beyond connectivity
BEYOND CONNECTIVIT Y 15
Slide 16: facebook : WY iwant BE | wwece
facebook : WY iwant BE 7 | wwece —S ee \ NBA TY CcPiay 7 ry a,
Slide 17: Expanded vertical solutions to transform industries
EXPANDED VERTICAL SOLUTIONS TO TRANSFORM INDUSTRIES Telecommuting Online Shopping e-Learning e-Health Cyber Security & Payments 17
Slide 18: Capex for the past 5 years
CAPEX FOR THE PAST 5 YEARS P260.0B P 70.0B for 2020 18
Slide 19: 19
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Slide 20: No learner left behind
DEPARTMENT I? EDUCATION.
Slide 21: MVP Group COVID-19 Response
MVP Group COVID-19 Response 21
Slide 22: We grow our business by helping our customers rebuild their lives
WE GROW OUR BUSINESS BY HELPING OUR CUSTOMERS REBUILD THEIR LIVES 22
Slide 23: 1H2020 Financial Highlights
1H2020 Financial Highlights 23
Slide 24: PLDT: Service Revenues by Customer Segment
PLDT: Service Revenues (by Customer Segment) 2020 vs 2019 (Php in bn) 1Q 2020 2Q 2020 1H 2020 vs1H 2019 20.2bn 19.6bn 39.8bn 16% Individual 48% +20% +3.3 +12% +2.1 +5.4bn 10.1bn 10.2bn 20.3bn 5% Enterprise 24% +3% +0.3 +7% +0.6 +0.9bn 9.6bn 10.0bn 19.6bn Home 24% 7% +5% +0.5 +8% +0.8 +1.2bn Consumer
Slide 25: PLDT Group: Financial Highlights
PLDT Group: Financial Highlights (Php in bn) 1H 2020 vs 1H 2019 Service Revenues 8% 82.8bn (net of interconnection costs) +6.2bn Cash Opex, Subsidies, 8% 149.4bn 39.6bn Provisions (ex-MRP) +2.9bn 43.2bn 8% EBITDA 149.4bn (ex-MRP) Margin: 52% +3.3bn 13% Depreciation & Amortization 21.2bn +2.5bn 4.2bn
Slide 26: Consolidated Service Revenues: Strong 1H20 growth
Consolidated Service Revenues: Strong 1H20 year-on-year growth, minimal impact of lockdown (Php in bn) P82.8bn 149.4bn 8% +6.2bn Affected by (vs 1H2019) Community Quarantine 7% 3% 7% +2.6bn +1.0bn +2.4bn Y-o-Y % 41.4 41.5 41.3 38.7 39.6 37.6 38.0 2.3 1.6 -6% 1.5 -34% 35.3 35.3 35.8 36.0 35.6 36.3 36
Slide 27: Historical Service Revenues: Data main growth driver
Historical Service Revenues: Data remains the main growth driver (Php in bn) P82.8bn 149.4bn 8% +6.2bn Data/broadband SMS/Voice ILD (vs 1H2019) 7% +2.6bn 41.4 41.5 41.3 38.0 38.7 39.6 35.3 35.3 35.8 36.0 36.3 36.3 37.6 0.8 1.0 1.1 35.6 1.2 1.1 1.0 1.7 1.5 1.4 2.3 2.2 2.1 1.8 1.7 12.1 11.2 10.7 12.2
Slide 28: 1H 2020 Service Revenues: Data is 71% of total
1H 2020 Service Revenues: Data is 71% of total revenues (Php in bn) (1H2020 vs 1H2019) P82.8bn 149.4bn 8% +6.2bn (vs 1H2019) Data and broadband Mobile Internet Home Broadband 29.3bn 34% 15.3bn 11% 149.4bn 59.0bn 18% +7.4 +1.5 +9.0 % to total: 71% Corp. Data Data Center Consumer + Enterprise 74%* Ind
Slide 29: Consolidated EBITDA (ex-MRP) and Telco Core: 1H 2020 vs 1H 2019
Consolidated EBITDA (ex-MRP) and Telco Core: 1H 2020 vs 1H 2019 (Php in bn) Higher Higher Cash Higher Higher Svc Rev (net of IC) Opex/CoS Provisions Subsidies +6.2 -1.9 -0.9 -0.1 43.2 40.0 8% EBITDA (ex-MRP) +3.3bn 1H 2019 1H 2020 EBITDA margins 51% 52% Higher Higher Higher Higher Lower EBITDA Depre
Slide 30: Consolidated EBITDA (ex-MRP): 2Q20 stable vs 1Q20
Consolidated EBITDA (ex-MRP): 2Q20 stable vs 1Q20, 1H20 higher year-on-year (Php in bn) 149.4bn 1H20: P43.2bn 8% +3.3bn 8% +1.7bn 22.8 21.6 20.4 21.6 20.1 19.9 17.4 17.4 17.1 16.4 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 Qtr ave: P17.1bn Qtr ave: P20.8bn Qtr ave: P21.6bn Margin: 47% 46% 45%
Slide 31: Telco Core Income: 2Q20 higher quarter-on-quarter
Telco Core Income: 2Q20 higher quarter-on-quarter, 1H20 up vs 1H19 (Php in bn) P13.9bn 149.4bn 5% +0.7bn 16% +1.0bn +2% 7.2 7.7 +0.1 6.8 6.9 7.0 6.4 5.9 6.0 6.2 4.9 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 Qtr ave: P6.8bn Qtr ave: P6.9bn ➢ In light of the continuing impact of COVID-19, we a
Slide 32: PLDT Group: Capital Management
PLDT Group: Capital Management Interim Record Date: Payment Date: Cash Dividend Declared: P38/share 20 August 2020 4 September 2020 6 August 2020 ➢ In line with PLDT’s dividend policy: 60% of 1H20 telco core earnings of P13.9bn ➢ Interim dividend of P36/share for 1H2019 Core EPS P64 Dividend Payout
Slide 33: PLDT Group: Telco Core and Reported Income
PLDT Group: Telco Core and Reported Income (Php in bn) 1H 2020 5% Telco Core 13.9bn +0.7bn Voyager Loss (0.9bn) -0.3bn 3% Telco Core + Voyager 13.0bn +0.4bn iFlix fully impaired– Tencent purchased iflix Investment Impairment – iflix 0.6bn Valuation lower by P0.4bn from end Net Loss in FV of Investme
Slide 34: PLDT Group: Debt Profile
PLDT Group: Debt Profile (post US$600mn bond issue) Debt Balance Debt Maturities (gross) (US$ in billions) (US$ in millions, 30 June 2020) Net Debt Net Debt-to-EBITDA* Gross Debt US$3,794mn 2.19x US$4,748mn Maturities well spread out 2,353 3.8 4.7 3.8 3.4 3.3 2.4 0.9 320 456 355 534 300 430 1.0 0.5
Slide 35: PLDT Group: Consolidated Capex
PLDT Group: Consolidated Capex (Php in bn) Total Capex Investments Capex (1H2020) Capex 2020 forecast (2011 – 1H2020) P31.5bn (vs P32.7bn LY) Up to P70bn P420.3bn (P27.2bn Tech/IT; P4.3bn business capex) Business Capex ➢ Original capex guidance for 2020: P83.0bn consisting of: Network/IT ▪ Network/I
Slide 36: Fixed Fiber and Wireless Network: Selected Highlights
Fixed Fiber and Wireless Network: Selected Highlights Extensive Fixed Network Rollout TOTAL HOMES PASSED TOTAL CAPACITY TOTAL FIBER FOOTPRINT (Million Homes) (Million Ports) (Thousand Cable Kilometers Laid) ➢ 1.1mn fiber + 0.5mn VVDSL ports ➢ 35.6kms of fiber laid from end 2019 available at end June
Slide 37: Superior mobile network supports growing data traffic
Superior mobile network supports growing data traffic and CX Wireless Payload March 2020 8,099 • 5.0x April 2018 (TB/day) • +12% M-o-M • +121% Y-o-Y 7,509 5,944 June 2020 • 5.4x April 2018 • +8% q-o-q • -4% M-o-M • +203% y-o-y Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun J
Slide 38: PLDT Group: Latest views for 2020
PLDT Group: Latest views for 2020 ➢ For full year 2020, many variables need to be considered, some of which are yet unknown ➢ Based on limited visibility to-date and certain assumptions, below are some updated views for the year: Capex: up to P83.0bn Up to P70bn ➢ Network rollout being ramped up fol
Slide 39: Other Details
Other Details 39
Slide 40: Individual: Double digit growth in 2Q20
Individual: Double digit year-year growth in 2Q20 despite impact of COVID-19 lockdown 149.4bn (Php in bn) 12% 149.4bn 16% 1H20: P39.8bn +2.1bn +5.4bn (vs 1H2019) -3% -0.5 19.4 20.2 19.6 16.9 17.6 18.2 14.6 14.7 15.1 16.5 14.5 14.5 14.2 14.4 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19
Slide 41: Home: 2Q20 revenues improvements
Home: 2Q20 revenues registered year-on-year and quarter-on-quarter improvements (Php in bn) 149.4bn 1H20: 19.6bn 7% 8% +1.2bn +0.8bn DOLE Order (vs 1H2019) +4% +0.4 10.0 9.1 9.1 9.2 9.2 9.6 9.6 8.5 8.7 8.8 9.1 9.1 7.8 8.0 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 2017: P3
Slide 42: Enterprise: Revenues rose 1% in 2Q20
Enterprise: Revenues rose 1% in 2Q20 despite COVID-19 (Php in bn) 149.4bn 1H20: 20.3bn 5% 7% +0.9bn +0.6bn (vs 1H2019) +1% +0.1 9.8 9.8 10.0 10.1 10.2 9.2 9.3 9.8 9.5 8.6 8.5 8.7 9.0 9.0 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 2017: P34.8bn 2018: P37.4bn 2019: P39.1bn Q
Slide 43: International/Carrier: Revenue declines moderating
International/Carrier: Revenue declines moderating (Php in bn) Year-on-year (excl Mobile Domestic Inbound) Organic 30% 10% Mobile Domestic Inbound 1H20: P3.1bn -1.3bn -0.4bn 34% (vs 1H2019) (vs 1H2019) -0.8bn 4.19 4.01 4.01 -6% 3.73 3.47 3.49 2.74 2.18 2.31 2.31 2.34 -0.1 2.16 1.61 1.53 vs Yo-Y 2.87
Slide 44: PLDT Group Subscriber Base
PLDT Group Subscriber Base (in mn) vs end 2019 end June 2020 Total Subscribers 75.7mn 3% -2.3mn Mobile 70.2mn 4% -2.9mn Cellular - Prepaid 66.9mn -4% Churn party due to alignment of subscriber lifecycle policy upon 69.1mn migration of Sun to OneOCS in Cellular - Postpaid 2.2mn +2% 2Q20 (1.2mn) Mobil
Slide 45: PayMaya: Only End-to-End Digital Payments Enabler
PayMaya: Only End-to-End Digital Payments Enabler in the Philippines Enterprise Consumer Biggest Acquirer for eCommerce Fastest way to get an account Download, register, upgrade in app and “Everyday” merchants Groceries, Pharma, Gas, Quick-Service Restaurants Widest Add Money and Cash-out Touchpoint
Slide 46: PayMaya: Enabling End-to-End Cashless Solutions
PayMaya: Enabling End-to-End Cashless Solutions for the "New Normal" PayMaya volumes across consumer and enterprise business grew over 2x YoY PayMaya Enterprise: PayMaya App: Smart Padala: Enabling 'everyday' merchants Conduit for essential transactions Last mile financial services • Total Enterpris
Slide 47: Appendix
Appendix 47
Slide 48: Subscriber Base: Mobile
Subscriber Base: Mobile Mobile Subscribers by Category: Net Adds (Reductions) Jun-20 Mar-20 Dec-19 Sep-19 Jun-19 2Q20 vs 2Q19 2Q20 vs YE19 (1) Mobile Subscriber Base Prepaid 67,738,421 70,590,758 70,721,789 69,012,106 65,151,418 2,587,003 4% (2,983,368) -4% Smart Prepaid 23,413,304 24,830,033 25,866
Slide 49: Subscriber Base: Fixed Line and Broadband
Subscriber Base: Fixed Line and Broadband Fixed Line Subscribers Net Adds (Reductions) Jun-20 Mar-20 Dec-19 Sep-19 Jun-19 2Q20 vs 2Q19 2Q20 vs YE19 Fixed Line Subscribers 2,917,641 2,801,187 2,765,209 2,727,035 2,711,411 206,230 8% 152,432 6% Broadband Subscribers Net Adds (Reductions) Jun-20 Mar-20
Slide 50: ARPU
ARPU Mobile ARPU, Net(1) : 2020 2019 1Q 2Q 1Q 2Q 3Q 4Q Smart Postpaid 804 816 796 813 809 806 Smart Prepaid 112 110 118 118 114 114 TNT 71 76 67 67 67 74 Sun Postpaid 377 386 423 418 401 403 Sun Prepaid 66 67 77 73 76 75 (1) Includes Mobile Broadband subscribers Broadband ARPU, Net : 2020 2019 1Q 2Q
Slide 51: 1H2020: Consolidated Financial Highlights
1H2020: Consolidated Financial Highlights 1H2020 Y-o-Y 1H2019 Wireless Fixed Line Others Consolidated % Change (Php in millions) Service Revenues (1) 47,190 45,951 - 83,482 78,356 7% (2) Cash Operating Expenses 16,165 24,627 7 34,377 33,372 3% Subsidies and Cost of Services 676 1,712 - 2,363 2,674 (
Slide 52: Consolidated Service Revenues
Consolidated Service Revenues 2020 2019 % Change 1H20 vs 2Q20 vs 1Q 2Q 1H 1Q 2Q 1H 3Q 4Q 2H FY (Php in millions) 1H19 2Q19 Fixed Line 18,543 18,729 37,272 18,199 17,955 36,154 18,356 18,602 36,958 73,112 3% 4% LEC 3,513 3,719 7,232 3,698 3,648 7,346 3,583 3,607 7,190 14,536 (2%) 2% Fixed Line Voice
Slide 53: Consolidated Service Revenues and EBITDA
Consolidated Service Revenues and EBITDA 2020 2019 % Change 1H20 vs 2Q20 vs 1Q 2Q 1H 1Q 2Q 1H 3Q 4Q 2H FY (Php in millions) 1H19 2Q19 Data and Broadband 29,357 29,667 59,024 24,667 25,393 50,060 26,728 28,550 55,278 105,338 18% 17% Home Broadband 7,505 7,835 15,340 6,855 6,994 13,849 7,089 7,454 14,
Slide 54: Wireless Service Revenues
Wireless Service Revenues 2020 2019 % Change 1H20 vs 2Q20 vs 1Q 2Q 1H 1Q 2Q 1H 3Q 4Q 2H FY (Php in millions) 1H19 2Q19 Data/Broadband 15,532 15,828 31,360 11,670 12,603 24,273 13,679 14,981 28,660 52,933 29% 26% Mobile Data 15,519 15,816 31,335 11,643 12,580 24,223 13,660 14,965 28,625 52,848 29% 26
Slide 55: Fixed Line Service Revenues
Fixed Line Service Revenues 2020 2019 % Change 1H20 vs 2Q20 vs 1Q 2Q 1H 1Q 2Q 1H 3Q 4Q 2H FY (Php in millions) 1H19 2Q19 Data/Broadband 16,032 16,238 32,270 14,996 14,891 29,887 15,115 15,762 30,877 60,764 8% 9% Home Broadband 7,515 7,845 15,360 6,875 7,007 13,882 7,101 7,466 14,567 28,449 11% 12% C
Slide 56: Expenses
Expenses 1H2020 Y-o-Y 1H2019 (Php in millions) Wireless Fixed Line Others Consolidated % Change Operating Expenses Compensation and Employee Benefits 3,795 8,253 - 12,040 11,600 4% Repairs and Maintenance 4,914 5,780 - 10,142 9,291 9% Professional and Other Contracted Services 1,956 3,545 1 4,086 4,
Slide 57: Other Income (expenses)
Other Income (expenses) 1H2020 Y-o-Y 1H2019 Wireless Fixed Line Others Consolidated % Change ( Php in millions) Equity Share in Net Earnings (Losses) of Associates and Joint Ventures Multisys - - (54) (54) 59 (192%) Vega - - 6 6 42 (86%) Voyager - - (1,080) (1,080) (946) 14% Others - 100 - 100 139 (
Slide 58: Earnings Per Share (EPS)
Earnings Per Share (EPS) 1H2020 1H2019 (Php in millions except EPS (in Php) and Shares (in mn)) Basic Diluted Basic Diluted Net Income Attributable to Equity Holders of PLDT 12,280 12,280 12,207 12,207 Dividends on Preferred Shares (29) (29) (29) (29) Net Income for the Period Attributable to Common
Slide 59: Balance Sheet
Balance Sheet Consolidated (Php in millions) June 30, 2020 December 31, 2019 Total Assets 557,692 525,027 Nominal Value of Total Debt 236,387 193,047 in US$ $4,748 $3,800 Less: Unamortized Debt Discount 1,087 491 Total Debt 235,300 192,556 Cash and Short-Term Investments 47,493 24,683 Net Debt (1) 1
Slide 60: Debt Profile
Debt Profile (US$ in millions) 2016 2017 2018 2019 1H2020 Debt Balance 3,730 3,466 3,362 3,800 4,748 Cash and Short-Term Investments 833 668 1,005 486 954 Net Debt 2,897 2,798 2,357 3,314 3,794 Interest-Bearing liabilities December 31, June 30, 2020 2019 Unamortized Debt Change Carrying Discount/Deb
Slide 61: Foreign Exchange Risk
Foreign Exchange Risk Forex Impact on Core Income Forex Impact of B/S Revaluation Forex sensitivity for every P1 change Forex sensitivity for every P1 change on B/S (in US$ millions) Conso - net of Elim Conso Revaluation (in US$ millions) US$ Revenues 249.9 Debt (net of LT hedges & ST Forwards/optio
Slide 62: 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 63: PLDT
4 PLDT